Six months after the Wallabies’ worst World Cup result, Rugby Australia has announced a $9.2 million deficit from the 2023 season.
The Roar can also reveal RA board director Karen Penrose has been unsuccessful in her attempt for re-election.
Other directors Matthew Hanning and Jane Wilson were re-elected for a further three-year period, while former National Rugby League executive Alexi Baker and Brisbane businessman Hans Pearson were elected.
The result is a blow to the Supporters of Australian Rugby Reform, who called for the entire RA board to be overthrown.
A year after RA announced a $8.2m profit, the governing body had long expected to announce a big deficit given the World Cup year. However, it was less of a financial loss compared to the 2019 ($9.5m) and 2015 ($9.8m) World Cup campaigns.
With just two home Tests in 2023, down from six in 2022, the Wallabies’ matchday revenue was down from more than $37m to $12.9m.
At the same time, operation expenditure increased $11.5m from $119m to $130.5m.
The deficit comes off the back of RA announcing late last year they had signed a flexible $80m credit facility on a five-year term $80 million facility with Pacific Equity Partners. On Monday, RA revealed they had already drawn on $50m of that loan.
The Wallabies suffered their worst World Cup result under Eddie Jones in 2023. (Photo by Chris Hyde/Getty Images)
The increase was driven by additional high performance costs, especially in the Wallabies, Wallaroos and Australia A programs, as well as increased investment in Super W and an increase in player payments reflecting 2023, being the first year of a new collective bargaining agreement with players.
In particular, RA was forced to pay two Wallabies head coaches after sacking Dave Rennie in mid-January 2023 and parachuting Eddie Jones into the role.
The figure comes less than two months after RA chief executive Phil Waugh revealed there was a $2.6m overspend in last year’s World Cup campaign in France.
In a statement on Monday, Waugh said RA would continue to be fiscally responsible, especially given they have taken over the operational costs of the Melbourne Rebels in 2024.
“We have set a clear path forward – to unite the game from the grassroots to the elite level, to maximise efficiencies in high-performance, to invest in growth areas of the game – especially in community and women’s Rugby – and to set the game up to maximise the commercial opportunities over the next six years to ensure a thriving future for Australian Rugby,” Waugh said.
Rugby Australia CEO Phil Waugh announced a $9.2 million deficit from their 2023 campaign. (Photo by Mark Evans/Getty Images for Rugby Australia)
Waugh was quick to point out that RA was expected to sail through some stormy seas over the next 12 months, especially with a looming legal battle with the Rebels expected.
“From a revenue perspective, 2024 will be another challenging year given we have had to take on the unplanned cost of the Melbourne Rebels’ operations for 2024, as well as additional investments and distributions to member unions, Super Rugby clubs, the community game, pathways and women’s rugby,” Waugh said.
“We could have reduced costs further for 2024, however this could have had a detrimental long-term effect for the game – it is essential that we set the game up as best we can for the major revenue events on the horizon in 2025, 2027 and 2029.
“Sales to date for the Lions tour have been exceptional, both in our market and in the UK – this once in 12-years event creates the opportunity to repay debt and get over the legacy of COVID-19 that the game is still facing.
“RA is working with the Super Rugby clubs, member unions and RUPA to set up a sustainable financial model for the future, aligned to a new broadcast deal in 2026.”
In his chairman’s address, Daniel Herbert conceded the decision to sack Rennie and appoint Jones hoping for a “quick fix” did not work and that the board would ensure there is no “repeat”.
“After changes at the Wallabies and board level, the remaining directors and new executive team were determined there would be no repeat of 2023,” he said.
“If there is a lesson that Rugby needs to heed, it is that we need to stop looking for the “quick fix”. We owe this to our players and fans moving forward.
“So, we set about building capacity, capability, and accountability in our High-Performance, with Peter Horne joining Rugby Australia late in 2023 to lead the restructured HP department, and Jaime Fernandez joining as the first dedicated women’s high-performance manager in that team.
“They have gone on to select capable and experienced staff with a track record of excellence. Headlining these appointments is new Wallabies coach, Joe Schmidt, and new Wallaroos Coach, Jo Yapp.”
More to come.
southcoastboy
Roar Rookie
Yep, I looked once, looked again to confirm, and then gave up even thinking about attending the Sydney Lions test. Plus, by then, there's always the chance it'll be a dead rubber.
Footy Franks
Roar Rookie
Yeah Johns is the best I’ve seen.
Paul
Roar Rookie
RA have now played their hand. They've advised the PwC administrators they themselves appointed that RA will vote against the DOCA. RA have also advised the administrator in writing that they (RA) believe the administrators are biased towards the Rebels Directors and have misled the other creditors. They're now praying the Rebels are liquidated, because if they don't a separate decision will be made by the administration to seek legal advise on the viability of the Rebels suing RA for the funding shortfall. https://www.afr.com/companies/sport/pwc-dragged-into-melbourne-rebels-fight-rugby-australia-alleges-bias-20240502-p5fofg They'll let the franchise sink to save themselves defending the legal action and avoid the precedent of having to pay the finding shortfall to the other franchises.
Ankle-tapped Waterboy
Roar Rookie
Another article on the Rebels in today's The Age. Includes this Widdup and other Rebels consortium members, including her father and business heavyweight Leigh Clifford, met with Rugby Australia officials on Tuesday to outline what their rescue deal would look like. It was the first time the parties met since Rugby Australia accused the Rebels directors of misusing funds meant for tax. In a statement, RA claimed: “[The Rebels] ... misused these funds and did not pay them to the ATO, which was the intended purpose.” Widdup disputed the claim last week, telling this masthead: “RA did our payroll, and on all occasions they knew the amounts they were paying us to pay the players were insufficient.” archive.is/20240501205346/https://www.theage.com.au/sport/rugby-union/sports-minister-raised-world-cup-final-in-phone-call-to-rugby-boss-20240501-p5fo1l.html
GusTee
Roar Pro
Well said and well researched, Nick. The negative comments appear to come from those who do not understand the different roles in a company and/or how to differentiate between the responsibilities and functions of a non-executive director and the paid day-to-day managers/executives of a company.
Gkl
Roar Rookie
Hi CD Very thought provoking article. What happened to the RA great reset? We basically have the same board that green lit the dismissal of DR and replaced with EJ and his plan to win the RWC with the young guns of Oz rugby, same board over seeing our bledisloe campaign . Now RA made a loss. What is going on ? GKL
BeastieBoy
Roar Rookie
They have debt of $89m and going higher. The definition of madness is doing the same things with the same people and expecting a different result. Going forward with the same constitution and same directors is madness.
Biscuit man
Roar Rookie
Are you Daniel or Phil?
Bliksem
Roar Rookie
In a statement on Monday, Waugh said RA would continue to be fiscally responsible… :unhappy: :laughing: :crying: :unhappy: :laughing: :angry:
LBJ
Roar Rookie
It's the only flattery you will get from me.
Ankle-tapped Waterboy
Roar Rookie
Melbourne's The Age has an editorial today on the Rebels: archive.is/20240430102135/https://www.theage.com.au/national/victoria/melbourne-rebels-are-a-cause-worth-rallying-around-20240430-p5fnla.html
Ballymore Brumby
Roar Pro
I think its great QRU initiative to get those sorts of games going again.
Rocky's Rules
Roar Rookie
OMG Nick - so you want more of the same. I'm simply pointing out the bleeding obvious that these RA Board members (all of em including the CEO) are not qualified to be members of any pro sport board. Not only do the RA crew have no qualifications, or experience, in hands on sport administration most are prof board sitters. And the decisions they have made over the past 20 years consistently confirms they are NOT fit their roles on RA (all of em). Your comment, while being absurd apologetics, just confirms their non suitability for RA. As a fan watching RA watching aussie rugby go down the tubes it's obvious the RA constitution needs urgent changing so that Board members (and CEO) are required to be independent people (non affiliated) with minimum tertiary qualifications and practical experience in sports administration. It should also be a minimum requirement that board members have the overall good of rugby as their 1st priority. Bankers, business people, doctors, accountants, marketing execs, ex great players etc are useless on a pro sports board in the 2020's. They know zero about sport administration and the collective decisions of RA prove that over and over. They obviously also don't have the overall good of the code as their 1st priority :stoked:
cs
Roar Guru
plagiarist
LBJ
Roar Rookie
Knock yourself out. Not my problem.
cs
Roar Guru
Stop it!
Muglair
Roar Rookie
2015 was the last year of a meagre TV deal where the game was in real financial strife. Also I am not sure when WR started subsidising Australia NZ and SA for lost income in the WC year. Could have been 2015 but the amount would have been smaller. The much larger revenues from the 2015 deal were well and truly absorbed through bloated RA overhead structures which were cut back significantly in COVID by Clarke.
cs
Roar Guru
I'll make note.
LBJ
Roar Rookie
What no pithy response? No sharp new insult to sling? But remember - what is happening because of this corporate bullying - is that just because we both might support the wallabies, we are not on the same side.
cs
Roar Guru
Knock yourself out LBJ. Not my problem.