FROM financial black hole to profitable organisation in the space of 12 months. That is the remarkable transformation the Newcastle Knights have made since being taken over by the Wests Group last November.
Wests Group/Knights chief executive Phil Gardner said a compulsory audit undertaken by the NRL will confirm Newcastle’s rugby league flagship has finished the 2018 season in the black, for the first time in more than a decade.
“We’re currently in audit for our 12-month result, which will then go to the NRL for ratification,” Gardner said.
“But we’ll have made a profit. I’m very comfortable to say we’ve made a profit, but I can’t give you an exact number until my obligations to the NRL are finished, and I have then reported that to my board.
“Then we’ll report that to the town.”
Gardner said that, given the Knights’ parlous track record, many doubted whether the club could ever break-even, let alone turn a profit.
“But everything we’ve said we were going to do when we took over, we’ve done,” he said.
The last time the Knights posted an annual operating profit was in 2006, when they bolstered their coffers to the tune of $813,255.
Within a year they had suffered a disastrous downturn of almost $2 million, announcing a $1.3 million loss in 2007.
Earlier this year, Garner estimated the Knights had lost $50 million over the past decade, including $10 million during the three years the club was under interim management of the NRL.
It is believed that during the three years the club was owned by controversial tycoon Nathan Tinkler, it racked up in the vicinity of $20 million in liabilities.
The Knights are expected to be among the minority of clubs in announcing a profit for this year.
NRL officials predicted in June that “between five and eight” clubs would deliver a surplus in 2018.
Brisbane Broncos – the only profitable club in 2017 – are again certain to be the benchmark franchise.
Newcastle’s new-found prosperity hinges on a number of factors.
The annual NRL grant to each club has risen to a record $13 million, while the Knights have increased their revenue from sponsorships, corporate-box hire, memberships and gate-takings.
While you’re with us, did you know The Herald is now offering breaking news alerts, daily email newsletters and more? Keep up-to-date with all the local news - sign up here.
Sign up for our newsletter to stay up to date.