Pictured: the group’s loss on ordinary activities before taxation for the year ended 30 September 2016 was £5.1m
Sportsworld, the corporate hospitality and sports events management agency, has suffered a £5.1 million loss. And it has blamed the losses on Brexit, terrorism and the weather.
The group’s loss on ordinary activities before taxation for the year ended 30 September 2016 was £5.1m, compared to a loss of £1.7m the previous year, according to accounts filed at Companies House.
Revenue increased from £8.7m in 2015 to £12.9m in 2016, but gross profit fell from £1.1m to £570k in the same period. An admin bill of £5.6m was up from just under £3m in 2015.
Writing in the report accompanying the accounts, director Richard Isaacs said that the “very disappointing” result was influenced in part by world affairs.
“The UK referendum on remaining within the EU, the Zika virus and caution around perceived terror threats have impacted spending patterns and reduced the appeal of travelling to the Olympic Games in Brazil,” he said.
“The Wimbledon and Americas Cup events in the UK both struggled to repeat the success of the previous year. Ticket prices and the market conditions have squeezed the margin on the Sportsworld Wimbledon Product. The Americas Cup failed to achieve the same interest as the previous year due to changes in the hospitality offering available and with memories of the poor weather from the previous year reducing the level of repeat bookings.”
He added that during the year the decision had been taken to drop brands and events that were not generating sufficient return. The Tribal Series Para Tri was cancelled and the Flexi Conferencing and Incentives brand was closed down, resulting in some redundancies.
Also, following a disappointing result from the Rio Olympics, the Sponsor Services side of the business was closed, with a significant cost arising from redundancies as a result of this decision.
Isaacs said: “The costs associated with this decision have been provided for in full in the current financial year and have had a significant impact upon the profitability of the company for 2016.”
The cash flows from losses on the Rio Olympics and a corporate restructure have resulted in reduced cash balances for the business. A long term loan was also settled in full during the financial year and the company issued 2.3 million shares to generate the capital required to pay off the loan.
Isaacs added that provisions had had to be made for the settlement of a legal dispute.
“There is a potential liability which may arise to settle an ongoing legal dispute,” he said. “A settlement offer has been put to the claimant and a provision has been made during the year to cover a settlement figure and any remaining legal costs.”
In November 2016, Chad Lion-Cachet stepped down from the Sportsworld board after 13 years. In February 2017, Sportsworld was sold by its parent company TUI as part of a deal with private equity firm KKR to sell its specialist holiday sector Travelopia, of which Sportsworld is a subsidiary. The company now has a new ultimate parent company and controlling party.