Glouces­ter fears over fu­ture

Club may go out of busi­ness

The Daily Telegraph - Business - - Sport - By Gavin Mairs CHIEF RUGBY COR­RE­SPON­DENT

Glouces­ter have laid bare the ex­tent of the fi­nan­cial cri­sis grip­ping English pro­fes­sional rugby, warn­ing that the 147-year old club will go out of busi­ness within six months with­out a govern­ment bail-out.

Lance Bradley, Glouces­ter’s chief ex­ec­u­tive, has re­vealed to The Daily

Tele­graph the full de­tails of the fi­nan­cial woes, fore­cast­ing that the club will run out of cash be­fore March fol­low­ing a pre­dicted loss of rev­enue of £6.2mil­lion due to the re­stric­tions im­posed by the Covid-19 pan­demic.

The dra­matic rev­e­la­tions come on another bleak day for the sport, with

Peter Tom, the Le­ices­ter Tigers chair­man, de­scrib­ing the new re­stric­tions on crowds as a “dis­as­ter” that “threat­ens the fu­ture of the Premier­ship”.

Worces­ter co-own­ers Colin Goldring and Ja­son Whit­ting­ham, mean­while, warned that play­ing matches be­hind closed doors for another six months was not “sus­tain­able for this club nor for the Premier­ship as a whole”.

The chief ex­ec­u­tives of all the Premier­ship clubs will hold an emer­gency con­fer­ence call to­day to dis­cuss “the fi­nan­cial Ar­maged­don” fac­ing them, but Premier­ship Rugby al­ready fears that this week’s de­ci­sion by the Govern­ment to ex­tend the ban on sup­port­ers at sta­di­ums un­til the end of March will lead to com­bined losses of rev­enue of £120 mil­lion.

The Rugby Foot­ball Union has fore­cast losses of £138mil­lion if no sup­port­ers can at­tend Eng­land matches at Twick­en­ham dur­ing the au­tumn se­ries and Six Na­tions Cham­pi­onship, and a fur­ther loss of £86 mil­lion for the com­mu­nity game. The sit­u­a­tion is even bleaker for the Cham­pi­onship clubs, who can­not af­ford to start their sea­son if sup­port­ers are not al­lowed in. Club own­ers are to hold a key meet­ing to­day, with sources in­di­cat­ing their en­tire sea­son may have to be “moth­balled” – which could leave rel­e­gated Sara­cens stuck in English rugby’s sec­ond tier for two years.

Bill Sweeney, the RFU chief ex­ec­u­tive, and his Premier­ship Rugby coun­ter­part Dar­ren Childs, met with Oliver Dow­den, the Cul­ture Sec­re­tary, on Tues­day to make the case for govern­ment fi­nan­cial sup­port, and Bradley in­sists pro­fes­sional rugby in Eng­land can­not sur­vive with­out a bail-out.

“I don’t know if the Govern­ment un­der­stands how se­ri­ous this is,” Bradley said. “We have just been through our num­bers this morn­ing and the im­pact of no fans for six months is a loss of £6.2 mil­lion.

“The fi­nance peo­ple have done the cash-flow fore­cast and we will run out of money in the next six months. We will not be able to sur­vive with no fans un­til

March, un­less there is an in­ter­ven­tion. And we are by no means the worst. There are prob­a­bly half a dozen clubs in more dif­fi­cult po­si­tions than us and they will go out of busi­ness, too.

“This is the end of the road for pro­fes­sional rugby in this coun­try if there is no in­ter­ven­tion.”

Anal­y­sis of Glouces­ter’s fi­nan­cial peril re­veals fore­casts that the club will lose £7.4mil­lion in rev­enue over the next six months, off­set by £1.2mil­lion of re­duced costs. The club have just spent £35,000 on mea­sures to en­able up to 8,000 sup­port­ers to at­tend matches while re­main­ing so­cially dis­tanced, fol­low­ing a suc­cess­ful pi­lot in which 1,000 fans at­tended their match against Har­lequins this month.

Dur­ing the first lock­down, the club fur­loughed all but seven em­ploy­ees, made up of 150 full-time staff and 200 ca­su­als, while six were made re­dun­dant. All staff, in­clud­ing the play­ers, took a pay cut of 25 per cent, but the club still lost £5mil­lion.

“When we went into the lock­down, we had cash re­serves of £3mil­lion,” added Bradley. “That was all burnt. We had to take loans and the share­hold­ers had to put in a sub­stan­tial amount as well.

“As a busi­ness, rugby was quite frag­ile be­fore all this and what is so frus­trat­ing is that even with the dif­fi­cul­ties that we have had, we were on course to start gen­er­at­ing cash next year. But we can’t sur­vive a blow of £6.2 mil­lion.

“If Glouces­ter Rugby was to dis­ap­pear, all the work that we do in the com­mu­nity would also dis­ap­pear. The Govern­ment can’t let pro­fes­sional sport die in this coun­try – and I don’t be­lieve they will.”

The im­me­di­ate con­cern is the fu­ture for the play­ers and Bradley ad­mit­ted he could not rule out the pos­si­bil­ity of fur­ther salary cuts and a player ex­o­dus, if govern­ment help was not forth­com­ing.

“We could be in a po­si­tion where we have to say to play­ers that we are go­ing to go out of busi­ness un­less we can agree some­thing,” he said.

“Clearly, we don’t want to do that be­cause we have al­ready cut salaries by 25 per cent. Tech­ni­cally, we would be in breach of con­tract again. If other coun­tries sup­port their sport or they are in a bet­ter po­si­tion than we are, there will be another drain of top tal­ent go­ing to the likes of France or Ja­pan.”

Crunch time: Lance Bradley says Glouces­ter will go un­der un­less there is fi­nan­cial help to re­place the ab­sence of crowds (above)

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