World Athletics narrows loss and claims to be moving in right direction
World Athletics, the sport’s international governing body, has posted a financial loss of $17.4 million for 2019 although this represents an improvement on the previous year, and, despite the undoubted negative impact of the coronavirus pandemic, anticipates that an expenditure review will demonstrate further progress in 2020.
In its first fully published accounts, the Monaco-based federation, formerly known as the IAAF, has reported revenue of $51.1 million for last year, up 13 per cent from a restated $45.2 million in 2018.
Turnover from television rights and sponsorship climbed slightly, from $42.4 million to $43.9 million, while other revenue rose from $2.8 million to $7.3 million. This latter figure included a $6.3 million fine paid by the Russian Athletics Federation as a penalty for violating anti-doping rules.
Overall, expenditure fell by 6 per cent, from $72.5 million to $67.8 million.
World Athletics recorded a deficit of $27.6 million in 2018.
The annual report shows that the governing body ended the four-year funding cycle to 2019 with cash reserves of $34.3 million.
The pandemic has forced the postponement or cancellation of multiple top-tier World Athletics Series championships and Diamond League events in 2020, which will have an inevitable effect on income, albeit a series of one-day meetings have been held between June and September.
In addition, the postponement of the Tokyo 2020 Olympic Games to 2021 will mean a wait for a share of proceeds from the International Olympic Committee. Ranked in the top groupings of federations, World Athletics received around $45 million from distributions from the IOC broadcasting deals for the 2016 games in Rio de Janeiro.
To compensate for the delay, World Athletics is among the international federations to have received a loan from the IOC as part of the organisation’s Covid-19 aid package.
With the rescheduling of the Olympics, the 2021 World Athletics Championships in Eugene in Oregon, USA have been put back to 2022.
However, the governing body anticipates expenses will continue to fall, saying: “A root-and-branch review of all HQ expenditure during 2018 and 2019 led to HQ staff freezes and excess costs cut from across the organisation. The benefits of many of these decisions will be seen from 2020 onwards.”
World Athletics also highlighted new sponsorship deals with Qatar National Bank, for the World Athletics Series, that came into effect in 2018, and with Wanda Sports Group for the Diamond League, starting in 2019, as well as a renegotiation of its long-term commercial deal with Japanese advertising giant Dentsu.
These are said to have filled the gap left by the exit of previous partners in the wake of damaging revelations concerning the previous leadership headed up by the federation’s ex-president Lamine Diack who went on trial for corruption this year.
Long-term renewals have been concluded with major sponsors Asics, Seiko and TDK and the extended agreement with Dentsu for 2020 to 2029 includes a minimum guarantee of $130 million, and a profit share element. In 2018, World Athletics received $8.4 million from Dentsu as profit share for the period of 2010 to 2017.
Meanwhile, World Athletics is implementing a strategic plan for growing the sport between 2020 and 2023, with targets to double the number of overall partners, both commercial and non-commercial, to double athletics’ digital reach and following, and to increase the overall broadcast audience by at least 10 per cent.
In a statement, World Athletics president Sebastian Coe said: “These 2019 consolidated financial accounts come at the end of a tough and turbulent four years for our sport,” says World Athletics President Sebastian Coe in his opening message in the report. “But if the last four years have been a time for change, the next four years will be a time to build our sport and our reputation as the No.1 Olympic sport from the ground up.
“The appointment of our new CEO, Jon Ridgeon, in 2019 has seen a renewed and successful drive on the revenue front and a robust approach to reviewing processes and priorities across the business to ensure the organisation lives within its means and is able to cut costs to meet the changing environment we all find ourselves in. Driving unnecessary costs out of the business by working smarter and committing revenue only when it is necessary is already paying dividends and will continue to do so over the coming years.”