Sydney Mardi Gras reports $1.2m deficit. Here’s everything you need to know

The organisation behind the Sydney Gay and Lesbian Mardi Gras festival has reported a $1.24 million deficit for the financial year ending June, a stark contrast to its $176,253 surplus in the previous year.

The release of the not-for-profit charity’s financial results comes after a tumultuous year marked by unforeseen disruptions and rising operational costs – and despite a $1.1 million rescue package delivered to it by the NSW government and the City of Sydney earlier this year to help keep it afloat.

Among some of the impacts to its finances were the cancellation of Fair Day, resulting in a $652,893 loss; a $1 million loss from the Bondi Beach Party, a $1.6 million loss from the Mardi Gras parade; a $305,000 loss from the official Mardi Gras after-party; and about 1000 fewer members this financial year compared to 2023.

In its annual report, sent to members shortly after 5pm on Friday, Mardi Gras said that its deficit exceeded the originally approved and budgeted amount of $164,761, attributing the shortfall to “unprecedented turbulent events that impacted the festival”.

Mardi Gras said it anticipated 2024 would be a challenging year, following the “huge” success of the 2023 Sydney WorldPride and Mardi Gras festival and the pressure to meet heightened community expectations, but acknowledged it had not foreseen challenges “to this extent.”

The charity reported a record total revenue of $12.35 million, marking an increase from $10.68 million in 2023. Ticket sales played a significant role, generating $4.1 million, which surpassed budget expectations by $764,688.

However, the cancellation of the flagship Fair Day event, due to asbestos contamination, significantly impacted revenue streams, including donations, sponsorships, and sales of goods. The cancellation led to sunk costs and disrupted promotional activities for other events, it said.

Additionally, the tragic deaths of community members Jesse Baird and Luke Davies during the festival added a sombre tone to the celebrations, Mardi Gras said, further complicating its efforts to recover financially.

The annual report also highlighted increasing cost-of-living pressures and the challenges faced by many established festivals and events, including difficulty selling tickets, attracting talent, and managing rising costs, which have forced many other festivals to close their doors.

The post-COVID impact on the events industry was “palpable”, the charity’s report added, with Mardi Gras absorbing another increase in production costs of 20 to 40 per cent.

“The 2024 Festival was set to the backdrop of some turbulent times, with the tragic publicised death of two community members and the unexpected, forced cancellation of Fair Day – all during a time when it has never been more difficult or expensive to operate within the arts and live events industry,” Mardi Gras co-chairs Brandon Bear and Melanie Schwerdt said in their co-chair’s report.

“In the face of these challenges, we adapted and made changes to mitigate these risks, enabling a Festival that truly lived up to and exceeded our expectations.”

These are some of the key takeouts from the Mardi Gras annual report:

• The cancellation of Fair Day resulted in a $652,893 loss and triggered “activation of community connections” to make savings of $780,343 across all of 2024’s budgeted events.
• The Bondi Beach Party cost $2.44 million to put on but only recorded $1.4 million in revenue, resulting in a $1 million deficit. As reported by GSN earlier this year, police estimated just 5825 people attended despite the event having the capacity for 15,000.
• The official Mardi Gras after-party cost $1.79 million but only recorded $1.49 million in revenue, resulting in an almost $305,000 loss.
• The Mardi Gras parade cost $2.4 million and collected $848,970 in revenue, which included $684,448 from people who paid for “parade viewing” spots. Mardi Gras said the overall deficit of the parade was more than the prior year’s by $605,387 and that this was “reflective of the extra compliance costs for the event”.
• The financial outcome of the parade was a deficit of $1.6 million (a 60 per cent increase) compared to a deficit of $1 million in 2023 and $782,288 in 2022.
• The report highlighted that the ABC TV broadcast of the 2024 parade reached 1.86 million viewers according to media analytics company OzTam, ranking it as the No. 1 program of the evening.
• Mardi Gras membership dropped from 4845 to 3761, reducing membership fee revenue from $209,627 to $142,024.
• The total costs incurred in providing compensation and benefits to its employees was $1.74 million, slightly down on the $1.9 million spent last financial year.
• As of the end of the financial year, the charity had $268,071 in cash and cash equivalents available.
• Mardi Gras said Darlinghurst had a 20 per cent uplift in foot traffic on the festival’s weekends, including a 76 per cent jump in interstate visitors.
• Sydney’s Oxford Street precinct had the biggest foot traffic gains, up 38 per cent across the entire festival and up 74 per cent in the evenings.

Despite the year’s setbacks, Mardi Gras noted that while larger events “struggled in the economic environment”, smaller events outperformed expectations in ticket sales.

Laneway returned a profit ($75,057), as did the Paradiso pool party ($34,895); Kaftana pool party ($26,003); Sissy Ball ($8776); and Ultra Violet ($2168). The Hot Trans Summer boat party recorded a $394 loss.

Sponsorship income for the financial year totalled $3.58 million, falling $464,577 short of budget expectations. Mardi Gras attributed the shortfall to a slowing economy, the cancellation of Fair Day, which reduced sponsorship benefits, and the “less than expected outcome” of a three-year sponsorship revenue-sharing deal coming to an end with Sydney WorldPride.

Returning Mardi Gras to financial sustainability, increasing its reserves “to ensure long-term sustainability”, and reviewing and re-visioning the organisation to meet the needs of its members and the community were listed in the annual report as some of the charity’s short-term objectives.

To achieve these, the report said one of its adopted strategies was “rigorous financial planning, monitoring, risk mitigation and cost control”.

Editor’s note: This article was written by Ben Grubb, who pays an annual $50 Mardi Gras membership for its discounts, including at retail outlets and bars. He does not use his membership’s voting rights.