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Where Does Money Go?
Where Does Money Go?
Saturday, 18th Jun 2005 00:00

Where Does The Stadium Money Go?

In five weeks from now, the club will have played their first game at White Rock Stadium and the new season will be just a fortnight away.

Comments have rolled in from around the country over the impressiveness of the Swans' new arena and many opposition fans have already commented about their eagerness to visit with their club next season.

With season ticket sales beginning to approach a five figure number there is an income that will sit nicely in the Swans bank account and hopefully see us in good stead for a push to the top half of League One at very worst.

But with it being close season and Saturday afternoons spent doing other things, a few thoughts started to cross my mind with regards to the income that is generated by these increased revenues and how much goes back into Swansea City. A new stadium is, as I have said, many times an absolute must as far as the club is concerned but it's interesting to contemplate just how much money the Swans could be losing out on

Let's take two scenarios.

Premier seats aside, the club attract for each league game 9000 people through the gates paying an average price of £14 for entry. Revenue for each game is £126,000 or £2,898,000 over a 23 game league season.

If that crowd increases for arguments sake to 15000, the revenue increases to £210,000 per game or £4,830,000 over the course of the 23 games.

Now we are rumoured to believe that of this income, 20% will go towards the stadium management company in STADCO. Based on the first scenario that is £579,600 over the course of the season and on the second one the figure increases to £966,000. Or to put that another way, an increase of £386,400. In reality this means that for success on the pitch which would lead to increased gates, the club is penalised by an extra £16,800 per game going to STADCO which has a split in profits three ways. Therefore financially supporting both the council and the Ospreys - assuming of course that the splits are equal.

Now we have also been told that the respective clubs will be responsible for the running costs of the stadium on their own matchdays. Do we therefore assume that there is a base charge for 'hiring' the stadium from STADCO? If the answer to this is yes then the cost will remain the same whether 2, 2000 or 20000 people come through the gates. So what are the extra costs? Extra stewards, ticket sellers, programme sellers, police possibly. Would the difference between 9000 and 15000 equate to £16k per game or does the respective clubs have to cover these costs out of their own income?

Let's think of something else. What if STADCO is running at a loss? I would assume on that basis that the Swans and the Ospreys would make up the shortfall between them? Therefore could we assume that if there was a profit it is only split two ways? Or will the council take a share? Which of course begs another question, what is the % split of the three parties that make up STADCO?

If you work on previous average attendance figures then you could say that in excess of 75% of the total gate receipts from the stadium will come from paying fans of Swansea City and therefore a very large proportion of STADCO's income will be derived from the Swans.

All questions that I'm not entirely convinced I have ever seen the answers to. Namely the ones from above

  • If the Swans average attendance is higher than they have budgeted for does the same % of that 'extra' go back into STADCO?

  • What is the split in terms of ownership of STADCO?

  • Do profits have to be split between the three parties in accordance with the company split?

  • Are losses covered in the same way?

  • If the attendances are higher than predicted what are the extra costs for the running of the stadium on that particular day? And does STADCO cover those costs or the respective clubs? If the latter then surely the respective clubs are entitled to keep the full extra profit?

If anyone does know the answer to these questions then I would be more than interested to hear them.

Photo: Action Images



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