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Post by Deleted on Feb 2, 2016 11:36:17 GMT
How cricket can make money from football : big screens showing the Euros at cricket grounds, esp. when matches coincide wuith T20s days. Hospitality companies are charging huge sums - I just got this e-mail inviting me to pay £139 + vat to watch England v Wales at a London venue (Billingsgate) on June 16. It's the same day Sussex play Middx at Lords in the T20. I'd much rather pay, say, an extra £20 to Middx to watch the football at Lord's (2pm kick-off) before the T20 than pay £139 at Billingsgate: us11.campaign-archive1.com/?u=eab1fe5736869f1af2532cbe6&id=a3c26a0205&e=b9edf2c2b2 |
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Post by Wicked Cricket on Feb 5, 2016 9:36:43 GMT
Leicestershire continue their phoenix rise under the exciting helm of Wasim Khan by making a profit - Yes, an actual profit of £4,315. When was the last time Sussex made such a positive mark in their accounts after being hijacked by depreciation, under-appreciation, co-opreciation, or whatever the latest accounting buzzword? A little sarcastic but slightly heart-warming Telegraph piece from journo Jonathan Liew who dared a few years back to criticise Aggers! You never criticise Aggers, never, never, never... Otherwise, a slew of TMS acolytes will troll you forever. Keep those raffles going Wasim. A 50% rise, well done. It's all a bit 'Dads Army' but who cares when the BIG guns come to the rescue with £2.4m.  www.telegraph.co.uk/sport/cricket/counties/12137111/Little-Leicestershire-still-have-a-big-role.html |
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Post by Wicked Cricket on Feb 25, 2016 11:15:45 GMT
Sussex have announced their financial results for 2015. It is difficult to know exactly what they mean when depreciation is brought in to the equation but I am sure the accountants on this Forum can offer a good explanation. Even so, £141,000 loss is a loss. My one comment is due to the ever expanding staff that the club are employing, whether via marketing, community or otherwise, this cannot be helping the profit margins; leaving aside the additional employment of Mills and Shahzad. As Jim May admits, “We invested more in the professional cricket budget last year and unfortunately it did not work out how we hoped it would. Obviously we will have to watch how we spend our money over the next few years but we are more focussed on generating extra revenue." It seems to me that by employing further marketing and community staff, where the club logic suggests this will create more money - that the initial staff investment now will in time create a profit - the success of this thinking is down to the business model. But what if this model is flawed? Unless the club keep gaining repeat and regular business from the same companies eg. dinners, conferences and the like, the marketing staff are chasing their tails looking for new clients. And why rental is proven to be one of the best forms of revenue elegance. My humble advice is keep focussing on and expanding rental opportunities like the 6 offices. As to the future, May hints at the 'Evening Argus' that the present 'Cricketers Pub' may be transformed into a housing development once their lease ends. Therefore, here is an excellent opportunity for the club to pay a property developer to transform the pub into a block of flats and then accrue an annual rental income from that development for many years to come. www.sussexcricket.co.uk/news-1/financial-results-sussex-cricket-optimistic-despite-posting-loss-in-2015www.theargus.co.uk/sport/14299954.Sussex_feel_the_pinch_after_posting___141_000_loss/?ref=eb |
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Post by Wicked Cricket on Feb 25, 2016 15:05:18 GMT
Having read more closely Steve Hollis' excellent piece in the 'Argus' it does send a chill down one's spine.
The increase of £100k in the overall club turnover to £5.8m should be applauded but then to read the extra £300,000 costs in the
budget came from the professional cricket side... How come? Was the club paying Matt Prior's wages before he retired? Are we
presuming Mills and Shahzad were both on high wages? And Sussex "have warned there could be more financial hardship ahead...."
May suggests a minimum £94k loss for 2016.
What has gone wrong? Why has the usual prudent and safe hands of our former banker Chairman let slip of the wheel? Has the gamble
he took in backing Mark Robinson for a bite at the Championship Trophy, which went so spectacularly pear-shaped, come back to
haunt the club?
Thank goodness for the Spen Cama legacy and ECB £1m soft loan. This £13m may have saved the club from what could have been a
far worse a fate than Kent, Northants and other counties. Thankfully, Sussex still have £794,000 left in the cash coffers.
For the brave, there are important questions to be asked at the AGM.
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Post by Deleted on Feb 25, 2016 16:52:21 GMT
I just still don't understand how those that initiated increase of £300,000 on playing side then get relegated are still in place. Some whose jobs are safer and others are promoted.
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Post by flashblade on Feb 25, 2016 17:50:32 GMT
I just still don't understand how those that initiated increase of £300,000 on playing side then get relegated are still in place. Some whose jobs are safer and others are promoted. IMHO, the biggest failure of SCCC management last summer was to persist with Ed Joyce as captain, when it became clear to anyone watching Sussex play, that the team had lost their spark and enthusiasm under his leadership. This isn't hindsight - it was obvious half way through the season that morale had become low. Whenever Luke Wright was acting as captain, the team looked up for it - their demeanor and body language was totally different. The decision not to appoint Luke during the course of the season cost us our Div 1 status, IMO. Does anyone believe that his leadership wouldn't have secured at least 3 more points?! Robinson has a lot to answer for, and he ultimately "resigned" - one season too late. With the purse strings now very tight, promotion to Div 1 could be a tough ask. What a disastrous season 2015 was. |
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Post by Deleted on Feb 25, 2016 19:10:46 GMT
What has happened to the annual £450-500k cash sum towards depreciation which we were told has to be put aside every year towards the next redevelopment when the current facilties need replacing?
Is it three years since the last redevelopment was finished? So there should be close to £1.5 million in the depreciation fund by now?
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Post by coverpoint on Feb 25, 2016 20:04:59 GMT
Having read more closely Steve Hollis' excellent piece in the 'Argus' it does send a chill down one's spine. The increase of £100k in the overall club turnover to £5.8m should be applauded but then to read the extra £300,000 costs in the budget came from the professional cricket side... How come? Was the club paying Matt Prior's wages before he retired? Are we presuming Mills and Shahzad were both on high wages? And Sussex "have warned there could be more financial hardship ahead...." May suggests a minimum £94k loss for 2016. What has gone wrong? Why has the usual prudent and safe hands of our former banker Chairman let slip of the wheel? Has the gamble he took in backing Mark Robinson for a bite at the Championship Trophy, which went so spectacularly pear-shaped, come back to haunt the club? Thank goodness for the Spen Cama legacy and ECB £1m soft loan. This £13m may have saved the club from what could have been a far worse a fate than Kent, Northants and other counties. Thankfully, Sussex still have £794,000 left in the cash coffers. For the brave, there are important questions to be asked at the AGM. Prudent Chairman? He used to work for RBS which played a big part in the financial crash of 2008 from which we are still trying to recover. How has the playing budget increased by £500K over three years and £300K over the last year? At this rate it won't take long before £794,000 disappears. The decision to spend £300K more on the playing budget was nothing short of financial suicide. |
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Post by Deleted on Feb 25, 2016 20:32:45 GMT
According to an article s&f wrote in 2012, May retired well before the crash: "Formerly the club’s treasurer, he took over as Chairman in 2008 bringing with him 35 years’ banking experience, including running the RBS and Natwest mid-market business in Southern England and South Wales until 2006. May is now a non-executive director of several companies and, with county cricket facing a financial crisis, Sussex are lucky to have such an experienced business head at the helm."
I'm sure Sussex are lucky to have him. But the £300k increase in the playing budget was utterly irresponsible. The salary cap is only , what, £1.9 million? And as May told s&f in the interview three years ago, "some Division Two counties have a wages bill of less than £1million.” Inflation has been running at almost zilch since then so £300k represents a massive increase. It cannot have gone on Mills and Shahzad alone. I'd guess half ot it went on Prior hanging on long after his ECB central contract had been severed and everyone knew he would never play again but we weren't allowed to say so?
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Post by flashblade on Feb 25, 2016 21:12:43 GMT
According to an article s&f wrote in 2012, May retired well before the crash: "Formerly the club’s treasurer, he took over as Chairman in 2008 bringing with him 35 years’ banking experience, including running the RBS and Natwest mid-market business in Southern England and South Wales until 2006. May is now a non-executive director of several companies and, with county cricket facing a financial crisis, Sussex are lucky to have such an experienced business head at the helm." I'm sure Sussex are lucky to have him. But the £300k increase in the playing budget was utterly irresponsible. The salary cap is only , what, £1.9 million? And as May told s&f in the interview three years ago, "some Division Two counties have a wages bill of less than £1million.” Inflation has been running at almost zilch since then so £300k represents a massive increase. It cannot have gone on Mills and Shahzad alone. I'd guess half ot it went on Prior hanging on long after his ECB central contract had been severed and everyone knew he would never play again but we weren't allowed to say so? To be fair, some of us did say this at the time. Prior seemed to delay his final exit - can't think why? |
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Post by hhsussex on Feb 25, 2016 21:26:35 GMT
According to an article s&f wrote in 2012, May retired well before the crash: "Formerly the club’s treasurer, he took over as Chairman in 2008 bringing with him 35 years’ banking experience, including running the RBS and Natwest mid-market business in Southern England and South Wales until 2006. May is now a non-executive director of several companies and, with county cricket facing a financial crisis, Sussex are lucky to have such an experienced business head at the helm." I'm sure Sussex are lucky to have him. But the £300k increase in the playing budget was utterly irresponsible. The salary cap is only , what, £1.9 million? And as May told s&f in the interview three years ago, "some Division Two counties have a wages bill of less than £1million.” Inflation has been running at almost zilch since then so £300k represents a massive increase. It cannot have gone on Mills and Shahzad alone. I'd guess half ot it went on Prior hanging on long after his ECB central contract had been severed and everyone knew he would never play again but we weren't allowed to say so? To be fair, some of us did say this at the time. Prior seemed to delay his final exit - can't think why? #sussexcricketfamily....all hail the vice-president elect |
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Post by hhsussex on Feb 26, 2016 9:13:09 GMT
Further interesting and imaginative strategies from Leicestershire's Wasim Khan. www.espncricinfo.com/county-cricket-2016/content/story/976281.htmlQuite rightly reasoning that success on the playing field takes time to build and that the ECB loan money could be used in better ways than paying for the perfunctory embraces of a Gayle or Pietersen, they have gone for further ground development in order to make Grace Road attract new customers, for the Woman's World Cup in 2017 as well as to provide a better experience for men's T20 spectators. "... we are hosting major match days in the next two years, including our popular NatWest T20 Blast games and the ICC Women's World Cup in 2017. That event will help inspire a generation of young cricket supporters and will encourage more female cricketers to take up sport in the city of Leicester." To that end they are building on the improved relationship with Leicester City Council that has already seen a covenant against erecting floodlights lifted, and borrowing £1 million at a 5% interest rate in order to get the work done now, against repayment from ECB money in 2018. Yes, it has risks, but what development strategy does not, and they should be applied for thinking imaginatively about where new support is coming from, rather than bleating sadly about former glories and and stubbornly clinging to the received attitudes of a generation ago. |
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Post by flashblade on Feb 26, 2016 11:14:03 GMT
What has happened to the annual £450-500k cash sum towards depreciation which we were told has to be put aside every year towards the next redevelopment when the current facilties need replacing?
Is it three years since the last redevelopment was finished? So there should be close to £1.5 million in the depreciation fund by now? Unfortunately, it isn't happening - because the club is currently running at a loss, whilst at the same time depleting its cash resources. The operating loss (EBITDA) was 141k, plus depreciation 470k = 671k bottom line loss. You would have needed to make extra profits of 671k to wipe out the operating loss and to provide the required depreciation fund of 470k. The bank balance has reduced from 1245k to 794k. it has reduced by more than the 141k 'cash' loss, mainly because 206k was spent on capital expenditure (see note 7 to the accounts on page 21). There is no depreciation fund out of which to meet this capex, so it has to be met out of current cash resources. It is not clear how long it will take to fully use up the remaining 794k cash balance. The club's budget for the current year predicts an operating loss of 94k, before adding any depreciation charge. The use of EBITDA (Earnings before interest, tax, depreciation and amortisation) as a headline profit figure is often used by organisations (including impoverished county cricket clubs) in order to exaggerate financial performance to those readers without accounting experience. See the following Forbes article entitled: 'Top Five Reasons Why EBITDA Is A Great Big Lie'. It's a little technical, but I think it makes it point very clearly. I love the quote from Warren Buffet - "“Does management think the tooth fairy pays for capital expenditures?” www.forbes.com/sites/tedgavin/2011/12/28/top-five-reasons-why-ebitda-is-a-great-big-lie/#1abde07c469d |
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Post by Wicked Cricket on Feb 26, 2016 11:31:29 GMT
Fb, Many thanks for your erudite accountancy explanation. As Hhs pointed out to me, the club's bread and butter annual income, Membership, is on the wane, down by 24 on 2014; but to make things worse, the early payment discount, diluted an already dropping revenue and the decision not to market Life Membership cut overall income. Cricket is changing and changing rapidly. You cannot try and hang on to the past, hoping that by offering deals here and there, that Membership numbers will return. They won't at Sussex. I don't know why when certain other clubs are increasing theirs. Perhaps, it is simply down to success on the field. Sussex have always had high salary expenditure on their players and coaching staff for a small club. They could afford to when the Spen Cama Legacy was gaining 6% interest in the bank. They cannot now as proven by the increase of £500k during the last three years with not sufficient new income to match this. Catering revenues are not working where profit margins are too small. How many weddings, conferences, hospitality days, Xmas functions etc.. can you attract each year, year after year, if there isn't consistent repeat bookings? Eventually, you will run out of people - especially when the AMEX is taking away many of your potential clients. If a majority of business is continually new, the marketing department are chasing their tails and any profits made are being diluted by the growing staff wages. Sorry to bang the drum, but rental has to be the primary way forward. Personally, I would use that remaining cash to build more offices, retail outlets and anything else that can garner a monthly income, just as I have been suggesting for the last 5 years.  As the saying goes, the present club business model could be viewed as 'a*se over t*t'. |
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Post by Deleted on Feb 26, 2016 16:48:44 GMT
The new accounts are very disappointing, and a sad reflection on the current Board and management. Read the Treasurer's report. Good he is open. But his report keeps emphasising increased costs absorbing extra commercial and catering income. But why were these costs not anticipated and controlled, as any good management would?
Another negative mentioned is membership income. Down quite significantly, though excuses around life membership. Told we remain committed to increase our membership. But no discussion about whether our membership pricing and offering is appropriate, or how we might increase this income. But am I mistaken, did we not launch a membership drive recently supported by external consultants? Ten years ago, Sussex and Somerset had roughly the same membership income. Now Somerset's membership income is close to double ours. Better management?
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