SCOTTISH RUGBY published its annual report yesterday [Monday], revealing an 11 percent [£5.8m] growth in turnover to reach a total of £57.2m in sales during the year up to 31st May 2018.
‘Broadcast income’ is up by £1.895m, which is attributed to an increase in the SRU’s dividend from the Six Nations; while the creation of a lucrative television deal with South African media giants SuperSport to cover the Southern Kings and Toyata Cheetahs in the Guinness PRO14 will have also been a factor.
There is also a £4.375m rise in ‘other operating income’ which is explained as “the increased commercialisation of the Guinness PRO14 league, higher match day hospitality and other game day related sales volumes at BT Murrayfield, additional events on non-matchdays, and income from the British & Irish Lions.”
Meanwhile, ‘ticket income’ is down from by £299k from £12.636m to £12.377m, with the SRU pointing out that there was one less home international match this year compared to 2016-17 – although there were just as many Scotland matches at the 67,000-capacity Murrayfield Stadium because the national team’s clash against Georgia in November 2016 was played in front of less than 16,000 people at Rugby Park in Kilmarnock. There was also an extra 1872 Cup match between Edinburgh and Glasgow Warriors at Murrayfield during the most recent season.
‘Commercial income’ also recorded a drop from £11.013m to £10.837m, with yesterday’s press release explaining that this reflected “the tough sponsorship market” the SRU are currently operating in.
All of which means that average debt is now down to £2.4m, representing a remarkable turnaround from the eye-watering £23m which was owed at the end of Gordon McKie’s first year as chief executive back in 2006. By the time McKie left the business in the summer of 2011, the debt had been wrestled down to a more manageable £14.4m through a programme of strict austerity. During the last six years under Mark Dodson, a better balance has been struck between financial control and the need to invest in the professional game in order to drive up revenue.
Concerns linger, however, as to where the club game fits in to Dodson’s materplan. While expenditure on ‘international and professional rugby’ is up by almost 16 percent from £24.967m to £28.984m, and overall costs are up by just over 12 per cent, the amount assigned to ‘club support and development’ increased by just five percent from £2,766m to £2.913m.
The SRU continue to lag well behind the other ‘Home Unions’ of England, Ireland and Wales in terms of its direct financial support of the club game.
AGM looms over the horizon
Dodson will be hoping that this generally positive report will help take the sting out of a potentially explosive AGM on 4th August, when member clubs will get the opportunity to put the people running the sport on their behalf on the spot over a number of issues, which will inevitably include the Keith Russell affair and the implementation of Agenda 3.
The chief executive was recently the focus of a damning judgement at the unfair dismissal employment tribunal brought by Russell, the former Director of Domestic Rugby. Russell gave a scathing interview after that ruling in which he levelled a number of serious charges about the management culture fostered by Dodson and his fellow senior executives. The Board and Council rallied behind their man with a joint statement of support, while President Rob Flockhart dismissed Russell’s comments as ‘laughable’.
Board member Lesley Thomson has spent the last six weeks conducting an internal review into Russell’s dismissal – but the scope of her investigation is not clear. She is not believed to have spoken so far to any of the several former employees known to have signed non-disclosure agreements after contentious departures from the organisation, and the SRU have not clarified whether her findings will be made public.
Agenda 3, which includes the creation of an elite Super 6 league to sit above the top of the domestic game and below the country’s two pro sides, was launched with great fanfare by Dodson at last year’s AGM, with his slick presentation initially eliciting a round of applause from the floor.
However, a failure to consult fully with the clubs, and a general lack of clarity as to the knock-on impact of some of the policies involved, means that there has been growing murmurs of discontent from the Union’s ultimate stakeholders.
Dodson has claimed that £3.6m in new funding will go into the club game over the first five years of Agenda 3. However, the fact that domestic rugby is to foot the £4.125m bill for Super 6 has raised concerns that the clubs are being sold a bum deal.
“Rugby in Scotland is enjoying a resurgence at international and professional level and the support for these teams has never been stronger. This has contributed to the strong financial position we can report this year, which will help us to continue to move the game forward at all levels,” said Dodson.
“We are committing record levels of investment into the grassroots game in Scotland in order to create a sustainable environment and help improve the standards of rugby being played across the board.
“We continue to build our brand on the global stage and find ourselves in a strong position as we head into Rugby World Cup 2019.”