AFL club Port Adelaide has posted a $3.9 million profit for 2008.

But the club said on Monday its result included $5 million in grants from the state and federal governments to develop its Alberton Oval headquarters.

Without the grants and also taking into account a $335,000 licence fee to the SANFL, the Power's finances slumped to $1.4 million loss.

Port Adelaide president Greg Boulton said the club had been challenged financially in 2008.

"Financially it was a difficult year and there are a range of factors for that which we are very keen to explain to our members and supporters," Boulton said.

"Quite simply, our current business model needs to change.

"While the level of corporate support and sponsorship we enjoy is excellent, we do rely heavily on it, along with memberships, and attendances at games.

"In fact, our business model relies too heavily on attendance at games."

Boulton said a significant drop in average home-ground attendances seriously hurt the club's result.

Smaller crowds were the result of scheduling issues, live telecasts of games and the side's poor on-field performance, he said.

Membership revenue was also down from 2007 and the Power's licensed club, The Port Club, made a significant loss.

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