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Adelaide Oval lost millions in 2021 but not as much as 2020

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The Adelaide Oval recorded a financial loss of $6.5m in the 12 months to October 2021, while the Stadium Management Authority still has nearly $42m left to repay on its 30-year state government loan for the Adelaide Oval Hotel.

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Agency audit reports published by the auditor general on Thursday show the Stadium Management Authority’s trading revenue declined from $55.7m in the year to October 2020 to $53.2m in the year to October 2021.

The revenue decrease saw the SMA take a $6.5m financial loss from trading activity in 2021, prior to receiving stakeholder contributions of $3.8m from the SANFL and SACA.

But the Adelaide Oval’s 2021 result is marginally better than its 2020 financial loss of $8.4m.

From 2020 to 2021, the SMA’s expenses decreased from $64.1m to $59.6m.

“The COVID-19 pandemic continued to impact AOSMA’s operations,” the auditor general’s report states.

“However, the easing of restrictions resulted in higher attendances at events and performances, which increased revenue from sales, fees and charges by $6 million.”

The auditor general, Andrew Richardson, also highlighted the withdrawal of the federal government’s JobKeeper scheme as a contributor to the decrease in revenue.

“Trading income decreased by $2.5 million to $53.2 million due mainly to a reduction in Commonwealth JobKeeper subsidies of $10.9 million,” the report states.

But he also said the JobKeeper withdrawal was “partially offset by reduced staffing costs of $8.1 million for staff stood down”.

A spokesperson for the SMA said the 2021 result was “in line with our forecast budget expectations” and attributed the financial loss to the ongoing maintenance costs of the Oval.

“Having said that, we are optimistic about the year ahead – crowds are returning, we’ve seen an increase in functions bookings and the early signs are positive,” the spokesperson said.

“Items such as electricity, insurance, stadium maintenance and cleaning – which are all important to the ongoing maintenance of Adelaide Oval as a world-class destination – are the biggest contributors to the trading position.

“JobKeeper was a very important initiative through the worst of COVID, particularly for largescale hospitality businesses like ours, but the conclusion of the initiative had been factored into our budgets.”

The Adelaide Oval’s average AFL crowd for the 2021 AFL season was 27,526 in a year invariably affected by COVID-19 crowd capacity restrictions.

Through 18 games this AFL season, average attendance has only marginally improved to 29,483 despite the absence of any health restrictions.

Meanwhile, the auditor general’s report shows that as of October 31, 2021, the SMA still has $41.9m to pay off the state government’s $42.6m loan for the construction of the Oval Hotel.

The controversial loan, administered by the Marshall Government in August 2019, is set for repayment at a 4.5 per cent per annum interest rate over 30 years.

The auditor general noted the SMA’s books have been impacted by “an increase in borrowing costs of $1.9 million, reflecting the full-year impact of AOSMA’s loan from the Treasurer for the construction of the Adelaide Oval Hotel”.

The SMA twice asked the state government in 2020 to cut the Hotel loan rate to help the stadium claw back funds lost at the height of the pandemic, but these requests were knocked back by former Liberal Treasurer Rob Lucas.

The former government instead agreed that year to defer the interest payable on the loan for six months at a cost of $530,000 and relieved the SMA of its obligation to pay its infrastructure sinking fund contribution in FY21, saving the authority $3m.

An SMA spokesperson said: “The South Australian Government Financing Authority loan for the Oval Hotel is being provided on a 30-year principal and interest arrangement and commenced in December 2019.”

“The loan is being paid back in accordance with those terms.”

A Malinauskas Government spokesperson said the SMA is up to date with its loan repayments.

“Since the beginning of the pandemic, the former Liberal Government provided millions of dollars in relief to AOSMA including deferring interest payments on the loan for the Adelaide Oval Hotel, waiving and reducing contributions to the sinking fund and ex gratia relief on the sub lease payment,” the spokesperson said.

“There are presently no indications that AOSMA will be unable to repay the loan. The loan matures on 30 September 2030.”

Adelaide Oval is now under the stewardship of CEO Nick Addison, a former Victorian racing industry executive.

Addison replaced long-time SMA CEO Andrew Daniels in June.

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