Wasps could lose £500,000 a month if supporters remain locked out of grounds and financial support is not secured.
Wasps Group chief executive Stephen Vaughan has become the latest senior figure at a Premiership rugby club to highlight the financial turmoil being caused by the coronavirus pandemic – which is estimated to be £70million in losses across the 12-team league since March.
In an interview with The Guardian, Vaughan stressed that all options were on the table, including further wage cuts, to avoid closure.
The club, which relocated to Coventry in December 2014, has already made more than 20 people redundant including its head of communications and matchday marketing manager during the pandemic period.
Players also agreed to a 25 per cent pay cut, a measure which was implemented across the top flight of English rugby.
It has been 200 days since the Ricoh Arena last hosted a game of rugby. Hopes were high that the stadium could be used for one of the DCMS pilot projects to reintroduce supporters to attending games after a small number of fans were allowed to attend matches at Harlequins and Gloucester.
But the latest government announcement saw Gloucester’s clash with Bath on Tuesday and next week’s meeting of Bristol Bears and Leicester Tigers, games that were due to be attended by a limited number of fans, be played behind closed doors.
“It is a very grim picture,” Vaughan told the Guardian. “The clubs are united in our response to this and a paper is being prepared for the government to consider. If a vital income stream is cut off for months on end, the emphasis will be on owners to dig even deeper into their pockets.”
Vaughan expressed concerns regarding drops in income that could come from the RFU, which has expressed fears it could lose £60million if supporters are not permitted to attend Test matches this Autumn or the 2021 Six Nations.
He also spoke about fears of how sponsors may act if fans are not allowed into grounds for potentially another six months.
Vaughan’s comments are by no means alone with owners and chief executives across the top flight of English rugby and in the Championship making statements through club media and news outlets.
Exeter Chiefs boss Tony Rowe told the Daily Mirror earlier this month that his club was losing £1million a month and that all Premiership clubs will be ‘financially dead’ if games continue to be played behind closed doors or before limited crowds.
Gloucester Rugby chief executive told CoventryLive’s sister website, GloucestershireLive, in July that they had already lost £5million as a result of the pandemic.
Worcester Warriors owners Colin Goldring and Jason Whittingham stressed that ‘without revenue generated on matchdays from crowds, sponsors and their associated spend, Warriors and all professional sports clubs cannot hope to be sustainable without significant support’ on the club’s website.
With revenue streams heavily impacted, it will place further financial pressure on Wasps Holdings Limited, who reported a £4.99million loss in the second half of 2019. The amount owed to owner Derek Richardson at the stage stood at £18.3million – a figure that has likely to have risen in the 28 weeks which have passed without supporters arriving at the Ricoh Arena and other revenue streams through the stadium such as exhibitions, conferences and concerts.
On the pitch, Wasps have been in remarkable form since the Premiership season restarted in mid-August. A return of six wins from seven games, in addition to the hat-trick of bonus point successes secured before the 2019/20 campaign was suspended in March, has lifted Wasps from tenth to as high as second before dropping to third with a game in hand.
Wasps’ play-off destiny lies in their own hands with two rounds remaining, a trip to Harlequins on Monday and the visit of Exeter Chiefs to the Ricoh Arena on Sunday week.
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