accounts Show Premiership Rugby Peril
Gallagher Premiership Rugby saw its losses nearly double to £36m last year, following the filing of its latest accounts.
Accounts published by Companies House show that Premier Rugby Ltd lost £36.11m in the year through to June 2022, up from £19.03m the previous year, highlighting the continued financial struggles within the sport.
The total equity in the company also fell nearly by more than half from more than £96m to £43m.
This season Premiership Rugby has seen two of its clubs, Worcester Warriors and Wasps, fall into administration.
London Irish, with debts of more than £30m, is the latest club to be threatened by the possibility of administration, and is currently working on a deal that would see an American consortium finalise a takeover from owner Mick Crossan.
The Department of Digital, Culture, Media, and Sport Committee recently released a report around the financial and structural issues within professional rugby union, in which it called Premiership rugby’s club finances ‘clearly unsustainable’.
In the case of Premiership Rugby, the losses were anticipated as a result of the venture capital firm CVC Capital Partners’ taking a 27% in 2019.
“Premiership clubs have benefited from loans provided by DCMS and Sport England through the Sports Survival Package, and whilst this support has been a key factor in no clubs going under during the main phase of the pandemic, those loans will remain on the clubs’ balance sheets for many years to come.“
NICK CLARRY, CVC MANAGING PARTNER
In the strategic report released alongside the financial results, the board of directors claimed that the ‘company now posts an accounting loss, which is to do with the accounting treatment of the CVC investment in that period, as opposed to reflecting operating performance.’
Overall, turnover increased by 6% to £65.5m following the lifting of Covid restrictions and return of crowds.
The report, signed off by CVC Managing Partner Nick Clarry, underlined the sport’s difficult situation with the loans from the Sports Survival Package during the pandemic due still needing to be repaid.
Clarry stated, “Another major factor affecting the league is the financial health of the shareholder clubs, as illustrated by the recent issues impacting Worcester Warriors and Wasps.”
“Premiership clubs have benefited from loans provided by DCMS and Sport England through the Sports Survival Package, and whilst this support has been a key factor in no clubs going under during the main phase of the pandemic, those loans will remain on the clubs’ balance sheets for many years to come. We continue to work closely with clubs, Sport England and DCMS on this topic.”
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