Munster ‘face massive challenge’ as financial deficit continues to grow
Having shown a cash-flow deficit of €1.08 million for the year ending June 30, 2012, the financial accounts for the year ending June 30, 2013, are projected to show a deficit of €658,000 against a budgeted figure of €200,000.
Accepting that “the Branch faced a massive challenge”, financial controller Philip Quinn outlined the counteractive measures being taken at last night’s annual meeting of the Munster Branch held at Thomond RFC.
Among the efforts to reduce expenditure over the 2013/14 season are three recent voluntary staff redundancies plus in-house and staff cost cuts. Chief executive Garrett Fitzgerald insisted that the “last thing” they would do was to interfere with the strength of the playing squad, that budget was also being looked at.
Quinn told the meeting that the “main drivers of last year’s deficit were a reduction in gate receipts (no touring team match and less home knock-out matches) in addition to an increase in the professional team running costs.” For the season just ended, he stated that “the Rabo Direct Pro12 gate income was down against budget, so also the retail sales in the Munster Rugby Stores — which will now be run by the Lifestyle company over the next three years — and a reduction in royalty income from replica sales.”
Fitzgerald added: “You have two options, either face the challenge and act accordingly or close your eyes and hope it will go away and of course it won’t. When 66% of your income comes from gate (receipts), you can’t write it down as guaranteed, it’s just a bigger challenge to sell more tickets and so on.”
There is a belief that reaching the semi-final of the Heineken Cup means a cash bonanza for the competing teams but this is not actually the case.
“There are two lots of income for that,” Fitzgerald explained. “There’s prize money that we don’t get, the Union (IRFU) get that, it’s about €400,000. That’s for reaching the quarter-final. For the semi-final, there’s another €400,000 and the Union get that. We don’t get any of the prize money.”
Asked if the IRFU don’t pass some of that on to the Branch, he replied: “You have a set budget for the year and whether you qualify or don’t qualify, you have the same budget. We played Harlequins away in the Heineken Cup. We got half the gate money after expenses and the Union got half of that as well so essentially we get a quarter of the gate money. So when Harlequins decided to play that game at the Stoop rather than Twickenham, it was 100% bad news for us. In the semi-final all the gate money goes to ERC.”
The prospect of seeing a major overseas touring side like the All Blacks in 2008 and the Australians in 2010 at Thomond Park is now extremely remote. That’s seriously bad news for Munster given that they made more than €500,000 from the New Zealand game although a lesser amount from the Wallabies fixture.
“The IRFU won’t allow them because they say they’re injuring the sales of their tickets for the autumn internationals,” stated Fitzgerald. “We make a request every two years to bring teams to Thomond Park and they turn us down religiously. A huge part of the Union funding comes from international games and they have to protect that. If we have an attractive fixture here, no one will travel. If we had one of those games every two years, you could clear around half a million.”
John Hartery — a key figure behind several major initiatives in Munster rugby in recent years — became the first member of the Thomond club to be elected president of the Branch.
Joe Murphy (Midleton) will replace Frank Byford, who has filled the position for the past eight years, as honorary secretary. He defeated Paul Griffin (Richmond) by 64 votes to 62.
