Premiership Rugby has been experiencing some stormy economic waters; its losses nearly doubled to £36 million last year due to the investment of venture capital firm CVC Capital Partners. In 2019, CVC bought 27 per cent stake in the league, making the league more vulnerable to losses in an ever-changing sports market. Accounts released by Companies House show that Premier Rugby Ltd lost £36.11 million in the year through to June 2022, compared to the £19.03 million seen the year before.
The decrease in the total equity of the company also hit hard, dropping to £43 million from more than £96 million. This year, both Worcester Warriors and Wasps have gone under creating a “stain on the reputation” of the sport, according to a Digital, Culture, Media and Sport Committee enquiry. With an average loss amounting to around £4 million a year for each club, London Irish is dangerously close to the same fate. Currently, the Rugby Football Union is still waiting on notification for a potential takeover by an American consortium.
The cause of the losses experienced by the league can be attributed to the plague of Covid-19. With restrictions on crowd attendance at sporting events, an increase in turnover of only six per cent can be seen (£65.5 million). CVC Managing Partner, Nick Clarry stresses the need for ‘closely’ working with clubs, Sport England and the DCMS to ensure that the loans embraced during the pandemic to stay afloat are able to be repaid.
Premiership Rugby is currently headed by the Chief Executive Officer, Darren Childs who joined in 2018. Childs is based in the company’s London head office, having held notable positions before at the BBC and ITV. He is no stranger to leading organizations through difficult times and is proven in working to increase attendances, commercial revenues and sports production for leading broadcasting platforms.
The league also relies heavily on the agreement with the Rugby Football Union and its broadcasting contract with BT Sport which is set to be renewed in 2024. Premiership Rugby’s financial future remains uncertain but with two powerful figures behind it in Darren Childs and Nick Clarry, the league may just weather the storm.
