New Zealand Rugby reveal the massive financial hit due to coronavirus
New Zealand Rugby has announced a $7.4 million loss for 2019 and laid bare the financial challenges facing all involved in the sport.
While the $7.4m loss represents a 37 per cent improvement on budget, NZR financial officer Nicki Nicol warned of the significant impacts Covid-19 will bring.
“At New Zealand Rugby we are forecasting up to a 70 per cent decline in revenue and we’ve had to quickly adjust our cost base accordingly,” Nicol said at Thursday’s annual general meeting.
“We know this has had an impact across all areas of our game; our players, teams, competitions, programmes and partnerships with provincial unions, Super clubs and others across the industry.
“It has also had a significant impact on our people and I acknowledge the New Zealand Rugby staff. They have been so professional as we’ve navigated all aspects of these uncertain times.”
NZR also announced an “unrealised loss” of $3.9 million from the original $19.4m investment on the five per cent shares it acquired in the new broadcast deal with Sky Television.
Sky’s share price dropped from 89 to 71 cents since November 1.
As part of the agreement, NZR must hold these shares for a minimum two-year period.
The positive news for NZR is the healthy state of its cash reserves which, at December 31, registered $93 million, excluding $21 million invested in managed funds.
“This strong cash position at year end and robust application of our reserves policy has allowed some much-needed respite to support the organisation associated with the shocks of Covid-19,” Nicol said.
“This has been beneficial in a year when there has been a massive shock to our revenue and we have had to respond by quickly reducing costs across all of rugby. Everyone is playing their part.
“We must now consider a total reset as we look to rebuild the sport in a financially sustainable way.
“The year in review does feel a little academic now, though, as we stand and assess the impact of Covid-19 on both New Zealand Rugby and rugby in New Zealand.”
NZR announced $187 million in revenue for 2019, one per cent down on the previous year but a 40 per cent growth on the previous Rugby World Cup year in 2015.
Broadcasting revenue declined 20 per cent and match day revenue dropped 40 per cent as a result of shorted international programmes in a World Cup year.
This was offset by $20m in compensation from World Rugby as part of the tier one union funding model for the truncated Rugby Championship.
NZR also made $9m foreign exchange gains and announced seven per cent growth in sponsorship and licensing which contributed to 39 per cent of overall revenue.
In 2019 NZ Rugby invested $195m into rugby in New Zealand. International and domestic competitions, the players and teams, accounted for the largest share at just over three-quarters of that expenditure.
Nicol concluded by acknowledging the stress the global pandemic is having on all areas of rugby – from provincial unions to Super Rugby clubs and the grassroots game.
“We note the significant financial impact Covid-19 on your own organisations and wish to thank you for the spirit in which and partnership approach as we work to put rugby ahead of self-interest in these challenging times.
“As we look ahead with some hopeful anticipation in the second half of 2020 we also recognise the recovery and growth of rugby in New Zealand will be different.
“Change is inevitable and the rebuild will create and opportunity for us all to co-design a rugby system that is more sustainable and captures some of the insights from the Review of Rugby held earlier this year.
“We need to rebuild financial resilience and this will ensure we can all be part of the long term success of rugby in New Zealand.”
For 2019, NZR gave itself a mark of 73.5 out of 100 for the year. The low score was attributed to 20 marks missed for failing to reach the Rugby World Cup final.
Steve Hansen is (probably quite rightly) never going to let this one go. #allblacks #lionsrugbyhttps://t.co/oXwHosp3U0
— RugbyPass (@RugbyPass) April 30, 2020
NZR has, meanwhile, made three changes to its board.
Vastly experienced senior executive Jennifer Kerr and Left Field Live sports agency chief executive Bart Campbell were confirmed, while Pango Productions founder and East Coast rugby president Bailey Mackey was promoted. Former All Blacks captain Ian Kirkpatrick was also elected as patron.
Kerr becomes the second woman to be appointed to the NZR board, joining Dr Farah Palmer at the top table. Her presence still leaves rugby short of the government target of satisfying a minimum of 40 percent of each gender on National Sports Organisation boards.
NZR chairman Brent Impey said the new board were guiding NZR into uncharted waters in the wake of Covid-19 but stressed there was also a rare opportunity to rebuild and reshape rugby.
“We face significant challenges, but many are not new with continued demand for our players overseas, the need to stay relevant to young people and adapt to fast moving technologies,” Impey said.
“We now have an opportunity to take stock and I am confident that if the dedicated and passionate people involved in rugby commit to working together in 2020 and beyond, we have the ability to ensure our sport thrives into the future.”
Comments on RugbyPass
It was a pleasure to watch those guys playing with such confidence. That trio can all be infuriating for different reasons and I can see why Jones might have decided against them. No way to justify leaving Ikitau out though. Jorgensen and him were both scheduled to return at the same time. Only one of them plays for Randwick and has a dad who is great mates with the national coach though.
53 Go to commentsBrayden Iose and Peter Lakai are very exciting Super Rugby players but are too short and too light to ever be a Test 8 vs South Africa, France, Ireland, and England, Lakai could potentially be a Test player at 7 if he is allowed to focus on 7 for Hurricanes.
5 Go to commentsPencils “Thomas du Toit” into possible 2027 Bok squad.
1 Go to commentsDon’t see why Harrison makes the bench. Jones can play at 10 if needed, and there is a good case for starting her there to begin with if testing combinations. That would leave room for Sing on the bench
1 Go to commentsWhat a load of old bull!
1 Go to commentsOf the rugby I’ve born witness to in my lifetime - 1990 to date - I recognize great players throughout those years. But I have no doubt the game and the players are on average better today. So I doubt going back further is going to prove me wrong. The technical components of the game, set pieces, scrums, kicks, kicks at goal. And in general tactics employed are far more efficient, accurate and polished. Professional athletes that have invested countless hours on being accurate. There is one nation though that may be fairly competitive in any era - and that for me is the all blacks. And New Zealand players in general. NZ produces startling athletes who have fantastic ball skills. And then the odd phenomenon like Brooke. Lomu. Mcaw. Carter. Better than comparing players and teams across eras - I’ve often had this thought - that it would be very interesting to have a version of the game that is closer to its original form. What would the game look like today if the rules were rolled back. Not rules that promote safety obviously - but rules like: - a try being worth 1 point and conversion 2 points. Hence the term “try”. Earning a try at goals. Would we see more attacking play? - no lifting in the lineouts. - rucks and break down laws in general. They looked like wrestling matches in bygone eras. I wonder what a game applying 1995 rules would look like with modern players. It may be a daft exercise, but it would make for an interesting spectacle celebrating “purer” forms of the game that roll back the rules dramatically by a few versions. Would we come to learn that some of the rules/combinations of the rules we see today have actually made the game less attractive? I’d love to see an exhibition match like that.
29 Go to commentsIrish Rugby CEO be texting Andy Farrell “Andy, i found our next Kiwi Irishman”
5 Go to commentsI certainly don’t miss drinking beers at 8am in the morning watching rugby games being played in NZ.
1 Go to commentsThis looks like a damage limitation exercise for Wales, keeping back some of their more effective players for the last 20/25 minutes to try and counter England’s fresh legs so the Red Roses don’t rack up a big score.
1 Go to commentsVery unlikely the Bulls will beat Leinster in Dublin. It would be different in Pretoria.
1 Go to commentsI think it is a dangerous path to go down to ban a player for the same period that a player they injured takes to recover. Players would be afraid to tackle anyone. I once tackled my best friend at school in a practice match and sprained his ankle. I paid for it by having to play fly-half instead of full-back for the rest of that season’s fixtures.
5 Go to commentsJust such a genuine good bloke…and probably the best all round player in his generation. Good guys do come first sometimes and he handled the W.Cup loss with great attitude.
2 Go to commentsWord in France is that he’s on the radar of a few Top14 clubs.
5 Go to commentsGet blocking Travis, this guy has styles and he’s gonna make a swift impact…!
1 Go to commentsWhat remorse? She claimed that her dangerous tackle wasn’t worthy of a red! She should be compensating the injured player for loss of earnings at the minimum. Her ban should include the recovery time of the injured player as well as the paltry 3 match ban.
5 Go to commentsArdie is a legend. Finished and klaar. Two things: “Yeah, yeah, I have had a few conversations with Razor just around feedback on my game and what I am doing well, what I need to improve on or work-ons. It’s kind of been minimal, mate, but it’s all that I need over here in terms of how to be better, how to get better and what I am doing well.” I hope he’s downplaying it - and that it’s not that “minimal”. The amount of communication and behind the scenes preparation the Bok coaches put into players - Rassie and co would be all over Ardie and being clear on what is expected of him. This stands out for me as something teams should really be looking at in terms of the boks success from a coaching point of view. And was surprised by the comment - “minimal”. In terms of the “debate” around Ireland and South Africa. Nice one Ardie. Indeed. There’s no debate.
2 Go to commentsThere’s a bit of depth there but realistically Australian players have a long way to go to now catch up. The game is moving on fast and Australia are falling behind. Australian sides still don’t priories the breakdown like they should, it’s a non-negotiable if you want to compete on the international stage. That goes for forwards and backs. The Australian team could have a back row that could make a difference but the problem is they don’t have a tight five that can do the business. Tupou is limited in defence, overweight and unfit and the locks are a long way from international standard. Frost is soft and Salakai-Loto is too small so that means they need a Valentini at 8 who has to do the hard graft so limits the effectiveness of the backrow. Schmidt really needs to get a hard working, tough tight 5 if he wants to get this team firing.
3 Go to commentsSorry Morgan you must have been the “go to for a quote” ex player this week. Its rnd 6 and there is plenty of time to cement a starting 15 and finishing 8 so I have no such concerns.
2 Go to commentsGreat read. I wish you had done this article on the ROAR.
2 Go to commentsThe current AB coaching team is basically the Crusaders so it smacks of wanting their familiar leaders around. This is not a good look for the future of the ABs or the younger players in Super working their way up the player ladder. Razor is touted as innovative, forward looking but his early moves look like insecurity and insular, provincial thinking. He is the AB's coach not the Golden Oldies.
10 Go to comments