Croke Park set to clear debts by 2010

Gaelic Games:  Croke Park is clearing its debts well ahead of all projections, and is on course to become profitable for the GAA within five to six years.

The €98 million projected debt in late 2002 has been drastically reduced to €36 million, and if current trends continue should be cleared by 2010 instead of the original schedule of before 2015.

This was the main talking point during yesterday's presentation of the GAA's financial report for 2004. The revenue account for Páirc an Chrocaigh Teo, the holding company for Croke Park, showed a 30 per cent increase in the operating surplus to €12,995,100 - and that was only the start of the good news.

Overall income rose to €19,247,969 from the €14,882,965 of the previous year. Commercial activities and advertising revenue continue to rise, and only the relevant percentage of the resale of corporate facilities was included in that total. In other words only €25,000 was included of the €250,000 resale value of the certain 10-year corporate boxes, the main benefits of which won't kick in until next year.

Stadium director Peter McKenna described yesterday's figures as "far more healthier" than predicted, and the GAA director general Liam Mulvihill agreed they were "very positive compared to some original projections". In both cases the comments were more specifically related to the Croke Park debt.

McKenna explained how they'd managed to reduce the debt so impressively in just two years. First and foremost was the Government grant of €42 million, which was paid out in full late last year and represented the balance of the £60 million in lottery funding which was controversially withheld this time two years ago following the collapse of the Stadium Ireland project.

But there were several other factors. The Hill 16 redevelopment came in well under budget, with a final figure of around €21 million compared to the original budget of €27 million. Interest rates have also remained lower than anticipated, while the resale of premium seats came in well ahead of predictions.

"Things like the Government grant were really positives on the double," added McKenna, "in that it also reduced the interest repayments. And I think the resale of the Cusack Stand boxes took us all by surprise. There was a 90 per cent pick-up rate from those offered first refusal, and we had only budgeted for 75 per cent.

"So if you add together those six or seven components it's quite easy to see how we've got to where we are, and certainly the €36 million debt is very, very manageable. But we're not out of the woods yet, and you always have to be aware of extra liabilities going forward."

Such a healthy balance sheet has watered down any argument for opening Croke Park to other sports on purely financial grounds, although it will always be argued the GAA could still use that extra money for improving club and county grounds and other grassroots activities.

It was suggested, however, the GAA had in some way overestimated the debt two years ago to put pressure on the Government to deliver the outstanding grant. That was rejected as being unfairly sinister by both McKenna and Mulvihill.

"That €98 million was a very real figure," explained McKenna. "The presentation we would have made to our two banks would have had a conservative view of the stadium development, but there was no way that figure could be used to influence anything."

There was a separate Central Council grant of €43 million towards the redevelopment of Croke Park but that won't become part of any potential repayment schedule until the stadium becomes fully profitable. Even then it will always remain at the discretion of Central Council.

The gate receipts continue to contribute to around 30 per cent of the stadium's overall income, while the advertising income is up around 25 per cent to €1.388,827 thanks in part to the scrolling systems installed on the Cusack Stand.

And for the first time in several years, Croke Park will this summer be used for major concerts, thus generating further revenue. On that basis even the 2010 projection for a clearance of debt could be viewed as conservative.

"Well it could go the other way," said McKenna, "with a rise in interest or insurance rates. But right now 2010 we feel is definitely a reasonable projection."

There will, however, be some added outlays over the coming years, including the installing of a giant TV screen to the side of the Hill 16, with an estimated cost of €1 million, and some ongoing pitch improvements, the latest of which is already under way.

The Central Council accounts were presented by GAA financial officer Kathy Slattery, and showed a 10 per cent increase in overall gate receipts for 2004, resulting in €24,189,533.

Again that proved how heavily dependent Central Council is in gate receipts, as it constituted 71 per cent of the total income.

The total income was €33,975,635, also up around 10 per cent on the previous year, and the overall operating surplus was €14,175,519.

After the range of grants and other distribution there was €788,657 left to transfer to the reserves.

CROKE PARK FINANCES

PROJECTED DEBT 2005

Net debt at Jan '05: a17 million

Essential cap ex: a16 million

Interest: a3 million

Total (before grant): a36 million

Inc CLG Grant: a43 million

Total projected debt: a79 million