Heineken Cup management company pays out €30m despite pre-tax loss

EUROPEAN Rugby Cup (ERC), the Dublin-based company that manages the Heineken Cup, made a pre-tax loss last year but still managed to give €30 million to the Irish, English, Welsh, Scottish, French and Italian rugby federations.

The latest accounts for the company show a loss of €170,000 in the 12 months to the end of June 2008 compared with a profit of almost €540,000 in the previous year. Turnover for the year fell to €35.6m from almost €37m in the previous year.

In 2006, the company broke even and, in 2005, it made a loss of €538,408.

A note in the accounts said: “Maintaining turnover, which derives mainly from sponsorship and television income, is key to the company’s continued success.”

According to the accounts, €30m was distributed to the Irish, English, Welsh, Scottish, French and Italian rugby federations in the year, down slightly on the previous year.

Income is distributed according to how many teams a federation provides to the Heineken Cup and the European Challenge Cup.

The ERC employed 15 full-time staff in 2008 and is run by Derek McGrath.

The board is chaired by the former France centre Jean-Pierre Lux, capped 47 times.

Each of the rugby federations provides two directors to the ERC board.

Staff costs increased from €1.2m to €1.4m.

The company said it was committed to specific financial terms, having entered into “exclusive agreements for sponsorship and television rights”.

The company operates a defined contribution pension scheme for its employees at a cost of €115,786.

Profit carried forward in the year was €1.8m down from €2m in the previous year.