Bosses at Sheffield Arena say the opening of a rival venue in Leeds has not taken the financial toll on them they expected.
Sheffield International Venues, which oversees the running of the Motorpoint Arena, in Attercliffe, said profits have dropped by £400,000 as a result of the First Direct Arena opening last year.
However, it is less than a Sheffield Council study forecast – it predicted a profit drop of between £980,000 and £1.8 million.
Steve Brailey, SIV chief executive,said: “It was always going to be difficult to assess the impact of the recently-launched Leeds Arena. However, we have performed far better than expected.
“We had to deal with an issue whereby neither Sheffield Council nor anyone else could reliably estimate what the financial impact would be.”
Bosses at the Motorpoint Arena countered the opening of Leeds Arena with a £3.5m upgrade of the building, including new seating.
Parking is also due to be extended on to the nearby Don Valley Bowl.
Paul Billington, the council’s director of culture, said: “The council is working closely with Sheffield City Trust and Live Nation to ensure the Arena continues to deliver a great programme of events for the city.
“The recent investment to improve the venue’s facilities is proving to be a further boost to the Arena and we’re confident it will continue to generate a major profit for the city.”