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Australian rugby league posts $49.9 million NRL profit

Australian rugby league posts $49.9 million NRL profit
February 27, 2015

Australian Rugby League Commission (ARLC) Chairman John Grant announced a net profit of $49.9 million for the NRL, but warned growth opportunities for the game may be diminished by inappropriate off-field behaviour by players.

The surplus comes in the first year of the NRL’s five-year, $1 billion broadcast deal with Nine Entertainment Co and Fox Sports Australia, which was double the value of the previous deal.

The increase in broadcast revenue and the competition’s five-year, $150 million digital deal with Telstra has lifted the ARLC’s total ­revenue to more than $300 million from the $185 million the organisation recorded in the 2012 season.

A surplus of close to $50 million is a large lift from the $4.7 million consolidated operating profit the ARLC recorded in 2012.

Grant and NRL Chief Executive Dave Smith delivered the game's business review for 2014 on Friday, just days after the drug scandal that has rocked the Gold Coast Titans and led to the club's license being taken over by the NRL.

The $49.9 million operating surplus for the NRL for 2014 is a record, coming on the back of a $49.6 million profit in 2013.

The ARLC Chairman said a key to future growth is converting the 3 million casual viewers who were part of a television audience of 4.2 million that watched State of Origin in 2014.

But after acknowledging the success of the code, Grant said the commission and NRL executives feel very disappointed over the damage to the brand arising from the events of the past week that saw five Gold Coast players stood down following a police drug investigation.

Grant is concerned about the impact of such incidents will have on growing the rugby league fan base, telling the ABC “very few of those three million (Origin viewers) will convert unless they see consistently adult, professional and respective behaviour from the head and heart of our culture.

"I see this as one of our greatest challenges.

"Clubs need to set the highest standards for their off-field and on-field teams.

"The players are role models whether they like it or not."

In 2014 the NRL provided for $14.7 million in loans to clubs, of which $10.4 million has been drawn down.

Smith said stepping in to save these clubs has saved the game from losing tens of millions of dollars, but he sees it as only a temporary measure, stating “we are not long-term owners of these businesses."

The NRL's total revenue for 2014 was $344.9 million up from $320 million in 2013.

The core income for the game remains its broadcast revenue following a $1 billion media rights deal ahead of 2013, but the league is boasting a 20% growth in non-broadcast revenue.

While Origin’s television ratings were encouraging, overall television viewing of NRL fell slightly, by about 2 to 3%, which was blamed on well-supported teams such as St George and Wests Tigers having poor seasons on the field.

In other 2014 results delivered at today’s Annual General Meeting, the ARLC also announced:

• Rugby League owned the top three highest rating programs of any kind on Australian television;
• More than a quarter of a million Rugby League fans made a membership commitment to support their Clubs;
• The game’s digital and social media profile grew significantly with 28 million views across digital platforms, and more Australians now follow the NRL on Facebook than any other sport;
• Participation growth was strong with 1.3 million participants, including increases in weekend players, recreational players, minis, females and masters;
• New investment commitments have been secured for stadia upgrades in New South Wales and Queensland to improve game day experience.

Smith said rugby league’s 2014 performance was a growth story and through a strong off field performance, the NRL could continue to ensure Rugby League was a leading entertainment brand for fans and a platform for community connection at the local level.

He added “in two years we have built a combined operating surplus of close to $100 million that will be reinvested back into the game. We’re proud that this surplus has been achieved while the NRL has continued to increased financial support for all aspects of the game.

“We have also put aside $50m into a long term Sustainability Fund that will ensure the game’s underlying position is secured.”

Smith said there was still a lot of work ahead to achieve the game’s longer term targets, concluding “our focus is our clubs and securing their sustainability; investment into rectangular stadia which will drive a better fan experience; staying committed to enhancing our brand; building value into our future rights; and a dedicated focus on key strategic priorities in football such as pathways and competition structures from the grassroots up to the elite level.

“These are the elements that will build even greater value in our game.”




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