Story image

NZ Rugby full-year profit shrinks by 86% as costs rise

08 Apr 15

New Zealand Rugby's annual profit dropped about 86 percent as the national sports administrator's costs grew faster than its income.

Profit shrank to $373,000 in the year Dec. 31, from $2.5 million a year earlier, the rugby union said in a statement. Income rose 3.2 percent to $120.8 million, while costs increased 5.3 percent to $120.2 million. Cash reserves were little changed at $62.6 million, from $63.7 million a year earlier.

NZ Rugby returned to profitability in 2013, after posting annual losses since 2008. The organisation has focussed on ways to make the game more profitable, including the sale of Super franchises, as provincial unions face the squeeze from dwindling attendance and, in some cases, poorly managed finances.

In 2012, the Otago Rugby Union chalked up its sixth straight deficit, and was kept alive through rescue packages from the national body and the Dunedin City Council, before returning to profit in 2013.

NZ Rugby wants the sport to be financially self-sustaining across all levels by 2016. To help achieve that, it plans to build a shared service model for back-office functions and create real-time reporting and forecasting tools for all provincial member unions to use.

Chief executive Steve Tew said the sports administrator was reviewing its overall investment plan including funding to Provincial Unions, Super Rugby teams and its cash reserves policy this year, once the renewed broadcast contracts covering the 2016 - 2020 period are finalised and the revenue stream confirmed.

The annual combined surplus of the 14 ITM Cup unions was $1.2 million, down on $3.3 million a year earlier, as four undisclosed unions slipped back into the red, the administrator said.

"Much good work has been undertaken by unions in recent years to work smarter and look for innovative ways to grow commercial income so it's great news to see another collective surplus," Tew said. "The smaller surplus underlines the fact that challenges to grow income and contain costs remain and we will continue to offer advice and support as needed."

Last year, Sky Network Television, New Zealand's dominant pay-TV company, signed a conditional contract to renew its five-year deal from 2016 with the NZ Rugby and the SANZAR unions for an undisclosed amount. The rugby union gets almost three quarters of its income from commercial contracts, including broadcast and sponsorship deals.

HPE promotes 'circular economy' for end-of-use tech
HPE is planning to show businesses worldwide that throwing old tech and assets into landfill is not the best option when it comes to end-of-use disposal.
This could be the future of ridesharing
When you hear the words ‘driverless vehicle technology’, the company Bosch may not immediately spring to mind.
2019 threat landscape predictions - Proofpoint
Proofpoint researchers have looked ahead at the trends and events likely to shape the threat landscape in the year to come.
InternetNZ welcomes Govt's 99.8% broadband coverage plan
The additional coverage will roll out over the next four years as part of the Rural Broadband Initiative phase two/Mobile Black Spots Fund (RBI2/MBSF) programme expansion.
Commerce Commission report shows fibre is hot on the heels of copper
The report shows that as of 30 September 2018 there were 668,850 households and businesses connected to fibre, an increase of 45% from 2017.
Dr Ryan Ko steps down as head of Cybersecurity Researchers of Waikato
Dr Ko is off to Australia to become the University of Queensland’s UQ Cyber Security chair and director.
Businesses in APAC are ahead of the global digital transformation game
“And it’s more about people and culture - about change management - along with investing in the technology.”
HubSpot announces fund for 'customer first' startups
HubSpot is pouring US$30 million (NZ$40 million) into a new fund to support startups that demonstrate ‘customer first’ approach of not only growing bigger, but growing better.