The Brisbane Racing Club is at the absolute minimum $75 million in debt, with the true figure inclusive of interest around the $85 million mark.
I have explained in an earlier article that the majority of this debt is deferred, which is in itself disastrous given that it was struck on the basis of compounding rather than fixed interest, but that’s a story for another day.
Today’s story is that the first payment of principal on the non-deferred loan must be made this year, and some interest must be paid on another; plus payments for leases on machinery and equipment (why don’t they own them?) of about $416 000 are also due.
The Brisbane Racing Club has to find about $1.7 million to make these loan and lease payments, which given that it lost $800 000 in the last financial year and is holding about 30 less race meetings in this one creates an obvious difficulty.
Where is the money going to come from?
There’s an even bigger problem.
Last year the BRC received $1.5 million in grants from the State Government, which was the residue of the $10 million placed with the club for the track redevelopment. The club also earned about half a million in interest on the original principal sum of $10 million before it belatedly spent it on the track redevelopment (ever wonder why things moved so slowly?).
This financial year both the grant and the interest earned on it disappear, and the club has lost $2.1 million in revenue from the very first day of the accounting period.
Suddenly the BRC is down both the cost of the loan and lease repayments and the amount of the grant and interest, which means that it is now $3.8 million in the hole for 2017/18.
Add around $600 000 in profits from asset sales to the ‘where’d that dough go?’ pile. There aren’t any more assets to sell, other than out souls, and I think they went on a pay day loan long ago.
That’s $4.4 million we have to find now. The slurry pit’s sinking further.
Add another $700 000 as well. That’s a non-recurrent grant that the BRC received from Racing Queensland last year that they won’t be getting again.
We’re up to $5.1 million that Whimpey Dave and Nifty Nev and the crew need to find by the end of this year just to put themselves in the same place that they were when the year began, which is $805 000 in deficit.
What this all means is that due to the mountain of debt the Directors have decided to take on – and remember only 1 of 5 loans is being paid this year: there are still 4 to come -if the Brisbane Racing Club wants just to break even this year, then it needs to find an additional $6 million dollars in cost savings or by means of increased revenue.
In a year where the club is running about 30 less meetings this is simply impossible.
So what the hell are the BRC going to do?
There is only one thing they can do; it’s the same thing that they’ve been doing for the past two years.
Borrow, borrow, borrow and hock, hock, hock.
Sell the Farm piece by piece, brick by brick, square metre by square metre until there’s nothing left at all except shattered dreams and a decaying infield stable complex and a bronze statue of a horse who once ran third to Black Caviar.
That’s the bitter truth sportsfans.
Six million dollars the BRC Directors have put the club in the hole for this financial year, and that’s just the tip of the massive debt iceberg.
These blokes are f*cking this club, and they’re doing it not for the betterment of racing, but purely for the advancement of their own interests.
The club can no longer pay its debts as they fall due without borrowing further money. In a technical sense this means that it is all but insolvent.
Don’t be deceived by the sell-out crowd at Doomben on Cup Day. It’s a mirage: the day’s a once a year job, and most of the bright young things that will be flitting around the track until they are so drunk they end up spewing in the rose bushes don’t punt. They are not the panacea to the ills that have beset the BRC.
Stopping believing the bullsh*t that the Directors and their hand-picked halfwit of a CEO are spinning you is the first step.
Sacking the whole lot of them and starting again is the second.
Members who care about the future of their club don’t have much time left to save it. If this Board of Directors are allowed to serve their full term the borrowing will increase apace – it has to, how else is a club bereft of ideas going to meet its expenses and keep the course gates open? – and they will foolishly and rapidly incur further debt that is leveraged against and secured by the assets of the club.
And when they’re all hocked to the hilt the great game of deception ends, the lights are turned off and the walls all fall down and its over.
Don’t kid yourself for a second that all of this is not true, because it is. Go online and have a look at the financials detailed in the club’s annual report if you need convincing. It’s all there, I haven’t made it up.
The situation is dire and getting worse by the minute, and the plain truth is that if you just stand there silently and watch the vandals steal the sport and your club away then you’re going to lose it.
It’s as simple as that.
Don’t ever say that you weren’t told.