November 18 - South Africa’s Premier Soccer League (PSL) recorded a loss of R8.3 million (£660,000) after rising costs and a failure to secure sponsorship for the First Division plunged the company into the red, it was announced today.
Chief operations officer Ronnie Schloss said yesterday that the PSL had finalised sponsorship for the lower tier when the global recession forced a company that had already agreed to fund the First Division to start retrenching employees.
He said: ”They were retrenching staff and we could not then expect them to continue sponsoring us in the meantime.
“It costs R60 million (£4.7 million) a year to run the First Division and we were forced to run it from our own pocket.
“Do not forget that we pay travel, accommodation, insurance, match officials, commissioners, and the R150,000 (£11,930) monthly grant that we pay to all 16 teams.”
Schloss said the PSL, whose sponsors are Absa , Telkom , Nedbank and MTN while their suppliers are Coca-Cola, Castle Lager and Vodacom, had taken the continued lack of backing for the First Division into account this year and R60m has been factored into the budget.
He said: ”We have cut our cloth accordingly and we will be able to break even in the coming financial year.”
Schloss said direct costs also increased from R118.6 million (£9.4 million) last year to R137.2 million (£10.9 million) this year.
Administration costs increased from R69.2 million (£5.5 million) to R85.7 million (£6.8 million) this year and the insurance - paid towards player injuries and public liability — increased from R4.7 million (£374,000) to R7.2 million (£573,000).
Advertising and marketing costs jumped from R17.9 million (£1.4 million) to R28.5 million (£2.2 million) this year.
Schloss said: ”Our travel costs went up substantially [from R22.7 million (£1.8 million) to R28.4 million (£2.2 million)] and the running of the games also went up because of a security bill that went up from R2.5 million (£199,000) to R3.6 million (£286,000) in the cup competitions alone.”
But Schloss said even though the PSL recorded a loss for the current year, officials were happy because the cash flow of the league was positive after increasing from R48 million (£3.8 million) to R56 million (£4.4 million).
He said: ”We are happy because attendance increased by 11 per cent from last season and income from the gates went up between six per cent and seven per cent from cup games alone.
“Our asset base has also increased and we now own property in Parktown and in Bryanston.”