Blues face crippling £6,000,000 black hole
CARDIFF Blues are in danger of losing up to £6m amid fears of Welsh rugby being stuck behind closed doors for the next six months.
The capital region has been forced to confront the looming ‘doomsday scenario’ of Covid-19 preventing spectators from attending any matches before next season’s Six Nations, scheduled to start in February.
The Rugby Paper understands that the consequent losses have been calculated within the Arms Park boardroom at between £4m and £6m.
The crippling cost of the pandemic will affect every club in England and France. What makes the immediate future particularly bleak in Wales is that the four regional teams have also been warned that, in the worst of all worlds, their annual funding from the Welsh Rugby Union could shrivel from £26m to £3m.
That the Blues don’t have a ground to play on, with or without spectators, makes their predicament all the more hazardous.
The Arms Park is in the front line of the fight against coronavirus, having been commandeered in a supporting role to the Dragons Heart field hospital at the Principality Stadium next door.
The initial contract ends on July 31 but those running one of Britain’s most famous clubs expect that arrangement to be renewed until the end of October as part of the contingency plan in case of a ‘second spike’.
“Losses on this sort of scale really do highlight how hard rugby is being hit,’’ a leading figure in the club game told The Rugby
Paper yesterday. “(WRU chairman) Gareth Davies used one word to describe it: ‘Calamitous’.
“Some would go further and describe the effects on the country as a whole as a disaster. In one month alone we’re told there’s been a 20 per cent fall in GDP. Unheard of…”
The projected losses come from three sources – gate revenue, broadcasting and hospitality. Before the pandemic, the Blues had been on target to break even over a season which brought them the first tranche of their portion of the £117m paid by CVC for their share in the PRO14. At worst, they would lose £250,000. Now it could be 24 times as much.
Their fans have not seen them play at home since beating Treviso four months ago. They still have eight matches to be played, four at home, against Zebre, Ospreys, Southern Kings and Connacht.
Rugby fans may have been flocking back in their tens of thousands in New
Zealand this weekend but such a prospect is a long way off from happening in Wales. Even if they play Test matches this autumn behind closed doors, the absence of spectators will cost the WRU £50m according to chief executive Martyn Phillips.
Davies claims that the postponement of the Scotland match, called off at short notice on Friday March 13 cost Wales £10m. Their plight may be about to get a whole lot worse, even if the fixture goes ahead as planned on October 31 with the other matches postponed from mid-March, France-Ireland in Paris and Italy-England in Rome.
No spectators will leave the WRU no option but to refund ticket money amounting to around £5m. They had also sold some 40,000 tickets for the ‘Judgement Day’ regional double-header before its inevitable postponement.
The Welsh Government has given ample warning that it will not be rushed into allowing ‘mass gatherings’. First Minister Mark Drakeford said: “Whatever happens elsewhere and however loud the demands, we will stick to the path we have chosen.’’