RFU warns it could lose 145 million pounds in revenue due to COVID-19
(Reuters) - England's Rugby Football Union (RFU) warned on Thursday that it could lose 145 million pounds in revenue in the short term in its "mid-case" scenario, but managed to keep its annual operating losses for 2019-20 within budget despite the impact of COVID-19.
Chief Executive Bill Sweeney also said the financial impact of the pandemic would take four or five years from which to recover, with the RFU expecting to lose about 20% in revenue on a cumulative annual basis over that period.
The RFU had already budgeted for 2019-20 to be a loss-making year within its regular four-year cycle due to costs associated with the Rugby World Cup and only hosting two Six Nations Games.
It budgeted for an annual loss of 11.5 million pounds, but its operating loss came in slightly better at 10.8 million pounds, despite the organisation ending the year with revenues 23 million pounds behind budget.
"While hitting operating budget... is positive, the RFU recognises revenue losses for the coming year will be so significant that they cannot be mitigated through reduced expenditure," the RFU said in its earnings statement https://www.englandrugby.com/news/article/rfu-annual-report-and-account-published-for-201920.
The shortfall in revenue was driven mainly by the loss in income from broadcast, ticketing, hospitality, conferences and events, brought on by the stoppage caused by the pandemic.
"The long-term financial challenges of coronavirus are significant for the entire economy," Sweeney said. "The RFU relies on revenue from matches and events at Twickenham Stadium and re-invests this back into the game.
"With no rugby and no events, we are looking at a potential short-term impact circa 145 million pounds in lost revenues in our 'mid-case' scenario.
"In the immediate term we also have to recognise that we are not in a position to carry the whole game through an extended financial crisis.
"We have therefore requested that the Government makes available a package of support for recovery funding to protect the integrity of the community game."
(Reporting by Simon Jennings in Bengaluru; Editing by Toby Davis)
