Club statement following EGM09/11/2016
A restructuring of Club finances has been outlined to Jersey Rugby Football Club members at an Extraordinary General Meeting (EGM).
Draft Profit and Loss Accounts presented to members - of whom 124 attended the EGM - showed significant losses for the three years to June 2016, plus a further deficit anticipated for the year 2016/17. In the light of this serious situation, Club officials shared with members the measures taken to acquire sufficient funding to enable Jersey Reds to complete the current season and allow a full strategic review to be completed on the future of the Club.
A joint working group, made up of executive committee members, directors of JRFC Holdings and other senior officers, has secured £1.5million in capital through a sale-and-leaseback of the Club’s assets.
The main assets covered by the restructuring include the clubhouse, pavilion, stands, car park and both main pitches at St Peter. For the duration of the agreement, these will be held by third-party owners, with the Club paying an annual rental fee and having the option to buy back the assets after three or five years.
Chairman Mark Morgan said: "Following the conclusion in late September of a full review of the Club's financial position, the full extent of the financial challenges encountered in recent seasons has become apparent.
"The investment required to operate a fully professional rugby squad in the English Rugby Championship has necessitated major investment by the Club over the last few seasons. In addition to the costs of the playing squad itself, satisfying the criteria to play in the Championship in terms of maintaining quality playing surfaces, coaching team, medical facilities, spectator facilities, floodlights and administrative support has required a significant level of commitment. The Club’s assets have appreciated in value to reflect the substantial physical improvements.
"Our focus has been on firmly securing the Club’s position in the first instance, which then allows us to undertake a full strategic review on the Club’s future beyond the end of this season as a priority.
"It is also our priority to protect grassroots rugby, and I am pleased to say, the Club's amateur teams, including minis and juniors, continue to go from strength to strength and remain largely unaffected by this situation."
The Chairman continued: "The decisions regarding the restructuring were not taken lightly. The joint working group included representatives from all parts of the Club and it was recognised that we needed a swift solution that would enable the club to continue operating while options for the longer term are considered.
"A Strategic Review Board will now be convened in order to undertake a thorough review of the Club's situation, and the board's findings will enable us to address the future with our members at a further EGM to take place by the end of January 2017."
Speaking after the meeting had concluded, Mark Morgan added: "I was thrilled with the turnout tonight. Our club only has one gear now, and that is forward. The positive sentiment expressed in the face of what we've openly acknowledged to be a very challenging situation was very encouraging. Support like this will be crucial as we move forward."