Cricket SA reports R50m profit‚ players union Saca claims the losses actually amount to R250m
Confusion reigns after conflicting statements were issued about the true financial health and long-term sustainability of Cricket SA on Tuesday.
The SA Cricketers’ Association (Saca) told its members that Cricket South Africa (CSA) will report a financial loss of approximately R250m in this financial year‚ but this was dismissed by acting CEO Kugandrie Govender and she said the governing body would declare a profit of R50m instead.
Govender was scheduled to report the CSA financial statements at the annual general meeting on Saturday but the much anticipated gathering was postponed to a later date that is yet to be announced.
She told TimesLIVE on Tuesday that the organisation not only turned a profit but remain on relatively healthy financial footing having managed to keep their cash reserves at R850m from the previous year.
“We have made a profit in terms of this year‚ we have. We will net out a profit of R50m‚” said Govender.
But the players union seems to be of the view that CSA would have reported a quarter of a billion in financial losses at the AGM on Saturday. Saca’s view is informed by the fact that crowd-pullers India did not tour SA as planned due to the Covid-19 pandemic.
Saca CEO Andrew Breetzke told the players last week that “CSA is predicting a loss of approximately R250m this financial year and a forecast of over R400m for the period ending 2022.”
“The above threatens the existence of cricket as we know it. We can sit back and do nothing‚ or we can try and be positive to motivate for change. The CSA AGM takes place on the September 5 and we need to ensure that the presidents and delegates recognise how important this AGM is. The future of our game requires strong‚ effective and honest leadership‚” Breetzke wrote to the players.
Asked on what informed Saca’s assertions when CSA has said it has declared a profit‚ Breetzke said the union is not making assertions but stating facts.
“These are facts‚” Breetzke told TimesLIVE on Tuesday.
“The forecast deficit has been well publicised and with the India T20 event not occurring in this financial year‚ the forecast loss could be R250m.”
CSA declared at last year’s AGM that the organisation was predicting a loss of R654m for the four-year financial cycle 2018/19 to 2021/22.
The loss has since been famously coined “Project 654” in the media. Govender said “Project 654” is no longer relevant as a turnaround strategy is yielding positive returns.
She said Saca’s assertion that the fact that India did not tour SA as scheduled due to Covid-19 has resulted in major financial losses is not fair.
“The reality is that we have worked really hard since finding out [about] the R654m loss that became to be known as “Project 654” and we are now in a position where we can break even‚ never mind even making a loss‚ which you will understand that you know for a company like us that is wonderful.”
She said CSA’s financial losses cannot remain fixed at R654m forever.
“It has already changed. Project 654 is no longer relevant. It can’t stay fixed on 654 forever because year on year circumstances are different.
“Because 654 is made up of four years of a cycle of financial losses‚ so essentially project 654 was that‚ if you do not do something starting with the year from 2019‚ then you are going to lose R654m and that’s how project 654 was coined‚” said Governder.
“So we are already one year into it [and] we have not maintained the losses that we forecasted. We [turned] the tide around in year one.
“So in the years two to four‚ if we carry on this trajectory that we are currently on‚ then project 654 will never become a reality.
“In fact‚ already it is not a reality because year one of the four-year cycle has not turned out as badly as it was initially thought.
“Remember 654 was always the case of saying‚ it is dependent on if you carry on the way you have been over the years.
“But if something changes‚ we can also change and something did change.”
CSA’s financial model works on a four-year cycle where money is made off tours like India‚ Australia and England‚ but the organisation runs at losses when lesser nations visit South Africa.
The Proteas toured India in October following the 2019 Cricket World Cup and hosted relatively money-spinning inbound tours against England and Australia during the home summer.
CSA will confirm a new date for the AGM where the full financial statements are expected to be presented.
Source: ARENA Holdings.