SUPERSTAR GIGS LAND WRU RECORD PROFITS
The Welsh Rugby Union has posted record revenues of £97m, buoyed by a string of headline act concerts from the likes of Ed Sheeran and Beyonce at the Principality Stadium.
Revenues for the WRU Group in the year to the end of June, 2018, which were up £22.1m up from £74.9m in the previous year, were also boosted by staging one more home game in the Six Nations, than previously, with three matches.
Although the cyclical nature of the business means that with only two home games in the Six Nations this season, revenues are forecast to come in below £97m in the current financial year, with a projected loss-making position too.
As a business that is tasked with redistributing money back into all levels of the game in Wales, the improved revenue position meant the union was able to reinvest a record £42.8m, compared to £36.6m a year earlier – although its operational costs were up nearly £19m to £61.9m.
Concerts from the likes of Ed Sheeran (four consecutive nights), Coldplay, the Rolling Stones, Beyonce and Jay-Z, as well as two world heavyweight title fights from Anthony Joshua, resulted in total non-rugby event revenues of £4.8m, up from £2.1m a year earlier.
This in turn helped to produce a strong hospitality and catering income of £18m, which was up £7.1m on the previous year.
The impact of an additional home game in the Six Nations for Wales meant that rugby-related income, including the autumn internationals, was up from £35m to £44.9m.
For the year, the union retained a profit of £2.3m, in part as contingency planning for the expected fall in revenues in the current financial year.
It is the first year that the trading impact of professional rugby region the Dragons – which is now wholly owned by the WRU but operated commercially at arm’s length – has been included in the union’s audited accounts.
This mainly explained (increase of 80) the rise in the union’s head count from 240 to 341, with total staffing costs also up from £10.7m to £16.8m.
Not included as a cost by the union was its funding of Welsh internationals on national dual contracts. During the year Wales squad players received a total of £3.8m.
This was a rise of £1.2m on the previous season due to Wales finishing second in the Six Nations and more paid out in wins bonuses, including for their undefeated summer tour.
The £97m in revenues came from:
■ Match income – £44.9m (£35m 2016-17)
■ Commercial income – £14.2m (£12.8m)
■ Hospitality and catering income – £18m to £10.9m
■ Competition (rugby) income – £11.7m (£9.2m)
■ Other event income – £4.8m (£2.1m)
■ Other income – £3.4m (£4.9,m) The WRU still has £37.6m to repay debentures holders. The union has, though, successfully negotiated with a significant number of holders to extend repayment dates in recent years.
Debentures were issued as a means of helping to finance the cost of the Principality Stadium, as well as the old National Stadium. In return, holders are guaranteed the offer of rugby international tickets at face value, in dedicated seats.
The next big repayment of debentures is due in 2024 at just under £10m.
At year end, the WRU had a £6.2m bank debt position on its facility with Barclays, of which £16.5m was undrawn.
WRU chief executive Martyn Phillips, whose total remuneration for the year was £336,000, said: “Our latest set of positive financial results are an endorsement of our strategy and testament to the high level of commitment and hard work of everyone involved in Welsh rugby.
“We have guarded against a boom and bust scenario by putting money aside to cover for a projected loss next year, whilst continuing to improve reinvestment through the game at all levels.
“The nature of our business means that our revenues fluctuate to quite a significant extent year on year.
“However, our ambition is always to maintain, if not grow, our investment into all levels of the rugby, hence our objective is to allocate modest and welcome increases each year. We know that rugby responds best to affordable, sustainable and reliable increases.”
On investment into the game, Mr Phillips said: “Our investments in clubs and communities safeguard the long-term future of the game. Our investments in professional rugby are made with an ambition to drive success on the pitch, which in turns drives our revenues.
“Both are interdependent and so, to a degree, any investment is an investment in all forms of the game.”
On non-rugby-related income at the Principality Stadium, Mr Phillips said: “We have had a record year for non-rugby event revenues and will continue to drive this side of our business, with new event formats being explored.”
During the year, across seven rugby internationals, there was a total of 482,000 spectators, compared to 377,000 in the previous year, when there were six internationals.
The average attendance was 69,000 per match, compared to 63,000 a year earlier.
The average ticket price was £46, compared to £45 a year earlier.
On the outlook, the Fishguardborn chief executive said: “We know that our income will decrease next year (2019-20), with a narrower window for concerts due to World Cup warm-up fixtures and a number of other factors, but we have of course planned for this eventuality.”