Small crowds and falling gaming revenue were the driving forces behind the Wellington Rugby Union posting a $322,166 deficit during the last financial year.
Though the union is not in the same fiscal strife as some other unions, with healthy cash reserves, the red ink on the final balance sheet highlights the challenges it continues to face.
Average ticket sales during the ITM Cup round-robin plunged to 16,485 compared to 22,605 in 2009 and the actual number of people in the stands was smaller still.
It represented a 27 per cent fall and was exacerbated by similar problems for the Hurricanes franchise which provided only $11,893 to the Wellington union in recruitment and retention funding, compared to $255,000 in 2009.
And gaming revenue dipped to $483,688 well below the budgeted figure of $600,000 further eroding the funding pie.
WRU chairman Tony Duffin wasn't watering down the figures and said the challenge was to reinvigorate the ITM Cup and reconnect with the supporter base.
"We still need people to come to the games," he said yesterday. "Last year we had very small crowds. We need to work and play and support each other in the game of rugby."
He does not share the opinion that the ITM Cup has lost its relevance in the professional age.
"The general opinion around the place seems to be that the ITM Cup has lost its shine, but we in Wellington do not believe that to be the case," he said. "It's a great game and a reflection of the community and it is where the future stars come from."
Duffin said the union had made major cuts to its spending in the past three years and would continue to cut its cloth in the coming year both in terms of operating and player costs.
"Two years ago the Hurricanes made a small loss, last year they broke even. In the professional environment player costs need to follow the revenue. We have been very conservative in our budgeting."
Duffin said that by next year the union would have cut $900,000 out of its player costs with the Hurricanes picking up most of the tab under the new franchise contracting model.
He was at pains to stress the WRU was not in a dire financial position despite two big back-to-back losses ($519,803 in 2009) with net equity of $5.182 million and current reserves in excess of $2 million.
Duffin also said the loss before depreciation was just $3279, but the falling value of their infrastructure would have been part of the 2010 budget.
Perhaps the most revealing gauge is that the union scored itself zero out of a possible 17 per cent on its governance and financial scorecard.
Things have not been helped by the absence of a chief executive after Greg Peters left in November to head Sanzar following a painful round of redundancies and cost-cutting measures.
Crucially, key sponsors Vodafone and Ricoh have committed till the end of 2011, giving some certainty in what will be a difficult year due to the World Cup.
The challenge will be to turn the ship around sufficiently to ensure they remain into the medium and long-term future.
On the playing front, the number of registered senior players dropped slightly to 10,949 and the juniors gave back most of the previous year's increase in falling 3 per cent to 4656.
However, teenage playing numbers increased by more than 8 per cent to to 3775 players in the critical 13-20 age bracket.
At A Glance
Wellington Rugby Union, the bad news:
Net loss after depreciation: $322,166 ITM Cup ticket sales down27 per cent
Gaming revenue down $116,312
Hurricanes recruitment and retention funding down from $255,000 to $11,893
Junior playing numbers down 3 per cent
The good news:
Teenage playing numbers up 8 per cent (13-20)
Cash reserves in excess of $2 million
Key sponsors Vodafone and Ricoh re-signed till end of 2011
- The Dominion Post
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