MUNSTER RUGBY ANNOUNCED a forecasted deficit of €1.9 million for the year ending 30 June 2016 at their Annual General Meeting in Limerick yesterday.
Although slightly less that the previously forecasted €2.2m, the deficit leaves Munster in a dire financial situation that means the IRFU will be required to step in and bail the province out as they look to rebound under new director of rugby Rassie Erasmus next season.
It is expected that the IRFU will cover the vast majority of the deficit with a major cash injection.
By way of comparison, Munster returned a €333,000 deficity for the financial year ending in June 2015.
Speaking at the Munster Branch’s AGM in Young Munster RFC last night, the province’s financial controller Philip Quinn stated that reduced gate income and rising player costs were the main causes for the alarming forecasted deficit.
Quinn pointed to “economic factors and the geographic spread” as having played a major role, as well as highlighting that there had been a large number of unsuitable kick-off times for Munster games this season.
Surprisingly, it was revealed that 71% of Munster’s tickets sales come from outside the Limerick area, meaning the province is now reliant on much of their support base travelling some distance to Thomond Park.
More positively, Quinn reported that sponsorship was up by close to €400,000 and that the work of Munster’s commercial board has also resulted in the generation of €800,000 in this financial year.
Nonetheless, the forecasted deficit of almost €2m is of grave concern.
“We had a significant reduction in our gate income, some of which was down to the impact of the Rugby World Cup in addition to unfavourable kick-off times for certain high-profile games in Thomond Park such as Glasgow, Ulster and Leicester,” Quinn told munsterrugby.ie.
“Combined with the on-field performance, this resulted in a significant drop compared to previous seasons. Player costs continue to rise due to competition from overseas and in line with market demand.
“Supporters are at the forefront of our plans for the coming season with newly adapted ticket structures providing kids-go-free incentives and the ability to transfer unused tickets which will be of significant benefit to those unable to make unsuitable kick-off times.
“We also look forward to welcoming the Māori All Blacks to Thomond Park in November and I’ve no doubt it will be a huge occasion for the province with hospitality already close to selling out and strong ticket sales thus far.”
Quinn also promised that Munster can remain competitive in the field of recruitment as they look to return to former glories.
“We continue to be competitive on this front, as illustrated by the retention of the likes of Keith Earls, Conor Murray, CJ Stander and Simon Zebo earlier this season,” said Quinn.
“No different to previous years, our budgets allow for the recruitment of suitable overseas candidates and this will not change.”
Last night’s AGM saw Gerry O’Shea of Young Munster RFC elected president of the Munster Branch.
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