England regain power on the pitch but suffer £30.9 million pound loss off it
Eddie Jones may have put England’s Chariot back on track for next year’s World Cup in Japan after an impressive November series, but his Rugby Football Union bosses have suffered a £30.9m loss and deny they are “moving money around” to try and hide the deficit.
The biggest and most financially powerful Union in the World has made 54 redundancies and had to deal with an overspend of around £40m to finish Twickenham’s East Stand. However, despite taking a massive financial hit, the RFU today made it clear Jones’s World Cup budget is ring fenced and insisted they were not hiding the loss by claiming a one off cash injection of £31.6m meant they effectively broke even .
The £31.6m comes from a restructuring of money from selling the Twickenham Experience Limited hospitality business to Compass and that money has gone into the RFU reserve fund. Steve Brown, the outgoing RFU chief executive, confirmed that under the deal it would have to be bought back in 2028.
He said: “We are absolutely not just moving money around. The asset (Twickenham Experience Ltd ) has become worth significantly more and that new value generates an income. That large liability will have to be paid back, but the business in 2028 will be worth substantially more.
“Let’s get this straight; the £30.9 loss is mirrored by the £31.6m input which is in a different part of the accounts and we are effectively at break even and it would be wrong to be report the loss in isolation”
Brown is quitting at the end of the year forcing the RFU to hastily find someone new he insists he is not jumping ship due to the Union’s accounts which reveal revenue for the last financial year of £172.4m with investment in the sport at all levels of £107m. The profit after tax was £83.3m and the RFU has increased its borrowing facility to £100m.
Brown said: “I am leaving for my own reasons and I don’t think the ship could be in better shape after the last seven or eight years. The World will always change and we are in the best position to move with change. It is a great time for someone to take over and move this to the next level. We are in a sound and solid position and the £25m we have in our reserves is sufficient for World Cup year to ride the loss without any November tests and there will be another financial report before then and we will make a profit next year and add to the reserves.
“We need to plan more prudently, given the recent rise in our fixed cost base, driven largely by the Professional Game Agreement (PGA) and Elite Playing Squad (EPS) fees, which were negotiated when our revenue outlook was more optimistic, and by stadium depreciation.”
Sue Day the Chief Financial officer of the RFU revealed: “Rugby investment for the year totalled £107.7m and was split between professional rugby at £70.7m and rugby development at £37.0m. The RFU has enjoyed unprecedented revenue growth over the last eight years or so, which has enabled record levels of investment in rugby. However, looking to the future we know now that the financial outlook will be tougher. There will be less money to spend both on running the business and on investing in rugby.”
“As a result, rugby investment is likely to come down from the over £100m averaged over the past three years to around £95m per year, still a very substantial sum, but one we need to adjust to in 2019/20 and beyond.
“During the period under review we reduced overheads by £1.1m, with a further focus on efficiency in June 2018 leading to a consultation process with our staff as part of the 2018/19 business planning process. As a result, 62 roles were made redundant across the organisation although, with the creation of some new roles as part of the process, 54 people actually left the RFU. While this was not an easy decision to make, it was however necessary to ensure the financial stability of the Union going forward in more challenging times.”
Comments on RugbyPass
I’m guessing Carl Hayman would have preferred to have stayed in NZ with benefit of hindsight. Up north there is the expectation to play twice as many games with far less ‘player management’ protocols that Paul is now criticising. Less playing through concussions means longer, healthier, careers. Carter used as the eg here by Paul, his sabbatical allowed him to play until age 37. OK its not an exact science but there is far more expectations on players who sign for Top 14 or Engl Prem clubs to get value for the huge salaries. NZR get alot wrong but keeping their best players in NZ rugby is not one of them. SA clubs are virtually devoid of their top players now, no thanks. They cant threaten the big teams in the Champions Cup, the squads have little depth. Cant see Canes/Chiefs struggling. Super has been great this year, fantastic high skill matches. Drua a fantastic addition and Jaguares will add another quality team eventually. Aus teams performing strongly and no doubt will benefit with the incentive of a Lions tour and a home RWC. Let Jordie enjoy his time with Leinster, it will allow the opportunity for another player to emerge at Canes in his absence.
4 Go to commentsLove that man, his way to despise angry little men is so funny ! 😂
4 Go to comments“South African franchises would be powerhouses if we had all our overseas based players back in situ. We would have the same unbeatable aura the Toulouses, Leinsters or Saracens of this world have had over the last decade or so.” Proof that Jake white does not understand the economics of the game in SA. Players earning abroad are not going to simply come back and represent the bulls. But they might if they have a springbok contract.
22 Go to commentsA lot of fans just joined in for the fun of it! We all admire O'Gara and what he has done for La Rochelle
4 Go to commentsThe RFU will find a way to mess this up as usual. My bet is there will be no promotion into the the Premiership, only relegation into National League One. Hopefully they won’t parachute failed clubs into the league at the expense of clubs who have battled for promotion.
7 Go to commentsWell that’s the contracts for RG and Jordie bought and paid for. Now, what are the chances we can persuade Antoine to hop over with all the extra dosh we’ll have from living at the Aviva & Croke next season…??? 🤑🤑🤑
13 Go to commentsWow, that’s incredible. Great for rugby.
13 Go to commentsYou probably read that parling is going to coach the wallaby lineout but if not before now you have.
14 Go to commentsIf someone like Leo Cullen was in O’Gara’s place I don’t hear Boo-ing. It’s not just that La Rochelle has hurt Leinster and O’Gara is their Irish boss. It’s the needle that he brings and the pantomime activity before the game around pretending that Munster were supporting LaRochelle just because O’Gara is from Cork. That’s dividing Irish provinces just to get an advantage for his French Team. He can F*ck right off with that. BOOOOO! (but not while someone is lying injured)
4 Go to commentsDid the highlanders party too hard before the game? They were the pits.
1 Go to commentsWhat a player! Not long until he’s in the England side, surely?
2 Go to commentsHe seems to have the same aura as Marcus Smith - by which I mean he’s consistently judged as if he’s several years younger than he actually is. Mngomezulu has played 24 times for the Stormers. When Pollard was his age he had played 24 times for South Africa! He has more time to develop, but he has also had time to do some developing already, and he hasn’t demonstrated nearly as much talent in that time as one would expect. If he is a generational talent, then it must be a pretty poor generation.
6 Go to commentsThe greatest Springbok coach of all time is entirely on the money. Rassie and Jacques have given the south african public a great few years, but the success of the springbok selection policy will need to be judged in light of what comes next. The poor condition that the provincial system is currently in doesn’t bode well for the next few years of international rugby, and the insane 2026 schedule that the Boks have lined up could also really harm both provincial and international consistency.
22 Go to commentsJake White is a brilliant coach and a master in the press. This is another masterclass in media relations and PR but its also a very narrow view with arguments that dont always hold water. White wants his team to win, he wants the best players in SA and wants his team competitive. You however have to face up to the reality of a poor exchange rate and big clubs with big budgets. SA Rugby cant compete and unless it can find more money SA players will keep leaving regardless of Springbok eligibility and this happened in 2015 - 2017. Also rugby is not cricket. Cricket has 3 formats and T20 cricket is where the money is at. When it comes to club vs country the IPL is king but that wont happen because the international calendar does not clash with the club calendar in rugby. So the argument about rugby going down the same path as cricket is really a non-starter
22 Go to commentsNZ rugby seem not to have learnt anything from professional rugby. Super rugby was dying and SA left before they died with the competition. SA rugby did a u turn on their approach to international players playing overseas and such players are now selected for Bok teams. As much as each country would love to retain their players playing in local competitions, this is the way the world is evolving my friends. Move with it or stay 20 years behind the times. One more thing. NZ rugby hierarchy think they are the big cheese. Take a more humble approach guys. You do not seem to have your players best interests at heart.
4 Go to commentsBeaches? In Cardiff? Where?
1 Go to commentsHe is right , the Crusaders will be a threat. Scott Barrett, ( particularly), Fergus Burke , Codie Taylor, ( from sabbatical) etc due back soon for the Crusaders. There are others like Zach Gallagher too. People can right the Crusaders off, Top 8 , here we come !!
1 Go to commentsWe will always struggle for money to match the other sides but the least the WRU can do is invest properly in Welsh rugby. Too much has been squandered on vanity projects like the hotel and roof walk amongst others which will never see a massive return. Hanging the 4 pro sides out to dry over the last decade is now coming back to bite the WRU financially as well as on the pitch. You reap what you sow.
1 Go to commentsWhat do you get if you cross a doctor with a fish? A plastic sturgeon
14 Go to commentsWhat happened to feleti Kaitu’u? Hasnt played in a while right?
1 Go to comments