RFU profits hit by reduced fixture list
November 18, 2010
RFU chief executive John Steele insists rugby and not profit is at the heart of everything his organisation is doing © Getty Images
The Rugby Football Union (RFU) has reported a loss for the last financial year - citing a reduction in the amount of England matches played at Twickenham as the main reason.
Turnover decreased £7.2m, from £119.2m to £112m, while the RFU as a whole posted a £1.1m deficit for the year - compared to a retained profit of £6.2m for 2008-09 - but finance director Nick Eastwood insisted the fall was largely expected and claimed English rugby's governing body remained in a strong financial position.
"Although down on a strong 2008-09, the past year was in line with expectations," he said in a statement. "Total revenue was £112m, down £7.2m from £119.2m in 2008-9 but this was mainly due to having three instead of four Investec Internationals and two instead of three Six Nations home games, which meant a £7.9m decrease in ticket income, from £29.2m to £21.3m.
"Despite the Twickenham match schedule and the economic environment, we delivered a strong financial performance, thanks largely to the RFU's cost reduction programme agreed early in 2009 to respond to the challenges posed by the global recession."
Operating profit shrunk by £6m, from £31.8m to £25.8m, but net worth increased by £11.7m to £162.4m and grassroots rugby benefitted from a £22.8m investment during the course of the year - a fact hammered home by chief executive John Steele.
"The strong financial performance of the past year in a period of economic downturn has seen the strength of the RFU's balance sheet continue to grow and net worth increase," he said. "We have had a strong year of trading from all of our businesses and for the full year show revenues of £112m, the highest ever with the equivalent match programme.
"At the same time it is crucial to note that the RFU's core purpose is not to make profits but to invest in growing and developing the game at all levels so over that cycle we are not looking to maximise shareholder return but ensure we are building the rugby infrastructure for the future.
"This has seen £22.8m invested in clubs facilities over the year across all levels of the game, with the RFU helping to improve pitches, clubhouses and changing rooms, floodlighting, disability access, ground maintenance equipment, heating systems, kitchens and the like.
"Our investment in the professional game has been some £25m in total. We invested £11.5m in the Elite Rugby Department, which covers all England teams and their management, Elite Coaching, Refereeing and Sports Science and Medicine.
"There was also funding of £10m for the Premiership Rugby clubs, which includes fees and bonuses paid to England senior and Saxons players, and £2.3m invested in the RFU Championship, with £800,000 going to clubs in the Anglo-Welsh Cup.
"We must be mindful that economic challenges lie ahead and that we must invest wisely. The RFU has one goal as the governing body of rugby union in England and that is to support and develop the game at all levels across the country. This means putting rugby at the heart of everything we do and ensuring that we not only drive our revenues as a business but consider carefully how we invest to maximise the benefits to the game."
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