SA Rugby announces profit but braces for financial blow
With the industry struggling while rugby competitions remain suspended, SA Rugby has budgeted for a loss of R1.2 billion due to the coronavirus lockdown.
SA Rugby chief executive Jurie Roux confirmed on Wednesday that the country’s four “Super teams” will play in the new Rainbow Cup. Picture: Gallo Images
Financial discipline has allowed the sport to face the Covid-19 pandemic from a position of relative strength, according to SA Rugby Union chief executive Jurie Roux, with the national federation announcing an R8.5 million post-tax profit for 2019 after its annual general meeting on Wednesday.
“The measures that we have implemented in recent years allowed us to deliver a very satisfactory result at the end of 2019,” Roux said.
“We improved our overall solvency and financial position through fully impairing all loans, investments or receivables where the recovery of such was in doubt.
“That meant that when the crisis struck our improved financial position allowed us the required time to formulate corrective measures to address the financial challenges unencumbered by any underlying weakness that could have worsened what is an extremely threatening situation.
“If this crisis had hit us two of three years ago it might have been a very different story.
“The pandemic has had the effect of tearing up all our approved budgetary plans but we have taken an aggressive approach to the potential impact of the virus.”
SA Rugby had agreed to an industry financial impact plan which would cut R1.2 billion from the budget if required, as it remained unclear when the sport would resume.
“It will be painful to endure for all rugby businesses, but it will mean that we will walk from the burning building still intact,” Roux said.
The organisation’s revenues had increased by 2.5% to R1.29 billion in 2019.
Roux, however, said operations continued to be funded by way of a bank overdraft for significant parts of the year and solutions had to be found to address a number of issues including the loss of a broadcast partner, budgeted Lottery income that did not materialise, further loan impairments and the R62 million required to honour player and management performance commitments for winning last year’s Rugby World Cup.
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