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RFU braced for revenue hit of up to £50m as Covid-19 impact felt

Twickenham Stadium, headquarters of the RFU (by Chloe Knott - Danehouse/Getty Images)

England’s Rugby Football Union (RFU) has said it expects revenue losses of between £45m (€49m/$53.6m) and £50m over the next 18 months, adding that Covid-19 is set to “considerably” increase a projected loss for the financial year.

The RFU had already stated that the 2019-20 season was set to be loss-making because of the 2019 Rugby World Cup in Japan, which reduced the number of big-ticket games played at Twickenham Stadium. Twickenham’s staging of England matches is said to account for 85 per cent of the RFU’s revenue, with each match having the potential to bring in more than £10m.

Following a virtual board meeting held yesterday (Wednesday), RFU chief executive Bill Sweeney said: “The RFU had budgeted for a loss-making year within a four-year cycle due to the costs of the 2019 RWC campaign and hosting only two home Six Nations games. The loss will now be considerably more as we face challenges similar to businesses across the country.

“The RFU’s biggest asset is also a major cost and the closure of Twickenham Stadium has a significant impact on the revenues we can generate to re-invest back into the game. In that sense we are like every other club in the Union, when we do not stage matches and events we do not generate revenue.

“Based on our planning assumption we estimate RFU revenue losses over the next 18 months to be approximately £45-£50m and have a firm plan in place to mitigate this. The RFU executive team will be taking a cut in remuneration in excess of 25 per cent. In addition, combined board fees will be reduced by 75 per cent.”

In December, the RFU posted group revenues of £213.2m for the 2018-19 season, up by £40.8m on the previous year, driven largely by an increase in international matches played at Twickenham over the season. Overall, profits before rugby investment increased 39-per-cent year-on-year to £115.4m, with operating profits rising to £14.9m, compared to losses the previous year of £24.4m.

Yesterday’s board meeting also addressed the issue of the domestic rugby calendar, with the RFU pledging a support package for community clubs directly funded from the Union worth £7m. Regarding the calendar, Sweeney added: “Significant progress has been made on the process for considering the implications of ending the season early.

“We will ensure a fair and balanced outcome for the game and are now committed to update on this by the middle of April. No one can predict every possible outcome of the Covid-19 outbreak, particularly with regard to the duration of this crisis, and we are managing in the unknown.

“We have modelled three potential scenarios and are working on an assumption based on a medium-term impact with a view to a return to rugby in the autumn. We will continue to monitor against this assumption and review and revise planning where necessary.”