South Africa

The South African government’s art company that lost R71 million in 5 years

Daily Investor • 25 February 2025

The Playhouse Company, a wholly owned entity of the Department of Sport, Arts and Culture, has recorded losses of R71 million over the last five years.

The Playhouse Company describes itself as a “meeting place for people who love the performing arts, especially residents of eThekwini and KwaZulu-Natal”.

At its core, it is a theatre in Durban that promises the best artistic, cultural, and educational performances.

In addition to live performances and shows, The Playhouse Company offers venue hire, a recording studio, and an arts department.

The government promulgated The Playhouse Company as a cultural institution under the Cultural Institutions Act.

Its primary mandate is to develop and promote performing arts works that are representative of the diverse South African artistic and cultural heritage.

The Playhouse Company has an artistic programme that focuses primarily on promoting arts education and arts development initiatives.

It presents artistic works in dance, drama and music and collaborates with external productions and events.

It must promote South Africa’s arts and culture to local and international tourists and offer underprivileged communities an opportunity to visit the theatre.

It is also tasked with creating job opportunities for participating artists, promoting theatre as a place of wonder, and fostering intercultural awareness and tolerance.

The Playhouse Company hosts various festivals throughout the year, including the Community Arts Festival, the New Stages Festival, and the South African Women’s Arts Festival.

The Playhouse Company has developed several partnerships with international bodies, including the South African Sports Confederation and Olympic Committee.

A partnership with the Department of International Relations and Cooperation saw The Playhouse Company commissioned to produce a series of productions.

The Playhouse Company regularly collaborates and partners with theatre producers throughout the year.

Some of these productions received nominations and awards, and some have toured to other national theatres and festivals.

Dismal financial performance

The Playhouse Company highlighted that it had achieved a record six consecutive unqualified audit results.

Although this is commendable, what stood out about the company is that it ran a deficit for five consecutive years. In the private sector, a deficit is known as a loss.

In the 2019/20 financial year, The Playhouse Company recorded a loss of R13 million, followed by losses of R16 million, R10 million, and R8 million.

The Playhouse Company recorded a loss of R23 million in the last financial year, its highest in half a decade.

The deficit for the 2024 & 2023 year considers depreciation and the recognition of the capital grant income, revenue from non-exchange transactions, taxes, and transfers.

The company’s expenses increased from R82 million in the 2021 financial year to R114 million three years later, which has taken its toll on the company.

The consistent losses have eaten into The Playhouse Company’s cash and cash equivalents, which declined from R70 million to R49 million over the year.

Despite this dismal financial performance, The Playhouse Company achieved 100% of its annual performance targets.

This shows that generating a profit, or surplus as it is known for government institutions, is not a performance target.