Munster facing €1.95 million cash-flow deficit this season

Colm Kinsella, Rugby Correspondent

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Colm Kinsella, Rugby Correspondent

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ckinsella@limerickleader.ie

Munster facing €1.95 million cash-flow deficit this season

MUNSTER are in line to record a significant cash flow deficit of €1.95 million for the year ending June 30, 2016, their AGM held at Young Munster RFC heard on Thursday night.

Falling income from ticket sales, as a result of poor performance on the pitch this season, and increased player costs are the two main factors in the province’s disappointing financial position.

Munster had been forecasting a loss of about €2.2 million around February and March but additional IRFU support support to each of the provinces brought the cash deficit back to €1.95 million.

Munster’s accounts showed a deficit of €333,000 for the previous 12 months.

Munster’s gate income dropped by €1.1 million against budget in 2015/2016, €500,000 of which was from Champions Cup gates. Munster failed to qualify for the knock-out stages of the competition once again with their hopes of progressing having disappeared before their final home pool fixture against Stade Francais.

Gate receipts for the Pro12 dropped by €380,000, with two 6pm Friday evening kick-off times during the World Cup period last autumn blamed in part for the decrease. 

Unlike 2014/2015 when Munster hosted a Guinness Pro12 semi-final and contested the final, Munster lost out on Pro12 knock-out stage income of €250,000 this season.

As a result of the drop-off in attendances. Munster also suffered resultant decreases in ancillary revenues such as bar, catering and match programme income.

Munster also report that their player costs have gone up by €620,000 in the current season. The province puts the increase down to inflation, pressure from overseas competition when trying to retain players that is constantly pushing the prices up.

On the plus side, Munster’s sponsorship revenue has gone up by just under €400,000 this season. The increase is mainly driven by the province’s commercial board which has generated €800,000 in revenue through the current season.

Munster have also expended some existing sponsorship deals which has brought in additional revenue.

Munster have also carried out a split of their ticket sales by county to ascertain where their support base on Thomond Park match days is coming from. The split showed that 71% of it is coming from outside Limerick.

Munster Rugby Financial Controller Philip Quinn told the AGM that the province is in constant contact with the IRFU, with five to six meetings held between the parties this season.

“We submitted a five year plan and had further meetings, had further feedback, had to go with a revised five-year-plan. 

“We are continuing to work very closely with them. They understand what the drivers are, gate income and player costs.

“They have to make a decision now. They have provisions in their accounts for losses this year and next year. They need to work out what allocations are. 

“They have met the other provinces too and now it is literally to come back and say what additional funding they are going to give to each of the provinces. That is subject to committee approval.  

Meanwhile, Young Munster’s Gerry O’Shea was elected as the 119th President of the Munster Branch at last night’s AGM. O’Shea will succeed Bertie Smith in the role next season.