Ahead of Motorsport Australia’s annual Member Forum on Tuesday 30 April at 7.30pm AEST, Motorsport Australia has released its audited financial results for 2023.

Motorsport Australia, which operates to a calendar financial year (January – December) has confirmed an EBITDA deficit of $517,792 in 2023 as inflation and rising insurance costs made for challenging operating conditions.

While the Motorsport Australia balance sheet and cash reserves remain strong, the sport cannot continue indefinitely to absorb rising costs.

A major factor was sustained and continuing increasing cost of insurance, which increased by 36 per cent year-on-year (a $730,000 increase).  The net result in 2023 was a $1,060,928 deficit (2022: $288,492).

The increasing costs of doing business, such as travel and supplier increases – which no business has been immune to in the past 12 months - have also impacted the sport, as competitors and promoters and other participants have experienced similarly.

Key points to note:

• Motorsport Australia’s balance sheet is strong, with a net asset position of more than $10million
• Head office costs reduced by 15 per cent
• Consultant and professional fees were reduced by 67 per cent
• Employee costs were below CPI – held at 3.6 per cent
• Insurance costs increased 36 per cent year-on-year
• Travel and events costs increased 18 per cent year-on-year

The audited 2023 financials can be viewed here.

Motorsport Australia President Andrew Fraser said the result underscored the need for the sport to take further steps to ensure its sustainability, following on from the decision to increase licence costs by 15 per cent from 1 October last year.

“Business and households are facing the pressure of rising costs, and we are not immune,” Fraser said.

“We are working to hold costs down where we can, but ultimately this result is not sustainable if repeated into the future. In recent years, we have done our best to absorb much of the inflationary pressures on the sport to date, but we cannot continue to do this and must ensure our sport remains in a strong financial position.

“We have a new CEO, along with other new leaders, who have a clear mandate to deliver organisational sustainability for the longer-term future of the sport.

“Tonight’s member forum will provide members with the opportunity to hear more from the leadership of our sport, as we present our 2023 financial statements, as well as addressing our future strategic direction. I encourage everyone to attend if they are available to do so. We will also be taking questions from members through the Q&A function on the night.”

Motorsport Australia CEO Sunil Vohra said the financial rigour and discipline was a key early focus in his tenure.

“We know that results such as this are not sustainable for the sport on an ongoing basis and the bottom line is: we need to significantly improve our bottom line,” Vohra said.

“I can confirm we have put in place new reporting structures and increased financial oversight as we progress through 2024.

“There are a number of working groups and other initiatives already in place to ensure we improve our financial position and reduce our expenses further wherever possible, while also looking at new revenue opportunities. Discussions are also underway with our insurers to determine how we can address the significant increases in our premiums and what more can be done to reduce our costs. 

“Rising insurance costs are an issue for us, for other motorsport bodies and for sport generally.  All options need to be on the table to address this trend.

“As members would be aware, the cost of licences was increased by 15 per cent late last year. This was directly related to the increasing insurance costs we are facing.”

Motorsport Australia members are welcome to attend tonight’s annual online Member Forum for more information and to ask any questions of the President or CEO. Registrations are required to attend the online forum, which can be completed here.

For those unable to attend, a full replay of the 2024 Member Forum will be made available on Wednesday, 1 May via the Motorsport Australia website.