Page 27 - RFU Annual Report 2018

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FINANCIAL REVIEW

5

Total other revenue increased by £1.4m, Overhead expenses Rugby development investment
from £14.2m to £15.6m, primarily due to Overhead expenses include all Rugby development investment grew for
additional World Rugby Development administration and non-match day the seventh consecutive year, increasing
grant income. stadium costs. These decreased £1.1m by £1.1m, from £35.9m to £37.0m. A
year-on-year, from £60.4m to £59.3m breakdown of development investment
Under the new Sports Governance as there was a significant focus on is as follows:
Code, the RFU is now required to show controlling and reducing overheads
the income from public investors and during the second half of 2017/18. Development 2018 2017
to clearly account for the expenditure This decrease was achieved despite investment £m £m
of these funds. The analysis and use of an increase of £0.8m in depreciation
Sport England funds received is shown (to £16.1m) and a provision for staff People and 11.8 11.8
below. restructuring (£1.3m). The depreciation people related
2018 2017 increase was mainly as a result of AGPs operational
£m £m brought into use during the year. costs
Total Sport 3.2 3.3 Profit before rugby investment Depreciation 0.5 0.2
England income Profit before rugby investment was (mostly AGPs)
down £10.3m (11%) to £83.3m. Combined
Related spend with the exceptional gain from the Investment in 17.7 17.3
Player retention 0.4 1.0 TEL transaction, this enabled rugby programmes
and transition investment of £107.7m.
League funding, 7.0 6.6
Broadening reach 0.5 0.2 Professional rugby investment club insurance and IPF
Professional rugby investment includes
Touch and sevens 0.9 0.7 the costs of all England representative Total 37.0 35.9
teams, pathway programmes, the
Women and girls/ 1.4 1.4 support infrastructure, as well as
talent development professional club funding. Overall Programme investment includes
investment at £70.7m was up £7.0m, programmes such as CBRE All Schools
Total spend 3.2 3.3 which is due to the phasing of funding and Project Rugby as well as investment
as part of the Professional Game in volunteer development, other
Agreement. A breakdown of professional club management and governance
Cost of sales rugby investment is as follows: programmes, and direct club and CB
Cost of sales reduced £1.1m, from funding.
£30.9m to £29.8m. As a result gross Professional 2018 2017
margin has been maintained at 83%, investment £m £m Interest payable and similar
in line with 2016/17. The outsourcing charges
of the retail operation means that this Professional club 37.2 30.2 Interest payable and similar charges of
margin would have been expected to funding £2.2m includes the interest on drawn
improve slightly. However, this is offset down loan funds, implied interest on the
by additional cost of sales in hospitality. Player fees, 20.4 20.8 future contractual obligation payable
Due to development, the East Stand was England men’s 15s, to Compass, a loss in the fair value of
unavailable during the 2018 Six Nations Women’s 15s, Sevens, investment properties and net pension
and so a temporary structure had to be men’s and women’s interest.
built, at additional cost, for hospitality. pathway

Base, including people, 13.1 12.7
operations and
investment games
Total 70.7 63.7

Annual
Report
2018