Reigning A-League champion Melbourne Victory has posted a record annual profit, after banking more than $1.5 million in the financial year to the end of June.

The bumper result confirms the club as the strongest franchise in the national football competition, with many other clubs such as Brisbane Roar and Central Coast Mariners continuing to trade in the red.

The club’s profit is up 61 per cent on the 2014 net result of $933,790.

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Melbourne Victory’s operating result is impressive compared to the 18 AFL clubs.

While most AFL franchises are yet to report their 2015 financial results, Victory’s $1.5 million bottom line eclipsed the 2014 business performances of most AFL clubs.

Based on 2014 financial results, only four AFL clubs are more profitable than Melbourne Victory: Hawthorn ($5.2 million), West Coast ($4.6 million), Collingwood ($2 million) and Gold Coast Suns ($1.6 million).

The key to Victory’s off-field success was booming revenue from higher gate receipts, merchandising and lucrative transfer income.

The club’s income soared almost 15 per cent last year to $18.5 million from $16.2 million in 2014, despite the volatile predicament most A-League franchises operate in.

A $1 million fee received in July from United Arab Emirates’ club Baniyas for the transfer of championship captain Mark Milligan accounted for around 40 per cent of the revenue growth.

Costs blow out, but balance sheet strengthens

The only blot on the 2015 financial result was a $1.7 million blowout in expenses.

While the cost of meeting player payments and marketing expenses grew modestly, the Victory suffered a $560,000 rise in administration expenses to $3.4 million.

The club also absorbed $2.3 million in “other expenses”, up $950,000 on 2014. Directors did not specify what these so-called “other expenses” covered.

Despite the record profit, no dividends were paid to the Victory’s shareholders.

This meant that all earnings were used to enhance the capital reserves of the club, which exceeded more than $5 million at the end of June.

About 50 investors have a stake in the club, including prominent Victorian businessman Mario Biasin.

Club chairman Anthony Di Pietro is also a leading shareholder.

Most A-League clubs in the red

Victory’s financial strength means that it was easily able to meet all payments due to players for the 2014/15 season.

That puts the club in a potentially unique position in the national competition, after revelations earlier this month that at least $1.5 million was still owed to A-League players from last year.

In addition to unpaid match payments, clubs including Brisbane have also failed to make compulsory contributions to the superannuation accounts of players and staff.

The club’s owner, the Indonesian-based Bakrie Group, has pledged to clear all debts by the end of January.

Victory’s success – on and off the field – has also put the spotlight on cross-town rival Melbourne City.

Despite a big capital injection two years ago by its sole shareholder, the City Football Group (owner of Manchester City), Melbourne’s second club is struggling to make a mark in the national competition.

Abysmal club finances have been a hallmark of the A-League, now in its 11th season.

The New Zealand Knights, North Queensland Fury and Gold Coast United have all folded in that time, highlighting the volatile nature of the league.

Brisbane and the Central Coast have had their aforementioned problems, while the Newcastle Jets are in FFA’s hands after its ex-owner Nathan Tinkler pulled the pin on finances last season.

Meanwhile, the long-term future of Wellington Phoenix looks to be in doubt, as FFA believe it is not an attractive enough franchise for television revenue.

While television money, FFA support and the backing of rich owners have proved a volatile mix for most A-League clubs, Victory has managed to beat that trend and post impressive results.

Professor Bob Stewart, one of Australia’s leading sports management experts, recently told The New Daily that the real financial condition of the A-League clubs was difficult to assess because of the sport’s lack of transparency on financial performance.

“There is a complete lack of financial transparency, and we can thus only assume that most of them (the clubs) are loss-making ventures held together by the investors’ generous funding arrangements,” Professor Stewart said.

“It therefore should come as no surprise that when these investors no longer have a large surplus to subsidise their toy football clubs, they consequently pull the plug.”