By Glenn Pearson
Kent chairman George Kennedy said he was “embarrassed” by the club’s financial results and that harsh lessons have been learned.
The county club announced substantial deficits of £802,452 for the financial year, which includes a staggering £190,000 lost on the two summer concerts staged at the St Lawrence Ground in Canterbury.
The club hosted the Sugababes and James Morrison at their ground in Old Dover Road over the course of two nights in June last year, but failed to fill the 15,000 capacity St Lawrence, with the Sugababes reported to have played in front of a crowd of just 5,000.
Kent’s losses for the financial year ended October 31, 2009, were £110,730 more than the previous year’s results (£691, 722) which saw the club take the steps of making several admin staff redundant just before Christmas 2008.
Those redundancies proved costly - £150,000 to be exact – and that, together with a further £140,000 lost to what’s been described as “bad debts’ believed to be lost in advertising boards around the ground, have made matters worse.
Kennedy, in his second year as chairman of the club, admitted the results didn’t make for good reading, but did want to highlight one point.
“If you compare like with like, there’s almost half a million of non-recurring costs,” he insisted. “Of the £802,452 lost this year, there’s £500,000 that won’t happen next year. A loss of that proportion is embarrassing, there’s no question about that, but I do take some comfort in knowing half a million of that won’t happen again.
“The disastrous concerts cost £190,000, there was £150,000 on redundancy and staff payments which related to the previous year, as well as £140,000 we uncovered in a serious audit. All of that comes to £480,000, so the true trading loss would be nearer £300,000 so we have cut that in half and that’s the important thing for me.”
The one big cost that will serve as a lesson learned by the club, was the two summer concerts. The county had forecast to make money out of the venture, but lost almost £200,000.
Kennedy said: “I’m embarrassed about the concerts, but we are non-executives on the committee and we were told everything was going swimmingly, and nearer the time there were clearly problems that cropped up at the last minute.”
The county’s new treasurer, Simon Phillip, writing to the club’s members in a letter they received on Monday, said the delay of the £8.2 million redevelopment and the impact of the recession had “wreaked havoc” on the finances.
Phillip said: “The two concerts incurred losses of over £190,000, which was an acute disappointment, given that our budget was predicated on very significant returns. This led to budgeted costs being set at too high a level. We also increased the marketing expenditure, only for the recession to bite subsequently. Marketing expenses are inflated by the costs of staging and promoting the concerts.”
The treasurer’s report says “actions are being taken to redress this situation” and a five-year financial plan is being put together, but confirmed that wouldn’t include dismantling the playing staff, instead more effort will be deployed in finding other revenue streams and getting the redevelopment scheme underway.
Phillip said: “Lessons clearly need to be learned from the sorry tale of the past few years. Firstly our budgetary and management accounting processes have been overhauled and we now have a far higher level of insight into the performance of the business and where we are spending our money.”
The club’s members will get to voice their opinions at the Annual General Meeting on March 29 at the St Lawrence Ground.
For the full interview which includes news on the vacant chief executive post, pick up a copy of this weekend's Kent on Sunday.
POSTED: 08/03/2010 07:00:00
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