Brisbane Broncos : 10 August 2021 - BBL - 2021 Half-year financial results

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10 August 2021

To: ASX Company Announcements Platform

BRISBANE BRONCOS LIMITED AND ITS CONTROLLED ENTITIES

2021 HALF-YEAR FINANCIAL RESULTS

Please find attached the following documents in relation to the 30 June 2021 half-year financial results for Brisbane Broncos Limited and its controlled entities:

• Earnings Release
• Appendix 4D - Half-Year Report
• 2021 Half-Year Financial Report
• Independent Review Report

Yours sincerely

Brisbane Broncos Limited

Louise Lanigan

Company Secretary

For personal use only

Earnings Release: 10 August 2021

BRISBANE BRONCOS LIMITED

and its controlled entities

30 June 2021 Half-Year Results

The Board of Brisbane Broncos Limited today announced the trading results for the half year ended 30 June 2021. The consolidated entity achieved a profit from ordinary activities before income tax of $3.17 million.

The comparison between the 2021 and 2020 half-year results is as follows:
		30 June 2021	30 June 2020
		$	$
Profit from ordinary activities before tax		3,171,390	21,958
Profit/(loss) from ordinary activities after tax		2,210,667	(10,237)

The net profit before tax for the half-year ended 30 June 2021 is $3.17 million compared to $0.02 million in 2020. Earnings before Interest, Tax and Depreciation is $3.78 million for the half-year ended 30 June 2021 compared to $0.57 million in 2020.

The prior period result reflects the unprecedented negative impact that Covid-19 restrictions had on the Group. As previously reported, the whole of the National Rugby League (NRL) was negatively impacted. The 2020 season was suspended on 24 March 2020 and recommenced on 28 May 2020. This impacted the Group's commercial operations through home game related shortfalls and the inability to deliver all contractual game day benefits. This resulted in a reduction in commercial revenue through sponsorship, ticketing, season membership and merchandise sales.

The period to 30 June 2021 reflects the 2021 NRL Telstra Premiership returning to regular scheduling and crowd attendances, with home and away games played throughout the period. In the first half of 2021, the Brisbane Broncos played six home games. Ticketing, season membership and corporate hospitality revenue and expenses are recorded on a home game basis.

Total revenue for the period to 30 June 2021 increased to $25.34 million (2020: $16.20 million). Items of note include:

• The grant received from the NRL for the period totalled $7.23m, representing a 0.1% increase on the comparative period, in line with the club funding agreement and recognition of advanced grant funding;
• Sponsorship revenue increased 25.7% on the comparative period, reflecting the ability to deliver game day and associated benefits throughout the 2021 season. The support from our sponsor family over the 2021 season has again been exceptional;
• The first half of 2021 included six home games compared with four in the comparative period where the 2020 season was suspended for a period and games were played with no crowds;
• Game day profits through ticketing and membership and corporate hospitality revenue benefited by the return of crowds for the 2021 season. The average home game crowd for the 2021 reporting period was 22,691;
• Season memberships sold for the 2020 season were re-allocated to the 2021 season and accordingly minimal season membership revenue was recognised in 2020;

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• In the period to 30 June 2021, season membership revenue and costs were recorded on a home game basis. Accordingly, season membership revenue was recognised for the six home games played during the current period. Season memberships including both ticketed and non-ticketed of 27,213 were achieved as at 30 June 2021. Ticketed memberships of 22,226 and non-ticketed memberships of 4,987 had been sold;
• The six home games played during the period included three Thursday night matches against the Penrith Panthers, Melbourne Storm and South Sydney Rabbitohs. This negatively impacted attendance rates in 2021 as well as crowd numbers;
• Merchandise trading revenue increased 35.1% on the comparative period across online, in-store and game day platforms. Merchandise royalty income received from the NRL increased to $0.4m in the period to 30 June 2021; and
• Government funding (cost recovery revenue) increased 48.8% during the 2021 period, due to the previously announced expansion of the Brisbane Broncos community programs.

Total expenditure increased to $22.17 million (2020: $16.18 million). The increased spend for the current period includes:

• Increase in NRL player salary costs as a result of the Covid-19 salary cap reductions in the 2020 comparative period. During the 2021 period negotiations were undertaken and agreement reached between players, the NRL and the Rugby League Players' Association (RLPA) for a reduction in the base salary cap for the 2021 and 2022 salary cap years;
• In the 2020 comparative period, cost saving initiatives were implemented to mitigate the financial impact of Covid- 19. This included reductions in Director, Chief Executive Officer and senior staff remuneration for the comparative period from 1 April 2020;
• Due to the six home games that were played with crowds in the 2021 period, stadium operations expense, corporate sales and ticketing related expenditure increased as a result; and
• Additional resourcing and community program costs were incurred for the expanded community programs.

It is anticipated that the evolving situation with respect to the impact of the Covid-19 outbreak on the NRL competition and the Brisbane Broncos will create uncertainty for the remainder of the 2021 season. Together with the NRL, clubs are working through scheduling, funding and game day logistics for future matches to ensure the competition can continue in a modified format. Depending on these factors and possible further impacts that Covid-19 may have on the remainder of the 2021 season, commercial revenue and costs may be affected. Given the constantly developing nature and uncertainty of the situation, it is not possible to accurately forecast the quantum of the full year financial effect on the Group and accordingly, the first half result cannot be taken as an indication of a full year trend.

For personal use only

BRISBANE BRONCOS LIMITED

(ABN 41 009 570 030)

APPENDIX 4D

HALF-YEAR REPORT FOR THE

SIX MONTHS ENDED 30 JUNE 2021

This information should be read in conjunction with the annual financial report for the year

ended 31 December 2020.

RESULTS FOR ANNOUNCEMENT TO THE

MARKET

Revenues from ordinary activities ($000)	Up	56.4%	to	25,340
Profit from ordinary activities before tax attributable to	Up	14,343.3%	to	3,171
members ($000)
Profit/(loss) from ordinary activities after tax attributable to	Up	21,693.8%	to	2,211
members ($000)
Basic earnings per share (cents)	Up	21,693.8%	to	2.25
Diluted earnings per share (cents)	Up	21,693.8%	to	2.25

Net tangible asset backing per ordinary share24.40 cents (2020: 24.02 cents)

DIVIDENDS	Amount per	Franked amount
security	per security
Interim Dividend	Nil	Nil
Total amount per share relating to the half-year ended 30	Nil	Nil
June 2021
Previous corresponding period (2020 Final Dividend)	0.5 cents	0.5 cents
AUDIT INFORMATION

The financial statements have been reviewed and a copy of the independent review report is attached to the financial statements.

Louise Lanigan

Company Secretary

For personal use only

BRISBANE BRONCOS LIMITED

AND ITS CONTROLLED ENTITIES

ACN 009 570 030

HALF-YEAR FINANCIAL REPORT

30 June 2021