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CA in financial trouble

undertaker

Coach
Messages
10,975
https://www.theaustralian.com.au/sp...h/news-story/76cd61693fe611aef79fc53d4d2d09b6

Australian cricket is reeling after revelations the game is in a perilous financial position on a day when almost all staff were stood down — even head coach Justin Langer was told late on Friday he is now a part-time employee.

The Australian revealed on Friday that the organisation has lost a significant part of its reserves on the stock market and is facing a cash crisis.

Chief executive Kevin Roberts has warned people the money will run out by the end of the August. Two weeks ago, staff were assured the game could weather the crisis, which has hit when there is little cricket activity, but there is anxiety about the future position and little fat to live on.

After working a range of scenarios for the next financial year, Cricket Australia has settled on projecting a 50 per cent loss of income.

The administration is preparing for the worst-case scenario that key broadcaster partners won’t make the second of their six monthly payments due on September 16 if the Test series against India is cancelled. The two networks paid $1.2bn for rights to the game over six years.

Fox Cricket and the Seven Network made the last payment on March 15, days before the crisis hit. Cricket, unlike the football codes, was assumed to have dodged a bullet because its season had concluded, but the situation ahead looks increasingly perilous.

All but essential staff have been stood down until the end of the financial year on 20 per cent of their salaries, with assurances they would be assisted if they did not qualify for JobKeeper payments. Roberts addressed them all via video on Thursday, revealing the changed situation, saying he was working 16 hours a day for them.

He and other executives had taken a 20 per cent pay cut. All executive general managers and much of senior management are understood to have been kept on.

Following a board meeting on Tuesday senior players were warned the game was in a perilous situation.

Players are bracing themselves for a major pay cut on top of losses they expect to assume because of the revenue share model they fought so hard to retain.

The chief executive is understood to have contacted Tim Paine, Meg Lanning, Steve Smith, Pat Cummins, David Warner, Aaron Finch, Rachel Haynes and others to warn there could be a crisis ahead if drastic action wasn’t taken.

Players are anxious they are going to be made to give up money owed to them because head office has got itself into a difficult position given that their salaries are already tied to revenue fluctuations.

Cricket was exposed to market fluctuations through its investment strategy, it’s 2019 annual report revealing $90.2m in local and overseas shares. The financial report claimed just $26.6m in cash reserves, down from $83.8m the previous financial year and almost $200m in 2016.

The dwindling reserves reflect the cyclical nature of cricket’s revenue cycles — the game works on a four-year economic cycle.

The AFL has $184m in cash reserves and declared no stock market exposure.

Cricket would not confirm a figure for the market losses and disputed reports the figure was $15m, claiming it was considerably less, but others are adamant the loss is greater.

Cricket was reported to be seeking a $200m line of credit, although there has been criticism of the move from within the game.

The layoffs are a shock given the game’s biggest revenue streams have not been affected by the international crisis. Only a handful of games against New Zealand, a tour of Bangladesh and a women’s tour of New Zealand have been cancelled.

If the summer series were cancelled the game would be in serious trouble, although a number of contingency plans are in place if India cannot tour.

Cricket had been on a cost-saving drive in recent years as it refocused its operation to more support of the grassroots of the game. The states have also been informed that they will have to make major cuts to operations, but have hit back, saying there is no need to panic.

Staff at Cricket Australia who spoke to The Weekend Australian were angry that management was paying itself 80 per cent of its wage when they were on 20 per cent and shocked that things had changed so quickly after they had been reassured the game was in a good state.

Interesting that CA's financial decline began whilst Sutherland was CEO.
 

Front-Rower

First Grade
Messages
5,297
Don't pay Test players over a $1million a year and divert that to grass roots funding.

The test players always say "they'd play for nothing"...well...

The players screwed the pooch during the last pay negotiations. The Australian contracted players were never sticking up for their mates in shield cricket, they were looking after their own interests should their own Australian contracts not be renewed.
 
Messages
14,723
The players screwed the pooch during the last pay negotiations. The Australian contracted players were never sticking up for their mates in shield cricket, they were looking after their own interests should their own Australian contracts not be renewed.

The grassroots are more important in cricket. Even the mid-tier grade and First class is more important. Australia's top XI can come and go...but needs the mid-tier to exist. If they're short on funds...pay cuts to the top first in every instance.
 
Messages
14,723
But the big bash

Same merkins getting millions to play test cricket don't play BBL as it is.

Patty will be pissed missing on his $3million IPL they were all going on about all summer.

Meanwhile, DO's can't get balls to use and there's no promo material to give kids anymore. Good one CA.
 

TheParraboy

Moderator
Staff member
Messages
68,127
Not overly concerned for now

Main issue is if home summer v india is cancelled (as well as the bbl) most likely due to borders still being closed, then the TV rights money planned to come in for September, will be pulled. They are doing all these cost cutting measure as a worst cause as they have no idea what will happen, which is fair enough

You'd assume if things were going to go back to normal, then those who are now losing money/wages would lose it for a few months tops?
 

TheFrog

Coach
Messages
14,300
Sounds like CA has some nasty money issues. This must be why India are scheduled to play Tests just two years after the last series here. India holds the cricket world to ransom these days.
 

AlwaysGreen

Post Whore
Messages
50,130
You like India? We'll give you more India.

https://www.news.com.au/sport/crick...a/news-story/3f9b59bbb2690b0dd300fe3a2fead876

Cricket Australia CEO Kevin Roberts has revealed next summer’s Test series against powerhouse nation India could be extended to five matches to help compensate losses for the coronavirus epidemic.

The additional fixture against India would presumably come at the expense of Australia’s historic maiden Test against Afghanistan. Broadcast revenue from a five-day match against the world’s number one Test nation would be considerably larger than that of minnows Afghanistan, which would most likely be a bland, one-sided affair.

Australia and India have not taken part in a five-match Test series since 1992, before their rivalry had even been labelled the Border-Gavaskar Trophy. An extra match against India would also allow the Gabba in Brisbane and the newly-developed Perth Stadium to both host blockbuster contests.

If the Test series against India does not go ahead due to the COVID-19 epidemic, CA would reportedly lose $300 million in broadcast revenue, according to the Herald Sun.

Roberts declared he had already discussed the possibility of an extra Test match with the Board of Control for Cricket in India.

“If you contemplate the prospect of the international season in particular being affected, we have an issue of hundreds of millions of dollars on our hands,” Roberts told reporters in a teleconference on Tuesday.

“So it’s very important that … we do everything possible to stage the season.

“Whether or not there are people at the venue or not … we will explore all viable options.

“Fortunately we have a little bit of time to work through the different scenarios with the India series.

“But we’re not ruling out any possibility for that at this point in time.”

Roberts also admitted there is a possibility all fixtures against India could be played at a single venue without spectators, most likely Adelaide Oval. The Daily Telegraph reported the South Australian Cricket Association had put its premier venue forward as the perfect ground to host cricket if interstate travel remains a difficult barrier next summer.

India achieved a remarkable 2-1 series victory when Virat Kohli’s men toured Australia in 2018/19, the rematch proving to be a highly-anticipated contest now that superstar batsmen Steve Smith and David Warner have returned from their ball-tampering suspensions.

Australia is also scheduled to host the Men’s T20 Cricket World Cup in October, with 16 national teams expected to take part. It is highly likely the tournament will be played behind close doors without spectators.

However, Roberts believes CA would not suffer as “significant” a financial loss if the ICC event is abandoned.

We might not generate financial returns from that event that are as significant as the international cricket season,” Roberts said.

“But what we do know is that the bigger returns from the broadcast rights around the event that are generated by the ICC are very important to all of our counterparts around the cricket world.

“So it’s incumbent on us to do everything possible to stage and host the T20 World Cup.”

On Thursday, Roberts announced CA would stand down the majority of its staff on about 20 per cent of their usual pay for the remainder of the financial year, and players have been warned to brace for looming pay cuts.

CA has already suffered a $20 million hit due to the coronavirus epidemic, and Roberts admitted that figure would climb into the “hundreds of millions” should India not tour.

The organisation’s dire financial situation comes as a surprise to many, considering CA signed a landmark broadcast deal worth $1.2 billion in 2018. Four years ago, CA had cash and investments worth approximately $270 million, but that figure had dropped to about $97 million in March this year.

“On one level, cricket is fortunate in terms of the time of year when the coronavirus situation hit,” Roberts said.

“On another level, cricket is unfortunate in that it has hit us at the lowest point of our four-year cash cycle.

“We were completely on track with our plan for the year until coronavirus hit.

“The unfortunate reality of that is we’re estimating that we have taken a $20m impact thus far … And we have to anticipate, given the unknown and fast-moving nature of this situation, that there will be more risks than that $20m.”

With AAP
 

AlwaysGreen

Post Whore
Messages
50,130
https://www.news.com.au/sport/crick...o/news-story/37b98e02514d760e9f545f79d40fac09

Out of favour official Kevin Roberts has confirmed he has resigned as chief executive of Cricket Australia.

The news was confirmed on Tuesday as Cricket Australia (CA) announced the appointment of Nick Hockley, currently CEO of the ICC T20 World Cup, as interim chief executive, effective immediately.

It follows 24 hours of speculation the former top Aussie cricket official was being forced out the door after falling out of favour with members of the Cricket Australia board.

Roberts is walking away with more than 18 months still running on his contract.

CA chairman Earl Eddings said in a statement the game will now begin an international search for the best man to eventually replace Hockley as CEO.

There has been unsubstantiated speculation former NRL chief executive Todd Greenberg is considering applying for the position.

Roberts has become the third CEO of a major Australian sporting code to exit during the coronavirus crisis, following Todd Greenberg (NRL) and Raelene Castle (Rugby Australia).

Both Greenberg and Castle departed in the past two months.

CA’s board has grown increasingly frustrated by Roberts’ handling of the financial fallout of the COVID-19 pandemic.

Roberts was given the top job in October 2018 following James Sutherland’s 17-year tenure, beating a field that featured former Cricket NSW chairman John Warn, current CA director John Harnden and WACA chief executive Christina Matthews.

Aussie legend Ian Healy on Tuesday morning said Roberts was paying the price for sparking a “panic” about the sport’s financial situation.

He’s led a panic, a very premature panic, on the pandemic for no great reason and no reason he’s been able to explain transparently to the states and the players,” Healy told SEN on Tuesday.

“Kevin’s going to cop it... but how does the board let that happen?

“Not only has Kevin implemented a lot of strategies that have turned a lot of people sour... the board of Cricket Australia has overseen all that.”

Roberts said in a statement released at midday he does not hold any grudges for the circumstances behind his departure.

Roberts said: “It’s been a privilege to lead and serve the sport I love as CEO of Cricket Australia. Our team of staff and players are outstanding people who contribute so much to the game and I’m proud of what we’ve achieved together.

“I’d like to thank the army of volunteers in communities across the country who are the lifeblood of our sport, enabling kids to experience the game and to dream about emulating their heroes in our national teams. As a lifelong and passionate member of the cricket community, I look forward to seeing the game thrive into the future.”

The governing body had sought to slash costs by 25 per cent across the board, including states’ funding, but NSW and Queensland refused to accept the cuts. CA staff, the vast majority of which have been stood down for the rest of the financial year, are desperate for some clarity and certainty regarding their uncertain future.

Roberts was expected to reveal a round of redundancies on Wednesday but it is now unclear whether the extent and timeline of those cuts will change.

Winning back disgruntled staff is one of many challenges faced by Eddings.

The Australian Cricketers’ Association (ACA) has already lodged a formal dispute regarding CA’s revenue forecasts, while TV broadcasters are expected to try to renegotiate the $1.2 billion deal that will soon enter its third year.
 

Twizzle

Administrator
Staff member
Messages
153,016
Noooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooooo

 

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