Irish rugby 'burning' €5million a month to keep show on the road

Irish rugby’s leading official Philip Browne has issued a dire warning that IRFU business is in financial peril due to the ongoing Covid-19 restrictions that see matches taking place behind closed doors with no spectators present. Rugby in Ireland returned last month with the restarted Guinness PRO14 season, a campaign that culminated in last Saturday’s title win by Leinster against Ulster at a deserted Aviva Stadium. 

That emptiness will continue this weekend with Leinster hosting Saracens with no fans present in Dublin and Irish officials are gravely concerned about their bottom line if current pandemic restrictions continue into the winter and force them to play their series of home Test matches in the Guinness Six Nations and the Nations Cup behind closed doors.

Speaking ahead of the likely introduction of further restrictions for the Dublin area due to a recent increase in the number of Covid-19 cases, IRFU CEO Philip Browne presented a grim outlook to an Irish Government committee.

RugbyPass brings you Game Day, the behind the scenes documentary that shows the vibrancy of a packed Aviva Stadium in Dublin

RugbyPass brings you Game Day, the behind the scenes documentary that shows the vibrancy of a packed Aviva Stadium in Dublin

He outlined how Irish Rugby’s net losses in 2020 as a result of Covid-19 are forecasted to amount to in excess of €30m, and the union’s financial situation will deteriorate “at an alarming rate” into 2021 if spectators do not return to stadia in meaningful numbers.

He further warned that despite the implementation of cost-cutting measures across the union, including salary cuts of up to 20 per cent, redundancies and the elimination of all but the most critical overhead costs, the IRFU’s current financial position was not sustainable and would require “significant additional actions” after December if there was no sight of supporters returning at that point.

This Leinster side deserved a flashier denouement to their unbeaten campaign but their dominance of the PRO14 isn't necessarily a negative, argues @heagneyl ???https://t.co/jRnY80TkpY

— RugbyPass (@RugbyPass) September 13, 2020

Browne added that the IRFU will be forced to commence borrowings in January, forecasting that until “we can admit spectators in meaningful numbers into our stadia, and return to some level approaching self-sustainability, the whole rugby infrastructure built over the last 150 years is under threat”.

He said it was anticipated that the IRFU will continue to “burn” at least €5m a month, primarily on professional game wages and costs, if the situation does not improve and warned that “the very existence of professional rugby on the island would be under significant threat in 2021”.

“The adjective ‘unprecedented’ has been overused over the past six months but our experience to date and history will show that if anything, the description of the 2019/20 season as being unprecedented is significantly understated,” said Browne, appearing at the meeting on The Impact of Covid-19 on Team Sport in Ireland alongside representatives from the FAI and GAA.

“Our season, and our business operations, were thrown into chaos by the Covid-19 pandemic in March when our Ireland vs Italy Six Nations fixtures became the first mass gatherings to be cancelled. This represented the first major blow to our sport and finances.

“Pre-Covid our financial situation was looking quite positive. Now we are facing an unprecedented cashflow crisis as we try to work towards the objectives of protecting our national and provincial teams, ensuring that we preserve the amateur club game and support the jobs of our 500 employees to the extent that we can.

“The current projected position to the end of June 2021, showing a negative cash swing of almost €40m from a cash surplus of some €28m in June 2020, to borrowings of just over €10m, backed by union assets, is very serious and is being kept under constant review.

“If these projections were to materialise, the very existence of professional rugby on the island would be under significant threat in 2021. Our audited financial statements for the period to July 31, 2020, will show an actual record financial loss of more than €35m.

“Back in January 2020, we were forecasting for a planned deficit of €3.5. Until we can admit spectators in meaningful numbers into our stadia, and return to some level approaching self-sustainability, the whole rugby infrastructure built over the last 150 years is under threat.

“We will, of course, continue to follow NPHET and public health guidelines in relation to this, but that support comes at a significant cost to our sport. It is our ambition, with the support of Government, to survive as a properly functioning unit and in this way repay the faith shown in us by playing our part in supporting the national recovery effort which will demand so much of us all in the years to come.

“We believe that rugby has a significant role to play in the physical and mental wellbeing of Irish people, and in the face of this cruel pandemic we continue to have a positive contribution to public health and Irish society and hope to do so for years to come.”

We can't wait for the action to unfold! https://t.co/ot0NE8ZlzM

— RugbyPass (@RugbyPass) September 17, 2020