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Exclusive: Union in crisis as Leeds sink £2m into the red
Gary Hetherington has warned that Leeds Carnegie and the game of rugby union itself face a difficult future as rising debts show no sign of easing.
Leeds froze a budget deficit of £1.5m last summer chasing Heineken Cup qualification but with relegation to the Championship looking increasingly likely, the Headingley club may have to start repaying that debt as a Championship operation.
Leeds needed to generate £500,000 of revenue through season-ticket sales and corporate sponsorship just to break even this year, but the public has been reluctant to buy into a team that has struggled on the pitch all season, meaning they will start next season nearly £2m in the red.
To extricate themselves, Leeds will start repaying their debt on July 1, despite owner Paul Caddick recently telling the Yorkshire Post that he would continue to back the club financially so as to not jeopardise the club’s future.
Hetherington, however, insists the club – who will receive a £2.6m parachute payment from the Rugby Football Union if relegated – must meet the problem head on before sinking further into a hole they will struggle to dig themselves out of.
“That debt will have grown further this year because it has been a disappointing year both on and off the pitch,” said the club’s chief executive.
“This year was supposed to be when we would consolidate and grow the business but there’s no doubt we have failed to do that.
“We’ve got to start repaying it from July 1, otherwise it would prove too expensive to repay and the club would be in a predicament. It is something the board will have to grapple with.”
The club’s plight is symptomatic of a financial crisis engulfing the English game. A report revealed that the combined losses for 10 of the 12 Premiership clubs this season was £19m. Leicester and Northampton are believed to be operating in the black.
“It’s not getting any easier throughout the Premiership, the whole game is going through lean times,” said Hetherington.
“After 15 years the professional game would appear now to be at an all-time low and for the Premiership as a whole there doesn’t seem to be a light at the end of the tunnel. The whole system depends on the personal benevolence of a very small number of people.”
Thompson’s future: Page 23.
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Weather for Yorkshire
Wednesday 22 May 2013
Today
Sunny spells
Temperature: 4 C to 17 C
Wind Speed: 20 mph
Wind direction: North west
Tomorrow
Light showers
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