Lancashire Cricket report net profit at close to break-even after tumultuous year
Lancashire Cricket Club can report a small surplus of £106,000 for the year ended 31 December 2020, following a year which saw its core business streams seriously impacted by the COVID-19 pandemic.
Lancashire has faced many financial challenges in recent years, but 2020 was its toughest of all. In normal times, the Club’s diverse business model with multiple revenue streams is viewed as an asset; however, with the unique circumstances attached to 2020, this became the organisation’s biggest obstacle.
The biggest impact was on the hotel, conference and events operation which was expected to achieve revenues of approaching £9million. Usually, a 365 day a year business, in March 2020 it halted immediately. In addition, all cricket was played behind-closed-doors which directly impacted on match day revenues, retail, car parking and sponsorship. The only exception to this, was the international ticket revenue which had been insured by the England and Wales Cricket Board (ECB).
In April and May, the Club was facing difficult circumstances as the reality of the situation became clearer. The initial game-changer was the opportunity to deliver 21 days of international cricket with Emirates Old Trafford hosting England, West Indies, Pakistan and Australian, over a highly successful and safe three-and-a-half-month period. This provided the Club, and its staff, with a welcome respite from the impact of the pandemic as well as putting the facilities to full use for a period of weeks when they would otherwise have remained idle. It also helped evolve the Club’s Safe in One Place strategy recognising its key assets of 17 acres, a 150-bedroom Hilton Garden Inn hotel and world-class staff.
2020 was also a year when everyone associated with the Club suffered the crushing blow of losing its much loved and respected Chairman, David Hodgkiss OBE to COVID-19. David will always be synonymous with the successful development of the Club over the last 15 years and his passing has left a large void that will be difficult to fill.
The ability of the Club to navigate through this testing time, has been testament to several other factors and support from a variety of sources. The ECB provided special funding to all counties and the Club made use of the various government support schemes, most notably Business rates relief and furlough payments. Despite this support, the impact on the Club’s conference and events business was so severe - with little sign of recovery in the short term - that a staff restructuring process was necessary. Whilst the impact was mitigated as much as possible, it has still led to several people leaving the organisation. The Club were able to keep the number of mandatory redundancies down to seven and would like to place on record its thanks to staff who have left during the year. All staff accepted 20% pay cuts for a period of time during the year, demonstrating that everyone was unified in contributing to the cause.
Further help was provided by Metro Bank, who have been a huge ally in the fight to overcome the challenges faced, by providing support throughout. Also, the Club’s long-term naming rights partner Emirates, stood shoulder to shoulder with us throughout the year which will undoubtedly help us to Fly Better into the future. We are also immensely appreciative of our loyal Members, many of whom allowed the Club to retain their Membership fees despite having no cricket to watch.
The aforementioned measures taken were all capped off with a major cost cutting exercise as most staff were forced to work at home for large parts of the year.
Finance Director and Club Secretary, Lee Morgan reported: “It has been a year when we have all been truly tested. After our record financial year in 2019 and transformational refinancing with Metro Bank, which in many ways served as our short-term safety net in the early weeks of the pandemic, we feel we have come through one of the most difficult and unexpected challenges, yet.
“With many financial hurdles remaining and the next few months remaining very uncertain, we continue to re-group and repair the business. However, the foundations on which the Club stand remain solid, and we can plan for a bright future which will allow us to grow again into 2022 and beyond.”