England and Wales Cricket Board (ECB) will have to make significant cuts to its costs despite posting a record turnover of £228 million in 2019.
A home ODI World Cup and Ashes series led to a rise in turnover of £56 million from the previous year and a profit of £6.5 million for the ECB.
Expenditure also rose through additional payments to the 18 counties (each received an additional £1 million as their share of World Cup profits) and a rise in central costs, including player salaries and set-up costs for the Hundred.
Tom Harrison, the ECB chief executive, told the culture, media and sport select committee last month that cricket would need to look again at its cost base due to the losses that will be incurred in 2020, as a result of the coronavirus pandemic.
“We are staring at a £100 million-plus loss this year, whatever happens,” he said. “It is the most significant financial challenge we have ever faced.
“We are going to have to take a good look at our cost base, because that is clearly an issue which we have to address now. How do we create 18 sustainable (county) businesses post-Covid?”
The sport has already lost about £100 million of expected income because of the cancellation of the start of the season and the inaugural edition of the Hundred. The losses could be worse if this summer’s Test series against West Indies and Pakistan fail to materialise albeit being played behind closed doors. If they go ahead the ECB should receive all or most of its expected £280 million broadcasting revenue in this first year of a new £1.2 billion five-year deal. They will also receive insurance money for the losses from ticket sales already made.
Ian Watmore, former chief executive of the FA, was unanimously ratified as the ECB’s new chairman at their annual general meeting this morning, and one of the first things in his in-box when he starts in his new role on September 1 will be a comprehensive review of the ECB’s outgoings, which could include how much money is distributed to the counties each year and how reliant they are on those funds.
For this year, the 18 first-class counties have been told that they will receive what that had budgeted for and have been given seven months of that upfront, to help ease cashflow issues.
There will have to be some uncomfortable decisions taken over the coming months about where savings can be found, which could include the costs for the Hundred, financial distributions to the counties and the number of employees at ECB head office, which has risen by more than 100 in the last couple of years.
John Stephenson
john@cricketinvestor.co.uk
#Cricketnews #ECB
