As we all know, the wallet of the Chinese Super League is very tight now. What about the CBA? Not so good. The finals are in full swing, and the two listed clubs of the CBA have released their annual reports according to regulations, and the result is that whether it is Nanjing Tongxi, who has won only two games a year, or Guangzhou Dragon lions, which have been able to occupy a place in the playoffs, the losses are more than 10 million: Nanjing is close to 25 million yuan, Guangzhou is 16 million.
Revenue analysis
Dividends are the big head, and funding is important
For any public company, operating income is obviously the most interesting project. As can be seen from the statement, Nanjing has more than 30 million operating income, and Guangzhou has more than 70 million.
However, a careful analysis of its income composition shows that the source of income of the CBA club is quite single: dividends from the CBA account for a large part, of which more than 30 million of Nanjing's operating income, almost two-thirds of which are dividends, reaching 22.85 million; and Guangzhou, although the results are far better than Nanjing, but the dividend is also about the same grade of 25.27 million.
In addition to dividends, government funding cannot be ignored. Nanjing Tongxi's annual report pointed out that last year, the club received about 5 million yuan in government funding, but this year it did not receive a single point. Guangzhou is in a slightly better situation, last year got more than 12 million, this year's results improved into the playoffs, and the government funding received also rose to nearly 21 million yuan. It is conceivable that if Guangzhou is on par with Nanjing, the loss of Guangzhou Dragon and Lions can instantly surpass Nanjing Tongxi; and if on the contrary, Nanjing Tongxi will turn a profit - of course, this is completely impossible, and it is unfair to get as much rewards as the eighth place in the regular season.
Interestingly, Nanjing Tongxi also has a non-operating income, amounting to 1.73 million yuan, "mainly due to the receipt of a salary cap adjustment fee of 1,733,505.31 yuan in this period, that is, a fine for the offending team, which is rewarded to the team that does not violate the law." This salary cap adjustment fee is actually a reward and punishment measure implemented by the CBA in recent years, which imposes a "luxury tax" on the teams whose total salary exceeds the standard, and then distributes it to the team that has not exceeded the standard. From the annual report, it can be seen that the total salary of Nanjing Tongxi has reached 42.17 million yuan, and it is only more than one million yuan away from the salary cap - does it seem to be well-run? Unfortunately, Nanjing Tongxi only won two games in the whole year...
Tournament system influence
Box office advertising plummeted
The numerical fluctuations in the above revenues are either stable alliance dividends, or government funding based on achievements, or they can be regarded as regular fluctuations. What really affects the financial statements of the two teams, especially the Guangzhou Dragon and Lion, is the advertising and box office revenue.
Guangzhou Dragon & Lion has always been an outstanding representative of the CBA's break-even, and has been slightly profitable for many years. But this season, the CBA has played closed-end games, and the home box office revenue has all been lost, and this figure was nine million in 2018.
And in 2018, the advertising revenue reached a staggering 60 million. The annual report for the year did not specify whether it included 15 million in government funding, but even if it was included, commercial advertising revenue reached 45 million. The 2021 annual report also did not specify in detail how much advertising revenue there was, and from the list of major customers, the naming fee dropped from 27 million yuan in the previous year to 18 million. The annual report said that the total advertising revenue fell by 65.82% year-on-year.
Nanjing is also bleak, with a box office revenue of 60,000 yuan that is 90% lower than that of the previous year – in fact, it is very surprising that there are 60,000 yuan at the box office, and Guangzhou is directly zero. But because the team gave the parent company a platform for the real estate project, the advertising revenue was twice as much as last year - unfortunately, the original foundation was too thin, and the triple was only more than six million, just making the loss figure look better, and did not break through the 30 million mark.
Obviously, the CBA and the Chinese Super League are essentially the same thing, mainly living on commercial sponsorship and government funding, and the ticket revenue, although meager, is not without small supplements. The only difference is that the CBA relies on a unified and powerful business operation, and can get a billion yuan of sponsorship in 2018, maintaining a stable and substantial league dividend, which can make the wallets of the teams more generous. Of course, the CBA's player salaries are also far cheaper than those of the Chinese Super League, so although the CBA's small days now look difficult, they are not as devastated as the Chinese Super League.
Text/Hubei Daily reporter Guo Xiaoming
Photo/ Weibo, Xinhua News Agency