Rugby: ITM unions back in black

New Zealand's provincial ITM Cup rugby unions are collectively back in the black, according to international accounting firm, Deloitte.

Together, the unions achieved a combined annual surplus of around $0.54 million in 2012 - the first profit in at least six years - compared with a loss of $0.63m a year earlier, it said.

Nine of the 14 unions made a surplus over the year. After adjusting for its restructuring package, the Otago union generated a small surplus of $0.2m.

In Deloitte's 'State of the Unions' report, which examines the annual accounts of the 14 semi-professional and amateur rugby unions competing in the ITM cup, which starts this weekend, the firm said there had been an overall improvement in financial performance in 2012, with lower costs outweighing decreasing revenues.

The combined revenue, adjusting for the Otago restructure, dropped by 2 per cent to $67 million in 2012, and was down 20 per cent from $84 million six years earlier.

Over the last year, total costs dropped $2 million to $66 million.

Deloitte partner Grant Jarrold said the small collective surplus was largely a result of cost-cutting, particularly in administration, and in team and match-related expenses.

"It is encouraging that the unions have not cut costs associated with growing the game, which actually increased by $0.7 million in 2012 from 2011," he said.

"While the unions have been able to cut back on total expenditure, they have not compromised their investment in the grassroots game which forms such a vital part in the health of New Zealand rugby," Jarrold said in the report.

The breakdown of expenses for 2012 was 48 per cent for team and match-related costs, 30 per cent for growing the game and 22 per cent for administration.

Even though the unions are collectively "back in black," there was still room for improvement, he said. "Ultimately, the fight for the hearts, minds and wallets of local community supporters may prove to be more important than simple prudent cost management," he said.

In terms of revenue, Canterbury led the way in 2012 with a total of $9.5 million, followed by Auckland with $9.1m and Wellington with $8m. The big three three, along with Waikato and Otago, make up the home bases for New Zealand's five super franchises, and collectively earned 52 per cent of total revenues in 2012.

Some unions are still struggling, with five showing a deficit. The biggest shortfall was Waikato with $0.2m, followed by Southland, Taranaki, North Harbour and Tasman respectively. The 14 unions' financial years finish variously at the end of October, November or December.


REGION BY REGION

- The Canterbury Rugby Union came out on top of the financial heap among the ITM Cup-playing unions in 2012, accounting firm Deloitte said.

- The union turned itself around with a net surplus of $289,000 for 2012, compared with a $562,000 loss in 2011.

- A restructured Otago union turned in a $217,000 surplus from a loss of $861,000 a year earlier.

- Northland reported a $166,000 surplus, compared with a loss of $126,000 a year earlier.

- Auckland's surplus came to $127,000 compared with a $92,000 loss a year earlier.

- Bay of Plenty's surplus rose to $184,000 from $33,000.

- Southland did not fare so well, reporting a $189,000 deficit in 2012 from a $719,000 surplus in the previous year.


 

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