Lancashire Cricket Club maintains growth in operating profits
Lancashire Cricket Club has reported an operating profit for 2018 of £2,387,000, which represent an increase on the previous year, despite not hosting a five-day international Test Match.
The Emirates Old Trafford-based cricket club has seen operating profit grow from £763,000 in 2015 through to the £2m-plus achievement of 2018, with a record year anticipated for 2019, supported by six ICC Cricket World Cup fixtures, a Specsavers Ashes Test Match, and the regular domestic season.
2018 saw Lancashire host a Royal London One Day International, with England facing Australia, and a Vitality IT20 where England played India, both of which were a great success from an attendance and revenue perspective.
In addition, a record 22,000 tickets were sold for the Friday night domestic Vitality Blast T20 game against Yorkshire, which will live long in the memory following a last ball win for the Red Rose county, and continues the year-on-year growth of this award-winning fixture.
The significant shortfall in revenues from not hosting a Test Match were offset by the benefit of the Emirates Old Trafford Hilton Garden Inn’s first full year of trading.
The 150-bedroom four star hotel is achieving strong average occupancy levels, now exceeding 70%, and has already developed a vibrant and healthy reputation for its quality and service, regularly ranking in the top 10 hotels in the city.
While performing well in its own right, the hotel has significantly enhanced two other key business streams of the club.
First, after two or three years of relatively static sales, the conference and events business grew its revenues by 14% in the year to more than £4mm. The two income streams now delivering more than £8m of off-the-field revenue for the club.
Secondly, the hotel was built with both the cricket and the off-the-field opportunity in mind, and the ability to convert pitch-facing bedrooms to hospitality suites for major cricket matches unlocked potential for growth in hospitality numbers in 2018, and much more in the longer term.
The diversity in the club’s business model was again further demonstrated with a new Caffè Nero coffee shop established on-site, a sell-out Liam Gallagher concert hosted, and the continued generation of income from car parking revenue. The cricket’s retail and merchandise operation was also brought back in-house during the year.
Revenues generated were used to support investment in the playing squad and its support staff, as well as some of the underlying cricket infrastructure.
In particular, the Club invested nearly £500,000 on a combination of new outdoor net facilities, improvements to the outfield drainage, new ground equipment and a new fully-equipped players’ gym.
Finance director and club secretary, Lee Morgan, said: “2018 yielded a positive set of financial results which demonstrated the benefits of diversifying the club’s activities beyond cricket to help support our responsibility and vision to grow the game in the North West.
“The strong and stable platform which has now been established following a number of years of ground development at Emirates Old Trafford provides the opportunity for the club to embrace and make the most of the regional, national and global profile and commercial income from the ICC Cricket World Cup and Ashes in 2019, and the exciting period of cricket that follows.
“The club has a desire and vision to be the best, and we are striving to achieve this.
“We are now starting to see the stability and strength that a sustainable commercial business model offers, and the opportunities it will provide in the coming years to invest in the game of cricket from grass roots and participation through to members, supporters, the match day experience and the elite performance department.”