Parramatta Leagues Club Limited - parraleagues.com.au

1 2017 ANNUAL REPORTP arramatta Leagues Club LimitedABN 52 000 218 655 For the period ended 31 October 2017 Annual Report 2017 | 3 CONTENTSA dministrator s Report ..4 CEO s Report ..6 Eels CEO Report ..8 Notice of AGM ..12 Annual Financial Report 2017 ..14 Financial Statements ..14 Notes to the Consolidated Financial Statements ..18 Independent Auditor s Report ..41 MAJOR DEVELOPMENTS IN 2017 Parramatta Leagues CLUB MULTI-STOREY CARPARKCEO, BEVAN PAUL AND EELS CAPTAIN, TIM MANNAH INSPECT THE CONSTRUCTION SITE4 | Parramatta Leagues Club Limited Annual Report 2017 | 5 Dear MembersIn my report as Administrator last year, I described 2016 as a challenging one for the Parramatta Leagues Club (PLC) and most notably for its subsidiary the Parramatta National Rugby league Club (PNRL).

2 I am pleased to report that PLC and PNRL have made good progress in 2017 and while there are some key business challenges ahead, Members can be assured that the stability at Board and management level is delivering better business outcomes for both organisations. I would like to highlight some of the key areas of the business for 2017 below Parramatta Leagues Club Redevelopment In December of 2017 the first levels of our new $25 Million PLC Car Park were opened to traffic marking a significant milestone in the current stage of the PLC redevelopment. At the time of publication, all levels of the car park remain on track to be opened to Members by May 2018. As I have stated previously, the car park is critical to the long-term strategic future of the Leagues Club and I am pleased that this particular part of the redevelopment is being delivered on time and on budget.

3 I want to thank Members and their guests for their patience throughout 2017 especially with the Limited on-site parking. Financial Performance The financial performance of PLC group saw it deliver a $ Million profit for the ten month period ending 31st October 2017. This was a strong result when you consider that parking capacity was reduced by over half, there was a reduction in overall venue attendance due to Eels home games being played at ANZ stadium and the reporting year had been shortened by 2 months as per our decision to align the financial years of PLC and PNRL*. It is a credit to Bevan Paul and his management team that PLC have delivered a strong financial result despite the operational challenges and I congratulate them for their performance.

4 There has however been a continuing financial impact on PNRL from the 2016 Salary Cap penalty with the Club suffering an operating loss of $ Million for the 10 month period ending 31st October 2017. This loss was above expectations and occurred primarily due to the short-term reputational damage within the corporate market, and the forced relocation of the Club to ANZ stadium. I can assure Members that the PNRL Board and management have been working hard on mitigating those factors for 2018 and already we have seen a bounce back in the commercial market, which will have a positive impact on the financial position of PNRL in 2018. PNRLT here were a number of positive highlights for PNRL in 2018 and at least two deserve acknowledgment in my report.

5 The first being the performance of the football program which culminated in the NRL team finishing fourth at the end of the home and away season leading to an appearance in the NRL finals series for the first time since 2009. This was a tremendous result and I would like to congratulate Brad Arthur and the players on behalf of all our Members and fans. We also saw strong success in our junior representative programs with the SG Ball (U18) being crowned National Champions. Our National Youth (U20 s) and Harold Mathews (U16) teams reached the grand final and preliminary finals respectively and a special mention must also go to our first junior girl s representative team that made the finals in the first year of the NSW Tarsha Gale Competition.

6 The second major highlight was the instalment of our new PNRL Board. In February 2017, five new Directors were appointed after an extensive selection process. These were Anthony Shiner, Colin James Robertshaw, Michael McRitchie, Vicki Leaver and Sean new Directors as well as myself and Jim Sarantinos (who are the PLC representatives on the PNRL Board), are focused on building a strong and sustainable PNRL that will be a major asset for the PLC. The financial performance of PNRL will improve and we are committed to ensuring that the rebuild of PNRL delivers value and benefit to PLC and its Members. Parramatta Leagues Club Governance Reforms The PLC undertook an extensive Member consultation process this year regarding governance reforms, which culminated in a General Meeting (GM) in September 2017.

7 Despite the overwhelmingly positive response during the consultation period, the Members who attended the meeting rejected these reforms. As I stated before the meeting, my appointment by ILGA included a clear objective to improve the PLC governance arrangements. ILGA and I remain committed to ensuring that Members receive a governance structure they can trust and rely on, especially at Board modern and stable governance environment is vital in ensuring important strategic projects such as our redevelopment can be delivered. Therefor I am determined to continue the reform process for as long as it takes to ensure we get the right and PNRL have a tremendous opportunity to benefit significantly from a combined precinct of the new Western Sydney Stadium and the PLC redevelopment.

8 There is a once in a generation chance to get this partnership right and therefore we must ensure that we have the right governance reforms in place - not the most expedient. I have met with a number of concerned Members since that meeting to understand some of the reasons for their particular opposition. I have noted the areas that concerned Members and I will consider those in the next round of proposed reforms that I intend to put to Members in 2018. At present, my view remains that any constitutional change should be done by special resolution of Members and not via legislative measures. I would like to conclude my correspondence by again thanking our Members for their tremendous support and encouragement throughout the year.

9 I look forward to a positive and stable 2018 for our organisation. Max Donnelly Administrator of Parramatta Leagues Club Ltd Chairman of Parramatta National Rugby league Club Pty Ltd* During the period, PLC aligned their financial year end with PNRL, which resulted in a change from a 31 December to a 31 October year end. This means the current reporting period is for 10 months S REPORT MAX DONNELLY The car park is critical to the long term strategic future of the Leagues Club and I am pleased that this particular part of the redevelopment is being delivered on time and on budget. 6 | Parramatta Leagues Club Limited Annual Report 2017 | 7 Dear MembersWhen I review my remarks from previous annual reports I recall that the strategic focus for the Leagues Club management team has been to prepare the company financially for the development that has now commenced.

10 Prior to committing to building costs for the carpark all borrowings were retired and the Leagues Club s cashflow optimised. With this improvement in the company finances 2017 saw the beginning of a new era for Parramatta Leagues Club where our long awaited carpark finally commenced work. The carpark is the first stage in development after which future developments will have less of a disruptive impact on normal club the year ending October 31, 2017 and bearing in mind that this reporting period has been reduced to ten months in order to align the financial years of both PLC and PNRL, the main impacts upon the club s overall performance were the reduction in revenue due to disruption associated with carpark construction and Eels costs.