Broadcasting and title sponsorship deals played a major role in fourth edition
HBL Pakistan Super League (PSL) franchises are set to make profit for the first time in four seasons of the event.
The franchises that will earn profit include HBL PSL4 winners Quetta Gladiators, along with two-time champions Islamabad United and 2017 champions Peshawar Zalmi.
However, the two most expensive franchises, Lahore Qalandars and Multan Sultans, are almost confirmed to record financial loss yet again.
Sponsorship deals can still save Karachi Kings from incurring loss this season.
The primary reason behind the profit will be the new broadcasting and title sponsorship deals penned by the Pakistan Cricket Board (PCB), which can generate income of $2.2 million in the central pool that will be distributed among the franchises.
PCB signed a three-year broadcasting deal worth $36 million, while they sold the title sponsorship for $14.3 million for the same period.
PCB also earned a good amount from gate money as eight matches of the PSL were held in Pakistan this season. The income from gate money can increase the amount in the central pool to $2.5 million.
Franchises are also set to earn handsome amount of income from sponsorships and sale of merchandise.
If we look at the figures from 2017, Gladiators paid $1.1 million in franchises fees to PCB, while they earned PKR 105,617,444 from central pool and PKR 95,647,001 from sponsorships. Despite earning an aggregate sum of PKR 201,764,445, Gladiators incurred a loss of PKR 63,518,476 due to heavy expenses.
However, the increase in the amount of central pool and title sponsorship along with the $500,000 winning bonus is likely to result in a profit for Gladiators this season.
On the other hand, Qalandars and Sultans paid a much higher amount in franchise fees to PCB which is likely to keep them in financial loss for another season. Qalandars also spent heavily on their player development program which further increases their expenses.
According to the PSL contract, 80 percent of the income from broadcasting rights is distributed among the franchises, while the remaining is kept by PCB. The income from sponsorships and gate money is divided in half between the franchises and the PCB.
The more expensive franchises suffer from this financial model, which is the reason why the previous management of Sultans pulled out of the PSL.