Gloucestershire Letter to Supporters

Update from the CEO and Chairman - Statement on the 2020 Cheltenham Cricket Festival

19 May 2020

Dear Members and Supporters,

We are living through unprecedented times and we hope you and your loved ones are well, or as well as can be, at what remains a very challenging period for everybody.

We wanted to take this opportunity to provide a further update regarding matters affecting the 2020 cricket season for Gloucestershire, as the situation changes on a weekly basis.

The England & Wales Cricket Board announced some weeks ago that there would be no cricket played in this country until 1st July at the earliest, and this remains the current guideline from our governing body. As we approach July, however, the Club’s preparations for the Cheltenham Cricket Festival would need to ramp up in order to deliver this annual showpiece event at the College Grounds. Due to the many and varied logistical and administrative issues we face in our planning, we are afraid that the Club have today decided to cancel this year’s Cheltenham Cricket Festival.

There are naturally some ramifications from taking a decision like this, but the first place to start is by stating that all matches currently earmarked to be played in Cheltenham will now be played at the Bristol County Ground, should these matches be confirmed on a re-jigged schedule the ECB are currently putting together. We trust that our supporters will understand that we cannot second-guess developments during this Covid-19 pandemic and need to make decisions based on the present situation we are faced with.

All ticket buyers for the Festival will of course be entitled to a full refund, together with supporters who had purchased a ticket package (Festival Pass) for this season; in both instances please can we ask you to contact tickets@glosccc.co.uk in order to process this refund.

Hospitality purchasers for the Cheltenham Festival will receive a separate communication later today from the Club, which will include an offer to roll over their booking for the 2021 season.

As the highlight of the cricketing summer for many and with cricket being played in Cheltenham since 1872, it is naturally a huge disappointment to us all that we have had to take this decision. As the festival requires detailed planning and logistics and with so much uncertainty around a return to playing professional sport, we’ve had to make the call to reduce the Club’s financial liabilities in erecting this temporary facility. We know The Bristol County Ground is of course geared up to host matches now and at any time, so our plans now revert to headquarters. It is extremely bittersweet to also note how beautiful both the College and Bristol County Ground are looking at present – which those of you following the Club on social media will have no doubt noticed. We do sincerely hope that we will have cricket to play in Bristol this season.

We would like to thank all of the amazing people who help with the planning and delivery of the festival and have been continuing to do so, even in this disrupted year. As well as our own internal staff special thanks should go to everyone at the College and notably Christian Brain and Andrew Hailes, Head Groundsman and Deputy Bursar respectively. Chris Coley, Festival Director of many years standing, has helped once again in much of the organisation and in also putting together an exciting programme of events for our 150th anniversary season. Likewise, we must thank our catering partners, Fosters, and Paolo and Anna, who I know many of us will miss keeping us refreshed in the glorious Cheltenham sunshine.

Lastly, a big thank you to the band of volunteers who make the festival such an amazing experience for all of us. They work tirelessly to raise much needed funds for the Club but do so with a ready smile and boundless enthusiasm.

Whilst we cannot now proceed for 2020, we are already excited about putting on something special at Cheltenham next year, and trust that all our members and supporters will want to join us for this!

We may have no cricket to watch at present, but we would like to signpost you to our Match Centre on the Gloucestershire Cricket website here which, this Thursday, will be showing as live every ball from the 2015 Royal London Cup Semi-Final against Yorkshire. The Sky cameras captured our brilliant win at Headingley and the Match Centre will not only broadcast the entire Sky Sports match action, but will also feature new interviews with Head Coach Richard Dawson and the two stars of the show from the day – Michael Klinger and Hamish Marshall. Please do sign in and enjoy one of our finest wins in recent years!

We will be writing to Members next week and we will of course write to everyone as soon as we have had the next update from the ECB, but in the mean time we would like to thank you all for your continued patience and understanding as we deal with these ever-changing circumstances.

Will and John

‘We’re nothing like a football club’: Lancashire cricket boss unveils record profits

Lancashire County Cricket Club boss Daniel Gidney set out how he plans to navigate the coronavirus pandemic

By Oliver Gill19 May 2020


The boss of the cricket’s most profitable club has not given up on welcoming crowds to see some action this summer.

Taking a sip from a towering Lancashire County Cricket Club mug over a video call, Daniel Gidney remains optimistic.

“A lot of people think the stadiums can't socially distance because they’ve got 20,000 to 25,000 people, but you could have 2,000 or 3,000 people in the 20,000 seat stadium with protections in place,” he says.

Discussion with the England and Wales Cricket Board are ongoing and are likely to include spectators spread with empty seats between them.

“[The ECB is] looking at hosting some internationals behind closed doors in a bio-safe environment.

“And I am hopeful that there will be some domestic cricket, at least behind closed doors and hopefully ... towards the back end of the year, late August, early September, perhaps with some smaller crowds, with some social distancing.”

Gidney is speaking as Lancashire announces record financial results. An operating profit of £7m on revenues of £34m is also the best by any county, the club says.

And while coronavirus is requiring the Manchester-based team to batten down the hatches, Gidney is grateful for the changes he began seven-and-a-half years ago.

After six years in charge of the Ricoh Arena – home to the likes of Coventry City football club and Wasps rugby – Gidney took over as chief executive at Old Trafford. Disaster had been averted three years earlier, when a planned development of Lancashire’s ground had soured, leaving it with a £1m legal bill and close to going bust.

Gidney started knowing that Lancashire would host Ashes Test in 2013, a crucial money-spinner and one that would provide the club’s finances some crucial breathing space. He would be disappointed.

“We had £4m of advanced sales for the Ashes in the back in 2012. I arrived in November [but] all of that money had been spent. I spent the first three or four years just managing cash flow, phoning creditors, finding partners, trying to get people to pay us early … managing cash flow became our DNA.”

But Gidney knew that running the club on a hand-to-mouth basis was not the answer. A long-term solution needed to be found. Sweeping changes needed to be made.

Gate receipts from county games did little more than cover costs. The club was too dependent on hosting England games over a handful of days to turn a profit. “I realised that we can’t run a business that has 365 days of costs on six days of revenue,” he says. “We had to diversify, and broaden our horizons.”

Not everyone agreed. The club’s old guard feared the prospect of turning the 156-year-old institution into a commercial enterprise and dilute the club’s long history.

“Very interesting” conversations followed with the old guard on the Lancashire board, Gidney says. He told them: “Cricket will always be in our heart, but business has to be on our mind.”

Plans were drawn up for a 150-bed Hilton hotel and conference centre. Eighty-five of the rooms would look out onto the playing surface.

Old Trafford would not just be the home of cricket, but a home to pop concerts, events and corporate get-togethers.

A key ally was David Hodgkiss, latterly the club chairman and chief executive of steel engineering firm William Hare.

Hodgkiss's business acumen, and two decades of experience running the club, was instrumental in delivering the £60m overhaul of the Old Trafford ground. In a tragic twist, Hodgkiss died in March of coronavirus.

Funding the development was far from straightforward. The club issued a corporate bond and raised loans from Australian bank Macquarie and Trafford Council.

But this was only supposed to be a interim measure. The final piece of the jigsaw was refinancing this debt and was hoped that their long-term lender – coincidentally the main sponsor of the English cricket team – would be supportive.

Gidney says: “The club had been with NatWest for 100 years. We had a long-term hedging arrangement that was punitive. It was the equivalent of 8pc interest.

“The fact that we wanted a 10-year term and £26m, I think those were the elements that NatWest felt that they couldn’t support us on.

“They did come up with an offer, but it was a five-year term and it wasn’t anywhere near the debt quantum. So we wouldn’t have been able to restructure.”

The lender - part of taxpayer-controlled RBS - was not alone in declining to help, however. “But you’d be surprised at some high street banks,” says Gidney. “The words were used to me on a couple of occasions: ‘You’re like a football club.’ I’ve worked in football and we're nothing like a football club. You know, we’re probably one of the only sports that has a salary cap that is lower than the distribution from the governing body.”

Redemption came from an unlikely source. Metro Bank agreed to a £26m loan, which almost halved its interest payments.

Gidney shudders to think how Lancashire, founded in 1856, would have navigated the coronavirus pandemic had Metro not stepped into the breach. “We would have found it incredibly difficult to get to where we are now, what with Covid and the revenue streams dropping off a cliff.”

Announcing the record results during the current crisis is a bittersweet experience. This year is destined to be a case of what could have been. “Pre-Covid, we were thinking that as we go into 2020, we can really enter around where we can become financially self-sufficient outside of international cricket,” says Gidney.

While scant consolation, for Lancashire, and for cricket in general, at least there is always next year.

Lancashire have prepared four scenarios, each with different levels of financial pain.

Mike Atherton.

The Times.

Monday, 27 April 2020.

PTG 3101-15341.

“It was the start of the week of March 16 when the phone just stopped ringing. We have people ringing constantly, for tickets, events, conferences, but the phone literally stopped ringing overnight. And when it did ring it was for someone to cancel an event. I’ve never seen anything like it”, said Lancashire chief executive Daniel Gidney.  “It was like tumbleweed in the offices. Our annual budget was £UK4 million ($A7.7m) ebitda [earnings before interest, tax, depreciation and amortization], which would have been a record for the club other than last year, but it disappeared in five days. I’ve never seen anything like that, either”.

Six weeks on from the crisis causing businesses to hit a brick wall, there is still an echo of the shock of those first few days in Gidney’s retelling of it, with his focus on Lancashire, the club he has run as chief executive for the past seven years, and the Old Trafford stadium, which had been rebuilt and redesigned to protect the club’s future by diversifying its revenue streams away from cricket.

It is a cruel irony that the hotel and conference centre that contributed, along with an Ashes Test and World Cup bonanza, to record turnover and profits last year, and that were regarded as a source of the club’s growing financial independence — their greatest strength in other words — should suddenly become their biggest weakness.

Counties are far from a homogenous group and while it was initially thought that this crisis would hit the smaller clubs hardest, it is the bigger counties with debts and big payrolls to service (all Lancashire’s non-cricketing income is serviced in-house through their payroll, as opposed to outsourcing elements such as catering) and no money coming in, who are suffering the most (PTG 3100-15335, 26 April 2020). Smaller counties, with furloughed staffs and fewer overheads, find themselves with fewer headaches.

A couple of 80-hour weeks followed the initial arrival of the crisis, as Gidney and his team put emergency measures in place, securing the safety of the ground and staff before full-scale lockdown on March 23, cutting all costs except for emergency ground preparation (the start of the season hadn’t been abandoned at this stage) and suspending the purchase order system. “With no cash coming in, we turned the taps off”, Gidney said.

These are uncharted waters for county chief executives. “Recessions have a playbook, but with this we were writing it as we went along”, Gidney said. “In recession you have a permanent turnover drop, and you’ve got to make people redundant. But this is different because if I made a lot of people redundant, how are we going to remobilise quickly? It’s an entirely different problem to solve. You’ve got to keep as many people around as you can, but you’ve got to find a way of funding the cash flow".

No matter what the summer brings, though, Gidney is confident Lancashire can weather the storm, and he has modelled four scenarios involving different levels of financial pain, from the most optimistic (and very unlikely), which includes cricket with crowds from July and a conference and events season for the last quarter, to the least optimistic, which involves neither, and would involve significant contingency plans and “emergency triggers that I don’t want to have to pull”.

That relative optimism is a measure of how far the club have come. “If this had happened in 2014 or 2015 we would have gone bust, because we were still in recovery mode. Two things have helped us through: we’ve rebuilt a lot of cash reserves because of a record year in 2019 and secondly, we’d already done a massive Metro Bank refinance, which halved our interest rate”.

“Metro have been fantastic: they phoned us immediately and said, ‘We’ll give you a capital repayment holiday, if you need a short-term working capital facility we’re there for you. You’ve got a sustainable business, and you will be back’. Without the refinancing that we had done, and the cash regeneration through 2019, we would have been in dire, dire trouble”.

Swift action from the government and the England and Wales Cricket Board (EWCB) helped too. “Governing bodies and governments can often be criticised for not moving quickly and being overly bureaucratic and generally those criticisms are fair, but in this situation, the government and the [EWCB] really stepped up. Tom [Harrison, the chief executive] showed leadership, he got it and bringing forward money was what we needed”.

Lancashire are one of two counties — Surrey the other — not to furlough their players and while Gidney is quick not to lecture other clubs, it is a decision with which Lancashire are comfortable. As well as being uncertain of the validity of the financial arguments for furloughing, they also wanted to remain in touch with their players, for mental and physical reasons, and have been using them imaginatively, phoning elderly members and providing community coaching online.

Unlike the vast majority of Professional Cricketers’ Association (PCA) members, who agreed a union-wide reduction of about 17 per cent salary for April and May through a complex calculation of salary sacrifice, pension and prizemoney giveaways, Lancashire’s players negotiated with the club directly. “They wanted to share the same pain as the rest of our staff, which shows you what kind of men they are — utterly fantastic”. A straight reduction of 20 per cent of salary was the result.

Through it all, Gidney has been operating without a permanent chairman, because of the loss to Covid-19 of David Hodgkiss, who was laid to rest last Thursday, and the former chairman’s business acumen has been missed (PTG 3068-15191, 31 March 2020). “He ran a highly successful business and I miss his calmness, ability to see through the fog and, above all, his optimism”. he said. “He’d expect this great club to bounce back”.

The initial shock of lockdown has subsided and now the club are in the desktop planning stages of how to host bio-secure cricket when, once again, having a hotel on site could become an advantage rather than a liability (PTG 3099-15329, 26 April 2020). “We’re looking very, very closely at how we would make that work. How do we create clean entrances? How do we keep as many people on site? Do we bring in containers that have beds and showers that could have staff stay on site for the three-week period?”

“Health has to come first. We’ve got people still dying, the death rates are still high. Health has to come first and I would really struggle with the idea of elite athletes getting tested before frontline personnel, but we’ve got to be ready for when it comes. Sport has a huge role to play in any recovery”.

BBCSport

The England and Wales Cricket Board has received "multiple offers" from other countries to help complete the domestic season.

On Friday the ECB said no cricket would be played in England or Wales before 1 July because of coronavirus.

Surrey chairman Richard Thompson earlier said Abu Dhabi had offered to host matches for the ECB.

"We've had offers as far away as Australia and New Zealand," said ECB chief executive Tom Harrison.

"Those offers are on the table.

"I haven't had anything from Abu Dhabi, but that's not to say the offer hasn't been made."

The domestic season was due to begin on 12 April. After initially being pushed back to 28 May, the latest delay means England's three-Test series against West Indies, due to begin on 4 June, and England women's two Twenty20 internationals against India in late June have been postponed.

In announcing the extension of the shutdown, the ECB said it will try to reschedule all men's and women's international cricket from July to September.

It also said it will create windows for domestic first-class and limited-overs competitions, pushing the T20 Blast as far back into the summer as possible.

Any decision to take matches - either domestic of international - to another country would have to fit into men's winter calendar that already features the T20 World Cup, tours of India and South Africa, and a potentially rescheduled two-Test series in Sri Lanka that was cut short in March.

With regard to matches that could be played in the UK this summer, Harrison said the ECB is becoming "comfortable with the idea there won't be crowds".

While he said it is too early to say exactly how cricket behind closed doors would be played, Harrison said there would be need to be "significant testing", as well as moving international matches to the grounds best suited to the demands of such a scenario.

For example, Old Trafford and Southampton have hotels within the ground, where players and officials could stay on site.

"Inevitably, behind closed doors does change the venue allocation and the mindset," Harrison said.

"It goes from taking the game around the country to give fans a chance to see England in their back yard. That shifts because there's no-one seeing England play live at all.

"Venues that are best suited to providing the right conditions will be in a strong position.

"You can see what other sports are considering: allocating neutral venues for all matches and then playing in those. That's the lens we're putting on this. What's the minimum number of grounds we need for our desired international schedule and how to cater for that."

The ECB is yet to make a decision on the inaugural season of The Hundred, which was due to begin on 17 July. An update is expected after a meeting on Wednesday.

Although Harrison said the game in England faces a "very significant financial problem", he remains committed to launching The Hundred, even if it is not this season.

"I don't think this in any way dilutes the case for The Hundred. It absolutely accelerates it and makes it something cricket needs to get behind," he said.

"If anything, this crisis and the implication long term or medium term, the case for The Hundred is even more important.

"It will generate really important commercial value for the game and it will help broaden the audience."