The Sunday Mail can reveal rugby league’s “Taj Mahal”, which was once Queensland’s No.1 club and poured millions into funding Brisbane’s six premierships, has been haemorrhaging cash for three years and has defaulted on massive loans.
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A rise in poker-machine taxes, a downturn in trade and the fallout of last year’s salary cap investigation have sparked the crisis.
In a bid to avoid ruin, Broncos Leagues is now brokering a five-year deal that will see Easts Leagues given management rights to the ailing club.
“Hopefully this is enough to keep the wolves from the door,” Broncos Leagues president Lawry Brindle said yesterday.
Broncos Leagues Club has been fit by falling patronage after the salary cap probe.
An investigation by The Sunday Mail into the club’s troubles can reveal:
● The organisation’s debt has ballooned to $10,841,000;
● Easts Leagues, which bankrolls the Tigers in the Queensland Cup competition, began due diligence last month and are the frontrunners to secure the management reins as early as this week;
● Former Broncos CEO and Super League supremo John Ribot offered to buy the club;
● Broncos Leagues have put three properties that housed the club’s greatest players, worth $2.2 million, up for the sale. Origin star Sam Thaiday lived in one as a Broncos junior; and
● The club has defaulted on bank loans of $7.757 million, but has the support of financiers ANZ Bank to trade their way out of trouble.
Ribot, whose offer to buy the organisation was knocked back, said: “If you look at their balance sheet last year, the club is a bloody mess.
“I genuinely hope they can pull themselves out of it. They are in dire straits.”
Mr Brindle yesterday confirmed the talks with Easts administrators to haul Broncos Leagues out of the worst debt in the club’s history.
“The new board was appointed last November and we recognised the club had too much debt,” Mr Brindle said.
“Unless we did something, it (closing the doors) is always a possibility.
The pokie taxes have been another drain on Broncos’ income. Pic: Adam Armstrong.
“But we have options and hopefully this one (an alliance with Easts Leagues) can reinvigorate the club.
“The club is not in a great financial state, I can’t hide from that, so we had to make some hard decisions and we’ve done that.
“The Easts option is an exciting one. It means we can retain ownership of the building and with the new management structure in place, there is a good feeling we can go forward.
“If we sold the building, it would have been selling our soul completely. That was the last resort.”
During the 1990s and early-2000s Broncos Leagues, which still has 34,000 members, regularly recorded seven-figure profits and would give grants of up to $1.5 million to their football arm.
Last November, boardroom bloodletting led to the installation of Mr Brindle after the NRL’s salary-cap probe into the Broncos football team exposed issues with the leagues club’s governance.
“The increase in poker-machine taxes aggravated our problems and there was money spent on refurbishments and the purchase of properties that we have decided to sell,” Mr Brindle said.
“The footy club has picked itself up under Wayne Bennett (Broncos coach) and it’s our goal to be No.1 again.”
Easts Leagues, based at Coorparoo, has experienced a major surge in turnover and club director Des Morris is hopeful they can rescue the Broncos.
“Hopefully it is finalised this week and we can make a success of it,” he said.
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SALARY-CAP PROBE COSTS DEEPENED CLUB MONEY WOES
Former Broncos star Andrew Gee received funds without board approval. Pic: Glenn Barnes
LEGAL costs related to an NRL salary cap investigation involving Broncos legend Andrew Gee played a role in plunging Broncos Leagues into a $10.8 million sinkhole.
Almost 12 months after Gee mysteriously quit the club, a Broncos Leagues Club annual report has, for the first time, confirmed his role in the football arm’s NRL salary-cap probe. In October, the NRL banned Gee from returning to rugby league after the former football manager refused to explain whether $298,000 in leagues club funds were used to rort the salary cap.
The Broncos were subsequently cleared by the NRL, but legal expenses incurred during the four-month investigation only amplified pressure on Broncos Leagues’ bottom line.
Broncos Leagues’ 2013-14 annual report revealed Gee, a former Queensland Origin star, received funds without board approval.
“Over the past two financial years, funds from the Club were made available to, or on behalf of, Andrew Gee who, at the time, was a director of the Club,” the report reads in part.
“The amounts involved totalled $298,000. Those payments occurred without appropriate supporting documentation, without first obtaining member approval and without board approval.”
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