NZ Rugby Union announces healthy profit



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    The New Zealand Rugby Union (NZRU) has announced a healthy profit, boosted substantially by the controversial deal to put advertising on the All Blacks’ playing jersey.

    The union announced a profit for 2012 of $NZ3.2 million ($A2.6 million) on Tuesday, up considerably from the $NZ3.1 million ($A2.5 million) loss of the year before.

    After three years of reporting losses, NZRU chief executive Steve Tew was delighted to exceed the break-even result they had initially budgeted.

    “This is an extremely satisfying result and underlines our success in driving greater commercial revenue and containing our costs,” Tew said in a statement.

    A new relationship with United States insurance company AIG played a major part in the improvement.

    The decision to advertise on the chest of the All Blacks’ playing jersey upset traditionalists but was defended by the NZRU as a necessity if the game was to continue flourishing at all levels.

    “Our improved position gives New Zealand rugby a sound base to make decisions on future investment in the game.”

    Tew said the NZRU would not need to dip into its reserves to the same degree that has been required in recent years.

    The reliance on its reserves would be reviewed once negotiations for a new players’ collective employment agreement were completed.

    Tew praised the provincial unions for tightening their belts.

    Nine of the 14 NPC unions recorded a surplus last year. The combined surplus of $NZ626,000 ($A504,000) improved on a $NZ631,000 ($A508,000) deficit in 2011.

    “There has been a clear focus by the unions on living within their means,” Tew said.

    “We are not out of the woods by any means and it remains a very challenging environment for any union to grow revenue from sponsorships and crowds.”

    Tew said the NZRU’s strong financial base might result in a change to how the unions were funded but it would continue to invest “wisely”.

    Meanwhile, the NZRU announced a set of six goals to achieve over the next four years.

    The two most tangible are for the All Blacks to defend their Rugby World Cup crown in 2015 and for the New Zealand men’s and women’s sevens teams to win gold medals at the 2016 Olympics in Rio de Janeiro.

    © AAP 2018

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    The Crowd Says (46)

    • March 27th 2013 @ 9:01am
      mania said | March 27th 2013 @ 9:01am | ! Report

      this is a it deceptive. sounds like the only reason theyve made this profit is because of the AIG deal

      • March 27th 2013 @ 9:25am
        Sailosi said | March 27th 2013 @ 9:25am | ! Report

        Of course, that’s what sponsorships and tv deals are for.

      • March 27th 2013 @ 9:51am
        Jerry said | March 27th 2013 @ 9:51am | ! Report

        How is that deceptive? They’ve added an additional revenue source so they’ve made more money. It’s not like it’s a one off thing, they’re gonna be getting a payment from AIG every year.

        • March 27th 2013 @ 10:20am
          mania said | March 27th 2013 @ 10:20am | ! Report

          deceptive because its a new rev stream and hard to compare previous years with this in addition. i doubt that they’d have this payment every year. it would be a lesser amount so again will skew the future results.
          and really this is obscuring whether the countries rugby is being well run or not. a huge injection of this type doesnt tell us how smart the provinces are being run and gives the impression that Nz rugby is fine and doesnt need to do anything better.

          • March 27th 2013 @ 10:34am
            Ryanno said | March 27th 2013 @ 10:34am | ! Report

            What part of creating a new revenue stream to improve profit don’t you understand?? It’s pretty simple really and you can compare year on year as far back you like. The simple fact is that there is now more revenue coming in that flows to the bottom lines creating a profit that can be reinvested in NZ rugby. This is a win and good business in case it’s still not obvious.
            The deal done with AIG will be for yearly payments that will most likely increase year on year. Sponsorship deals don’t go backwards unless the team does. I can’t see the value of th ABs shirt going backwards anytime soon. The AB brand gets bigger and bigger every year.

      • March 27th 2013 @ 3:34pm
        Kuruki said | March 27th 2013 @ 3:34pm | ! Report

        The NZRU pocketed close to 4 million for one game against England last year. AIG had nothing to do with that, the All Blacks success as World champions had everything to do with it. They are healthy across the board.

        • Roar Guru

          March 28th 2013 @ 2:39am
          abnutta said | March 28th 2013 @ 2:39am | ! Report

          So if they don’t play that revenue shared 4th test against England, then they’d still be in the red even with their whoring of the AB jersey to AIG… and some people have the temerity to suggest that the underlying business/financial models within NZR are sound.

          Whatever. NZR is run by a bunch of morons

    • Roar Guru

      March 27th 2013 @ 10:00am
      Mick Gold Coast QLD said | March 27th 2013 @ 10:00am | ! Report

      Sir Ritchie’s cheating fingerprints are all over this!

      • March 27th 2013 @ 1:42pm
        Hightackle said | March 27th 2013 @ 1:42pm | ! Report

        His fingerprints are all over the Bledisloe cup.

        • March 27th 2013 @ 2:13pm
          richard said | March 27th 2013 @ 2:13pm | ! Report

          ….. and more importantly the World Cup trophy.

          • March 27th 2013 @ 2:25pm
            Sprigs said | March 27th 2013 @ 2:25pm | ! Report

            Phew! It was close there for a while but what a mighty finish.

        • March 28th 2013 @ 12:42am
          GWS said | March 28th 2013 @ 12:42am | ! Report

          Cheating fingerprints…

      • Roar Guru

        March 27th 2013 @ 5:51pm
        Mick Gold Coast QLD said | March 27th 2013 @ 5:51pm | ! Report

        Landed a couple Mick. Well done son!

    • March 27th 2013 @ 12:32pm
      johnny reb said | March 27th 2013 @ 12:32pm | ! Report

      Our union had to sell of two club houses to stay affloat. That’s why we posted a small surplus.

      Meanwhile we’re now out two club houses. No doubt the sell of is happening nationwide

    • March 27th 2013 @ 1:14pm
      atlas said | March 27th 2013 @ 1:14pm | ! Report

      to me it shows how fragile NZ rugby remains financially
      “Nine of the 14 NPC unions recorded a surplus last year. The combined surplus of $NZ626,000 ($A504,000) improved on a $NZ631,000 ($A508,000) deficit in 2011.”
      Consider the unions as 14 companies employing ? 500 staff (players/support), 5 run at a loss (was Otago alone $2 million bailout?), nine an annual profit approx half what eg Jerome Kaino gets for a single season in Japan. Massive regional/union debts on stadiums. Not a good business model overall.
      Maybe start sub-letting (transfer fees) top players to Japan etc?

      • March 27th 2013 @ 1:16pm
        Johnno said | March 27th 2013 @ 1:16pm | ! Report

        Or have a 3rd-tier ARC/ITM cup with Australia.

      • March 27th 2013 @ 1:33pm
        AndyS said | March 27th 2013 @ 1:33pm | ! Report

        Is the point of those unions to turn a profit and who pockets the money if they do? I would have thought the true items by which their management should be judged would be the accuracy with which they broke even, the total turnover in the process and what percentage went back into community rugby instead of overheads…

        • March 27th 2013 @ 2:05pm
          Ryanno said | March 27th 2013 @ 2:05pm | ! Report

          Exactly. They are non profit. All monies made should be reinvested into the club, it’s not about posting profit at the end of the year. Of course they don’t want to make loss, they want to maximize revenue and then invest wisely in the clubs infastructure and talent

        • March 27th 2013 @ 2:53pm
          atlas said | March 27th 2013 @ 2:53pm | ! Report

          no chance of anyone ‘pocketing the money’
          debt repayment and some in the bank – not much margin either way
          A bad weather day or two with low crowds could blow away a season’s finances, as can a low-performing team.
          The union I follow, Taranaki, supports 130 school teams, 17 clubs for men’s and women’s rugby, sevens, kids ‘Ferdie’ rugby for 6-13, referees, and two charities, one for disadvantaged kids, the other the local hospice.
          No sign of anyone running away with the profits; their total surplus 2011 was NZ $26,000 (after a loss the year before) -and that was after the bonus of hosting several RWC matches; they were also able to give $33,000 back to the clubs.

      • March 27th 2013 @ 2:30pm
        maximillian said | March 27th 2013 @ 2:30pm | ! Report

        the NZRU initially tabled a plan to cut some teams as 14 wasnt financially viable. There was a furore in regards to which teams would be cut so the NZRU buckled to public pressure & kept all the teams even though they couldnt afford them all. The result in 2011 was almost all provinces operating at a loss & some like Otago requiring multi million dollar bail outs packages. The NZRU is now taking more of a hardline stance with the provinces & refusing bailout packages. This puts the onus back on the provinces to be more financially savvy & it appears to be working.
        In recent seasons the NZRU has agreed to extend the Super Rugby season & Tri Nations as these competitions pump more money into the NZ game. The downside of this has been there is almost no room in the calendar to play the 3rd tier ITM Cup. The ITM Cup is essentially a 14 team competition played in an 8 week window so some teams are playing a game every 3-4 days. From a financial perspective this makes a lot of sense but I think it will ultimately be to the detriment of rugby in NZ. Our ITM Cup along with SA Curry Cup have been the premier 3rd tier comps & the envy of the rest of the rugby world. This unique competition provides us with the strongest depth of any rugby nation so I hope the NZRU can look passed the financial implications & not sacrifice the ITM Cup anymore than they already have.

    • March 27th 2013 @ 2:26pm
      Sprigs said | March 27th 2013 @ 2:26pm | ! Report

      Watching such quality NZ games via Foxtel, I am surprised how many empty seats there are at some grounds.

      Wellington is a good example but even at Hamilton , despite having a fantastic team, there are often lots of empty seats.

      Are the prices too high?

      Is the sport suffering from promotional overkill or competition from other sports? Or do people just like to stay at home and watch it on TV?

      Or is there no problem at all?

      • March 27th 2013 @ 3:36pm
        Cantab said | March 27th 2013 @ 3:36pm | ! Report

        Small populations and large saturation of games with super xv, NPC and All Blacks.

        Tickets are within reason, code competition is very limited. The Auckland based warriors would be the only competition.

        Basically you have 19 fully professional rugby teams, 12 semi professional teams plus the All Blacks, in a country which has a population which is less than Queensland..

        • March 27th 2013 @ 9:09pm
          hoqni said | March 27th 2013 @ 9:09pm | ! Report

          Wow, that’s a lot of wages.

          NZRU should consider to:

          (1) reduce the number of professionals hired; and

          (2) export the Allblacks who have reached a certain number of caps to be eligible to turn out for the Allblacks.

          Since nobody is watching the games, the professionals may as well play where people watch.

        • March 28th 2013 @ 12:48am
          GWS said | March 28th 2013 @ 12:48am | ! Report

          Bring itm games to oz.
          Id go.

        • March 28th 2013 @ 4:36am
          allblackfan said | March 28th 2013 @ 4:36am | ! Report

          cantab, what 19 professional and 12 semi-professional teams are you talking about? The rural-based Heartland Championship is amateur while the ITM Cup is only marginally semi-professional and even then, player payments have either been capped or reduced.

      • March 27th 2013 @ 4:17pm
        Tarragon Fields said | March 27th 2013 @ 4:17pm | ! Report

        I went to a game last Saturday and it reminded why I am just not that into going to games. Because there were five of us and we couldn’t get ideal seats, as such, we ended up seated on a corner, about halfway up. Basically, I couldn’t see much and the ‘big’ screens were only at the ends of the field, so they weren’t much help. I could not help but contrast this with a soccer match I watched in a South Korean stadium where there were four enormous TVs viewable from basically every seat.

      • March 28th 2013 @ 8:35pm
        Kuruki said | March 28th 2013 @ 8:35pm | ! Report

        I prefer to watch games at home on TV. I honestly would rather watch the world cup final at home rather then at the field. I like the replays and being able to hear myself think.

    • Roar Guru

      March 27th 2013 @ 2:48pm
      AdamS said | March 27th 2013 @ 2:48pm | ! Report

      NZ is a cold, windy nasty place, why do you think sheep,do so well?
      If I was a Kiwi I’d be rugged up in front of the Telly too.

      • March 27th 2013 @ 3:40pm
        Cantab said | March 27th 2013 @ 3:40pm | ! Report

        Every year TVs and ground cameras get better vs the live rugby experience staying the same or perhaps even declining with increased regulations and prices. Seems rather odd when people are confused by decling crowd numbers In any code in any country.

      • March 28th 2013 @ 1:01am
        Hightackle said | March 28th 2013 @ 1:01am | ! Report

        Adam, NZ will rule the world one day and you may regret your words. We already have bondi and half of Brisbane.
        If I were you I wud stirt spekking wuth a kuwi ex-unt aye bru.

        • March 28th 2013 @ 1:22am
          Asia said | March 28th 2013 @ 1:22am | ! Report

          Ha ha, I live in Asia… you can be in some remote town in the middle of nowhere, not see a white face in days.. as soon as an All Blacks game is on.. the bars are full of face painted Kiwis.. like, hundreds come out of the woodwork!!! are you guys in Kahoots with that chubby kid running North Korea planning world domination?? ( the president of NKorean is the Gamlang syle guy right?)..