Questions have to be raised over the future of Eden Park, in the wake of their latest financial report released on Friday.
It was a huge year of sport at the Auckland venue, including the bonus of three matches against the Lions, which resulted in revenue of more than $20.5 million, which represented an increase of more than 40 per cent on the previous year.
That contributed to a net operating profit of almost $5 million, but the Eden Park Trust Board still incurred a comprehensive deficit of $3.65 million in their annual accounts for the year ended October 2017.
That figure includes more than $8 million in depreciation, which is an unfortunate reality for the historic stadium.
In the wake of those numbers, it’s hard to forecast a positive future, given the park is still saddled with more than $50 million in debt, and can only meet the interest payments each year (which were $1.52 million in 2017).
This year was as good as it got – but the Trust were unable to pay off a single dollar of principal on their loans.
As Eden Park Trust Board chairman Doug McKay admits in his notes, the financial hurdles remain daunting.
“The cost of servicing this debt is significant and limits Eden Park Trust’s ability to reduce debt or invest in capital expenditure to continually upgrade the stadium and maintain it as a world class facility and asset, said McKay. “This remains an ongoing issue for the Trust.”
McKay also added that the outstanding loans “are unlikely to be repaid under the current activity constraints.”
The Lions was a massive event for Eden Park, with more than 40,000 attending the Blues’ clash with Warren Gatland’s team and more than 96,000 flocking in for the two test matches.
There was also the bonus of the All Blacks match with Samoa, the NRL Nines and the opening ceremony for the World Masters Games.
But the Lions won’t be back in this country until 2029, and the Nines have been put on ice for this year and are almost certain to be staged in an Australian city from 2019 onwards. Cricket’s future at the park is also uncertain.
The dimensions of the ground make it far from ideal, and Regional Facilities Auckland are pushing for cricket to be moved to Western Springs, though the council have expressed concern about the cost of that venture.
Friday’s figures make it hard to see how the venue will ever become economically viable, let alone make inroads into the debt of more than $50 million that it holds with the council.
The Warriors appear to have no interest in staging games there now, while the Wellington Phoenix have reverted to using QBE Stadium in Albany for their visits.
And Rugby League World Cup organisers chose to use Waikato Stadium and Mt Smart Stadium as their Upper North Island venues last year, partly due to the high operating cost of hiring Eden Park, the lack of atmosphere when the ground is less than half full, and the greater distance from the action for most spectators.
In his report, McKay was optimistic but also realistic about the next 12 months.
“[In 2017] the popularity of the Lions series matches in particular has driven an uplift in financial performance. Our budget expectations were exceeded due to the popularity of the Lions matches, as well as the commercial opportunities that were leveraged as a consequence of the visibility, both in-stadium and around the world, that the tour matches generated.”
“Unfortunately, this is not expected to continue as we return to a more traditional schedule of events in 2018. However, the management team are focussed on delivering new and innovative content and extending commercial relationships in order to increase EPT’s revenue base wherever possible.”
McKay added that Eden Park was still an under utilised public amenity, “due in no small part to Auckland Council’s role as regulator (by way of setting consent conditions) and competitor (in the form of Regional Facilities Auckland (RFA) who operate all other major outdoor stadiums in Auckland).”
He also admitted the Trust remain in a “vulnerable” financial position, due to interest costs and the inability to lift the amount of usage of the stadium, due to the restrictive resource consent conditions.