The company that runs the Newcastle Falcons rugby team has returned to profit despite seeing revenues fall as games were played without fans during the pandemic.
Newcastle Rugby - which also operates the Thunder rugby league team - has released accounts for the year ending June 27 2021, which show revenues falling to £8.9m, having stood at £11.1m a year earlier. The company’s operating profit came in at £162,000, having been a £140,000 loss in the previous period.
In the accounts, Falcons’ owner Semore Kurdi highlights how the period was “one of the most challenging” in the Falcons’ history, with the club having to rely on Government grants and investment income as most of its games were played behind closed doors.
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Both the Falcons and Thunder were playing in higher leagues during the accounts period after having secured promotion the season before. Both teams maintained their league positions during the season.
Mr Kurdi said: “The adverse impact of the Covid pandemic on the group’s results were offset against an increase of £3.8m in the investment in PRL Investor Limited. In addition, the group utilised the Government’s Coronavirus Job Retention Scheme, from which £2.2m in grants were received in order to mitigate operating losses and safeguard jobs.
“The 2020/21 season has been one of the most challening in the club’s history as a result of the coronavirus pandemic. All but two of the club’s matches at the Kingston Park stadium were played in front of no fans, which made this an incredibly challenging period financially for both players and staff. The impact on the club’s finances was mitigated somewhat through a financial loan from the Department for Digital, Culture, Media and Sport (DCMS).
“After gaining promotion from the championship in the 19/20 season, the club achieved a respectable ninth placed finish in the Premiership, picking up nine wins in the process. The club has a young and ambitious squad and are optimistic about the future.”
Newcastle Rugby has benefitted to the tune of £12.9m from a 2019 deal that saw investment group CVC Capital Partners take a significant minority stake in the English Premiership rugby competition. It received more than £8m of its income from Premier Rugby and the sports’ governing bodies.
In the accounts, Mr Kurdi says that a decision to scrap relegation from the Premiership until the 2024/5 season allows Premiership clubs to “have some certainty over their futures as they attempt to recover from the financial implications of the coronavirus pandemic.”
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