High Loss of £8.7 Million for New Zealand Rugby After the Ineos Incident
Rewritten Article:
Amidst a third straight loss, New Zealand Rugby (NZR) is bleeding an astonishing NZ$19.5m (roughly £8.7m). This, despite a record income year.
The financial bloodbath, following losses of NZ$8.9m (£4m) and NZ$47m (£21m) in 2023 and 2022 respectively, has got the rugby enthusiasts chattering.
Just months ago, NZR took a swing at Sir Jim Ratcliffe's Ineos for early sponsorship termination and filed a legal challenge.
A statement declared, "Although the organization almost broke even operationally, foreign exchange hedging on sponsorship revenue and investments into revenue growth initiatives through New Zealand Rugby Commercial (NZRC) led to a whopping $19.5m net deficit."
In a surprising move to counteract the losses, US private equity firm Silver Lake invested a whopping US$120m into NZR's commercial arm in 2022, bumping up their ownership from 5.7% to a meatier 7.5% in 2023.
The Dismal Pockets of NZR
The losses come when you'd think the All Blacks, one of the most globally recognizable brands in rugby, if not in sports, would be riding a wave of green. With commercial agreements in place with Adidas, Altrad, and soon Toyota, who'll replace Ineos on the training kits, it's hoped the new deal will fill the void left by the Ineos termination.
The losses also come when rugby's popularity seems to be flourishing. In an interview last year, New Zealand Rugby Commercial chief executive Craig Fenton claimed the sport "has about a billion followers worldwide."
"Despite the loss, we're still seeing a new high watermark of $285m income, healthy commercial revenue streams, and reinvestment into rugby at all levels. These are signs of hope," remarked New Zealand Rugby chairman David Kirk.
He added, "NZR retains a formidable financial backbone, crucial for rugby's survival in New Zealand and the ability to weather financial storms."
At NZR's AGM, this staggering loss was attributed to a NZ$38m investment in "commercial revenue growth opportunities," including NZ$11.7m in their own content platform, NZR+.
- The financial loss experienced by New Zealand Rugby (NZR) resulted in a deficit of approximately NZ$19.5m, despite a record income year.
- In an attempt to counteract the losses, a US private equity firm, Silver Lake, invested a substantial US$120m into NZR's commercial arm in 2022.
- The All Blacks, one of the most globally recognizable brands in sports, are losing money despite commercial agreements with companies such as Adidas, Altrad, and Toyota.
- Despite the current financial loss, New Zealand Rugby (NZR) remains optimistic, with a new high watermark of $285m income, healthy commercial revenue streams, and reinvestment into rugby at all levels.
- NZR's chairman, David Kirk, emphasized the organization's formidable financial backbone, crucial for rugby's survival in New Zealand and the ability to weather financial storms.
