The Scarlets have published their accounts for the year to 30 June 2014, reporting a pre-tax loss of £1.75 million, compared with a loss of £700,000 the year before. Turnover was stable at £8 million, although match attendances have been poor and are worsening.
The story has so far been covered by the BBC (here) and Running Rugby (here).
The board blames the deterioration partly on a £200,000 increase in legal and professional costs incurred in the regions' dispute with the WRU last year, however there was a 6% increase in the wages and salaries bill, and the number of employees on the books rose sharply from 162 to 210. The region said that it had invested an additional £500,000 in its "rugby playing budget and backroom coaching group".
Long-term liabilities, loans and overdrafts rose by 28% to more than £12 million. Debts include £2.6 million owed to Carmarthenshire County Council.
Running Rugby reports that former chief executive Mark Davies, who left to become CEO of Regional Rugby Wales (RRW)
back in September, said that the financial situation for 2014-15 would
be “significantly improved” as a result of the changes made to European
competition and the new agreement struck with the WRU, and the Scarlets will be hoping that will be borne out in next year’s accounts.
There is no doubt that 2013-14 was a particularly difficult time for Welsh regional rugby because of the protracted dispute with the WRU, but unfortunately the deterioration in performance stands in stark contrast to results announced by the Blues and the Ospreys which have both reported a reduction in losses. The Blues made a loss of £238,000 (£259,000), while the Ospreys reported a net loss of £123,000, a remarkable turnaround from the record loss of £1.86 million reported for 2011-12.
I do hope we are not heading for a Glamorgan Cricket Club situation where they were unable to service their debt so Cardiff Council eventually were persuaded to write off £4.4 million of the club's debts.
If a school were to operate at half capacity the council would close it!
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