RFU Annual Report 2022/23 published
The RFU 2022/23 Annual Report shows significantly higher reported revenues for the year at £221.4m (£189.1m in prior year), increased investment in rugby at £99.4m (£77.4m in previous year) and an operating profit of £4m (£15m in previous year).
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During the year all debt from Covid impacted years has been paid off and the RFU has £24.9m in cash and £25m in deposits. Exceeding targeted profits to reserves, the Union ended the financial year with a strong P&L reserve of £123.3m.
RFU CEO, Bill Sweeney said: “Wasps, Worcester, and London Irish going into administration was the single most defining aspect of the men’s professional game last season. The after-effects of Covid, levels of debt, and the economic environment brutally exposing difficulties for business models with existing challenges.
“In a very difficult financial environment, the RFU achieved an operating profit of £4m due to robust financial management. The coming years will continue to be challenging with inflationary pressure on our costs, our revenues being under pressure from reduced discretionary spend, and the recovery of corporate confidence. We will continue to implement strong cost control and prudent fiscal management.”
Chief Operating Officer and Chief Finance Officer, Sue Day, added: “It has been a challenging few years financially for rugby in England. The RFU is facing these challenges too, but from a position of stability because of our strong financial discipline. It is critical that we maintain that discipline so that we can continue to support all elements of the game now and in the future. We have made an operating profit in the year of £4m, but are facing challenging future economic conditions, and so it remains very important to manage our finances very tightly.”
Rugby finances work in four-year cycles based on the number of men’s home internationals staged at Twickenham Stadium. 22/23 is the third year in the Rugby World Cup cycle when there are the highest number of home internationals at Twickenham Stadium and, as such, these higher revenues were expected. Next year, as England Autumn Internationals were replaced by the men’s Rugby World Cup, the 2023/24 annual results will show a significant loss.
The high match profile in 2022/23 explains much of the increase in revenue compared to 2021/22 (seven men’s international fixtures v five). Ticket income increased to £48.4m (£33.7m in previous year) and the world record crowd that attended the Red Roses’ victory over France in the Six Nations contributed c.£1m of revenue. Revenues from hospitality and catering reached their highest levels ever at £70.8m (£61.5m in previous year).
The two other largest revenue streams are broadcast and sponsorship revenues. Broadcast revenue fell slightly to £40.9m (£43.6m in previous year) and remain behind pre-pandemic levels. And sponsorship revenue increased from £24.1m in the previous year to £25.9m.
Overall, rugby investment increased by 28% year-on-year to £99.4m (£77.4m in previous year).
Investment in the community game increased 52% from 2021/22 (£31.1m vs £20.4m). The increase was partly due to the resumption of more programmes post-pandemic, and partly due to securing additional external Sport England funding, with £3.2m secured for Rugby World Cup 2025 Impact projects, and £1.2m for the Governance and Business Transformation project. Community game investment is made up of £7.4m of funding (for leagues, CBs, club insurances and the Injured Players Foundation), £8.2m of people costs, £1.5m of depreciation on Artificial Grass Pitches, £9.7m of programme investment, and £4.3m of Sport England investment into Rugby World Cup 25 Impact and Governance and Transformation programme investment. Increases are across all areas of investment, including people costs, community game insurances, CB funding and various programmes including ‘Project Pheonix’, a project focussed on increasing adult male participation numbers.
Professional Rugby Investment increased 20% from £57.0m to £68.3m. This consists of Club Funding (including Men’s and Women’s Premiership and Men’s Championship); England Teams and Programmes (including player fees and contracts, XVs and 7s programmes, pathway, and kit), and Other (sports medicine, player welfare, match officials, rugby operations, events and competitions and, in 2022/23, the professional game elements of the Governance & Business Transformation project).
Most of the year-on-year increase in ‘Club Funding’ (£31.1m vs £26.7m) has driven increased payments to Premiership Clubs under the Professional Game Agreement. The increase in investment in our England teams (£25.5m vs £20.8m) is due to several factors. It includes: the costs associated with changing the England Men’s coaching team; the costs of the Red Roses attending a Rugby World Cup (both player costs and logistics); and the increased costs of the men’s team due both to a longer autumn window and the first Rugby World Cup camp falling in June.
As a result of monies received from CVC for selling a share of future broadcast revenues, this and some sponsorship rights have been reduced in the short term. The RFU is committed to driving long-term growth by using these proceeds which will bring in £90m in capital over four years to invest in revenue-generating projects that support the game in England. Areas targeted for ‘strategic growth fund’ investment include the women’s game, stadium master-planning, digital transformation, and development of revenue generating projects (including assets) for the community game.
