NRL set to smash revenue forecast and post $50m-plus surplus
ByJohn Stensholt,
12:00AM September 3, 2018
The National Rugby League is set to smash revenue and profit forecasts and post a huge surplus of more than $50 million in 2018, fuelled by its massive broadcast deal and better-than-expected commercial income.
Rugby league crowds and television ratings have plateaued, but half of the 16 clubs in the competition will at least break even, led by the most financially successful outfit in the competition, the Brisbane Broncos, and the resurgent South Sydney Rabbitohs.
The ASX-listed Broncos should make a full-year profit of more than $3 million while Souths, who finished third on the ladder after the weekend’s action, are on target to make a $1.3m net profit for their owners Russell Crowe and James Packer.
The Broncos were the only profitable club in 2017.
The NRL meanwhile is set to make a record surplus of at least $50m-$55m, a result that could be even higher if popular clubs such as Souths or St George Illawarra win through to the grand final.
The governing body’s revenue should top $530m, a big increase on the $354m result in 2017, though it still is behind the $650m the AFL received last year. Two AFL clubs alone this year, Richmond and West Coast, should make $10m combined.
There are also NRL clubs such as Cronulla, on track to lose $4m despite a finals appearance, that will struggle financially, while others with leagues club funding such as Canterbury, Penrith and Parramatta will have large fiscal losses covered.
But this year’s result will also exceed the NRL’s previous record surplus of $45.3m in 2013 and the AFL’s $48 million surplus in 2017. It also means the game has achieved a big turnaround in its financial position that at one stage last year had it considering taking out a loan before the TV money kicked in. “We will beat expectations and exceed our budget,” NRL chief executive Todd Greenberg told The Australian. “Our non-broadcast income has been strong for us and we’ve had double-digit growth across all categories in that space, which shows we have a strong executive team.”
The NRL claim television ratings have risen about 1.1 per cent and crowds have increased almost 3 per cent, boosted by big attendances in Auckland, Newcastle and the Gold Coast on the weekend.
Both the NRL and its clubs have been boosted by the first year of the code’s record $2 billion broadcast deal with Foxtel and Nine Entertainment Co, which has meant each club has received almost $13m in central grant funding. That in turn has led to eight clubs on the verge of breaking even.
As well as the Broncos and Souths, other clubs performing well financially are Melbourne, the Warriors, Gold Coast, North Queensland, Wests Tigers and Newcastle.
“It has been a very good year off the field for the code,” said NRL chief financial officer Tony Crawford. “The clubs are really showing an even greater level of professionalism and achieving some good financial results.”
Big membership increases have driven the good results for the likes of the Storm and Tigers, while the Titans have managed to renegotiate a cut of almost 50 per cent in the rent they pay at Cbus Super Stadium.
“It is hard to make money in rugby league but we made a conscious decision to concentrate on the business side four years ago,” Tigers president Marina Go said. “We’ve more than doubled our membership since then. But next year we must make the finals ”
The Storm’s financial strength have been underpinned by good crowds and licensed club revenue.
“We operate in the toughest market given we are the only NRL club in AFL heartland,” said Storm CEO Dave Donaghy. “But it has also given us a good opportunity to have a real point of difference. It should be pointed out too that the money we make off the field goes towards building what we are doing on it.”
Souths have had a big increase in crowd numbers as they surge back up the table, but CEO Blake Solly said commercial income has also been strong.
“We’ve got the Souths Cares foundation and while that is run separately it has a strong connection to the club, and we’ve found corporates really want to be associated with something like that.”
https://www.theaustralian.com.au/sp...s/news-story/fffb1c164c683069702f9f27baec674e
