Pandemic shrinks sponsorship income
PSL dribbles past Covid-19 to score solid financial results
The Premier Soccer League may have reported a shortfall in their finances after a tough trading year due to Covid-19, but the league remains on solid ground, its financial report tabled at this week's elective annual general meeting shows.
The league fell short of the record R1bn revenue it achieved last year, amassing R970m in revenue from sponsorship and TV rights, according to the financial statement.
Predictably, sponsorship income dwindled significantly as a direct result of lack of action caused by the pandemic between March and July, with last season's title sponsors Absa paying the league R115m, compared to the R136m the banking giant paid in the previous year.
The Nedbank Cup was also severely affected by the lockdown and, as a consequence, the bank paid the league R72m this year compared to the R80m of last year. Telkom and MTN, whose competitions were not affected by the lockdown, paid R60m and R45m into the league's coffers, while newcomers GladAfrica forked out almost R21m. MultiChoice paid R32m, compared to the R42m from the previous year for the MDC reserve league product, which was cancelled prematurely last season.
But the biggest contributor to the league's revenue remains television rights holders SuperSport, who paid R587m, R13m short of last year's R600m.
At Wednesday's meeting, where he was re-elected unopposed for another term as chair, Irvin Khoza said the prohibition of fans at stadiums affected their business. “The one proposition of our business is gatherings. We are the largest event organiser in the country, and the inability of people to move and gather has fast-tracked the adoption of technologies and has gathered people behind scenes and screen in their homes,” Khoza said.
But the financial statement shows gate takings do not make too much of a difference to the PSL's coffers, having contributed R23m last year, compared to R14m this time.
The financial results show that the PSL paid an extra R40m in grants to clubs, as the season extended beyond June 30. While businesses have been largely hit by the coronavirus, the league projected it would continue to remain in the black for some time.
"Covid-19 is not expected to have a significant impact on the operations of the league. We have determined that there is no material uncertainty that casts doubt on the league's ability to continue as a going concern. Covid-19 will have some impact on the operations, though not significant. We believe there will be sufficient funds generated from broadcast rights and sponsorships to enable the league to continue as a going concern in the foreseeable future," the report reads. – additional reporting by Charles Baloyi
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