Rugby Australia (RA) Chairman Hamish McLennan has admitted that they will look to follow the lead of New Zealand and seek private equity following the confirmation of a $27.1m deficit.
RA confirmed the result for 2020 at its Annual General Meeting after a $45.7m reduction in revenue as a result of the impact of the COVID-19 pandemic.
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The organisation undertook significant cost reductions as a result, with over $31m cut across staff, player and member costs.
“Australian Rugby has been through some challenging years recently, but nothing could have prepared us for 2020. When the extent of the COVID-19 pandemic became clear in late March, we were forced to shut down both professional and community Rugby across the country. The organisation was shaken to its core," McLennan said in a statement.
“It has been an extraordinary job just to survive. We will carry a very weak balance sheet into this year, in what will be a very testing time. This only highlights the importance of external investment as we look to alternate sources of funding to reinvest back into the game.
"It is a testament to the strength, resilience and passion of the Rugby community that we’ve made it to this point. As you can see, we’ve made huge sacrifices, but the difficult decisions we were forced to make in 2020 will set Australian Rugby up for a sustainable and successful future.”
However, he was well-aware of the gigantic challenge that faces RA and the sport, leading to suggestions surrounding private equity.
Whilst they are not expecting to command the $387.5m injection that NZR received from US company Salt Lake, McLennan believes that it's 'critical' to ensure the future of the sport.
"We've started organising documents, we're off and running in that regard...It's critical. We've got to reinvest into grassroots and shore up the balance sheet," he told reporters.
"We're by no means happy with where we are at but at the end of the day, it is what it is. I think we've caught the falling knife. Now what we need to do is turn it around with our commercial partners, make our international tours work really well.
"Broadcast is giving us a big uplift in the ratings year-on-year. That's all really helpful so we'll bring people back to the games and that gets people back to the clubs and we're having good sponsorship conversations.
"I think it's all trending in the right direction but it's not easy by any stretch of the imagination."
The deal would see RA pursue a similar percentage, giving up no more than 15% of a share in the game, with talks ongoing with a number of parties.
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Whilst discussions continue, McLennan was hopeful that a packed International schedule would help reinject interest and revenue into the sport, starting with the upcoming series with France.
With dates for the series set to be confirmed in the coming days according to the Chairman, he is hopeful that this would kick-start a jam-packed International schedule, hinting at a end-of-year Grand Slam tour
"We're feeling confident that it's going to happen," he added. "If we can get an agreement with Ireland, we're happy to pull that off.
"We've still got to work that out but I think everyone wants to get back to normal and playing Rugby. There's always great excitement when the All Blacks and Wallabies come over… they're really keen for us to come over.
"If our guys continue to play well, anything can happen."
McLennan was re-elected as chairman while Dr Jane Wilson, Karen Penrose and Matthew Hanning were elected to the RA board.
Wilson and Penrose will join immediately, with Hanning set to follow them in the coming months
