Rugby cup’s €44m windfall

The windfall to national rugby unions and clubs from the final year of the Heineken Cup totalled €43.59m, new figures show.

The data is contained in fresh accounts filed by Dublin-based firm, The European Rugby Cup Ltd (ERCL) that operated the competition since 1995.

The company last year lost the rights to operate the Heineken Cup and the European Challenge Cup after a power-struggle with English and French clubs.

The new ERCL accounts show that revenues generated by the Heineken Cup jumped by 2%, from €50.9m to €52m, in the 12 months to the end of June last.

The firm recorded a pre-tax profit of €1.74m last year, a turnaround from a loss of over €4m in the previous year.

However, the 2013 loss is largely attributable to the €3.8m in wind-down costs for the firm.

Last year, the firm enjoyed an exceptional gain of €799,496 relating to the release of accrued costs not invoiced, that was held previously within the terms of the statute of limitations, which have now expired.

The figures also show that €200,000 was utilised from the €3.6m wind-down bill last year. ERCL’s revenues were mainly derived from TV and sponsorship income.

Underlining what was at stake in the battle that has resulted in a revamped European Rugby Champions Cup and European Rugby Challenge Cup this season, the €43.59m was marginally down on the €44.35m paid out in 2013.

ERCL ceased its main trading operations last June. However, as part of a one-year service level agreement to June 30 this year, it is currently assisting the organisers of the new competition, European Professional Club Rugby, to run the new competitions and after that will wind down its operations later this year.

The firm has never paid any corporate tax as the company “is engaged in an exempt activity and as a result, its profits are exempt from Irish corporation tax”.

The figures show that the 19 people employed at the firm were well remunerated in 2014, receiving pay, including pension costs, of €1.936m, or on average over €101,894 each.

The chief executive of the IRFU, Philip Browne, is one of 13 directors currently sitting on the board.

The profits last year take account of non-cash depreciation costs of €104,799.

The figures show that the firm had cash of €8.7m at year end.