Finally, some good news for the embattled Australian Rugby Union, which is set to announce a modest profit of $3.749 million, something that neither the AFL nor the NRL was able to do last year.
That is probably about as far as the ARU would like to push that comparison, however. The AFL generated a massive $517m and its loss of $17.8m, only its second *deficit in 16 years, came as a result of the purchase of Etihad Stadium and the need to fund the new *national women’s competition. The NRL, too, registered a loss, a more modest $2.6m, but after generating revenue of $351m.
The ARU’s numbers to be announced at the annual general meeting in Sydney next Monday — a copy of which were leaked to The Australian — show that the code’s revenue for 2016 was $128.5m, up from $84.8m the year before, though the rise was almost identical to the dramatic increase in broadcast rights.
The scale of the revenue figures, however, show how intense the fight has become for rugby, both in the domestic marketplace and abroad, where it has to face the likes of New Zealand and, arguably of more concern, England.
The Rugby football Union has always had more player numbers than any of its international rivals but these days it is harnessing them to a formidable financial model. Last year England rugby still made a profit of $6.41m despite exceeding its own strategic plans by investing $147m in rugby development, $46m more than it had budgeted for. Imagine what they might have invested had they got out of their World Cup pool round.
It’s not a straight apples-with-apples comparison, but the ARU’s investment in community rugby last year was only $4.2m, and even that was an increase of $1.9m on the previous year, although this needs to be also taken in conjunction with the $5.596m allocated to member unions and affiliates. Still, it is light years short of what England is paying to develop the game.
One wonders, indeed, how long Australia can keep defying gravity by bobbing along at No 3 in the world rankings, which has basically been its average during the 21 years of professional rugby. Still, that has been the enduring quality of Australian rugby. Over the years it has built the equivalent of the Empire State Building on a virtual suburban block.
As a result of the new broadcast deal, revenue from this source jumped by a dramatic 238 per cent, from $18.1m to $61.38m. But at the same time the ARU’s distribution to Super Rugby franchises jumped from $19.1m to $33.33m, while Super Rugby team costs rose from $4.17m to $8.08m.
The breakdown of the distributions to the various franchises is intriguing, with Queensland and NSW each receiving $5.95m and the Brumbies $5.775m. The Western Force received $7.357m, which included the $3.7m paid to the Western Australia Rugby Union for the effective sale of the Force to the ARU in August last year. The biggest share, however, $8.3m, went to the Melbourne Rebels, though $2.6m of this was special funding relating the external private equity sale.
Match day revenue increased from $16m to $31.7m, with the three-Test England tour accounting for much of that, although there was a corresponding drop in World Rugby grants from the $18m in 2015 — to compensate for the loss of inbound Tests due to the World Cup — to only $676,000 last year.
The warning, however, is that Australia is currently in the “mellow” years of the four-yearly cycle from World Cup to World Cup.
The next Cup year, 2019, will see the budget shrink dramatically as inbound Tests are cancelled. And that pretty much clarifies what will happen to the $3.749m profit. It will be basically be put away for a rainy day.
http://www.theaustralian.com.au/spor...c48a30e8d8ac49
