NZ Rugby’s financial model ‘not sustainable’

New Zealand Rugby recorded sizeable losses in yearly accounts released on Thursday.

Chief executive Mark Robinson admitted its commercial model was “not sustainable” despite a contentious private equity cash injection. Robinson pointed to high fixed costs, which include player wages, as the governing body booked losses of NZ$19.5-million (R212-million) in its annual report for 2024.

He said there was “much work to do to get the shape of our game right”. New Zealand Rugby oversees the powerhouse All Blacks, a highly lucrative global sporting brand in its own right. But critics say they have not capitalised on their marketability in the way other leading brands in sports such as Formula One and English football have done.

Sponsorship deals and broadcast rights helped to put US$170-million in the governing body’s coffers last year, the accounts showed, which was a “record level of income”. But foreign exchange turbulence and investment in other areas of the business turned this into a loss.

“New Zealand Rugby retains an incredibly strong balance sheet, which is vital for rugby in New Zealand and its ability to weather any major shocks,” said chairman and former All Blacks captain David Kirk.

US private equity firm Silver Lake secured a US$120-million stake in New Zealand Rugby and the All Blacks in 2022. Under that deal, Silver Lake, a fund manager specialising in private equity investments and whose growing stable of sports interests includes Manchester City, took a 5.8% stake in a new commercial entity operated by New Zealand Rugby.

New Zealand Rugby was hit hard by the global lockdown, and its provinces have been losing money for several years as spectator numbers fall.

ALSO: NZ Rugby settles sponsorship dispute

© Agence France-Presse

Photo: Hagen Hopkins/Getty Images