FINANCIAL FORECAST
Nelson Mandela Bay Stadium August 2010 International Multi-purpose Stadium Model – Ensuring Financial Sustainability
World Class Stadium Stadium competition Market / economy Location
Re-investment Quality Operator Stadium & Precinct Sports / entertainment Maintenance reputation and network Quality staff Industry knowledge Events Stadium operations
This ongoing annual process is fundamental to ensuring the stadium assets are maintained at a world class level, with no burden on the City / taxpayers
Build Event CommercialCommercialCommercial Viability ViabilityViability Programme NamingNamingNaming rights rightsrights Anchor tenants Suites+Suites+Suites+ hospitality hospitalityhospitality Other annual events OtherOtherOther income incomeincome streams streamsstreams Non-bowl events SpectatorsSpectatorsSpectators Precinct activities
DeliverDeliverDeliver Quality QualityQuality Product ProductProduct ForForFor spectators spectatorsspectators ForForFor corporates corporatescorporates ForForFor sponsors sponsorssponsors NMB Stadium – Operator Focus Areas to Date 2009 2010 JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL INTERIM CONTRACT ACCESS 3-YEAR OPERATOR CONTRCT
PARTNERSHIP ACTIVITIES • Budgeting process •Reporting / liaison / feedback Ongoing •Contract approvals • Precinct development •Event planning + approvals (Conferences, Functions, Tours Development and Bowl Events DOCUMENTS for CITY (14 in total) FINANCIAL ACTIVITIES CITY •Business Plan • Transport Ops Plan •Reporting / liaison / feedback Ongoing •Disaster Mgmt • Parking Plan •Contract development (suite sales, events, functions) •Supply Chain • Claims Mgmt •Event budget planning + approvals
Ongoing World Cup Planning and LOC Liaison + regular FIFA Visits FIFA / City Contract Analysis + Resolution •Security • Power Supply •Cleaning • Waste Management •Power supply requirements
FIFA / LOC Handovers 2010 FIFA •Stadium • Media Centre World WORLD CUP WORLD •Broadcast area • Media Tribune Cup •Hospitality • Public Catering
• Upgrade Floodlights • Pitch • Purchased Pitch Grow lights Laid • Took over control of the pitch • Appointed Service Providers; • Obtained a liquor license • Seat •Cleaning •CCTV • Operation and business process in terms of legal documents for Audit •IT •Access Control various agreements •AV • Worked in consultation with PA, contractors and architects to assist with •North East Park completed
STADIUM STADIUM snag listing for completion of final construction phases •Completion of new access gates OPERATIONS •Guard huts installed Appointment of full time staff + ongoing training Part time for WC (29) NMB Stadium – Event Programme To Date 2009 2010 JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL INTERIM CONTRACT ACCESS 3-YEAR OPERATOR CONTRCT Bafana vs Japan Open Day FIFA World Cup Keizer Chiefs vs Santos Southern Kings Vs. B & I Lions Korea vs Greece Premiers Cup Bay Summer Concert Ivory Coast vs Portugal Germany vs Serbia Vodacom Challenge Nelson Mandela Bay International Music Festival Switzerland vs Chile England vs Slovenia Women’s Day Bay United vs Korea Gaborone United vs Pirates Korea vs Uruguay EP vs Cheetahs Currie Cup (EP vs Falke) Brazil vc Netherlands Uruguay vs Germany EP vs Argentina BOWL EVENTS BOWL
June 2009 to end September 2009: October 2009 to date: 6 Events 17 Events Total Attendance: 116 000 Total Attendance: 389 970 Currie Cup
Conferences Conferences – 3 : FIFA Conference Launches Grinaker Conference Functions Launches – 2 : General Motors Dealer Awards FNB Roadshow Functions – 3 : Wedding
Parexel Banquet Dinner
Advertising –VISA Commercial NON-BOWL EVENTS NON-BOWL NMB Stadium – Operator Dashboard
Financial Sales and Marketing Human Resources Contracts City Liaison/Reporting Staff budget YTD: Naming Rights - in 19 full time staff (budgeted Appointments made: Quarterly report last (23 % below budget) market place selling for 29) Megapro submitted end of March Marketing cost saving of Functions 2010 Additional appointments Magnetic Storm Next report due 44% Suite Sales (Sold 12 for planned – 10 during 2011 Dimension Data Budget 2011 submitted to Cost saving total budget 2010 ) Temp world cup staff have Afrisec City end of August. just over R4.1million Suit sales 2011 .Success completed contracts. No other noteworthy BUSINESS
OPERATIONS depended on event issues calendar) Safety and Security Cleaning Food and Beverage Outstanding Tenders Ticketing Security tender been Tender advertised Liquor License to be Waste Management Seat audit complete finalized appointment Contract awarded to changed to wholesale Kitchens Layout successfully expected end of August Zama Cleaning Kitchen fit-out tender to be Suites loaded by Computicket Temporary security Training provided by the finalised Precinct Management Internal ticketing system company on site. stadium operator F & B Strategy to be training complete
STADIUM finalised Ticket design in progress
OPERATIONS Accreditation plan to be implemented World Cup Overlay Anchor Tenant Anchor Tenants (Rugby) Other Bowl Events Non-Bowl Events Certain items of overlay (Soccer) Agreement with EP rugby Concerts BMX construction will remain at •Enter into discussions with concluded Pitch cover World championships + the stadium for legacy use, SAFA Vodacom purchased Mountain biking e.g: conference equipment, •PSL Team major problem Currie Cup Corporate events Concerts in the park CCR Level 5 •Other soccer events Super Rugby Community Events Precinct community
EVENTS / EVENTS • Vodacom Challenge Internationals participation
WORLD CUP • Premiers Cup RB Sevens Friendlies
Facility Maintenance Asset Protection Pitch Friendlies Improvements HMI (Human Machine World Cup Major Disappointment Ablution facilities Business As Usual Interface) System in Photo documentation To be rectified by Fencing and turnstiles operation Damage reports by PA December Water System Facility maintenance issued to LOC Desso system to be Drainage Some Challenges, but manager appointed installed Team Benches Under Control Lift North and South Problem Area FACILITIES NMB Stadium – Planned Event Programme 2011 to 2013+
2011 2012 2013 Vodacom Cup – EP Kings •4/5 matches • 4/5 matches • 2/3 Matches (reduced for Super Rugby)
Currie Cup – EP Kings •5/7 matches (including Sharks, WP, Bulls etc.) • 5/7 matches • 5/7 Matches
Super Rugby – Southern Kings •5 friendly matches (Sharks, Stormers, Bulls, Lions, Cheetahs) for 2011 + 2012 • 8 Matches (Full Super Rugby ) RUGBY
Other Rugby •SA vs. All Blacks (TriNations) • Annual Test Match • Annual Test Match •IRB Sevens (George currently) • IRB Sevens • IRB Sevens
PSL + Knockout – Assisting Bay United in PSL Qualification •Bay United / PSL Expansion – potential of +/- 20 matches per annum
Other Football • Bafana Bafana • Bafana Bafana •Bafana Bafana • Vodacom Challenge • Vodacom Challenge •Vodacom Challenge • Premiers Cup • Premiers Cup •Premiers Cup FOOTBALL • Other friendlies • Other friendlies •Other friendlies
Target 4 to 6 per annum • Concerts [2] • Concerts • Concerts [2] • Roadshows • Roadshows • World Wresting Professionals • BMX World Cup • BMX World Cup • Mountain Bike World Cup • Mountain Bike World Cup OTHER
NON-BOWL EVENTS •Ongoing focus area aimed at conferences, roadshows, functions •Specifically targeting cycling, vehicle and international conference markets NMB Stadium – 2011 Financials
2011 Financial Model LOW ROAD HIGH ROAD Difference Comments
Revenue Sponsorship and Advertising 5 500 000 9 400 000 71% Additional "naming rights" income in HIGH Road Event related income 7 548 450 7 670 450 3% Hospitality 3 253 500 3 693 100 14% Additional suite sales income in HIGH Road Other income 1 908 000 2 508 000 31% Higher kitchen rental forecast in HIGH Road
Gross Revenue 18 209 950 23 149 550 27%
Less Anchor tenant share -2 000 000 -2 000 000 0% Fixed, as agreement in place with EP Kings
Net Revenue 16 209 950 21 271 550 30%
Less Fixed operating expenses -19 891 461 -19 891 461 Fixed Expenses under direct operator control (part of GOP calculation) Expenses in relation to Stadium infrastructure due to Less Facilities maintenance ------design/failure /uncontrollable maintenace and will be added back expenses for GOP calculation
-3 681 511 1 380 089 --- Net Profit / Loss
Comments: • “Naming rights” sponsorship income is the biggest determinant of whether net revenue covers the fixed operating expenses or not. Consequently we have been proactive in preparing our sponsorship packages (before World Cup) and appointed market leader to assist with sales • SARU decision on event programme • Working with SAFA and the PSL to get a local PSL team as Anchor Tenant