Northampton Saints plc, the parent company of the Franklin’s Gardens-based Aviva Premiership rugby club, has today announced its financial results for the 12 months ending on May 31st, 2017.
Although increasing turnover to £16.7 million, Northampton Saints is declaring a pre-tax loss of £1.2 million, the first time that the club has ended a financial year in the red since it became a plc in 2001.
There are two significant reasons for these results, namely:
– Dramatically increased playing-related costs, with a much larger salary cap framework and the related inflation in player wages, and strong competition from within the Aviva Premiership and overseas for player signatures
– A number of one-off costs and a stock write-off as the business restructured for the future. These included a mid-season change of caterers to Levy Restaurants UK, part of Compass Group, and costs related to a number of board appointments as the club’s management was reorganised and strengthened to tackle the challenges ahead
The financial results also see the Saints joining the majority of Aviva Premiership clubs that have made losses over the past few seasons.
Nevertheless, Northampton Saints plc has maintained a strong balance sheet, with nearly £20 million of net assets, and there have been some significant commercial deals which are essential for the club’s future.
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On the field the club is bringing in new international players to join the 2017/18 squad like Piers Francis (England), Rob Horne (Australia) and Cobus Reinach (South Africa), who are joining a group which includes the current England captain, Dylan Hartley, and two members of the successful British and Irish Lions touring party to New Zealand, Courtney Lawes and George North.
So while he acknowledges that the club faces some immediate challenges across its operations, Northampton Saints chairman John White says he remains optimistic about the future.
“We remain a club that is determined to achieve the balance of success on the field with profitability off it,” he commented, “and plans are in place to return us to the black over the next few years.
“We have a strong balance sheet, minimal debt, and the backing of thousands of Season Ticket Holders and supporters, as well as a fantastic group of club sponsors and partners. Furthermore, the £1 million additional investment from our major shareholders in April 2017 was testament to their ambition and continued faith in the people who are managing the club.
“On the field we have made some exciting new signings, and we will continue to seek further opportunities to strengthen the squad for future seasons. Jim Mallinder has also reviewed how we do things in his department and has implemented a number of changes in order to refresh and improve things.
“Furthermore, the game against Stade Francais at the end of May showed the character that the players have, and we can use that as inspiration going forward into the new campaign.
“Away from the playing front we have appointed Mark Darbon as our new chief executive. Mark will bring a fresh approach to how we run our business, which of course in turn is essential in supporting a successful playing effort.
“My ambitions for the club are quite simple. I want to build on previous successes by bringing together the best of what we have already while improving how we operate as an organisation, both on and off the field. It is critical that we do this to ensure that we maintain our status as one of the best clubs in Europe and our hard-earned high reputation across the rugby world.”