2023-12-11 21:23:53
Meeting at the start of the week, the Paris 2024 Board of Directors adopted the multi-year budget of the Organizing Committee (COJO) following a fourth budgetary revision showing relative stability at less than 230 opening days of the Games.
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Un year later having presented a budget increasing by 400 million eurosthe organizers of Paris 2024 were expected to be around the corner, as the home stretch of preparations began this summer and the threshold of 200 days remaining before the Opening Ceremony approached.
Also, this Monday, December 11, 2023, the Paris 2024 Board of Directors approved a multi-year budget revised to balance at 4.397 billion euros, i.e. a controlled increase of 17 million euros over one year, in other words, an evolution of less than 0.4%.
The increase in expenses noted this year is partly explained by the development of the sites, but also the energy supply of the latter, these two aspects having been reviewed and corrected to the tune of 63.5 million euros for the first and 17 million euros for the second.
Without any real surprise, the forecasts surrounding the artistic component linked to the Opening Ceremony of the Games have been increased by 20 million euros.
It must be said that past projections were certainly counting on an underestimate of expenses, especially if we take into account the logistical characteristics concerning more specifically two of the four Ceremonies which will be held in an urban environment and not in the heart of a stadium as at ‘accustomed, with the opening of the Olympic Games on the Seine et the opening of the Paralympic Games on Place de la Concorde (8th arrondissement of Paris).
The framing of the Ceremonies will also be one of the key points to monitor in the strategy for maintaining a balanced budget for the 2024 Games.
On the revenue side, Paris 2024 might only appreciate the success of Olympic Games ticketing, which now records more than 7.5 million tickets soldas well as the encouraging beginnings of ticketing for the Paralympic Gameswithout however the slightest sales figure having been mentioned to date.
In the months to come, as the Games approach, the opening of new stores and the sale of new licensed derivative products will constitute a guarantee of visibility and an additional opportunity to increase the OCOG’s revenues, as was explained to the Executive Commission of the International Olympic Committee (IOC) recently meeting in Pariseven if the level of merchandising does not represent – far from it – the essential part of the revenue hoped for by the organizers.
Above all, the COJO was able to garner new partnerships throughout 2023the most spectacular illustration being the long-awaited arrival of LVMH as a Partner Premium Games in midsummer.
The objective of 1.2 billion euros sponsoring should also soon be exceeded, knowing that Paris 2024 was still 66% of the said objective at the end of 2021, then around 90% at the dawn of 2023.
In any case, the control of expenses is today a legitimate reason for satisfaction for the COJO which worked last year and once more this year on a battery of cost adjustments, while ensuring not to suffer from full force of the repercussions of economic inflation which had heavily impacted the previous revision by contributing 196 million to the overall additional cost of the budget presented in December 2022.
However, to ensure this control, the organizers of the 2024 Games have still agreed to furnish part of the contingency reserve.
Thus, during the year 2023 or during the budget review carried out since September, the COJO drew 154 million euros from the said reserve, including 60 million in order to compensate for the effects of inflation.
For the next nine months, however, the organizers intend to maintain a reserve level described as protective.
While the Court of Auditors had recently mentioned the need for a minimum floor of 100 million euros, Paris 2024 has decided to preserve 121 million euros, i.e. a fine margin of safety, especially when the we know that the last months before the Games are decisive and, in factpotentially risky on a budgetary level.
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