Australia / Press Releases
IBISWorld Releases AFL Revenue Ladder

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by Tom Youl
Mar 17 2020

While their premiership defence did not go to plan, the West Coast Eagles have gone back-to-back on the AFL club revenue ladder. The club’s revenue growth was also the strongest of any club in 2018-19, driven by a surge in match day sales and membership income. The Eagles continue to be the best financially-managed club in the league, benefiting from a new stadium and being one of two teams in the large Western Australian market.

The 2019 premier, Richmond, came a clear second on the revenue ladder. Similar to West Coast, the club’s on-field success has driven financial growth. Victoria’s other large clubs occupy the next six spots. While these clubs’ position on the 2019 AFL ladder varied throughout the year, all teams in this group are financially supported by large membership bases. Although Collingwood posted a significant revenue decline over 2018-19, this result was due to the club’s transition out of the pokies and gaming market, rather than a decrease in core revenue. Collingwood’s average home-game attendance grew by 16.9% in 2019. Carlton’s encouraging list and improved play brought Blues fans back to home games in droves, with a remarkable 47.1% increase in average attendance during the 2019 season. Somewhat surprisingly, the Geelong Cats posted a modest revenue decline despite topping the home and away ladder. The Brisbane Lions’ remarkable on-field resurgence and exciting young players garnered renewed fan interest in 2019. The club propelled itself up the 2019 AFL ladder, which was reflected in its revenue growth in 2018-19.

On the outside looking in

Outside the revenue ladder top-eight, only three clubs reported revenue growth in 2018-19; the North Melbourne Kangaroos, Gold Coast Suns and GWS Giants. The Giants’ strong result was unsurprising given the team’s strong season, culminating in an inaugural Grand Final appearance. Fellow expansion club, the Suns, continues to be a financial worry for the AFL. Although the club’s revenue increased moderately over 2018-19, most of this gain was from additional AFL funding. Gold Coast’s match day sales and membership income decreased by 29.6% over the year.

The remaining bottom-10 clubs posted revenue declines of varying degrees. Most of these clubs posted similar 2019 win-loss results compared with 2018, which were reflected in comparable revenue results. In contrast, the Melbourne Demons spectacular fall in 2019 showed in the club’s 2018-19 revenue result. The Demons disappointed members and fans by posting a familiarly dismal season following a long-awaited resurgence in 2018. However, a notable portion of this revenue decline was from a one-off decision in 2017-18; a $7 million gain on the sale of the Leighoak Club as part of the club’s move away from gaming revenue. A similar story explains the Western Bulldogs’ revenue decline. The club reported an $18 million gain in 2017-18 due to the recognition of the transfer of land at the Whitten Oval from the Victorian Government. St Kilda’s revenue decline also resulted from one-off revenue gains in 2017-18, when the club sold gaming assets in line with the club’s strategic move away from pokies.

Interestingly, a strong correlation continues to exist between financial ladder rankings and on-field success for AFL clubs. Of the bottom-10 revenue ladder teams, only two played finals in 2019; the GWS Giants and Western Bulldogs. Gaming income contributes to the discrepancies between the AFL’s haves and have-nots. Most of the league’s highest-earning clubs still earn significant pokies revenue. North Melbourne, Sydney, West Coast, Adelaide, Fremantle, Gold Coast and GWS do not currently hold pokies licences. In addition, Melbourne, Collingwood, Geelong and Western Bulldogs plan to exit the market at various points over the two years through 2022. AFL clubs that recognised hospitality and gaming revenue (including non-pokies income) rose by 1.5% in 2018-19, but many teams do not report this revenue source.

The broader picture

Combined, AFL club revenue increased slightly by 0.8% in 2018-19. However, this result masks an anomalously strong 2017-18 resulting from one-off revenue results, such as the gains of Melbourne and the Western Bulldogs. Also, many clubs’ transition away from gaming revenue has reduced one of four primary income pillars for AFL teams. Nevertheless, total match attendance grew by a modest 0.9% during the 2019 season. Strong competition from other sports and alternative forms of entertainment has been proving an ongoing challenge to the AFL, but one it has mostly overcome successfully. The AFL’s preliminary annual report states league revenue increased by 2.0% in 2018-19, a solid result considering the sluggish economic climate. The AFL is in a strong financial position, which is likely to aid leagues and clubs over what is expected to be a challenging 2020 as COVID-19 affects sporting codes around the globe.

IBISWorld reports used to develop this release:

For more information, to obtain industry reports, or arrange an interview with an analyst, please contact:
Jason Aravanis
Strategic Media Advisor – IBISWorld Pty Ltd
Tel: 03 9906 3647
Email: jason.aravanis@ibisworld.com