Vancouver’s Olympic coffers flush with cash

Vancouver Olympic organizers said on Monday that the economic downturn no longer poses a major threat to the 2010 Winter Games.

At the same time, they expect to use all of their contingency revenue, as well as a promised contribution from the International Olympic Committee, to avoid going into deficit after the games.

Vancouver’s Olympic organizing committee, VANOC, released its annual financial report for the year ended July 31, 2009, showing it made $591 million and spent $379 million.

Major spending is still to come as organizers pay for printing, services and other last-minute items for the games.

Final agreements have not been signed on how much VANOC will compensate the owners of the two major mountain venues for lost revenue. Weather or other unforeseen problems could also wreak havoc with plans and drain operational contingency funds.

“It’s what lies ahead not what’s behind us that is the most important,” John McLaughlin, VANOC’s chief financial officer, said in a conference call with reporters.

Just over six months ago, organizers had been mulling cuts in everything from staffing to transportation to printing costs in order to stay in line with their $1.64 billion operating budget. Revenue projections were taking a hit as sales of VIP packages and billboard advertising space stalled.

But now only $5.6 million in unsold ad space remains, and the committee believes the VIP packages will sell out.

“With the budget we have, and as of today … we are not looking at significant changes to anything we’re doing that a major stakeholder group would notice,” said Dave Cobb, VANOC’s deputy chief executive officer.

However, organizers are still looking at borrowing more money to see them through the next few months.

“Current projections indicate that additional short-term financing will be required, which management is confident will be achieved through negotiation with (the committee’s) lenders,” VANOC said in its year-end financial statements.

VANOC says it is also working on plans to get those who owe them money to pay up a little faster.

Several of VANOC’s major sponsors have faced serious financial difficulties in the last year – among them General Motors and Nortel – but none has defaulted on any payments and aren’t expected to.

“Our concern is less than it was six months or a year ago,” Cobb said. “Frankly, I’d be quite surprised if this close to the games, if one of our partners did default.”