IRB announces strong financial results

IRB announces strong financial results

21 MAY 2007, irb.com

The International Rugby Board (IRB) has announced strong financial results for the year ending 31 December 2006. The results from the third year in a four-year financial cycle leading up to Rugby World Cup 2007 in France, reflect the IRB’s continued commitment to major investment in the Game on a global scale.

The results were approved by the IRB Council at its Annual Meeting held in Dublin on May 3 and indicate that total revenues for the period were £53 million. The figure is approximately 20% better than budget for this period. The vast majority of revenue generated continues to be in respect of Rugby World Cup 2007, which is already guaranteed to set a record for gross revenue for a Rugby World Cup. Total expenditures for the year of £32 million were in line with budget for the period and are analysed below.

RWC 2007

“Rugby World Cup 2007 in France promises to be a huge commercial success. Broadcasting deals for the Tournament have already been completed in the major territories such as France, the United Kingdom, South Africa, New Zealand and Australia, representing a substantial increase on Rugby World Cup 2003. We are also pleased to have completed significantly enhanced broadcast deals in the emerging Rugby markets of Russia, India, USA and Romania and there has also been significant growth in the corporate travel and hospitality and official suppliership markets,” said IRB Head of Finance Robert Brophy.

“All six worldwide partner packages were completed last year and each of the partners; EDF, Visa, SNCF, Societe Generale, Peugeot and GMF will add greatly to the profile and success of the Rugby World Cup.

Worldwide Development of the Game

“The IRB is committed to major development of the Game worldwide. This commitment resulted in an extra £30 million being invested in the game at Tier 1 and Tier 2 Union levels as part of the unprecedented, three-year Global Strategic Investment Programme that was launched in August 2005. This also includes significant investment for targeted Tier 3 Unions of up to £1.3 million.”

“This massive injection of funds is primarily targeted at strategic high performance programmes, including Union management, playing infrastructure and new Tournament structures. This sum supplements the existing Union Development grants of £6.3 million and Tournament grants of £5.4 million that the IRB already invests annually in its 115 Member Unions and means that £65.1 million will have been distributed by the IRB for the global development of the Game in the three years to December 2008,” added Brophy.

This investment has also resulted in the implementation of exciting new cross-border competitions across the globe, including the IRB Pacific Rugby Cup, IRB Pacific Nations Cup, IRB North America 4 and IRB Nations Cup in Europe as well as enhanced funding for the Churchill Cup and various regional Tournaments in Europe, Asia, Africa and South America. In addition, the IRB has also provided significant funding and additional key human resources for all Tier 2 Nations.

International Financial Reporting Standards

The IRB operates International Financial Reporting Standards in line with global best practice. The major financial implication is that all revenue and directly attributable expenditure for Rugby World Cup 2007 is now deferred to the year of the Tournament. Under the IRB’s previous accounting policy, revenue was booked in the year it was invoiced and revenues were accumulated incrementally for each Rugby World Cup over the four-year cycle.

“The policy of recognising income only in the year of the Rugby World Cup is in line with best practice and better reflects the nature of our business. It has had the impact of changing the net book surplus for the 2006 year of £21 million to a loss of £28 million with a corresponding increase in deferred revenue. However, this does not impact on the IRB’s cash flow or operations in any way and we are looking forward to a successful Rugby World Cup year in 2007,” added Mr Brophy.

CLICK HERE TO READ THE IRB FINANCIAL RESULTS IN FULL>>

http://www.irb.com/NR/rdonlyres/16D3...ts31122006.pdf

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