The IRFU annual accounts for the Year ended 31 July 2022

CIARAN_BOYLE · 13-11-2022 6:15pm #1

The Irish Rugby Football Union released accounts during the week.

There's plenty of articles summing up the results.

In short the IRFU made an operating profit before exceptional income of roughly 6.5 million and it booked additional profit of 44 million from a CVC investment in the 6 nations. The operating profit only occurred due to COVID grants. Furthermore the IRFU are predicting deficits for the next few years.

Anyway one thing I wanted to talk about and draw attention to is the Cash pile that the IRFU are sitting on. They are holding 66 million in cash and cash equivalents. This hasn't been mentioned in any article that I've seen about the IRFU accounts.

What are the IRFU going to do with the money. Are they planning a big investment? Well if you look at the detail of the accounts they state that ideally they would have 94.4 million in the bank as that is the value of tickets sold in advance over the next 9 years. IE 10 year tickets, box tickets etc.

[quote=irfu]Whilst this balance is extremely welcome, it must be looked at in conjunction with the amount of €94.4m included in the deferred ticket fund. This €94.4m reflects the monies that the Union has received in advance for matches over the next nine years, which is then released into the Union’s accounts each year over the lifetime of the ticket or box sold. For this year this release amounted to €16m, which is described as amortised income in schedule 1 of the accounts. Ideally we would have the full €94.4m in our bank account so as to ensure that we can match this income to be released in the future with future expenditure.[/quote

While I understand the idea surely they should be getting value from the 10 year tickets. There should be something the IRFU are doing with the money rather than selling a 10 year ticket and letting the money sit in the bank account. Or am I completely off with that idea. I'm sure if nothing else that there may be value in investing the money commercially even if it would carry risks.

For the record the IRFU accounts do not contain the income and expenses of the branches. If they did transactions with the branches (ie Munster loan) would not show up on the balance sheet or cash flow statement of the Union. Player and management costs (of 54 million) included a 14 million covid bailout and compares to 45 million in the year ended July 2020 which was to an extent pre COVID (or at least pre IRFU steps taken for COVID) which indicates a fall in standard support to the provinces of 5 million even though there was an extra bailout.

For reference here is a link to the accounts.

https://d19fc3vd0ojo3m.cloudfront.net/irfu/wp-content/uploads/2022/11/10144957/IRFU-Annual-Report-2021-22-Accounts-Section.pdf

13-11-2022 7:03pm

How much debt does the IRFU have? Assume it's still significant from Lansdowne redevelopment?

phog · 13-11-2022 7:34pm

Munster owe just under €6.6m to the IRFU and after a renegotiation of the repayments (2018) only pay back €100,000 a year on that loan. They will also have to give the IRFU 50% of the naming rights to TP and 50% of 10yr ticket sales. The 10year ticket sales and naming rights could be interesting now with the chat of moving some games to PuC.

This caught me eye but other than to get 3m I've no idea why they would do it or what the purchasers gets in return or who the purchaser was.

Other financial investment

During the previous year, the Union granted an option that provides the holder of the option with the right to purchase the Union’s interest in the European Rugby Championship (ERC) based on the terms set out in the agreement. The option was exercised during this financial year, with the Union receiving cash proceeds of €3.1 million for a disposal of 28% of its rights in ERC. Since the Union retains a significant portion of its economic rights to ERC through Celtic Rugby Designated Activity Company, a company which the Union holds significant influence in, this portion has not been derecognised.

CIARAN_BOYLE · 13-11-2022 7:52pm

https://www.boards.ie/discussion/comment/119870064#Comment_119870064

None in terms of oweing money to a bank. Theres 94.4 million owed money in an accounting measurement of the rights the IRFU owe people who bought long term tickets.

Thers also 35 million of short term creditors that aren't bank loans but thats countered by 30 million short term debtors.

https://www.boards.ie/discussion/comment/119870243#Comment_119870243

I believe but am not certain that this was South Africa buying in to the ERC brand so that their clubs could take part. As the South African teams are competing with the URC teams for involvement in the ERC they bought in by buying stakes in the competition from them.

aloooof · 13-11-2022 7:57pm

Out of interest (and this might be off topic for this thread, so apologies) but in 2 podcasts I’ve listened to since Thursday, there’s been one suggestion Munster made around 150k, and another they made close to a million from the SA game.

Anyone any ideas which is more accurate??

phog · 13-11-2022 8:07pm

https://www.boards.ie/discussion/comment/119870354#Comment_119870354

That's a plausible explanation

phog · 13-11-2022 8:10pm

https://www.boards.ie/discussion/comment/119870378#Comment_119870378

The close to the million could be just ticket sales but then 150k seems a tad low after expenses are paid out. I suppose it depends on what the sponsors paid for and how much SA received.

CIARAN_BOYLE · 13-11-2022 8:35pm

https://www.boards.ie/discussion/comment/119870378#Comment_119870378

It depends. No one knows.

Munster would have gotten gate receipts, concession income, TV money, sponsorship from hoardings and pinergy man of the match etc.

They would have had to pay a match fee to South Africa, rent to Cork County Board and possibly other expenses.

Now I can't tell you what those were.

I can tell you that numerous media reports state that the rent to Cork County Board was 200K or 250K. In 2016 when New Zealand Maori came to Munster the match fee was 250K. I'd assume South Africa would command a higher fee so lets say double or 500K

I don't know how many kids were there. As an estimate I'm going to guess that tv, concessions and sponsors contributions were enough when added to the gate receipts - stewards and other match day fees to make it like an adult only gate.

https://www.corkbeo.ie/sport/gaa/corks-pairc-ui-chaoimh-seating-16122053

https://www.munsterrugby.ie/2022/08/30/ticket-update-munster-v-south-africa-select-xv/

Based on 21K terrace and 24K stand. Given that PUC only had 41K for Munster as it had never hosted a rugby match I'm going to take that from the terrace.

17K Terrace, 340K. I don't know the split between category A B and C so lets assume its even. 8,000*30=240,000, 8000*40=320,000, 8,000*50=400,000.

So my estimate of the income is 1.3 million.

So my very rough estimate is 1.3 million income - 500K match fee -250K rent leaves a profit of €550K.

Its worth noting that the game between Munster and South Africa was confirmed before Munster secured PUC. I really doubt that they would have had played in Thomond if it was going to be a loss making event. Adding 16K fans from what was at least break even point in Thomond would have to be somewhat profitable.

I have no special knowledge here. Just throwing out guess work. Whose podcasts were you listening to. Maybe they had special knowledge.

aloooof · 13-11-2022 8:56pm

https://www.boards.ie/discussion/comment/119870556#Comment_119870556

It was Off the Ball’s Adrian Barry (suggested the 150k when talking to Quinny) and TRK (suggested close to 1m).

The figures are so disparate, it feels like one of them must have some knowledge and the other a very un-educated guess (being kind).

14-11-2022 1:02pm

1m sounds a bit high when you do the back-of-the-napkin maths but who knows.

CIARAN_BOYLE · 21-11-2022 8:24pm

The Ulster branch release a set of accounts.

https://ulster.rugby/rugby-in-ulster/ulster-branch/annual-report

Not sure how to read it but its difficult to understand as we don't know what expenses Ulster pay and what expenses the IRFU pay.

A lot of very broad categories too.

3.1 million in professional game match income. Is that supposed to be ticket sales? I presume that's ticket income but I would have thought that Ulster would get more in ticket income than that. Looking at wiki Ulster had 91K fans in the 8 games with official attendances in the URC last season. There was 2 more games without an official attendance. Ulster also had 44K fans at home in 3 European cup games.

The Ulster branch finished the period in profits which can only be a good thing.

The IRFU annual accounts for the Year ended 31 July 2022

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