'Deliberate investment': NZR reports multi-million dollar loss
NEWS: New Zealand Rugby has reported a financial loss of over NZ$47 million in 2022.
NZR’s annual report, presented at its annual meeting in Wellington on Thursday, showed a net deficit of NZ$47,461,000.
NZ’s situation is vastly different from their Trans-Tasman neighbours Rugby Australia, who posted an A$8.2 million profit for 2022.
However, NZR Chief financial officer Jo Perez revealed it was deliberate spending which prioritized the Super Rugby and the women’s rugby.
Perez said NZR’s commercial revenue, largely through broadcast and global sponsorships, reached a record high of NZ$271 million in 2022, up 43 percent from NZ$189 million in 2021.
#NEWS: From ‘cusp of catastrophe’ to surplus @RugbyAU‘s financial state https://t.co/9DTP2hhdGl
— rugby365.com (@rugby365com) April 26, 2023
The financial report stated that operating expenses of NZ$277 million increased mainly due to more activity in 2022 coming out of a reduced schedule in 2021 due to Covid. NZ$21 million was spent on women and girls’ specifically, excluding the Rugby World Cup, with increased investment in the Black Ferns and Super Rugby Aupiki’s inaugural year.
“When you combine NZ$37 million of stakeholder payments injected into the game, with more than $10m of one-off costs associated with completing the equity partnership transaction and Covid-related costs to keep the game going early in 2022, the operating result would be near breakeven for 2022,” Perez said.
“As a national sports organisation, our role is to invest earnings back into the game, and to do that with good stewardship and a clear strategy. This includes ensuring a strong capital position to navigate future challenges.
“When we consider our cash reserves have grown from NZ$65 million in 2021 to NZ$95 million, the success of the Black Ferns and the growth of women’s rugby, as well as the record levels of support from our global partners, we feel we are in a strong position to move forward and take the opportunities ahead.
“We are fortunate to have like-minded and supportive partners, who understand the wider value of sport, and who also appreciate the aspirational and inspirational pursuit of high-performance success on a global stage through our Teams in Black.”
It was also announced that teh record revenue of NZ$271 million and the first tranche of funding from the Silver Lake transaction allowed NZR to pay NZ$37 million to its stakeholders and build more than $90m in cash reserves despite the ongoing COVID costs and inflationary pressure through 2022.
NZR Chief Executive Mark Robinson said it was pleasing to emerge from a turbulent period globally with a strong balance sheet and healthy reserves.
Robinson remains adamant that the future looks bright.
“The challenges of recent years should not be underestimated but the NZR Board remained committed to investing in our game. The Silver Lake transaction allowed us to inject nearly NZ$40 million into our community clubs, Provincial Unions, Super Rugby clubs, our Players pool, Associate members and Māori Rugby, while also increasing our investment in women’s rugby,” Robinson said.
“The 2021 Rugby World Cup, played in 2022 was a priority area for NZR, alongside the establishment of Sky Super Rugby Aupiki, and we have seen a continuation of that strategy in recent weeks with $21m committed to the first year of our 10-year women and girls’ strategy.
“It was pleasing to see a return of uninterrupted rugby after so much disruption with fans in the stands and competitions able to be played in full and it has been encouraging to come through a three-year period with 40 percent growth in our commercial revenue and with the establishment of New Zealand Rugby Commercial over the past six months we are well placed to see new revenue streams opening up for rugby, and with fan engagement initiatives in the pipeline, the future looks bright.”
Meanwhile, Catherine Savage and Stu Mather were announced as the latest additions to the NZR board.
Savage, the former chair of New Zealand’s Super Fund, moved into the independently appointed board position vacated by Bart Campbell’s decision to step away.
Mather, the current chair of the Auckland Rugby Union, was elected to the board after being nominated by the Auckland union, heading off Shaun Nixon for a place on the nine-person board.
Former All Blacks captain Graham Mourie was given life membership, after being nominated by the Taranaki Rugby Union, at the AGM.