The WRU announced its highest turnover in its 131 year history of more than £63m which enabled the governing body to re-invest more than £20m into all levels of Welsh rugby and the wholly owned Millennium Stadium.
The Annual Report showed that the turnover of the WRU has risen by 44% in the five years from 2007.
Also, as a result of the financial performance and the re-financing during the year, the net repayable bank debt of the WRU was also reduced to its lowest level since the Millennium Stadium was built in 1999 dipping below £19m for the first time.
The report highlights the WRU’s clearly declared priorities for the months and years ahead based on a five year rolling strategic and financial plan.
It warns that there are challenges ahead as trading conditions in the wider economy are still difficult combined with the cyclical nature of its business model, but the WRU believe it can maintain a financial momentum which can support the sustainability and development of the national sport of Wales.
The Annual Report pinpoints key factors in the WRU’s continuing success such as the on-field performance, its strategic financial planning, recruitment of exceptional staff and departmental restructuring aimed at achieving set goals.
The financial progress of the WRU across the past five years which is highlighted by the latest results have earned the governing body the status of the most successful Tier 1 Union in world rugby in terms of its compound annual growth between 2007 and 2011.
Group Chief Executive, Roger Lewis said: “The results we announce today are clear evidence of how our robust reforms and adherence to clear business strategies across the past five years are paying off with success for Welsh rugby both on and off the field.
“We have recruited and developed great people, reformed our systems and structures and delivered a raft of new initiatives aimed at sustaining and developing rugby as the national sport of Wales.
“This has translated into financial and sporting success and gives confidence that the WRU is clearly in the right shape to meet the challenges of the future.
“We have also taken risks, always measured, and we have not been afraid to face up to the challenges that we have encountered over the course of the past five years.
“To record a 44% growth in turnover across the past five years is a remarkable achievement the WRU can rightly be proud of, but we will not ease up on our commitment to develop within the aims we have defined in our five year rolling strategic plan. The best is yet to come. Our financial performance is the engine to drive our rugby forwards.
“I want to thank my outstanding executive team, the WRU Board for allowing us the space to get on with the job, and particularly all of the staff of the WRU Group for their exceptional commitment and dedication. On a personal note I thank my Finance Director, Steve Phillips, for his wise and prudent counsel and Warren Gatland for his commitment and dedication to Welsh rugby.
“I want to thank also all our broadcasting and commercial partners for their support and the Welsh Government for enabling us to align certain strategies for the benefit of Wales.
“My biggest thanks however goes to all the players, officials, volunteers and supporters who are the true champions of our sport. Together we can continue to take Wales to the world, welcome the world to Wales and play our part in defining Wales as a proud and united nation.”
Financial highlights of last year, summarised in the 104 page report, include:
* A record turnover of £63.2m, an increase of 16% on 2011 and up 44% on 2007.
* A record equallingEBITDA (earnings before interest, tax, depreciation and allocations) of £27.6m, an increase on 2011 of 6%, and an increase since 2007 of 31%.
* A record £20.1m allocation to affiliated organisations, an increase on 2011 of 4% and an increase since 2007 of 35%
* An investment of £3.8m into community rugby, an increase of 23% on 2011 and an increase since 2007 of 31%. This is in addition to a further £2.1m to support the operational costs of the community game, together a record level of funding
*A record £4.1m invested into the operational costs of elite rugby, in addition to record levels of direct costs driven by an exceptional Rugby World Cup year.
£2.9m committed to refurbishing the Millennium Stadium. This highest single spend on the Stadium since its opening in 1999.
* A reduction in repayable net bank debt of £7.4m from last year to a record low of £18.8m, having eradicated £20.5m of repayable net bank debt since 2007, keeping the WRU on target to be debt free by 2021.
More than 650,000 people attended the various events in the Millennium Stadium
Other highlights include:
* Another Grand Slam
* A semi-final place in RWC11
* An IRB 4th place world ranking
* The further development of North Wales as a development region
* Ospreys win the RaboDirect Pro12 final
* The U20s achieving a third place in the 2011 IRB Junior World Championship and beating New Zealand
* Dual contracting of the National Sevens core squad
* Growth in age-grade participation levels across the community game
* Record TV viewing during RWC11 and the Six Nations
* New commercial partnerships during the year and extensions with existing partners
* During the year there was an extension of the WRU agreement with kit manufacturer Under Armour, a new deal for all club rugby balls with Gilbert, a new pourage rights deal with Heineken and Brains and renewal agreements with Dove Men Care, SEAT and the Principality Building Society.
* Television rights deals, including both with the BBC and Sky to show Rugby World Cup warm-up games, match-day ticket revenue and increased commercial activity were three key revenue drivers.
The robust performance also enabled the WRU to embark on a raft of initiatives and changes including the employment of 19 new rugby development staff to work across Wales.
This confidence was also expressed with the WRU embarking on rugby reforms within the Principality Premiership Division, the formation of a new National Championship Division, significant strategic development in North Wales and initiatives aimed at developing schools and college rugby.
The WRU continued to prioritise the community game across Wales and during the year an additional £1m was invested in the community game including club facilities and recruitment grants.
The WRU also launched and completed the first ever Census of all rugby clubs which has provided the governing body with a unique data base of information about the status of the game in Wales.
The challenges within Regional rugby were recognised with the WRU and the Regions agreeing to the first ever detailed financial analysis of the elite level of Welsh rugby.
During the year many observers pinpointed the attendance at the Millennium Stadium of some 61,000 fans to watch the Rugby World Cup semi final between Wales and France as clear evidence of the level of support the game in Wales now enjoys.
In the Annual Report the WRU also declares its full support for Wales Head Coach Warren Gatland in his secondment as coach for the British and Irish Lions on their 2013 tour of Australia.
The Group Finance Director, Steve Phillips, said: “These results indicate that the Group operates within a business model which understands the marketplace we work in and is able to adapt to the opportunities and challenges it presents.
“Across the last year we have been able to deliver a robust financial performance in an economic environment which presented obvious challenges.
“We recognise our business is cyclical and the inevitable hurdles that arise from that but these are fully recognised within our commercial and financial planning processes.
“That gives our stakeholders and commercial partners confidence in our ability to deliver success and enables us to plan for growth.
“We are delighted that we able to convert our on-field success and business planning into additional revenues for the Group and it is pleasing that we may then re-invest into the wider game and our iconic stadium which will serve us well in the future
“Our executive structure now boasts a wealth of experience and we are able to define our priorities based on a real understanding of the needs of Welsh rugby.”
