BusinessPeople In BusinessProfile: Andrew Gambrell, FD of the English National Opera

Profile: Andrew Gambrell, FD of the English National Opera

The finance director of the English National Opera is less opera novice more aficionado and, as our reporter learns, fusing art with finance makes crunching the numbers that much more rewarding

Andrew Gambrell, FD of the English National Opera

Andrew Gambrell, FD of the English National Opera

Andrew Gambrell never intended that his career should read like a soap opera
script, but the world of commercial entertainment has invariably followed him
from his role as tax adviser at Ernst & Young to his tenure with the
English National Opera, where
he’s served at the finance helm for the past 12 months.

Gambrell qualified with Winters, a small City-based accountancy firm where he
originally trained as an auditor. He then broke into the top six, working for a
firm that now bears the name Ernst & Young.

Having taken on famed record producer Pete Waterman ­ then revelling in the
success of Kylie Minogue and Jason Donovan ­ as a client, Gambrell soon
recognised how he could blend his love of accountancy and entertainment,
encompassing art, film, classical music and opera.

‘Not feeling terribly creative myself ­ I certainly can’t sing or play a
musical instrument, or act ­ accountancy was one way of getting a foothold in
those creative industries and making a contribution to them,’ he says.

Change of script

Gambrell’s appointment to ENO did not represent his foray into the opera
world; it came after a term with the Welsh National Opera.

But as one of the two most prestigious opera companies in the UK, ENO is
symbolic of far greater pressure for a finance director both in terms of size
and turnover, something Gambrell was conscious of when making the move.

He had anticipated a tougher financial proposition, particularly given ENO’s
turbulent history with the books and within the ranks of senior management. In
2003, the then finance director Caroline Felton left the role after only nine
months. Back then, the company was being marred by a series of strikes and
walkouts backstage.

According to Gambrell, that period of hostility has almost certainly ended,
with a company-wide restructure two years ago serving to restore stability to
the once beleaguered opera house.

‘[The restructure] resulted in a sense of commitment for the company and
stability both artistically and in the quality of performances we do but also in
the financial stability of the company. It helped enormously in the way we
operate now… I’d like to think it was down to me [laughs],’ he jokes.

In restructuring, the company was in effect, he says, able to preempt the
recession that was soon to follow, and there are currently no plans for further
restructuring or redundancies.

The effect of the restructuring has begun filtering through to the company’s
financial results, and it is on target to achieve forecasts for the current
season. ‘It largely reflects the reviews and the quality of the productions.

You can always compare opera numbers on previous seasons.

‘If your target is too high, it will cause financial problems down the line,
and if you’re too pessimistic we might actually reduce our capacity by target
setting,’ he says.

ENO’s gross box office figure is £10m, with the average income per
performance approximately £75,000. The company sets performance targets at 130
per production season. It also forecasts £2.75m from sponsorship and development

Top ticket prices at ENO are about £80, with the lower rank tickets available
for between £20 and £25. Tickets for ‘Jenufa’, a recent Czech production
undertaken by ENO, sold for an unprecedented sum of £5, leading many to question
how the opera house can justify such a price.

For Gambrell, the figures need to balance out across the entire production
season and not be defined by any one opera. He concedes it’s a balancing act,
but one the company has managed to fine-tune based on the spread of productions
and the innate desire for the opera house to reach the masses.

‘We try to maximise the revenue from the repertoire of productions we have
within an audience development and accessibility agenda. Of course we want to
maximise revenue from our ticket sales but we also have a wider public remit to
make opera accessible to everyone, especially to those who otherwise wouldn’t be
able to come. It gives everyone the chance to experience live opera.

‘“Jenufa” was a difficult opera to sell because it doesn’t have the profile
of the likes of “Carmen” or “The Magic Flute” or “La Boheme” or “Madam
Butterfly”. We have to achieve a balance throughout the entire season. I’m not
going to be concerned if one opera isn’t doing as well with ticket sales ­ I’m
concerned about the season as a whole. Having said that, you couldn’t get a £5
ticket to “Carmen”,’ he says.

Numbers reflecting art

Ultimately, he says, budgeting and end-of-season results will be a direct
reflection on artistic decisions made, namely by artistic director John Berry.
The artistic and financial strategies complement each other and ‘they’re
constantly updating one another’.

Integral to Gambrell’s role is ensuring the artistic director and chief
executive understand the financial implications of the productions undertaken in
any one season. Berry, he says, facilitates this process by understanding what
the implications of certain operas are likely to be, and because Gambrell is
less engaged in the structure of the performance season, he can then identify
other opportunities which could impact the company’s bottom line.

Currently, one of those opportunities is sponsorship, and with ENO’s six-year
contract with Sky expiring in July, Gambrell is on the hunt for a new sponsor.
Sponsors, he says, not only benefit in terms of marketing and brand awareness,
but also allow the opera house to lower ticket prices at the box office.

West End theatre and opera houses have – more so than in other streams of
arts and entertainment ­ fared better throughout the economic downturn. While
locals have arguably reined in on expenses that could be deemed unnecessary, the
tourist trade has meant companies such as ENO have been assured a steady flow of
ticket sales.

He concedes the earlier stages of the downturn had had an effect on sales,
but he remains ‘cautiously optimistic’ that box office and sponsorship targets
will be met for the final part of the season. The new 2009/10 season kicks off
in September.

Two years ago, the company also sold a property in Stepney that helped to
create a level of financial reserve. It also owns its headquarters and opera
house, the London Coliseum, and has acquired an additional building in
Hampstead, which is used as a production and costume-making facility.

‘We’re in quite a good position financially. Making sales targets reflects
the reviews our productions have had, the quality of productions and word of
mouth. We haven’t had to rely on significant corporate income for next year. My
job is to make sure there’s no financial drama and everything is kept onstage,’
he says.

In anticipation of the new season starting, Gambrell is intent on
consolidating ENOs long-term plans and ensuring the finance function of the
business adds value to the creative output.

‘Finance is not the be all and end all…working somewhere like ENO, we’re here
to help the business achieve its aims, and that’s fundamentally driven by what’s
happening on stage,’ he says.

Behind the scenes…

  • The financial position of the ENO: ‘It could always be better, but given the
    current environment it’s a tremendous success and shows how well regarded the
    ENO is. Even though sponsorship and development targets are lower than box
    office sales, it affects the work we are able do. Small changes in revenue can
    have a remarkable effect on what happens on stage.’
  • Royal Opera: ‘I don’t see the Royal Opera as a competitor – we’re two very
    different organisations doing very different jobs. We’re very distinctive – the
    types of productions we do are very different to the Royal Opera. For example,
    over the next three months we’ve got an opera by an Iranian film director and a
    revival of the late film director Anthony Minghella’s production of “Madam
    Butterfly” as a tribute to him. The collaborations we do give us a distinct
    style on stage… [artistically] our productions will stand up against the Royal
    Opera. [A propos repertoire] we should be doing different work.’
  • His favourite opera: ‘I like them all for very different reasons, but
    probably the ones that surprise me, or maybe haven’t seen before. ”Jenufa” was
    one of the most dramatic nights I have spent in an opera house, because I didn’t
    know what was going to happen. The new stuff may not be as good as the stuff I’m
    used to, but [depending on the show] it might be better. There’s a limit to how
    much we see – even so, we’re completely spoilt. There are times when seeing an
    opera is a chore, but it doesn’t happen very often.’
  • How he influences ENO: ‘I’m trying to extend the planning cycle. The
    artistic plans stretching out to 2012/13 and getting the financial plans and
    artistic plans together, and ensuring everyone understands how it all fits
    together. Everyone makes individual decisions that have cost implications
    throughout the organisation. I need to communicate strategy to everyone so
    additional costs don’t get forgotten and all opportunities are taken.’
  • Finance in the arts being taken seriously: ‘It’s good to see this role in
    the arts being taken seriously. Finance is taken very seriously by the ENO board
    and senior management, right down to the way we control our budgets. They are
    really concerned with how much we spend and how much money we get in and that
    was what was so nice to see from a financial perspective. Over the past 10
    years, the industry has grown up in its attitude to finance and is much more
    responsible now compared with how it used to be.’

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