The costs of fixture suspension

The much-anticipated league match between Mamelodi Sundowns and Orlando Pirates had to be cancelled this week because of the Covid-19 coronavirus pandemic. Picture: Supplied/BackpagePix
The much-anticipated league match between Mamelodi Sundowns and Orlando Pirates had to be cancelled this week because of the Covid-19 coronavirus pandemic. Picture: Supplied/BackpagePix

The financial implications of the cancellations of football fixtures are huge. And the PSL – trading as the NSL – will in all likelihood not be spared a huge shortfall in the aftermath of the Covid-19 coronavirus pandemic.

This is the main reason that the PSL, like its international counterparts, is determined to complete the current season, despite criticism from some quarters.

As things stand, most professional clubs around the globe fear a cash crunch that could make it hard to pay players’ salaries. Others, such as promotion hopefuls from the lower leagues, could resort to legal action should the season be called off.

The suspension of games is a big setback for broadcasters, who fork out millions of rands for the right to beam live matches to attract viewers and sell advertising.

The PSL ranks among the top-earning leagues in the world, having posted a record R1 billion in revenue in the 2018/19 season. This milestone was attributed to “the contractual increase in the broadcast rights agreement and inflationary increase of sponsorship revenue”.

Although PSL chairperson Irvin Khoza this week maintained that the local league “could not quantify the issue of money at this point”, it is inevitable that its financial results this fiscal year will reflect a different picture.

The suspension of games is a big setback for broadcasters, who fork out millions of rands for the right to beam live matches to attract viewers and sell advertising.

The PSL received R600 million from SuperSport International for broadcast rights, according to its financial statement for the year ended July 31 2019.

Also, potential losses from ticket sales can hurt the clubs, especially the smaller ones that cash in when they host prominent opposition such as Kaizer Chiefs, Orlando Pirates and Mamelodi Sundowns.

The league’s financial report reflected about R23 million from gate takings for cup competitions. The PSL claims 20% of the proceeds, while the clubs equally split the 80%.

“We are a business. We are affected just like other businesses and we cannot quantify the issue of money at this point. What was important was to deal with the issues of safety [of players and spectators],” said Khoza this week.

He added that the PSL was hoping to end the current season by June 30 at the latest.

“What was important was how best we can protect ourselves first, before we can even think about the consequence of the losses that we might suffer.

The significant impact on the countries’ economies means that football clubs, their employees and other businesses associated with the game all face an uncertain few weeks, if not months.

“If this virus is as strong as it is showing in other parts of the world, we might not get to enjoy the benefits of what we are hoping to protect. But that is not the objective now. The objective is how we, the players and the broadcasters stay healthy – the people who will be part of the 100-person gathering limitation. If there is no human capital, where can we do business [if we don’t protect that]?”

Chiefs supporters will be crossing their fingers that the league resumes as they are a few matches away from clinching the title, which would be their first in five seasons.

At the bottom of the log, as many as six clubs could still go down to the GladAfrica Championship, where Ajax Cape Town are sitting pretty on top with their promotion to the top flight almost guaranteed.

The only cup competition that might be affected by the current pause in matches is the Nedbank Cup, which has two more rounds to play. The season-ending tournament is in the semifinal stage.

Mamelodi Sundowns have been drawn against Bidvest Wits, while Baroka will host Bloemfontein Celtic.

Meanwhile, Safa, which also depends on the broadcast rights fees as its main source of income, will be affected.

The federation is still reeling from a R74 million loss from the past fiscal year.

Safa was hoping to cash in on hosting the return leg of Bafana Bafana’s qualifier for next year’s Afcon against São Tomé and Príncipe, which has also been cancelled due to Covid-19.

Safa president Danny Jordaan said: “For Safa, major revenue is earned when our teams are playing for qualification and qualify for [major] tournaments – the Fifa World Cup and Afcon. Now we can’t get the revenue because the matches have been postponed.

“We have five teams that would have generated a lot of revenue for us,” he added, referring to Bafana, Banyana Banyana, the Under-17s and the Under-20s, as well as the Olympic team, the Under-23s.

“But we understand. We have to put the interest of the players first,” Jordaan said.

He said Safa would meet with the broadcasters and commercial partners to explain that “we have to put the interest of players’ health first”.

“We cannot give guarantees,” he said.

English football has estimated that it will lose up to £10 billion (R205 billion), while the Spanish La Liga will lose about €700 million (R13 billion) if the current campaigns do not continue. The two leagues announced on Thursday that they were also hoping to conclude their seasons by the end of June.

Premiership clubs in England receive as much as £30 million a season in revenue from domestic and international broadcast deals, which are worth £9.2 billion in total. La Liga has estimated that there could be losses of €494 million related to television revenue, and the figure could be as high as €610.9 millon lost on season and match-day tickets.

Most football leagues that are played between August and May have been stopped with only nine or 10 fixtures remaining.

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The state of top football leagues around the world. Graphic: Theuns Kruger/Graphics24

Governments around the world have advised their citizens against mass gatherings, effectively putting a stop to games.

The significant impact on the countries’ economies means that football clubs, their employees and other businesses associated with the game all face an uncertain few weeks, if not months.


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