Praise be to Allah, Lord of the Worlds, and may His peace and blessings be upon our Prophet Mohammad and upon all his family and companions.
If an outside party and not the participants themselves donate the prizes, then it is permissible for the winners to take them. However, if they were from the money paid by the participants or part of it, then that is forbidden, because it is gambling.
In principle, competitions that are based on the possibility of material loss or profit are a sort of forbidden gambling, which is prohibited by texts from the Quran and the Sunnah. Scholars have also considered it amongst the
major sins, as reflected in the following verse, "O ye who believe! Strong drink and games of chance and idols and divining arrows are only an infamy of Satan’s handiwork. Leave it aside in order that ye may succeed. Satan seeketh only to cast among you enmity and hatred by means of strong drink and games of chance, and to turn you from remembrance of Allah and from (His) worship. Will ye then have done?"{Al-Mai`dah, 90-91}. And Allah knows best.