£4m loss for WRU, but rugby investment is up
ONE less rugby fixture and fewer events at the Principality Stadium saw the Welsh Rugby Union Group post a planned loss of £4.3m.
However, the WRU did re-invest a record £49.6m, up from £42.8m in 2018, across the game in Wales last year according to its Annual Report.
The WRU Group turned over £90.5m during the year ending 30 June 2019.
The home matches staged at the Principality Stadium generated 50% of the group’s overall income.
Match income remained constant at £44.9m, with one less home fixture being offset by higher average ticket prices and increased broadcast income.
Commercial income remained constant at £14.2m but fewer thirdparty events, notably boxing, reduced other sources of income, including hospitality and catering income which was reduced by £4m.
During the year the group brought forward the negotiation of a new Professional Rugby Agreement (PRA) with the four Welsh rugby regions from June 2020, which resulted in greater strategic alignment and significant increased reinvestment into the professional game.
The new PRA required the group to obtain the appropriate banking facilities, and this was achieved through NatWest, who replaced Barclays as the group’s bankers.
The new NatWest facilities continue to provide funding for general working capital requirements and also now include a new facility that is specifically designed to support EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) enhancing projects.
Re-investment in professional Regional rugby rose by £6.5m to £33m (including re-investment in the Dragons, a subsidiary of the WRU), while the semi-professional club and community game received an additional investment of £0.3m on the prior year.
“From a business perspective the year unfolded as expected as our ability to over-perform in YE18 allowed us to increase investment in professional rugby and the community game in YE19 resulting in a planned loss,” said WRU CEO Martyn Phillips.
“Historically the professional game benefitted from contracted and certain income, whilst the community game received what remained following contractual obligations.
“In YE19 we agreed a new approach whereby the community game funding is protected, with the pro game in effect carrying the risk and reward fluctuation in annual investment.
“As a union of clubs this seems entirely appropriate and we are pleased to have gained agreement to this new and innovative way of funding the game in Wales for the foreseeable future.
“We have increased our re-investment into professional rugby as our model of success in the national team is very dependent on four professional teams participating and performing in the relevant club competitions.”
The average attendance per match at Principality Stadium was 66,000 with a total of 393,000 rugby spectators across the Under Armour Series and the Guinness Six Nations championship. In 2018 there were seven home fixtures that saw a total number of spectators of 482,000.
The average ticket income per attended for matches held at the Principality Stadium was up £3 in 2019, to £49 from £46.
“Winning the Guinness Six Nations with a Grand Slam was a fitting tribute to Warren Gatland and his team and I would like to take this opportunity to thank all who leave their posts after RWC for their loyalty, commitment and leadership in propelling Wales to the forefront of the global game under his tenure,” added Mr Phillips.
“It has been a challenging and rewarding year for Welsh rugby, but these are unprecedented times around the world in the sports industry and our professional game has met an inflection point in its evolution.
“The potential for change is very much along the lines of when the game turned professional around 20 years ago and we face important choices about the future of the game in Wales.
“We are working closely and effectively with our Six Nations partners, World Rugby and the SANZAAR nations, and it is critical we collaborate effectively to maximise the opportunity for rugby.”
Looking at the year ahead the stadium will be be hosting the Nitro World Games Wales in May 2020, the first time that the Nitro Circus event has been held outside the USA.
And work will start on the Westgate Hotel & Spa, on Westgate Street, which is expected to open by early 2021.
The new venture for the WRU will look to complement its event business as well as provide a long-term source of revenue.