Rugby Union: Wales Enjoy Record Profits

The Welsh Rugby Union, which was in danger of going to the wall a couple of years ago with debts of more than £70m, yesterday marked the approach of its 125th anniversary season by announcing record profits.

Construction of the Millennium Stadium, completed in 1999, left the WRU with the finest rugby stadium in the world and a debt it was unable to service until the arrival of David Moffett as chief executive two years ago.

The WRU announced a restructuring of its debts earlier this year and its accounts for the 2004-05 season, in which Wales won the grand slam for the first time since 1978, showed that turnover was up nine per cent to £21.2m and that a loss of £219,000 had been turned into an operating profit of £3.5m. Net assets almost doubled to £113.5m.

The WRU chairman David Pickering warned against complacency: "Hard work has helped us deliver record profits but we are aware that there is still a lot of work to be done.

"We have established the Millennium Stadium as a leading venue for the music industry and we are able to attract events from boxing to ice-skating. Maximising revenues and keeping a firm rein on costs has paid dividends but this is just the beginning of a concerted effort to further reduce our indebtedness."

Harlequins, whose income will drop after being relegated from the Premiership, will not be subsidising the London Broncos, who are moving to The Stoop at the end of the Super League season and adopting the Harlequins name.

"We have agreed to invest our ground, brand, logo and colours for a fixed period of time so as not to saddle the rugby league operation with cripplingly high rents," said the Harlequins' chief executive Mark Evans. "The rugby league team will be able to take full advantage of the revenues their activities create, the first time for many years that the sport in London has had a chance to operate on a normal commercial basis. What will not happen is that one will subsidise the other financially.

"Of course there is the risk of reputational damage if the dual-code concept does not capture the imagination of enough people in the area but the possible upsides are exciting and, while there are supporters on both sides who will not want to sample the other game, we are about providing a choice and not being hamstrung by the past."