Player costs and recession hit Reds

RISING player costs and a dip in the general retail market reduced Munster Rugby’s forecasted cash surplus for the year to June 30 by almost €300,000.

In figures presented to the Munster Branch AGM at Midleton RFC, the forecast cash flow surplus is forecast to dip from €758,000 at June 30, 2010 to €471,000, a falling off of €287,000.

Chief contributory factors cited to delegates by Munster Rugby financial controller Philip Quinn were a 17 per cent drop in its store sales, although they are still on track to break even this year, and a 14 per cent rise in player costs to €2.4 million for the professional squad, who were crowned Magners League champions last Saturday.

There were two separate factors for the rise in player costs from €2m in 2010, Quinn said. The first was that the branch had to absorb the salary of a player whose central, international contract had been switched to a provincial one, while there was also the cost of retaining players on improved contracts in the face of interest from foreign teams.

Such increased costs helped to offset a 15 per cent rise in gate receipts, which rose to €8.6m, thanks to a lucrative Test against the touring Australia side in November as well as two additional Magners League fixtures.

Sponsorship income was maintained at €2.3m for the year while the Magners League knockout success, with two home ties in the semi-final and final, was also a welcome boost to the coffers.

A disappointing European campaign was not badly felt in financial terms as the branch kept 100 per cent of pool income from home games but only 25 per cent of its knockout games, its 50 per cent share having to be split between the branch and the IRFU.

The relationship between the branch and the IRFU was also a bone of contention in terms of both the ticketing policy chaos that arose during the autumn internationals and the amount of the government’s €3.2m contribution to the governing body that actually reached domestic clubs under the Clubs of Ireland scheme.

Cork Constitution president Der O’Riordan highlighted the anger felt by clubs and asked who was fighting the Munster cause on behalf of the clubs and whether there were likely to be further reductions to funding for the scheme.

Several delegates also raised concerns to both outgoing branch president Cyril Fitzgerald and incoming president Denis Kelleher regarding the recommendation that clubs pay up front for international tickets.

Fitzgerald said he would raise those concerns with the IRFU.