Newport Gwent Dragons auditor's concern for region's future
Published: 9th Jul 2012 08:22:46
The auditor of Newport Gwent Dragons says he is concerned about the future of the rugby region.
Recently published accounts reveal the Dragons were nearly £2.4m in the red in the year ending May 2011.
The region, which is part owned by the Welsh Rugby Union, made a net loss of more than £272,000 during the year.
Chief executive Chris Brown said it was a "wake up call", but the region was getting closer to a "break even position".
The independent auditor who examined the Dragons' accounts says they reveal "a material uncertainty which may cast significant doubt about the company's ability to continue as a going concern".
The other three rugby regions in Wales are also facing financial challenges with all agreeing a £3.5m salary cap to keep costs down.
The key to what I'm trying to do is looking for a more sustainable future without such reliance on benefactors”
Mr Brown said the Dragons' debt was created by the cost of building a new stand but plans were in place to pay that off.
He told BBC Wales: "They [the accounts] are disappointing and they are losses again.
"We're not terribly happy with that but we have been working on that since then."
He said efforts were being made to address the losses, with three new directors on the board including former owner Tony Brown.
"We believe we can generate sufficient funds, together with the money we receive towards the players, to have a break even situation," he said.
"The key to what I'm trying to do is looking for a more sustainable future without such reliance on benefactors.
"It's of concern so far into a deep recession that rugby clubs and other sports clubs rely on benefactors to keep them going.
"It's a lot of money. I talked before about the new stand and it has been key in terms of getting hospitality and catering money coming into the business, and certainly we've been successful with that since the stand was completed."
Dragons director Tony Brown wrote to season ticket holders recently to warn them that the region was facing "considerable" debt.
"If we can get through the next six months then I am confident that we can build for the future and create great rugby at Rodney Parade once again," he said.
The other regions are also losing money, with Cardiff Blues making a loss of almost £2.3m for the year up to May last year.
In May, Ospreys faced a winding-up petition from Her Majesty's Revenue and Customs over an outstanding tax debt, although the region said at the time both parties were confident an amicable solution could be reached.
And last November, Scarlets reassured fans they were not in financial danger despite a £5.5m debt.
The Welsh Rugby Union said it was in the middle of discussions with the regions on a range of issues so it would be inappropriate to comment.
Harvard CitationBBC News, 2012. Newport Gwent Dragons auditor's concern for region's future. [Online] (Updated 09 Jul 2012)
Available at: http://www.ukwirednews.com/news.php/1439413-Newport-Gwent-Dragons-auditors-concern-for-regions-future [Accessed 15th May 2013]
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