Safa explains loss to Parliament

2014-02-11 17:29

The SA Football Association (Safa) has seen operational losses because of a sharp drop in revenue, chief financial officer Gronie Hluyo has said.

“What is contributing to the loss is mostly on the revenue side. There was a huge reduction in revenue,” he told Parliament’s sport and recreation portfolio committee today.

According to financial documents handed to the committee, Safa had budgeted R271 million in income for the 2013-2014 financial year, offset by R249 million in anticipated expenses.

But according to its financial results at the end of 2013, there was only R119 million in income. Expenses came to R124 million.

In 2012-2013, Safa recorded a loss of R43 million.

Hluyo said there were two reasons for a drop in revenue.

“Firstly, the global economy is experiencing a serious downturn, affecting South African corporates and, as a result, most of the companies have slashed their sponsorship budgets,” he said.

The second reason was the bad publicity the association had received for match fixing in the past two years.

“We have managed to change that perception,” he said.

Hluyo said revenue was largely secured from broadcast and sponsorship rights, as well as stadium revenues including ticketing, licensing and merchandising.

The association was specifically focusing on broadcast strategies to increase revenue.

“Safa is getting very little from broadcasting rights, mainly because of broadcasting regulations, which compels us to stay with the SABC.”

Safa earned R27 million from broadcasting in 2011-2012, but Cricket SA earned R277 million and SA Rugby made R307 million.

Hluyo said future changes in broadcasting regulations were exciting and expected to change this situation. There had been a belief that expanding soccer matches to other channels would divide audience numbers.

About 4.1 million people tuned into SABC to watch Bafana Bafana matches last year.

Hluyo said an analysis of all live Bafana Bafana soccer matches on SABC and SuperSport in 2013 painted a positive picture.

A bar graph showed that SABC audience numbers stayed the same and that there were about 1.2 million additional viewers on SuperSport.

With regard to sponsorships, Safa president Danny Jordaan said two announcements linked to a health club and vehicle fleet would be made in the next few weeks.

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