The Welsh Limited Annual Report 2013 Adroddiad Blynyddol 2013 Undeb Rygbi Cymru Cyfyngedig “I felt a hand gently touch my shoulder. It was the man I was having to mark, the maestro, Jackie Kyle. He put an arm around me and whispered as fondly and genuinely as an uncle would, “I hope you have a wonderful, wonderful first cap today Cliffie.”

CLIFF MORGAN First Cap v Ireland 1951 Arms Park Contents

Financial highlights 02

Neges y Llywydd / President’s message 04

Datganiad y Cadeirydd / Chairman’s statement 06

Group Chief Executive’s summary 10

Operating and financial review Financial review 20 Elite rugby review 28 Community rugby review 52 Stadium review 60 Key performance indicators and business risks 64

Directors’ report 65

Consolidated profit and loss account 68

Consolidated statement of total recognised gains and losses 68

Balance sheets 69

Consolidated cash flow statement 70

Notes to the financial statements 71

Independent auditors’ report 89

Welsh Rugby Union governance 90

Registered office and advisers 93

Welsh Rugby Union Board of Directors 94

Obituaries 100

Commercial partners 104

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 1 Financial highlights

P&L extract - 2013 & 2012 70

63.2 61.0 60

50

40 35.6 m ‘ 31.9 £ 30 29.0 27.6

22.1 20.1 20

10 7.0 7.5 3.8 4.4 2.3 2.6 0 2013 2012 2013 2012 Year

Turnover EBITDA

Operational costs Operating profit before exceptional items

Allocations to affiliated organisations Profit before tax & exceptional items

Amount remaining to service other costs

Analysis of turnover 65 60 5% 3.1 6.0 6% 55 3.5 0.5 50 12.3 13.2 Match income 45 40 9.2 Competition income 35 9.1 21% Commercial income m

‘ 30 53% £ 25 Other event income

20 Other income 35.2 15 32.1 10 5 15% 0 2013 2012 Year

EBITDA = Earnings before interest, depreciation, allocations and exceptional items

2 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013

Turnover v EBITDA 70

63.2 61.0 58.5 60 54.3

49.4 50 m ‘

40 £

29.0 30 27.6 26.2 27.6 24.5

20 2009 2010 2011 2012 2013

Turnover EBITDA

EBITDA v Allocations 29.0 30 27.6 27.6 26.2

24.5 25

22.1 20.1 20.0 19.3 20

m 17.0 ‘

£ 15

10

5 2009 2010 2011 2012 2013

Allocations - all EBITDA

Allocations 18 16.9

16 15.0 15.1 14.2 14 12.1 12

10 m ‘

£ 8

6 4.5 4.0 3.8 3.8 4 3.1

2 1.1 1.2 1.2 1.2 1.2

0 2009 2010 2011 2012 2013 Regions Community Rugby Semi-professional

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 3

Neges y Llywydd

Dennis Gethin, Llywydd / President

Rwyf wrth fy modd i fedru edrych yn ôl ar dymor pan wireddwyd y gwerthoedd a drysorwn fwyaf. Mae gweld enghreifftiau o’r gwerthoedd hynny yn ennyn balchder a llawenydd. Cofiaf y foment honno pan geisiodd Jonathan Davies, canolwr y Llewod, atal y chwarae er mwyn dwyn sylw at chwaraewr a anafwyd yn y tîm a’i gwrthwynebai. Chwarae teg i Jonathan gan fod pawb ohonom a wyliai’r gêm yn rhannu’i bryderon. Ni allwn lai na gwenu wrth weld mor ddedwydd yn cludo d wˆ r i chwaraewyr tîm Ieuenctid Gorseinon pan oeddent yn chwarae yn Stadiwm y Mileniwm. Yna cofiais fel y siaradai , Cyfleusterau newydd yng Nghlwb Rygbi Tylorstown chwaraewr o fri gyda’r Gweilch, Cymru a’r Llewod, gyda balchder am ei sesiynau hyfforddi rheolaidd gyda Chlwb ni gyd y golled. Roedd nifer ohonynt yn hoelion wyth eu Rygbi Trebanos lle plannwyd hedyn ei lwyddiant. clybiau a’r ardaloedd o gwmpas ac fe estynnwn ein Mae’r rhain ac eraill yn enghreifftiau clodwiw o’r modd y cydymdeimlad i’w teuluoedd a’u ffrindiau. Mae cyn- gall rygbi yng Nghymru ymffrostio’n haeddiannol yn y chwaraewyr rhyngwladol yn cynnwys Brian Sparks, cyswllt cadarn gyda’n cymunedau a’n clybiau lleol. Heb y Onllwyn Brace, Billy Thomas, Billy Watkins, Billy Hullin, cyswllt hwnnw ni fyddem yn gallu denu chwaraewyr W.O. Williams a fy ffrind annwyl, Cliff Morgan. Misoedd newydd a chynnal y llwybrau sy’n bwydo tîm cenedlaethol lawer yn ôl collodd cyn-aelod o Fwrdd URC, Steve Pike, all unwaith yn rhagor sicrhau buddugoliaeth ym frwydr a ymladdodd yn ddewr, a bydd bwlch enfawr ar ôl Mhencampwriaeth Chwe Gwlad yr RBS. rhain i gyd. Yna, wrth gwrs, penllanw’n llwyddiannau oedd cael Gadewch i fi hefyd gymryd y cyfle i ddiolch unwaith yn cynifer o chwaraewyr a staff ystafell gefn o Gymru’n rhagor i bawb sydd ynghlwm wrth Ymddiriedolaeth chwarae rhan flaenllaw yng nghyfres fuddugoliaethus y Elusennol Undeb Rygbi Cymru am eu gwaith hynod o Llewod Prydeinig a Gwyddelig yn Awstralia. galed er mwyn sicrhau bod ein chwaraewyr a anafwyd yn Tra oedd y buddugoliaethau hynny’n digwydd yn Awstralia ddifrifol yn cael y gofal priodol. Mae’r Ymddiriedolaeth yn roedd ein tîm Dan 20 yn curo De Affrica yn rownd falch o gymorth Undeb Rygbi Cymru a’r clybiau yng cynderfynol Pencampwriaeth Iau'r Byd a’n carfan Saith Bob Nghymru sy’n cefnogi’r cyn-chwaraewyr hyn a Ochr yn curo tîm nerthol Fiji mewn Cwpan Byd lle rhoesant ddioddefodd anafiadau trychinebus. Gallaf eich sicrhau fod berfformiadau i’w cofio. y chwaraewyr hyn yn hynod ddiolchgar am yr holl gymorth sy’n gwella ansawdd eu bywydau hwy a’u teuluoedd. Wrth nodi’r holl lwyddiannau hyn carwn oedi ac atgoffa pawb sydd ynghlwm wth y gêm gymunedol na ellid Yn olaf, carwn ddiolch i Gadeirydd y Bwrdd, David cyflawni hyn o gwbl heboch chi. Yn y clybiau lleol mae’n Pickering, a holl aelodau eraill y Bwrdd, Prif Weithredwr y chwaraewyr elite yn datblygu’u cariad at rygbi. Gr wˆ p, Roger Lewis a holl aelodau’i Fwrdd Gweithredol, am eu gwaith caled a chyson ar ran rygbi Cymru. Dyna paham roeddwn mor falch pan ddathlodd URC ei lwyddiant ariannol y tymor diwethaf drwy glustnodi Rwyf nawr yn edrych ymlaen at flwyddyn arall lle gallaf buddsoddiad ychwanegol sylweddol i helpu’n clybiau gwrdd â ffrindiau newydd ac adnewyddu hen cymunedol. gyfeillgarwch fel y teithiaf o gwmpas clybiau rygbi Cymru. Eleni rwyf hefyd yn dymuno cymryd y cyfle hwn i ddiolch Diolch. i’n Pennaeth Rygbi ymadawedig, Joe Lydon, a adawodd i ymuno ag Undeb Rygbi Lloegr wedi cyflawni cymaint i atgyfnerthu craidd ein gêm. Mae fy niolch yr un i’m cyfaill didwyll, Gerry Toms, sydd wedi ymddeol o’i swydd fel Rheolwr Stadiwm y Mileniwm, swydd a gyflawnodd yn ddeheuig ac yn egnïol. Dennis Gethin Gyda thristwch, fel yn y blynyddoedd blaenorol, rhaid nodi Llywydd/President i ni golli rhai o sêr y byd rygbi yng Nghymru, ac fe deimlwn Undeb Rygbi Cymru Cyfyngedig

4 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 President’s message

I am delighted to be able to look back on a season when the values we hold closest were championed. Witnessing examples of those values being followed fills me with pride. There was the moment when our Lions centre Jonathan Davies tried to halt play to get attention to an injured rival player. Well done Jonathan because all of us watching the match shared his concern. I noted with a smile how Leigh Halfpenny happily acted as water boy for the Gorseinon Youth players when they performed at the . Then I recalled how that great , Wales and Lions player, Justin Tipuric, spoke proudly of the coaching sessions he regularly manages at Trebanos RFC where it all began for him. These and others are shining examples of how rugby in Greeting former internationals on match day Wales can justifiably boast of being linked with an unbreakable bond to our communities and our grassroots. areas and our condolences are with their families and Without that bond we would not be able to attract new friends. Former internationals include Brian Sparks, Onllwyn followers and sustain the pathways which feed a national Brace, Billy Thomas, Billy Watkins, Billy Hullin, W.O. Williams team capable of securing yet another RBS 6 Nations and my great friend Cliff Morgan. Several months ago a Championship title. former WRU Board member Steve Pike lost his brave battle, and all of these men will be sorely missed. Then of course there was the ultimate accolade for our achievements when so many players and backroom staff Let me also take this opportunity to again thank everyone from Wales helped the British & Irish Lions to their series involved in the Welsh Rugby Charitable Trust for the victory in . incredible hard work they have delivered to ensure our seriously injured players are properly cared for. The Trust is As those triumphs were unfolding in Australia our U20 side grateful for the help of the Welsh Rugby Union and the was beating South Africa in the semi-finals of the Junior clubs in Wales that support these former players who have World Championship and our Sevens squad defeated the suffered catastrophic injuries. I can assure you that these mighty Fijians in a World Cup from which they emerged players are extremely grateful for all this help which with pride. improves their quality of life and those of their families. In noting all these achievements I want to take a breath and Finally I want to thank the Chairman of the Board, David remind everyone involved in the community game that none Pickering, all the other Board members, the Group Chief of it could be achieved without you. The grassroots game is Executive, Roger Lewis and all his Executive Board for their where our elite players develop their love of the game. unstinting hard work on behalf of Welsh rugby. That is why I was so delighted when the WRU celebrated its I now look forward to another year in which I can meet new financial success in the last year by identifying significant friends and catch up with old ones as I travel around the additional investment to help our community clubs. rugby clubs of Wales. This year I also want to take this opportunity to thank our Thank you. departed Head of Rugby, Joe Lydon, who left to join the RFU having achieved so much to strengthen the core of our game. I hold similar sentiments for my great friend, Gerry Toms, who has retired from the role of Millennium Stadium Manager which he has fulfilled with vigour and style. Sadly, as in previous years I have to note the passing of some Dennis Gethin luminaries of the Welsh game who will be missed by us all. President Many of them were stalwarts of their clubs and surrounding The Welsh Rugby Union Limited

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 5 Datganiad y Cadeirydd

David Pickering, Cadeirydd

Ryan Jones yn siarad â’r Clwb Busnes

Os oedd 2012 yn dymor a gadarnhaodd yn ystadegol fod capten carismataidd a rhagorol, pob un ohonynt â rhan rygbi Cymru’n profi’i drydydd cyfnod euraidd o lwyddiant allweddol yn adfer balchder a llwyddiant y Llewod ysgubol, yna gwelodd tymor 2013 Gymru’n atgyfnerthu’i chwedlonol. statws yn Ewrop ac ar draws y byd fel gwlad rygbi o’r radd Ni chyfyngwyd llwyddiant i’r Llewod a’r tîm Cenedlaethol. flaenaf. Cyrhaeddodd ein tîm Dan 20 rownd derfynol Daeth a‘i dîm drwy gyfnod o newid drwy Pencampwriaeth Iau’r Byd yn Ffrainc gan gadarnhau bod sicrhau’r fuddugoliaeth fwyaf pendant erioed dros ein ein hacademïau a’n llwybrau rygbi’n gweithio’n gwrthwynebwyr cystadleuol, Lloegr, i ennill teitl Chwe llwyddiannus. Gwlad arall, ein pedwerydd mewn naw mlynedd. Mae’r ddyled i’w thalu ar Stadiwm y Mileniwm, a oedd yn Cydnabyddir rygbi Cymru ledled y byd fel man lle mae £72m ddeng mlynedd yn ôl, bellach yn llai nag £20m – rygbi’n ffynnu a’n stadiwm odidog yn gyfystyr â llwyddiant. cyflawniad anhygoel gan unrhyw undeb rygbi ar y cae ac oddi ar y cae drwy reolaeth ariannol a rheolaeth rygbi gref. Roedd cynrychiolaeth fwy nag erioed o Gymru yng nghyflawniadau hanesyddol tîm y Llewod a gwelwyd Bwriedir llwyddiannau pellach, oherwydd wedi tair blynedd dylanwad a chwaraewyr Cymru, ynghyd o waith caled a chydweithio gyda’n cyfeillion yn Undeb â dylanwad Cymry ar y tîm rheoli, gan gynnwys y cadeirydd Rygbi Lloger a phartneriaid rygbi ar draws y byd, rydym o Gymro, , ar daith lwyddiannus y Llewod wrth ein boddau i gadarnhau y bydd Cwpan Rygbi’r Byd Prydeinig a Gwyddelig. Roedd un chwaraewr ar ddeg o 2015 yn cynnwys wyth gêm i’w chwarae yng Nghymru, Gymru yn y Prawf terfynol, un chwaraewr ar bymtheg ar y gan gynnwys dwy gêm gogynderfynol. daith gyflawn, heb anghofio cyfraniad , y

6 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Dennis Gethin, yn ei neges. Yn ddiamau rydym yn ffodus o fedru elwa ar sgiliau llysgenhadol Dennis sydd wedi helpu i godi’n proffil mewn modd cadarnhaol o gwmpas y byd rygbi. Eleni rydym wedi cyflwyno’r Bwrdd Gêm Rhanbarthol Proffesiynol (“PRGB”), menter newydd i symud y gêm ymlaen ar lefel rhanbarthol. Ategwyd cyflawniadau rhagorol ein timoedd ar y cae drwy gadarnhau’r cysylltiadau oddi ar y cae. Rydym yn diolch yn arbennig i’n rhanddeiliaid masnachol ac i gymorth y llywodraeth ar lefel leol a chenedlaethol. Gweledigaeth ddewr ein clybiau i adeiladu Stadiwm y Mileniwm fu’r allwedd i’n llwyddiant masnachol ac, fel Cadeirydd Bwrdd Stadiwm y Mileniwm ccc, rwyf wrth fy modd fod rygbi’r gynghrair wedi dewis agor eu Cwpan y Byd yma. Wedi llwyddiant ein cais ar gyfer Cwpan Rygbi’r Byd 2015 byddwn nawr yn gwneud cais ar gyfer Rygbi Saith Bob Ochr y Byd 2018, digwyddiad lle daeth URC, am y tro cyntaf, yn bencampwyr byd yn 2009. Rydym yn benderfynol o yrru ymlaen am lwyddiant. Ni allwn ymlacio gan ein bod yn ymwybodol iawn bod byd chwaraeon yn un hynod gystadleuol. Âf â’r penderfyniad hwn gyda fi pan gynrychiolaf URC yn y Chwe Gwlad, Cyngor y Bwrdd Rygbi Rhyngwladol a Bwrdd Cwpan Cwpan Rygbi’r Byd yn dod i Gaerdydd yn 2015 Rygbi’r Byd. Gallaf eich sicrhau bod llais URC i’w glywed yn uchel ac yn glir. Mae chwaraeon ar frig y don yng Bydd Cymru wedi croesawu gemau Cwpan Rygbi'r Byd Nghymru ond o gwmpas y byd bydd rygbi Cymru’n parhau fwy nag unrhyw wlad arall yn y byd rygbi, gan chwarae i weithio hyd yn oed yn galetach i gynnal ei statws. rhannau allweddol yn 1991, 1999, 2007 a nawr yn 2015. Dyma fan priodol i ddiolch i Brif Weithredwr y Gr wˆ p, Roger Bydd Stadiwm y Mileniwm a Pharc yr Arfau Caerdydd Lewis, y Bwrdd Gweithredol, fy nirprwy Ken Hewitt, unwaith eto’n croesawu Gemau terfynol Cwpanau cadeiryddion allweddol pwyllgorau eraill, Martin Davies, Heineken ac Amlin yn 2014. Alan Jones a Mal Beynon a’r bwrdd am eu hymdrechion Mae’n llwyddiant, fel bob amser, wedi’i sylfaenu ar rygbi’r diarbed ar ran rygbi Cymru. filltir sgwâr, ein clybiau a’n cymunedau rygbi o gwmpas Gwyddom pa heriau sydd o’n blaenau ac fe’u hwynebwn, Cymru. Rwy’n gwybod pa mor galed mae’n clybiau’n wedi paratoi’n briodol ac yn llwyr hyderus fod gennym y gweithio i sicrhau bod rygbi’n dal yn weithgaredd doniau angenrheidiol. hamdden cenedlaethol Cymru a chyda hyn mewn golwg, mae URC, drwy’i chryfder ariannol, wedi buddsoddi £1.3m pellach yn y gêm gymunedol, yn bennaf drwy grantiau cyfleusterau i helpu’n gêm glwb i dyfu. Mae’n Hadroddiad Blynyddol yn amlinellu’n llwyddiant ariannol, a strwythurwyd gan ein Bwrdd a’n Bwrdd Gweithredol. Rwy’n falch i fod yn Gadeirydd sefydliad all David Pickering ymffrostio yn ei lwyddiannau ar ac oddi ar y cae a hefyd Cadeirydd yn gwireddu’r gwerthoedd a amlinellodd ein Llywydd, Undeb Rygbi Cymru Cyfyngedig

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 7 Chairman’s statement

David Pickering, Chairman

A post match conversation

If 2012 was a season that statistically confirmed that Welsh management and the chairman, our own Gerald Davies, Rugby was experiencing its third golden era of, arguably, gave a representation as strong as ever in Lions history. unsurpassed success, then the 2013 season again saw Eleven Welsh players in the final Test, sixteen on the tour Wales confirm its status in Europe and around the world in total, not to mention the contribution of the charismatic as a rugby country of the highest calibre. and outstanding captain, Sam Warburton, all helped restore pride and success to the legendary Lions shirt. Rob Howley and his team came through a period of change by delivering probably the most conclusive ever Success has not been limited to the Lions or the National victory over our great rivals , to deliver another Six team. Our U20 team reached the final of the Junior World Nations title, our fourth in nine years. Championship in France confirming that our academies and the rugby pathway are working successfully. Welsh rugby is universally recognised as a place where rugby prospers and our great stadium is synonymous with The repayable debt of the Millennium Stadium that ten success. years ago was over £72m now stands at less than £20m - an incredible achievement by any rugby union to have Warren Gatland and Wales’ influence on the successful delivered success on and off the field through strong rugby British & Irish Lions tour along with several key and fiscal management.

8 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 European cup finals will return to Cardiff The Duke and Duchess of Cambridge

Further success is being planned, for after three years of of the Board of Millennium Stadium plc, I am delighted hard work and collaboration with our friends at the RFU that has chosen to open its World Cup here. and partners, we have been delighted to After the success of our Rugby World Cup 2015 bid we confirm that Rugby World Cup 2015 will consist of eight will now look to bid for the games to be played in Wales, including two quarter-finals. 2018, an event where the WRU, for the first time, became Wales will have hosted RWC matches more times than any world champions in 2009. other nation in the rugby world, playing significant parts We are determined to drive for success. We will not be in 1991, 1999, 2007 and now 2015. complacent because we are only too aware that the world The Millennium Stadium and will again of sport is extremely competitive. I take this determination host the Heineken and Amlin Cup Finals in 2014. with me when I represent the WRU on the Six Nations, IRB Council and the RWC Board. I assure you that the voice of Our success, as always, is built on the grassroots of our the WRU is being heard loud and clear. Sport is on the crest game, our clubs and rugby communities around Wales. I of a wave in Wales, but around the world Welsh rugby will know how hard our clubs work to ensure we remain the continue to work even harder to maintain its status. national sport of Wales and, with this in mind, the WRU through its financial strength has invested a further £1.3m This is a fitting sentiment on which to thank my Group into the community game, mostly through facility grants Chief Executive, Roger Lewis, the Executive Board, my to help our club game grow. deputy Ken Hewitt, other key committee chairmen, Martin Davies, Alan Jones and Mal Beynon and the Board for their Our Annual Report tells the great story of our financial relentless endeavours on behalf of Welsh rugby. success, strategically planned by our Board and Executive. I am proud to be the Chairman of an organisation that can We know what challenges lie ahead and we face them hold its head high in the world, delivering success on and with the knowledge that we are fit for purpose and we are off the field and also championing the values our President prepared. has outlined in his message. This year we have introduced the Professional Regional Game Board (“PRGB”), a new initiative to take the game forward at regional level. The excellent achievements of our teams on the field have been complemented by the strengthening of relationships off it. We particularly thank our commercial stakeholders and government support at local and national level. David Pickering Our clubs’ bold vision to build the Millennium Stadium has Chairman been the key to our commercial success and, as Chairman The Welsh Rugby Union Limited

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 9 Group Chief Executive’s summary

Roger Lewis, Group Chief Executive

Chatting with Leigh Halfpenny after victory in

It has been a season of mixed fortunes for Welsh rugby. • 21,000 primary school children and 16,500 secondary Extraordinary achievement has at times run parallel with school children received four weeks of WRU skills deep frustration. coaching. That said, the Welsh Rugby Union can look back over the • 16,646 pupils from Years 7, 8 and 9 had the opportunity past twelve months and draw confidence for the future of to play in additional rugby fixtures. the game in Wales both on and off the field. • 183 secondary schools were visited by a WRU Together, we have done a great deal in 2012/13, with development officer for a four week visit. some remarkable results, and within this Annual Report we review in detail our financial and operational performance for the year ended 30 June 2013. I summarise below the key points of the year: Community Rugby first, which includes our funding, professional staffing and support of our 320 clubs, alongside our leagues and competitions, in addition to our support of Welsh school and college rugby. In Community Rugby the headlines for 2012/13 include: • An increased focus as promised by the WRU in supporting rugby in Welsh schools. • The WRU Schools of Rugby accreditation scheme was launched with 22 schools recognised for their contributions to the development of rugby. Little Stars in Aberdare

10 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 • Junior WRU club participation increased with 2,000 new junior players joining. • 6,500 players between the age groups of U12 and U16 attended player identification and development events. • Alternative forms of touch rugby were encouraged with success in secondary schools and with adult organised events. • A Freshers Team competition was introduced for Welsh Universities and Colleges to increase student participation. • A Welsh Students team played fixtures against the German National XV and England Students. • Partnerships with organisations such as Sport Wales, the WJEC, the Universities of South Wales, Metropolitan, Bangor, Aberystwyth and Swansea were developed to support player and coach development WRU Club Census presentation to District D in Kenfig Hill initiatives. Significantly increasing current participation levels at senior • The WRU Club Funding Index was published to highlight club level continues to be a challenge and is an issue which to clubs what support is available and how clubs have we continued to address with vigour, and so: accessed that support. £27m has been received by WRU community clubs during the five years ended 30 June • We invested an additional £1.3m directly into the 2012. community game in June 2013 on the back of this year's strong financial performance. This included £800,000 for • The WRU Club Operations team was established this year club facilities grants, £300,000 to develop new websites to assist WRU club development. for all WRU clubs and £200,000 for a range of schools • The WRU Club Funding Tool was launched online, to rugby projects. help clubs identify wider external funding streams. • These priorities were driven by the findings of the 2012 • The MyWRU website was enhanced, to include a wide WRU Club Census which was presented at WRU District range of support from first aid courses to the training of meetings during April and May 2013. club stewards. • Workshops were held at the Millennium Stadium to train volunteers on many areas of club operations. • A new WRU pro bono legal initiative was launched, in partnership with the Law School to provide advice on request to club officials, supported by the Hugh James law firm and the Civitas barristers’ chambers; this scheme has been applauded in UK legal circles. • Coach development has been a priority, with significant success. More than 2,000 coaches either became newly qualified or achieved enhanced qualifications. • 26 Level One courses attracted 728 candidates, 12 Level Two courses attracted 215 candidates and three Level Three courses had 40 coaches attending. A facilities grant and fund raising help Cefn Cribwr RFC

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 11 Group Chief Executive’s summary

Blues Girls U18 v Girls U18

• 230 district and regional age grade coaches received • The first female referee Francesca Martin was appointed mentoring on a one on one basis or in group sessions to the WRU National Leagues for the 2013/14 season. during the season. • Within the WRU, over 8,000 matches were officiated • Womens’ rugby participation levels continue to be during the season. modest and our efforts to expand our womens’ league • 503 new referees attended 21 Level 1 referee courses structure have met with limited success. with 38 moving onto the Level 2 qualification. • There are areas of excellence in the womens’ game, • 3 referees from the WRU National Academy made their notably with Athletic and Cardiff Quins who Principality Premiership debuts this season. featured in the Cup Championship final. • The WRU/RFU referee exchange programme continued • The WRU Womens’ National Team qualified for the 2014 for a second successful year. Womens’ Rugby World Cup, a very important achievement. • The behaviour of a small minority of players and spectators fell below the required standard this year. This • The WRU Womens’ Sevens team was launched and is not acceptable, will not be tolerated by the WRU and played in two FIRA Grand Prix Series Tournaments. has been dealt with appropriately. • The chair of the Womens’ Six Nations sub-committee • The SWALEC National Leagues continue to be the continues to be held by the WRU which has proposed bedrock of Welsh rugby and the league structures were that a conference on womens’ rugby takes place in the reviewed this year to reflect the needs of the game and Autumn of 2013. the clubs going forward.

12 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Justin Tipuric coaching Trebanos

• The SWALEC Championship, a new league, combining • Most significantly, we successfully concluded our the best sides from Divisions One East and One West was negotiations to host eight 2015 IRB Rugby World Cup successfully created and all of the National League matches, (including 2 quarter finals); and we secured the winners are highlighted within this report. 2014 Heineken Cup Final for a record 7th time in Cardiff. Next, the Millennium Stadium , which is wholly owned by the WRU and all of its commercial and business management is integrated within the WRU Group. The Millennium Stadium headlines for the year include: • The hosting of eleven 2012 Olympic international football matches, attracting hundreds of thousands of fans to Wales, and with images transmitted across the world on global TV channels to millions. • Six Wales rugby international games, the climax being the RBS decider against England, hailed as the stadium's greatest spectacle to date. • Hosting the Rihanna concert, the 2013 Speedway Grand Prix, promoting the Regional Double Header, "Judgement Day", the match, and planning for the July Bruce Springsteen concert along with the opening game of the 2013 Rugby League World Cup game (England v Australia) this coming October. • We launched the Legends’ Stadium Tours with Gareth Edwards, Scott Quinnell, , Jonathan Davies and Phil Bennett. • The Millennium Stadium was awarded the Best Venue Teamwork Award at the Live Music Business Awards RWC 2015 will come to Cardiff 2013.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 13 Group Chief Executive’s summary

RBS 6 Nations Champions

And so to Elite Rugby , which includes the WRU funding, • A record seven WRU national squad staff members, led staffing and support of the national teams, national age by Warren Gatland, along with 16 Welsh international grade teams, the 7s teams, elite match officials, the players in the 2013 British and Irish Lions squad that national academy, the regional academies, and a £6.4m toured to Australia. sum to the four Regions (in addition to the pass through • During the month of June 2013, over 100 Welsh players of ERC and RaboDirect monies), for international player were playing or preparing to play international rugby, release, with a further £1.2m to the semi-professional with over 90% of them based in Wales. Premiership Clubs. • The continuing development of the National Centre of Elite Rugby headlines for the year include: Excellence facilities with cryogenic and high altitude • Winning another RBS 6 Nations Championship title in chambers. 2013, our third since 2008, following a very • The first WRU Rugby Medical Conference was held at disappointing 2012 Autumn Test Series. the Millennium Stadium with great success. • Losing finalists in the IRB Junior World Championship in • Greater alignment of rugby coaching between the France. national squad and national age grade teams, with 27 • Winning the first but badly losing the second test match players aged between 18-21 involved in the WRU in . National Academy. • Wales Sevens reaching the final of the Hong Kong leg of • Further development of match officials, with Leighton the IRB Sevens World Series (finishing the year in seventh Hodges joining Nigel Owens on the IRB Elite Referee place) and qualifying for the quarter-finals of the IRB Panel, and WRU officials involved in the Junior World Rugby World Cup Sevens. Championship, IRB Sevens World Series and Amlin Challenge Cup.

14 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Inside the Wales changing room

• The four Regional Organisations have yet to achieve their Premiership teams, RFC, the Welsh Students potential either on or off the pitch. The Scarlets did and RGC representing North Wales – a continuation of however reach a RaboDirect play-off semi-final, their our Sevens development. We also announced during the highest league finish since 2007. year our desire to tender for the 2018 IRB Rugby World Cup Sevens. • Following last year’s report into the business management of the Regions, the PRGB was established to encourage and support the Regional ambitions. The WRU will make available £6.6m to the four Regions in the forthcoming year, fund the four academies (at a cost of c.£0.6m) and pass through all the monies from participation in the ERC and RaboDirect competitions. The future of the ERC competition continues to be debated amongst its stakeholders. • The WRU made available an additional £1.0m for the development, recruitment and retention of current and future Welsh internationals and is currently reviewing all options and suggestions for the use of this money. • North Wales, as a development region, continues to succeed. RGC, in their first season of league rugby won Division One East and were promoted into the new SWALEC Championship Division. Eirias, in Colwyn Bay, the home of , hosted matches between Canada, Russia, Samoa, Tonga and USA and the Wales U20 Six Nations games before sell-out crowds which were broadcast live on BBC Wales and . • The Principality Premiership along with the SWALEC Cup were won by Pontypridd, a historic double and Llanelli led the way for Wales into a quarter-final of the British & Irish Cup. This is the last ring-fenced season for the Principality Premiership. • A WRU National Sevens competition for 2013 was announced during the year open to all Principality Heineken Cup action

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 15 Group Chief Executive’s summary

The WRU and BBC Wales controller Rhodri Talfan Davies announce a new contract

The Financial, Commercial and Business Affairs • Our repayable net bank debt stands at £19.5m (2012: headlines of the year are as follows: £18.8m) In last year's report I explained, it was unlikely that we Our financial results were driven by an outstanding would achieve the record revenues of the 2013 year end. performance by the National Team, winning the RBS Six Nations Championship. This was matched by the This prediction was based upon our carefully developed performance of our commercial, financial and legal teams five year financial plan, which has identified the cyclical with great support from our broadcast partners, most nature of our business, and which ensures that we can notably BBC Network Television, BBC Wales and S4C, maintain our appropriate investment into the game and along with a range of fine sponsors, the Welsh our Millennium Stadium over a rolling five year period. Government, Sport Wales and our local authorities, in However, I am pleased to report that we exceeded our particular, Cardiff City Council and Conwy Borough financial targets this year which allowed us, in June 2013, Council. to invest significant new monies into the game at all levels. WRU Group Turnover 2007-2013 • Turnover is £61.0m (2012: £63.2m) 65 63.2 61.0 • EBITDA is £29.0m (2012: £27.6m) 60 58.5 • Allocations to our affiliated organisations is £22.1m 55 54.3 50.3 (2012: £20.1m) 50 49.4

m ‘

• Investment into Community Rugby is £4.0m (2012: £ 45 43.8 £3.8m) 40 • Investment into the operational costs of Elite Rugby is 35 £4.2m (2012: £4.1m) 30 2007 2008 2009 2010 2011 2012 2013 Year

16 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 The commercial headlines for the past year include: • Significant attendances at the Rihanna concert (60,000), the WRU promoted Regional Double Header • The conclusion of a major broadcast agreement with the “Judgement Day” (36,000), and the third year of the BBC for our Autumn Test matches until 2018, alongside Welsh Varsity rugby match (14,000), along with a total a new agreement with BBC Wales and S4C for domestic of 355,000 fans attending the six Wales home rugby. internationals. • Renewal of partnerships with Admiral (now a five year During the year, a review of the Governance of the Welsh relationship), Sportseen (now a 10 year relationship), Rugby Union commenced under the chairmanship of Sir Maximuscle until 2016 and Guinness until 2017. Robert Owen, an esteemed High Court Judge. Its • New partnerships agreed with Dove Men Care until recommendations will be made to the Board of the WRU 2016, NatWest untill 2017 and Gullivers Sports Travel in due course. Sir Wyn Williams (one of the most senior until 2019. Judges in Wales) accepted the position of Chair of the PRGB. Dyfrig John, the current Chair of the Principality • A record year for WRU Hospitality with strong demand Building Society agreed to join the WRU Audit Committee for both long term and one-off agreements. and David Goldstone continued to advise the WRU on its • The introduction of the WRU Business Club, bringing property opportunities. Their services are given on a pro- Welsh businesses and rugby together. bono basis and we sincerely thank them all for their • Record crowds for Wales U20 games in Eirias in North invaluable assistance to Welsh rugby. Wales with over 10,000 people attending both Wales v Outlook for 2013/14 and the priorities for the year Ireland and Wales v England U20 internationals. ahead: • Launch of a new WRU Supporters Club scheme; with The rolling five year plan of the Group, established in 2007, over 10,000 members, the majority of these living has ensured that we can maintain appropriate investment outside of Wales. into the game at all levels and also into our Millennium • A record year for the WRU Official Hospitality Operators Stadium through sensitive cost management and carefully scheme, providing over 2,000 covers in Cardiff for predicting our cyclical patterns. The year ahead will not be Official Offsite Hospitality and most importantly giving without its challenges both on and off the field but with back monies to the community clubs in Wales. strong leadership we can continue the record success we have all experienced in the WRU over the past seven years. Our priorities for the next twelve months are clear: • Build upon the undoubted rugby success of our National Team achievements over the past five years with a sharp focus in the lead up to 2015 and beyond. • Continue strengthening our National Age Grade and National Academy rugby developments looking ahead to 2019. • Encourage the four Regions via the PRGB to achieve their commercial and rugby potential. • Enhance the rugby performance of the Principality Premiership. • Develop rugby in North Wales. • Advance our identification of rugby match officials across the game. • Maximise the participation and enjoyment in all forms of First Minister Carwyn Jones and Warren Gatland rugby at all levels for all players.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 17 Group Chief Executive’s summary

Wales U20 JWC13 runners up

• Sustain our rugby clubs and their facilities along with our It has been a remarkable year and a remarkable team communities, volunteers, schools and colleges in as best effort; thanks go to everyone who has contributed to its a way possible. success, whether staff, players, coaches, clubs, schools, colleges, Regions, officials, volunteers, directors, • Review the staffing, systems and structures of the WRU committee men and women, sponsors, partners or media. to ensure that we are properly positioned and supported A special thanks must go to our fans. to secure our future success. Diolch yn fawr iawn. • Further our commercial and business affairs performance. Conclusion On joining the WRU in 2006 I said that rugby defines us a nation, unites us as a nation, and as a union of clubs we will continue to stand together, united around the overarching goal of placing Wales at the forefront of world rugby with passion, pride and with dignity. We want to take Wales to the world and welcome the world to Wales. Together we truly have achieved a great deal over the past Roger Lewis, twelve months, at all levels of the game, and we have once Group Chief Executive Officer more come a long way in living up to our ambition. The Welsh Rugby Union Limited

18 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 19 Operating and financial review Year ended 30 June 2013

Steve Phillips, Group Finance Director

The Group’s business and objectives Group activities The Welsh Rugby Union Limited’s (“Company”) principal activity is to promote, foster, encourage, control and improve the game of throughout Wales. The Company wholly owns Millennium Stadium plc (“MS”), WRU National Centre of Excellence Limited (“WRUNCE”) and WRU Supporters Club Limited (“WRUSC”) and, collectively, the Company and these subsidiaries are referred to as the Group. Dynamics of the business The activities, both operational and financial, of each company in the Group are so intrinsically linked that there is little merit in assessing individual performance. Whilst they are all separate legal entities and are obliged to prepare separate financial statements, it is the Group’s performance that is the only meaningful measure. The Group must deliver on its commercial activities to allow re-investment in elite rugby, community rugby and the stadium. Accordingly, the Group’s income generation is paramount to delivering on its stated objectives. The key economic income driver of the Group’s business is the hosting of events at the Millennium Stadium; particularly, the hosting of international rugby matches featuring the Welsh team Wales in action and especially a winning Welsh team. The more matches that are played, the greater the Group’s revenues and The average attendance per match was 59,000 (2012: profits that are available for re-investment in Welsh rugby. 64,000) and equated to an average of 80% (2012: 86%) The Group welcomed 355,000 (2012: 446,000) rugby when expressed as a measure of capacity attendance. spectators through its turnstiles for the Dove Men Series The primary reason that the overall attendance decreased and the RBS Six Nations Championship, analysed as follows: in 2013 was due to playing two Six Nations matches as 2013 2013 2012 2012 compared to the three in 2012. No. of ‘000 No. of ‘000 home home The average ticket income per attendee at matches held matches matches at the Millennium Stadium in YE13 was £44 (2012: £36). Autumn Series 4 208 --Commercial income, including sponsorship income and hospitality income, is also critical to the financial Six Nations 2 147 3 205 performance of the Group. Summer Series -- 2 124 Within reason, the Group’s operational cost base is One-off match against -- 1 60 relatively fixed; albeit there are incremental costs if more Australia in Autumn Group controlled events are staged. As a consequence, June Test against -- 1 57 incremental events should mean incremental profits which Barbarians can be reinvested into the game across all levels. 6 355 7 446

20 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Financial Performance The surplus of £36.0m (2012: £33.8m) made by the Group which is invested in “Welsh Rugby” can be analysed as Overview of Performance follows: The Group generates income from its international 2013 2012 matches (including sponsorship and broadcast rights) and £’m £’m incremental revenue from the use of the stadium. This Operational costs income meets the operating costs of the Group to allow - Elite rugby 4.2 4.1 the majority of the surplus to be “invested” in “Welsh - Community rugby 2.7 2.1 Rugby”, as follows: 6.9 6.2 2013 2012 £’m £’m Allocations to affiliates Group income 61.0 63.2 - Regions (Professional) 16.9 15.1 Business and administration (6.0) (5.8) - Clubs (Semi - professional) 1.2 1.2 Direct costs (13.7) (15.8) - Community rugby 4.0 3.8 Stadium costs (5.3) (7.8) 22.1 20.1 Surplus 36.0 33.8 Total investment in “Welsh Rugby” 29.0 26.3

As analysed later on page 22, the Group earned some The balance is analysed as follows: £61.0m (2012: £63.2m) predominantly from international Surplus 36.0 33.8 rugby matches staged at the Millennium Stadium. These Total investment in “Welsh Rugby” (29.0) (26.3) matches generated 53% (2012: 56%) of the Group’s 7.0 7.5 overall income. Commercial income at £13.1m contributes 22% (2012: Deprecation (net of grants) 3.2 3.2 19%) of the Group’s overall income. Exceptional items (see Note 4) - 0.2 Interest costs 1.7 1.0 Two other income streams, not generated from staging Fair value (gains)/losses on derivative (0.2) 0.7 international rugby matches, arise from: financial instruments • Competition income which represents the income Tax (credit)/charge (3.3) 1.8 from competitions including the Heineken Cup and Transferred to reserves 5.6 0.6 the RaboDirect Pro12; and 7.0 7.5 • Other events which represent events staged at the Millennium Stadium apart from rugby matches featuring the National Squad - including, in the two years indicated above, music concerts, motorsport and the Olympics. These two forms of income amount to some 21% (2012: 15%) of the Group’s income. The remaining income arises from ancillary activities and various grant sources. The business and administration costs represent the costs of managing the Group; the direct costs represent the costs of staging both international rugby matches and other events held at the stadium; the stadium costs represent the costs of managing the stadium other than those directly attributable to events. Team GB Olympic fans

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 21 Operating and financial review Year ended 30 June 2013

The allocations to the four Regions have continued to 2013 2012 increase by 12% (2012: 1%) to £16.9m (including the £’m £’m competition income referred to above). These allocations cover all international player release and provide core Autumn Series 11.8 - financial support for the four Regions and reflect the Six Nations 19.8 23.3 Participation Agreement signed in September 2009. Also Summer Series - 6.7 included in YE13 are amounts due from the British & Irish One-off match against Australia in Autumn - 2.7 Lions to the Regions and the one-off additional investment June Test against Barbarians - 1.0 of £1.0m to develop, recruit and retain international Other broadcast income 0.5 1.5 players. 32.1 35.2 The allocation to the Group’s semi-professional league has remained in line with the previous year and stands at Commercial income increased by 7% to £13.1m due to £1.2m. The allocations to the Group’s community clubs increases in sponsorship and hospitality income. have increased by 5% to £4.0m; this increase includes Other event income increased to £3.5m; mainly due to the £0.8m for facilities grants, £0.2m for school initiatives and 11 football matches staged during the 2012 Olympics, the £0.3m for the club website initiative. This increase follows Rihanna concert and Judgement Day, the Regional double on from the significant increase of 23% in YE12. The total header. In YE12, there was a lack of opportunity to attract investment in the community game is: other events due to the pitch remaining in place during the 2013 2012 usual concert window in order to stage RWC11 warm up £’m £’m matches. There was a decrease in other income predominantly due Operational costs 2.7 2.1 to a contribution from the International Rugby Board Trust Allocations 4.0 3.8 for RWC11 in YE12 offset by the return derived from the 6.7 5.9 British & Irish Lions Tour in YE13. On a pre-exceptional basis, the Group generated an Operational costs operating profit of £3.8m (2012: £4.3m) from which net As shown in Note 2(b), the Group’s operational costs have debt service of £1.7m (2012: £1.0m) is deducted, the fair decreased by some 10% to £31.9m. This overall decrease value gains on derivative instruments were £0.2m (2012: includes an increase in staff costs of 14% to £9.4m and loss £0.7m) resulting in a profit before exceptional items this is driven by an increase in staff numbers primarily in and tax of £2.3m (2012: £2.6m). the rugby departments. Revenues Business and administration costs have increased by 3% Revenues are analysed as follows: to £6.0m in line with inflationary increases. 2013 2012 Direct costs are costs incurred directly in relation to £’m £’m attaining revenues and will include all National Squad costs and third party costs incurred in delivering events at the Match income 32.1 35.2 Millennium Stadium. These costs have decreased by £2.1m Competition income 9.2 9.2 mainly as a result of: Commercial income 13.1 12.3 • a decrease in player costs of £3.0m due to the Other event income 3.5 0.5 reduction in matches played compared to YE12 Other income 3.1 6.0 which included RWC11; 61.0 63.2 • in YE12 there were additional costs for competing in Match income decreased by £3.1m predominantly due to RWC11 and an additional match compared to YE13; one less home match in this year’s RBS 6 Nations. Match and income can be further analysed as follows: • the above has been offset by an increase in the costs of staging additional events.

22 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 2013 2012 £’m £’m Company 27.3 30.6 WRUNCE 0.2 0.1 WRUSC (0.1) - MS 1.7 (3.1) Group EBITDA 29.1 27.6

Allocations to affiliated organisations (22.1) (20.1) Exceptional items - (0.2) Depreciation (net of grant release) (3.2) (3.2)

Operating profit 3.8 4.1

Net interest (1.7) (1.0) Fair value gains/(losses) on derivative 0.2 (0.7) financial instruments

Profit before tax 2.3 2.4 Minister for Economy, Science and Transport Edwina Hart in Japan Tax 3.3 (1.8) The costs in respect of elite rugby have increased by 2% to £4.2m and include managing the age-grade structures, Profit after tax 5.6 0.6 the national 7s side, player development, referee costs, national centre of excellence and insurance which Net interest expense collectively amount to some 63% (2012: 69%) of the total with the balance of the 37% (2012: 31%) comprising staff The Group’s net interest expense is analysed as follows: costs, including the staff costs of the academy structures. 2013 2012 The investment in community rugby has increased by 29% £’m £’m from last year to £2.7m and include coach development, referee costs and insurance which amount to some 42% Bank interest payable & similar 1.0 0.8 (2012: 41%) of the total with the balance of the 58% Bank charges 0.2 0.3 (2012: 59%) comprising staff costs. Interest receivable - (0.1) Fair value (gains)/losses on (0.2) 0.7 Stadium costs have decreased by some £2.4m to £5.3m derivative financial instruments mainly due to the replacement of the floodlight system and Interest due to HMRC arising from 0.5 - the refurbishment of the hospitality facilities within the settlement of capital allowances stadium in YE12. Total 1.5 1.7 EBITDA and net result YE13 was the first year that the derivative instruments set One of the key measures of the Group is the earnings out in Note 14 had an effect on the results of the Group. before interest, tax, depreciation, exceptional items and Given that the prevailing LIBOR rates during YE13 were allocation to affiliates (“EBITDA”). This is a key measure as below the floor of the derivative instruments, the £1.0m it is the best proxy for cash generated from the Group’s shown under bank interest payable & similar above includes operational activities. This provides the cash to fund the some £0.2m of interest cost arising from these derivative Group’s strategic objectives. instruments. The Group’s EBITDA was £29.1m (2012: £27.6m). The The fair value gains on derivative financial instruments above Group’s pre-exceptional profit before tax was £2.3m are a function of comparing the existing derivative financial (2012: £2.6m); after exceptional items, a profit before tax instruments to current market values; these amounts are of £2.3m (2012: £2.4m). This can be analysed as follows: unrealised.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 23 Operating and financial review Year ended 30 June 2013

Taxation Cashflow and Net Debt During YE13, the Group has agreed the treatment of The Group’s net cash inflows from operating activities certain matters for corporation tax purposes with HM were as follows: Revenue & Customs ("HMRC"). These matters include the 2013 2012 extent to which expenditure on the Millennium Stadium £’m £’m qualifies for tax relief. Following this agreement with HMRC, adjustments to the provisions of corporation tax EBITDA 29.1 27.6 and deferred tax are required in the current year. These Allocations to affiliated organisations (22.1) (20.1) adjustments include prior year tax credits in relation to the Exceptional items - (0.2) release of liabilities previously reflected. Working capital movements (3.3) 2.4 This agreement covers the period since the Millennium Stadium was first constructed up to and including 30 June Net cash inflows from 3.7 9.7 2012. operating activities The Group has agreed terms with HMRC such that this From this amount in YE13, the Group paid net interest historic liability can be settled over a three year period with costs of £1.8m, paid £0.7m in respect of fixed assets, interest and the first payment under this agreement was repaid a grant to the Compass Group of £0.1m and paid made in March 2013; this payment is included in the tax tax of £1.7m leaving a net cash decrease of £0.6m. paid amounts on the Group’s cashflow. Net debt, which is defined as bank loans plus debenture The effect of this agreement was as follows: loans less cash balances, as at 30 June 2013 was £67.1m £’m (2012: £66.4m). Corporation tax due: up to and including 3.6 Net bank debt, which is bank loans less cash balances, was 30 June 2012 (less payments on £29.5m (2012: £28.8m). Included within these amounts account prior to 30 June 2012) is some £10.0m which is repayable only in the event of certain defined events occurring. The corporation tax liability as at 30 June 2013 can be analysed as follows: The net bank debt position, excluding the £10.0m above, of the Group is as follows: £’m 30 June 2013 30 June 2012 Corporation tax due: up to and including 3.6 £’m £’m 30 June 2012 (less payments on account Loans: prior to 30 June 2012) Term loan 12.8 15.5 Less: payment made in March 2013 (1.2) Revolving credit facility (“RCF”) 7.5 4.1 Corporation tax due: on trading results 0.9 20.3 19.6 for YE13 Cash (0.8) (0.8) Less: payments on account in respect of YE13 (0.5) Net bank debt 19.5 18.8 2.8 The remaining amounts of £2.4m due in respect of the The increase in net bank debt during the year of £0.7m period up and including 30 June 2012 will be paid in equal includes a £2.7m reduction in the term loan in line with instalments in March 2014 and March 2015 respectively. the terms of that loan offset by a £3.4m increase in the The amount due of £0.4m in respect of the trading result RCF to deal with the working capital requirements of the for YE13 will be paid by October 2013. Group. The RCF was £7.5m drawn as at 30 June 2013, Whilst, it is very welcome that the matter has been £4.1m drawn as at 30 June 2012 and had a maximum and resolved and the uncertainty removed, it has, of course, minimum draw of £12.8m and £4.1m respectively during created a cash cost to the Group. the year. As set out in Note 13, as at 30 June 2013, the Group had unutilised facilities of £10.0m (2012: £13.4m).

24 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Capital expenditure During YE13, the Group invested in some £0.7m of capital expenditure; the main categories of investment were as follows: £’m

National Centre of Excellence 0.4 Stadium LED project 0.2 Other capital expenditure 0.1 0.7

The amounts shown for the National Centre of Excellence above include gym and medical equipment, a high altitude chamber and a cryotherapy chamber. Balance sheet and reserves The increase in the Group's net assets from £5.7m to Cryotherapy session £11.3m arises from the retained profit for the year. The fixed assets of the Group reduced by some £4.2m, As part of the banking agreements the Group has to reflecting the capital expenditure of £0.7m offset by the comply with bank covenants which require the Group to, depreciation charged in the year of £4.9m. inter alia, meet certain levels of cashflows and surpluses. This enforces normal business practices on the Group, but Operating working capital fluctuates from year to year limits the extent to which the Group can invest, make depending upon the timing of events arising immediately allocations to affiliated organisations and access the prior to the year end. facilities above. Pension Funds These bank covenants are typical of those applying to As shown in Note 21, the defined benefit pension scheme commercial businesses. It is in the Group’s best interests which the Group operated was wound-up during the year to comply with these covenants as a breach would be a and the benefits accrued to the former members of that default of the loan agreements. The Group’s financial scheme were protected through the purchase of annuity management and controls are structured so that the Group policies. Consequently, the Group has no deficit on the comply with these covenants. defined benefit pension scheme which it previously Debentures operated as at 30 June 2013 (2012: £nil). During YE13, the Group invited debenture holders of the 410, 420, 430 and 440 Series to extend the redemption date of their debenture from 2024 to 2050 at no cost. Invites were extended to cover some 3,000 debenture holders involving some 5,800 debenture seats. Some 1,300 debenture holders involving some 2,700 debenture seats, being approximately 47% of the total, accepted this invite resulting in the redemption of some £11.5m being extended from 2024 to 2050. It is currently anticipated that a similar offer will be extended to the debenture holders that did not accept the offer in YE13 in future years. The Millennium Stadium at night

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 25

Elite rugby review

RBS 6 Nations Champions

The reputation of Wales as one of the top nations in world Wales Assistant Coaches Rob Howley and rugby was enhanced by the achievement of another RBS joining him along with the Head of Physical Performance, 6 Nations Championship title in 2013. , the National Medical Performance Manager, Prabhat Mathema, the Head of Performance Analysis, Rhys This followed Grand Slam successes in 2012, 2008 and Long and Performance Analyst, Rhodri Bown. These 2005 and served to confirm that the systems, structures personnel remained on Wales duty throughout the season and personnel available in Wales are of high quality and which meant that Rob Howley was able to step up as correctly focused on success. Wales Interim Head Coach for most of the 2012 Autumn The championship victory was further enhanced when full series and throughout the whole of the 2013 RBS Six back Leigh Halfpenny was named as the IRB Player of the Nations with Warren Gatland taking back the reins for New Tournament before he went on to be acclaimed as the Zealand and Australia. British & Irish Lions Man Of the Series. The Japan Tour Head Coach role went to Robin McBryde, These achievements were further recognised during the which again served to enhance the strategy of developing year when sixteen Welsh international players were senior staff from within the existing Wales structures selected to represent the British & Irish Lions on tour in whenever possible. Australia during the summer of 2013. Aligned to this upgrading of roles, the Scarlets backs coach Warren Gatland was chosen as Head Coach of the British Mark Jones was seconded to senior Wales duty for the RBS & Irish Lions and was seconded to that role following the 6 Nations in 2013 and went on to take on the role of 2012 RBS 6 Nations tournament. The Lions further Acting Assistant Wales Coach for the summer tour to selected a strong Welsh contingent of backroom staff with Japan.

28 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Wales v

During the year, the development of the WRU National between 18 and 21 selected for a series of intense Centre of Excellence continued with the introduction of coaching and fitness programmes with direct input from permanent Cryotherapy treatment, an altitude training senior national coaches. Many of the intake were involved chamber and enhanced GPS units. in the Junior World Championship with others, Harry Robinson, Dafydd Howells, and all This facility is now widely recognised as a state of the art travelling to Japan for the summer tour with the senior elite sporting environment within which all Welsh Wales squad. The concept is for selected individuals to international rugby players and teams benefit from being receive an escalated level of input by utilising the in-house nurtured and developed to the peak of their abilities. The coaching, conditioning, skills and medical staff to help day to day use of the facility encourages communication nurture their development. between all squads which helps deliver on the aspirational aims of the Centre of Excellence concept within the This financial year was the first season of the newly pathway structure. reformed, twelve team Principality Premiership Division of Welsh rugby and the introduction of the new SWALEC Throughout the year there was a wider interaction Championship division below that level of the game. between the senior and other squads with a strong example of this being the attachment of Wales Assistant These changes were carried out following a review Coach Shaun Edwards to the U18 structure and travelling involving all stakeholders and were aimed at improving with the squad to the FIRA AER tournament in Grenoble, playing standards and utilising the funding structure to France. greater effect. Another example of success within the pathway structure The Regions and the WRU continued detailed discussions was delivered by the Wales U20 squad which defeated throughout the year following the completion of the PwC South Africa on their way to the final of the Junior World report which focused on the financial structures and Championship in Vannes, France. performances of the organisations. Their victory over southern hemisphere opponents took Before the completion of YE13 the WRU announced a place a year after they became the first U20 team to beat one-off investment of £1.0m to Regional funding to help New Zealand at the same tournament. develop, recruit and retain international players. This sum was in addition to the amounts agreed within the terms In 2013 the Ospreys and Wales U20 outside half, Sam of the Participation Agreement between the WRU and the Davies, was honoured with the award of IRB Young Player Regions. of the Year following his performances in France. One significant conclusion of the ongoing discussions Aligned to the age grade activity during the year was the between the Regions and the WRU was the establishment first intake of the National Academy with 27 players aged of the Professional Regional Game Board (“PRGB”). All the

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 29 Elite rugby review

Judgement Day

stakeholders agreed this would be an important joint There was confirmation of the confidence broadcasters initiative and the PRGB would comprise of an equal have in rugby as a product in Wales when the WRU number of representatives from the Regions and the WRU concluded a major new agreement with the BBC nationally with an independent chair. By the end of the year a to secure coverage of the annual Autumn international fundamental agreement had been reached and an series hosted at the Millennium Stadium. inaugural meeting was held with discussions continuing to The Colleges League continued to improve throughout the refine the agenda remit. year as a foundation for the elite pathway structure. The On the field there was no involvement in the latter stages WRU and S4C continued to work in partnership and of the Heineken Cup, but all four Regions continued to achieved a programme of live match webcasts and supply the majority of players for the senior national squad broadcast highlight programmes throughout the year to and all the players for the age grade international teams. build on the visibility of the Colleges League. During the year the hosting of the Judgement Day games This added value to the league and by the end of the year involving matches between all four Welsh Regions on the there was significant uptake in requests from schools and same day at the Millennium Stadium was universally colleges to join the league and take advantage of the acknowledged to be a great success both on the field and visibility achieved through the media output. as an example of cooperation between all the The Welsh Exiles group made progress in their refocusing stakeholders. on elite player identification. Their attendance and recruitment activities at events like the Rosslyn Park Schools

30 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 7s saw the player database increase in size and more elite players are now being identified. Also, eleven Exiles were selected for the Welsh Students fixture against England. The Principality Premiership Division continued to play a crucial role in the elite structure and another milestone was reached when the former Pontypool RFC and Newport RFC forward, Andrew Coombs, was selected for Wales. This season was the last in which the new 12 team division format was to be ring-fenced against relegation so from the end of the 2013/14 season the Premiership Division will be accessible to the best team from the new SWALEC Championship. There was a significant milestone when the WRU announced the launch of a new National Sevens competition open to all Principality Premiership teams, the top two Championship clubs and RGC representing North Wales. The first event was held at Cardiff Arms Park and it is hoped the tournament will become a permanent fixture in the sporting calendar of Wales. WRU support for the on-the-field activities included a focus on player welfare especially involving matchday medical cover. This led to the launch of a medical initiative to help pitchside care for elite regional and national teams under the supervision of the WRU medical team. Before the end of the financial year a senior departure Wales in action from the game in Wales was announced. The WRU Head of Rugby, Joe Lydon, resigned from the WRU and has taken One East. Their victory in that league means a significant on a similar role with the RFU based in Twickenham. enhancement of their status for the season ahead with inclusion in the Championship Division. Joe Lydon has overseen and championed a remarkable and varied level of change across the game in Wales and has Match Officials put in place systems and structures which offer the WRU A significant milestone was celebrated during the period every opportunity to fulfil its potential in the years ahead. when Nigel Owens became Wales’ most capped referee During the year there was a significant development of the when he officiated at his 45th test match. The honour was profile of elite rugby in North Wales with games played at achieved in the southern hemisphere when he took control the Eirias stadium attracting significant support. In of a summer tour encounter between New Zealand and November 2012 the inaugural IRB International Rugby France. Owens also officiated at two matches in the RBS Series was hosted at the venue with Canada, Russia, Tonga 6 Nations as well as the Amlin Challenge Cup Final and the USA playing Test matches over two matchdays. between Leinster and Stade Francais. Again the Wales U20 home Six Nations games were hosted Leighton Hodges became Wales’ 55th test match referee at Eirias with games played before sell-out crowds and after he was appointed to the IRB Elite Referee Panel broadcast live on BBC Wales or S4C. alongside Nigel Owens and took control of Canada v The WRU structural and operational organisation of North Ireland and Scotland v Italy. Wales rugby was strengthened with the appointment of At the Junior World Championship in France, Wales was the former Wales international, Rupert Moon, as General again represented with Ian Davies selected by the IRB to Manager. His new role coincided with the introduction of officiate. RGC into league rugby for their first season within Division

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 31 Elite rugby review

Wales’ elite referees

Rhys Thomas firmly established himself on the Sevens Coach Development World Series and officiated in eight out the nine The strategic objective of aligning backroom disciplines tournaments and was also selected to referee at the Rugby across the player pathway was exemplified during the year World Cup Sevens in Moscow. with more formal interaction between coaching personnel. With Nigel Owens and Leighton Hodges refereeing The involvement, already referred to, of Shaun Edwards Heineken Cup rugby during the season both Ian Davies with the U18 squad was an excellent example of this while and Neil Hennessy officiated within the Amlin Challenge other senior coaches operated within the National Cup for the first time. Rhys Thomas also made his debut Academy. in the Rabo Direct Pro 12. Both Gareth Simmonds and Outside the day to day activities the undoubted success Nigel Whitehouse were included in the 2013 RBS 6 Nations and value of the Wales backroom team at senior level was TMO Panel and Clayton Thomas continued in his role as recognised at the Sport Wales Coach of the Year Awards one of the five IRB world selectors. where they were honoured with a Special Achievement The National Academy continued to evolve throughout the Award. period with three of the group making their debuts in the There was stability within the appointments structure at Principality Premiership towards the end of the season. A age grade level and again the fostering of alignments was regular referee exchange programme with the RFU evident with the U20 squad training with and in contact continued for a second year giving invaluable experience against the senior Wales squad players at several organised to these young referees within the Academy. Underpinning sessions. the Academy are development groups at both Level 3 and Level 2. The coach development structure continued to develop with ten candidates attending Level Four courses organised with the Cardiff Metropolitan University.

32 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Wales’ kickers train in Rome Wales in action

Professional – International his side secured a record-breaking fifth consecutive away victory in the RBS 6 Nations with a 28-18 win against A season that peaked with Wales claiming their first back- Scotland in Murrayfield. to-back RBS 6 Nations title since 1979 started with four defeats in the Dove Men Series. Halfpenny amassed a further 23 points in , with scoring the game’s only try. Warburton Argentina and Samoa claimed the first victories with 26- returned from injury to start the game and collected the 12 and 26-19 wins respectively. Next up were World man-of-the-match award as Wales set up a Championship Champions New Zealand who produced a clinical first-half decider against England at the Millennium Stadium. display to set up their 33-10 victory. The final match of the campaign ended in agony with Australia scoring in the England arrived in Cardiff with four wins from four and final minute to snatch victory from their hosts 14-12. searching for their first Grand Slam since 2003 up against Wales looking for a fourth title in just nine seasons. The opening encounter of the 2013 RBS 6 Nations saw the defending champions slip to their first defeat to Ireland In a match that will live long in the memory Wales since 2010. The visitors raced into a 23-3 half time lead dominated to win 30-3. A brace of tries from Alex before Wales forced their way back into the game, but Cuthbert, twelve points from Halfpenny and eight from eventually came up just short, going down 30-22. , ensured the famous trophy would remain in the Welsh Capital. The following weekend captained Wales with Sam Warburton ruled out through injury. Jones’ side Wales not only finished top of the Championship table but became only the fourth Welsh team to taste victory in Paris finished with the best defence, having not conceded a try since 1975 as they beat their hosts 16-6, with George since early in the second period against Ireland and as top North scoring the only try of the game. The victory was the try scorers. Halfpenny followed in ’s footsteps first of three successive matches on the road which all to claim the prestigious RBS Player of the Tournament ended with impressive away wins. award. and Jonathan Davies both crossed for tries Sixteen Welsh players, head coach Warren Gatland and in the dominant display against Italy where Leigh coaches Rob Howley and Neil Jenkins, as well as a further Halfpenny collected sixteen points with the boot and the four backroom staff, travelled to Australia with the 2013 man-of-the-match award in torrential conditions. British & Irish Lions. Captain Sam Warburton led the tourists to a first series victory since 1997. The test decider With Warren Gatland seconded to the British & Irish Lions, saw the Lions run out 41-16 victors. Eleven Welshman took Rob Howley had assumed the position of head coach and to the field that day with Alun captaining the

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 33 Elite rugby review

RBS 6 NATIONS CHAMPIONSHIP 2013 Pos Team PWDL F APD TF Pts

1 Wales 54 0 1 122 66 56 98

2 England 54 0 1 94 78 16 58

3 Scotland 52 0 3 98 107 (9) 74

4 Italy 52 0 3 75 111 (36) 54

5 Ireland 51 1 3 72 81 (9) 53

6 France 51 1 3 73 91 (18) 63

side in Warburton’s absence through injury. Halfpenny not The Regions only finished the tour with 114 points, breaking the record Heineken Cup and Amlin Challenge Cup for most points in a test series and points scored in a test match, he was also crowned player of the series. There was no Welsh representation in the knock-out stage of the Heineken Cup with , the Ospreys and Under the guidance of Robin McBryde, Wales headed to the Scarlets failing to reach the last eight. Japan for a two-test summer tour. Four uncapped players started the first test in Osaka with Harry Robinson’s try The Ospreys finished with two victories to their name helping Wales to an opening 22-18 victory. In total nine including a 17-6 win over four-time Heineken Cup new caps were blooded across the two-games and at a champions Toulouse. However, four defeats in Pool 2 left packed Chichibunomiya Stadium, Eddie Jones’ side levelled the Ospreys in third place. the series winning 23-8. Cardiff Blues, who reached the quarter-finals in 2012, Results: could only register one victory in a tough pool which contained eventual champions Toulon. A 26-14 victory in Dove Men Series 2012 the final pool match against Sale meant Phil Davies’ Wales 12 - 26 Argentina side finished in third place in Pool 6. Wales 19 - 26 Samoa The Scarlets failed to record a victory in their six pool matches, but were up against defending champions Wales 10 - 33 New Zealand Leinster and beaten finalists in 2013 ASM Clermont Wales 12 - 14 Australia Auvergne. RBS 6 Nations 2013 Newport Gwent featured in the Amlin Challenge Cup but could only register two pool victories. The Wales 22 - 30 Ireland Dragons lost home and away to Bayonne and London France 6 - 16 Wales Wasps, but recorded back-to-back victories against Italian Italy 9 - 26 Wales side Rugby Mogliano. Scotland 18 - 28 Wales RaboDirect PRO12 Wales 30 - 3 England The Scarlets reached their first RaboDirect PRO12 play-off semi-final in 2012/13 after securing fourth spot in the Japan Tour 2013 table. Japan 18 - 22 Wales It was the Scarlets’ highest league finish since 2007 and Japan 23 - 8 Wales set-up an away fixture against Ulster at Ravenhill in the last four, which ended in defeat for the Welsh region 28-17.

34 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Regions in action

Ulster went on to face Leinster in the final but lost 24-18, LV= Cup with Leinster lifting the title. The knock-out stages of the LV= Cup were contested by It was the first time the Ospreys, the defending champions, English sides after the Welsh regions failed to qualify from missed out on a play-off position since their introduction. their respective pools, with Harlequins taking the title. The Ospreys finished a place behind the Scarlets in fifth, The Scarlets, Cardiff Blues and Newport Gwent Dragons with a four point deficit. all ended their LV= Cup campaigns with two victories from Cardiff Blues finished the campaign in ninth position with four outings while the Ospreys lost their last three matches Newport Gwent Dragons in eleventh. after an opening success against Gloucester. Play-Offs Notable victories for the Welsh regions saw the Scarlets beat 40-19 and Cardiff Blues beat London 28-17 Scarlets Wasps 22-17. 17-15 Wales U20 Final Wales U20 completed their most successful season to date Ulster Rugby 18-24 Leinster Rugby after reaching the final of the Junior World Championship and winning four out of five matches in the U20 Six Nations.

RaboDirect PRO12 Team PWDLFA BP Pts Ulster Rugby 22 17 14577 348 11 81 Leinster Rugby 22 17 05585 386 10 78 Glasgow Warriors 22 16 06541 324 12 76 Scarlets 22 15 07436 406 6 66 Ospreys 22 14 17471 342 4 62 22 11 1 10 442 389 8 54 Benetton Treviso 22 10 2 10 414 450 6 50 22 8113 358 422 4 38 Cardiff Blues 22 8014 348 487 6 38 22 7015 399 504 8 36 Newport Gwent Dragons 22 6016 358 589 4 28 22 0022 291 573 10 10

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Wales U20 in action

After edging out Ireland in their opening Six Nations They impressed against Samoa in their opening JWC game, match, a turning point for Danny Wilson’s side was the but struggled to stick to the game plan against Scotland, impressive win over France in Clermont Ferrand. Three a flash of Jordan Williams magic making the difference in tries, by Sion Bennett, Rhodri Williams and , the end. With two wins out of two, the pool decider helped the side, captained by Blues back row man Ellis against Argentina was key and Wales showed their Jenkins, to gain real momentum going into the last three versatility in the way they fronted up against a brutal games. Despite atrocious conditions in Viterbo causing a Pumas side, the boot of steering them into the 45 minute delay, they gained a 19-3 half-time lead thanks semi-final for the second consecutive season. to tries from Rhodri Williams and Daniel Thomas along The side was confident ahead of their semi-final against with a penalty try and two Sam Davies conversions, and South Africa, following last season’s win over New managed to hold on in the second half despite an Italian Zealand, and with some of the players having only comeback. narrowly lost to their South African counterparts during an There were five Welsh tries and 12 points from Sam Davies’ U18 tour in the summer of 2012. boot in the 42-17 win over Scotland in Inverness, setting In another bruising encounter, Wales’ forwards stood up up a Championship decider against England at home in to their opposition and the backs created some inspiring Colwyn Bay, however, Wales’ Grand Slam hopes were attacking, but the youngsters still found themselves 17-11 dashed by an impressive England side. down late into the second half. With minutes to go, Sam The defeat was hard to take for the young Welshmen who Davies, who went on to be voted IRB Junior Player of the vowed to take the lessons of that game into the Junior Year, chipped for wing Ashley Evans to chase and score, World Championship in France. Davies adding the conversion to win the game.

38 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Wales U18 in action

In the first ever final for a 15-man Wales team in an IRB Wales U18 competition, Wales went in at half-time 15-3 up over Wales U18 head coach Allan Lewis stuck to his philosophy England, but they failed to capitalise on a numerical of always challenging the opposition with the ball in hand advantage while England had a player in the sin bin and during a successful season in terms of developing players England also proved too strong in the second half. It was for the future. a disappointing end having got so close to a first ever world title for Wales in the 15-man game, but it was a A decision was taken to take a development squad to campaign to be proud of and a sign that Wales has a South Africa in August to play the hosts, along with development system that is producing players and coaches England and France which was regarded as a great success capable of competing at the very highest level. and the initiative was set to be repeated a year later. Results: With narrow losses to England – despite a hat trick for soon-to-be Wales international Dafydd Howells - and U20 Six Nations: Wales U20 17–15 Ireland U20 France U20 13–27 Wales U20 Italy U20 10 – 25 Wales U20 Scotland U20 17-42 Wales U20 Wales U20 15 -28 England U20 Junior World Championship Wales U20 42-3 Samoa U20 Wales U20 26-21 Scotland U20 Wales U20 25-20 Argentina U20 Wales U20 18-17 South Africa U20 Wales U20 15-23 England U20 WRU National Academy training

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Wales U18 squad

South Africa, Wales came away from the experience with February 2013 a draw against France in the final game, but more Wales U18 29-27 France U18 important than that, the players involved gained a huge amount of confidence from having competed with some Wales U18 7-44 England U18 of the best teams in the world. FIRA-AER U18 tournament During the Six Nations period, the Wales U18 side played Wales U18 17-18 Scotland U18 against France and England at St Helens. They impressed in the first match, this time gaining a win over France Wales U18 45-0 Portugal U18 before going down heavily to England ahead of the FIRA- Wales U18 50-0 Georgia U18 AER tournament in the Grenoble area. In that competition, the side was edged out by Scotland in their opening game Wales Sevens but came back strongly. They improved in the execution of Sevens rugby continued to be a core activity within the their ball in hand attacking game and with a little extra Group and during the year the WRU decided to bid to host help from Wales’ defence coach Shaun Edwards, they beat the Rugby World Cup Sevens in 2018. Portugal – with another hat trick for Howells - and Georgia convincingly. Neath centre Howells impressed senior Wales That will be the first World Cup following the inclusion of assistant coach Edwards so much during the tournament the Sevens game in the 2016 Olympics in Rio De Janeiro that he pushed Robin McBryde to include him in his Wales and will undoubtedly prove to be an important showcase training squad, and ultimately the final squad for Japan. for the development of the game. Many of Howells’ team mates on the 2012 U18 tour to During YE13 the Wales Sevens travelled to the World Cup South Africa, including Ashley Evans, Steffan Hughes and in Moscow as defending champions and after a convincing , took that experience into their U20 victory over the tournament favourites, Fiji, emerged as performances in the Six Nations and the successful Junior winners of Pool E. World Championship campaign. John's men entered the knock-out stages full of Tour to South Africa August 2012 confidence after dismantling tournament favourites Fiji the Wales U18 25-28 England U18 previous day to finish top of Pool E. But the Kiwis dominated the quarter-final from start to finish to claim a Wales U18 16-24 South Africa Schools deserved victory. Wales U18 13-13 France U18

40 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Wales Sevens win Plate in Dubai

A try by Rhys Shellard on the stroke of half-time offered Results Wales a glimmer of hope going into the second spell but IRB Sevens World Series two quick-fire tries by Bruce Heem and Gillies Kaka put the game beyond Wales' reach. Australia Fittingly, it was Lee Williams, the only remaining member Wales 19 - 12 Portugal of the squad who tasted World Cup success in Dubai, who Wales 19 - 17 France scored a consolation try for Wales. Wales 5 - 17 Argentina Although that defeat marked the end of their chance to retain the trophy, there is no doubt that the Sevens game Wales 27 - 19 USA has become an important element of the WRU Wales 17 - 26 Spain international structure. Dubai The Rugby World Cup Sevens in June 2013 completed a demanding season for Wales which saw the IRB Sevens Wales 7 - 14 New Zealand World Series kick off in Australia’s Gold Coast eight Wales 14 - 7 Argentina months earlier. Wales 22 - 5 Russia Wales finished the series in seventh place, an improvement of one spot from the previous campaign and the highlight Wales 7 - 19 Samoa was undoubtedly reaching the final in Hong Kong in Wales 27 - 5 Fiji March. Wales 21 - 14 Canada The abbreviated form of the game continued to be a proven breeding ground for full international honours with South Africa Rhys Patchell, Owen Williams and Dafydd Howells earning Wales 12 - 5 Spain their first Test caps on the tour of Japan. The trio had all previously played on the Sevens circuit in Paul John’s side. Wales 7 - 12 Argentina Wales 33 - 14 Kenya

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Wales 5 - 35 New Zealand Wales 26 - 19 USA Wales 26 - 14 Fiji New Zealand Wales 26 - 17 Canada Wales 12 - 19 Samoa Wales 0 - 21 South Africa Wales 12 - 33 France Wales 17 - 15 USA Wales 26 - 21Tonga USA Wales 17 - 7 Argentina Wales 5 - 40 New Zealand Wales 17 - 14 France Wales 0 - 26 South Africa Wales 14 - 35 Scotland Hong Kong Wales 19 - 14 Australia Wales 19 - 14 Argentina Wales 0 - 31 South Africa Wales 28 - 14 Canada Wales 19 - 0 Kenya Japan Wales 22 - 24 USA Wales 10 - 12 Scotland Wales 33 - 15 Kenya Wales 22 - 14 Japan Wales 19 - 21 England Scotland Wales 22 - 14 France Wales 26 - 21 USA Wales 28 - 22 Russia Wales 21 - 24 England Dafydd Howells in Sevens action

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Wales Women in action

Wales 26 – 7 Canada Wales Women Wales 14 – 26 New Zealand The role played by the Group within elite womens’ rugby was enhanced with the appointment of the WRU’s Group England Chief Executive as Chair of the Six Nations Womens Game Wales 19 - 31 Kenya Sub-Committee. One major outcome of the committee changes was a decision that the Womens’ Six Nations Wales 17 - 14 Canada should remain in its current format instead of adopting a Wales 5 - 45 New Zealand proposal to split the tournament into a two tier Wales 21 - 12 Samoa competition. Wales 19 - 7 France On the field Wales Women achieved their aim of qualifying for the 2014 World Cup by finishing the 2012/13 Six Rugby World Cup Sevens 2013 Nations Championship in fourth place. Wales 33 - 5 Uruguay However ’ side could have finished even Wales 28 - 19 Tonga higher if they hadn’t suffered two close defeats against Ireland and England on home soil at Aberavon’s Talbot Wales 19 - 14 Fiji Athletic Ground. Wales 10 - 26 New Zealand

44 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Womens’ Six Nations launch

2013 - Womens' Six Nations Pos Team Pl WD L PF PA Pts 1 Ireland 5500 88 26 10 2 France 5302 160 48 6 3 England 5302 150 71 6 4 Wales 5203 55 79 4 5 Italy 5203 39 68 4 6 Scotland 5005 3203 0

In their opening game of the campaign against Ireland, Semi-Professional Game Wales had edged in front only for Irish hooker Gillian The 2012/13 season saw Pontypridd secure an historic Bourke to score in the corner to give the visitors a 12-10 league and cup double – the first time the Sardis Road club victory. has achieved the feat. Tries by winger Charlie Murray and replacement prop It was certainly a campaign to remember for everyone put Wales in pole position against England in associated with Dale McIntosh’s side. After finishing the the last game of the tournament, but a late try by Sally regular season as runaway leaders of the Principality Tuson ensured England secured a 20-16 win. Premiership, in the SWALEC Cup final, Pontypridd saw off In between Wales were defeated 32-0 against France but Neath at the Millennium Stadium to secure the first part recovered with wins against Italy in Benevento (16-15) and of the double. Scotland in Glasgow (20-16).

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 45 Elite rugby review

Pontypridd, Principality Premiership winners

A score from Neath wing Dafydd Howells, who would go Fly half Simon Humberstone added a try of his own and on to play for Wales on their two-Test tour of Japan, failed kicked four conversions and four penalties as Pontypridd to halt Pontypridd and a brace of tries from wing Chris ended a superb season on a high. Clayton secured what was eventually a 34-13 victory. Principality Premiership play-offs With the SWALEC Cup in the bag, Pontypridd then hosted Principality Premiership play-off Llanelli in the Principality Premiership play-off final after the west Wales outfit had edged out local rivals Llandovery in Llandovery 20-29 Llanelli the play-off semi-final. Principality Premiership play-off final The final proved to be a fitting spectacle to what had been Pontypridd 47-15 Llanelli a thoroughly entertaining season. Prior to the meeting between Pontypridd and Llanelli, there had been a thrilling British & Irish Cup 2012/13 Competition contest for the final two play-off places with Bedwas and Llanelli were Wales’ leading lights in the British & Irish Cup, Cross Keys chasing Llandovery and Llanelli until the final eventually losing out in the quarter-finals to round of games. by 32-18 at Goldington Road. And with the last two places only decided after Llandovery The west Wales outfit topped their pool fighting off tough edged an 11-try thriller away to Bedwas, the league competition from Moseley, London Scottish and Gala. certainly proved it provides its fair share of ups and downs. Although Llanelli were the only Welsh club to reach the In the final, Pontypridd showed no sign of nerves as they knock-out stages, , Llandovery, Newport and blitzed Llanelli 47-15, captain and Principality Premiership Pontypridd all managed to finish in second place in their Player of the Year Chris Dicomidis among their five try respective groups – with Llandovery particularly unlucky scorers.

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Principality Premiership launch

after finishing level on points with Nottingham but losing British & Irish Cup Pool Tables 2012/13 out by virtue of the English club’s superior scoring through Quarter Finals the season. Newcastle 72-17 Nottingham It should also be noted that Neath were hampered from progressing from their pool after fielding two ineligible Bedford 32-18 Llanelli players and losing four points from their total as a penalty. Bristol 26-30 Leinster A Wales had entered twelve Principality Premiership sides 9-10 Munster A into the competition - Aberavon, Bedwas, Ravens Cardiff, Carmarthen Quins, Cross Keys, Llandovery, Llanelli, Semi-finals Neath, Newport, Pontypridd and Swansea - but honours Munster A 15-17 Leinster A in the final went to Leinster A who beat Newcastle 18-17. Bedford Blues 15-18 Final Newcastle Falcons 17-18 Leinster A

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Welsh Rugby Charitable Trust

Regional Age Grade Charities Regional action at U16 and U18 levels takes place through The Welsh Rugby Charitable Trust (“WRCT”) provides the WRU Regional Age Grade Championship. assistance to severely injured rugby players in Wales and is the primary charity of the Group. There are currently 19 With all four Regions, plus RGC, competing in the U18 rugby players in Wales who have suffered serious spinal competition and Cardiff Blues split into north and south at injuries and are now confined to wheelchairs. Dennis U16 level, the Championship provides emerging Welsh Gethin, the President of the WRU chairs the WRCT and the talent with the chance to play at a competitive level from Duke of Cambridge is its Royal Patron. During the year the a young age. Duke and Duchess of Cambridge visited the stadium and Last year proved one to remember for the Scarlets, with met some of the injured players who regularly attend their Regional sides securing both the U16 and U18 titles. international matches. The double success was a huge source of pride to everyone Other charities continue to benefit from association with involved at . the Group and throughout the year the WRU actively After the Scarlets U18 side had got the better of the Blues engaged with some of them to help boost campaigns and to be crowned champions, the U16 completed the double brand building projects. The Group continued its with a 24-15 victory over Blues South at Swansea’s St membership of the Princes’ Charities Forum which involved Helen’s ground. The win was all the more remarkable as liaising closely with a number of UK charities to identify at one stage, the young Scarlets were 15 points down. But work of mutual benefit. a second half fightback, in which scrum half Harri Randall, Ryan Davies and outside centre Kieran Jones all scored tries, saw them claim the title, with the boot of full back Jack Evans adding gloss to the victory.

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SWALEC Bowl winners Wattstown

The importance of safeguarding and nurturing the The investment was split into £0.8m of facility grants development of the community game remained a key similar to the one introduced at YE12 with great success, strategic and operational aim of the Group throughout the £0.3m to develop new websites for all clubs and £0.2m year. for a variety of projects aimed at schools. This was emphasised with the continued focus on The principles for deciding how the money should be initiatives designed to increase participation for people of invested were driven by the Club Census which continues all ages. All the effort focused on the community game to drive strategy for the Group based on direct feedback embraced the need to attract more players of all ages and from member clubs. During the year members of the WRU sexes, recruit more volunteers and promote the benefits of Board and Executive Board hosted a Census Roadshow to all forms of rugby for all round health and enjoyment. present the findings of the census to all Districts and gather feedback on the value of the information outlined therein. The Group recognised the impact of wider economic challenges and the continuing and inevitable threat from In an aligned initiative the Group produced a Club Funding other leisure activities. Index which explained how clubs in Wales had received nearly £27m in the five years ending 30 June 2012 either An example of this was the decision of the Group to invest directly from the WRU or through funds allocated from a further £1.3m directly into the community game from outside bodies. funds identified through a strong financial performance during the year. One of the aims of the index was to show all clubs the full range of funding streams available and to encourage them The investment was announced as a one-off funding to make best use of their ability to draw income from these injection to help improve facilities and encourage more and other sources. young people to take up the sport.

52 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 School rugby at the Millennium Stadium

The index showed that some eleven clubs had received professional, semi-professional and amateur game in more than £0.4m each by identifying and contacting the Wales and will be monitored going forward. appropriate funding authorities. A new WRU pro bono legal initiative was launched aimed The WRU also launched the Club Funding Tool as an online at providing free advice on basic issues and disputes to all system to help clubs identify the wider external funding member clubs. The scheme was set up in partnership streams. between the WRU and the Cardiff University Law School with students assigned to issue advice to club officials. The A significant development throughout the year was the programme was also supported by the Hugh James law establishment of the WRU’s Club Operations Team which firm and the Civitas barristers’ chambers whose staff was tasked with developing strategies and projects aligned helped monitor the level of advice being issued. to the needs of community clubs. There was also an innovative link-up with the Wales Air The work carried out by this team was determined to a Ambulance Service as all Welsh rugby clubs were invited large degree by the results of the Census to ensure the to offer their grounds as landing venues during emergency help provided was prioritised according to club call-outs. This was another example of how the WRU requirements. regularly utilises its brand to help charities and good causes The range of work carried out spanned a wide area from achieve visibility. first aid courses through to IT assistance related to the use The WRU Rugby Development Department also either of the MyWRU site and on to specific help on training introduced or enhanced a range of other initiatives all stewards who work in clubs. Workshops were held directly aimed at increasing participation at all ages from throughout the year based at the Millennium Stadium to three upwards. train volunteers on all areas of club operations. Primary Schools The aim of the new department is to provide continued help and advice to the community game and will be In total 21,000 primary school children received four weeks constantly refocused and updated based on identified of skills coaching with 17,000 enjoying an additional need. opportunity to play in festival matches against other schools. A link was also forged with the Duke of Edinburgh Awards Scheme to reward young people involved in rugby clubs Some 6,646 children experienced a four week with credit within the award structure. Fundamental Skills Programme and a total of 14,544 pupils received a skills programme which was delivered by WRU Approval was granted for a policy change which obliges Participation Officers or Community Coaches. certain clubs to confirm they will not be paying players for the forthcoming season. This is a strategic initiative aimed A total of 16,887 children participated in at least three at defining precisely the difference between the WRU rugby festivals.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 53 Community rugby review

General Manager North Wales, Rupert Moon Tag rugby

Secondary Schools Alternative Rugby A total of 16,500 children received four weeks of skills Atomic Touch, which is a limited contact form of the game coaching with 183 schools receiving a Development Officer with simple rules, was played by 5,000 children in visit. secondary schools. Attendance at festivals was impressive with 5,600 Year 8, Adult Touch leagues again proved to be a growth area with 5,573 Year 9 and 5,473 Year 10 pupils participating in at 2,102 participants across Wales but there was less success least two events. in the Back 2 Sport initiative aimed at adults with 755 people taking part in organised programmes. A total of 16,646 pupils from Years 7, 8 and 9 got the opportunity to play in additional fixtures during the season. In all, more than 8,000 people, including 2,800 adults engaged in alternative forms of rugby at organised events Clubs across Wales during the year. The strategic aim of increasing participation received Resources limited, but important, success at junior level. A substantial amount of work was carried out during the New junior clubs working with WRU Development Officers year to develop a new leaders course linked to the Welsh recruited an additional 2,000 members throughout the Joint Education Committee (“WJEC”). This will now be year. rolled out during September 2013. A further 61 festivals were organised and managed by To support the drive for visibility, Schools Skills Posters and clubs and WRU development staff which were in addition Game Cards were produced by the Coach Development to the traditional round of weekly club fixtures. Department and distributed to secondary schools around Wales.

54 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 55 Community rugby review

SWALEC Championship launch

More fun-based game cards and other instructive Player Identification resources to encourage physical literacy amongst younger A feature of player identification and development were children were planned for distribution to primary schools. the Core Skills Hubs at various age grades involving work This is an example of the Group’s alignment to Welsh in all the Regions. Government strategy aimed at encouraging more children to simply get active. At U12 level there were 2,016 participants, 1,794 at U13 level and at U14 level there were 1,465. All these were The Coaches Locker website continued to be developed significant increases on the prior year. A total of 796 throughout the year with users able to access skills players represented their respective Schools Districts and programmes such as the line out throw, the clearing pass the revamped Dewar Shield competition continues to and the scrum. Coach Development Officers were given demonstrate improvement and growth. training in camera operation in order to create content for the site. In all, some 6,500 players attended player identification and development events between the ages of U12 and There were also significant partnership developments U16 level with an increase in the quality of provision throughout the year with particularly strong growth in the between U14 and U15 level. links with Universities. The Rugby Department worked closely with the University of South Wales to develop YE13 was the first full year that the WRU has run the elements of coaching foundation and sports degree national programme of Rugby Stars which utilises senior courses. During the year, Swansea Metropolitan, Bangor international players as mentors at events. In the Little Stars and Aberystwyth Universities developed links focused on project 1,595 children took part in courses and 1,435 primary school teacher training. youngsters got involved in Junior Stars Rugby Camps.

56 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Lloyd Williams launches the Schools of Rugby accreditation scheme

The Schools of Rugby accreditation scheme was launched main cup. Adam Jones, from Brecon, took charge of the and recognised 22 schools for their contributions to the final of the Welsh Youth Cup. development of rugby. Five schools finals were held at the Although the WRU is proud of its record on core values Millennium Stadium. These were the national schools finals there were again some instances of behaviour from players at U11, U14 and U16 levels plus the DC Thomas and and spectators which fell below the required standards. Dewar Shield competitions. The WRU will continue to work to standards which ensure Wales Students introduced a Freshers Team competition this level of behaviour will not be tolerated within the helping to increase participation amongst first year national sport of Wales. students. The Welsh Students team completed a two Coach Development match international programme with fixtures against the German National XV and England Students. Throughout the year more than 2,000 coaches either became newly qualified or achieved enhanced During the year the community game also benefitted from qualifications. A total of 1,900 coaches received additional the Group’s new partnership with Gilbert as the contract support in the form of CPD mentoring. spanned the whole of the game in Wales through the provision of rugby balls. 26 Level One courses attracted 728 candidates, 12 Level Two courses attracted 215 candidates and three Level Match Officials Three courses had 40 coaches attending. A noteworthy achievement during the year was the Six high performance candidates attended the annual Six appointment of the first female referee to officiate in the Nations conference in Rome with the WRU’s Phil John WRU National Leagues. presenting to delegates. Francesca Martin started officiating at this level in the Throughout the year, mentoring courses particularly 2013/14 season, which both recognises her ability and the benefitted district and regional age grade coaches. A total WRU’s commitment to promoting equality. of 230 coaches received mentoring at either one-on-one YE13 was again a busy year within the department as or in group sessions. referees qualified at both Level 2 and Level 3 were Womens’ Rugby allocated to around 8,000 matches during the course of the season. The womens’ game in Wales continued to support a league structure as efforts to expand the structure met Through the year a total of 503 people attended the 21 with limited success. Level 1 courses with 38 referees moving on to Level 2 qualification. On the domestic front Neath Athletic were crowned Women's Cup champions following a thrilling 15-8 win The SWALEC Finals day at the Millennium Stadium again over Cardiff Quins. proved to be an important showcase for the community game with Chris Williams and Julian Smith respectively At regional level, the Ospreys won the Women’s officiating the Plate and Bowl games before Simon Rees Championship back from the Blues on try count, while the took charge of the semi-professional encounter for the Scarlets were crowned U18 champions.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 57 Community rugby review

Inaugural SWALEC Championship winners Ebbw Vale

SWALEC National Leagues forward to competing at SWALEC Championship level next season. The SWALEC National Leagues continue to provide a vital component of the WRU’s player pathway. In One West, Tondu edged out Cwmllynfell as league winners. The 2012/13 season saw the development of the inaugural SWALEC Championship, a newly formed league In Two East, the current Wales’ squad player Andrew combining the best sides from Divisions One East and One Coombs’ first club Nelson saw their title dreams dashed as West. Ebbw Vale, who had been crowned One East they finished 10 points behind winners Bedlinog. champions in both the two previous years, again proved Meanwhile, the Two West title went to Builth Wells as they too strong for their rivals, becoming the first SWALEC won 16 of their 20 league games, running in an impressive Championship winners with an impressive 123 points. 59 tries in the process. The Steelmen, who played an attractive brand of rugby Amman United finished top of Three West while throughout the campaign, lost just once in the league all Blaenavon were convincing winners of Four East. season, as well as reaching the SWALEC Cup quarter finals. Gowerton ran in an astonishing 170 tries on their way to Their backs in particular impressed, especially on home soil the Five West title while in Six West it was a close run race at . between Tonmawr and Pantyffynon. With near identical records – both teams scored 61 tries apiece – the season The North Wales development team, RGC, were crowned went down to the wire but it was Tonmawr who were One East champions in their debut season in the league. victorious with one more win than their closest rivals. Coached by former Wales prop , they enjoyed a close battle with Ystrad Rhondda before pulling Nant Conwy led One North at the end of the season. They away in the last few fixtures. Horsman’s side eventually finished four points clear of Pwllheli in second place with finished eight points clear at the top and can now look an impressive 14 wins from their 18 league matches.

58 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Facility grant for Pentyrch RFC floodlights

Divisional Champions SWALEC Plate Championship Ebbw Vale Quarter-finals One East RGC Heol y Cyw 11-3 Pill Harriers One West Tondu Kidwelly 13-22 Cwmllynfell Two East Bedlinog Llantrisant 13-18 Rhydyfelin Two West Bulith Wells Ystrad Rhondda 28-5 Felinfoel Three East Abertillery / Blaenau Gwent Semi-finals Three West Amman United Cwmllynfell 15-19 Heol y Cyw Three South East Dowlais Rhydyfelin 17-3 Ystrad Rhondda Three South West Mumbles Four East Blaenavon Final Four West Tycroes Heol y Cyw 20-19 Rhydyfelin Four South East Wattstown SWALEC Bowl Four South West Penlan Quarter-finals Five East Nantyglo Fishguard and Goodwick 19-16 Pontycymmer Five West Gowerton Wattstown 18-16 Nantyglo Five South East Abertysswg Falcons Blaenavon 10-3 Penlan Five South West Cwmgors Cilfynydd 11-6 Cambrian Welfare Five South Central Glyncoch Semi-finals Six East Trefil Fishguard and Goodwick 22-20 Cilfynydd Six West Tonmawr Wattstown 16-15 Blaenavon Six Central Cambrian Welfare One North Nant Conwy Final Two North Denbigh Fishguard and Goodwick 17-27 Wattstown Three North Wrexham

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 59 Stadium review

Craig Bellamy in Olympic action for Team GB

The Millennium Stadium reinforced its reputation as an headed by the Group Chief Executive and the Chairman iconic and multipurpose venue when it hosted eleven to secure agreement for the games. London 2012 Olympics international football games. The Also during the year, the WRU announced that the Stadium hosted the very first event of the 2012 Olympics, Stadium had been chosen to host the Heineken Cup Final two days before the opening ceremony. The Olympic in 2014. This will be the seventh time Cardiff has hosted football fixtures attracted hundreds of thousands of fans the final of Europe’s most prestigious club rugby from foreign nations not normally associated with major competition, more than any other venue. sporting events in the Principality. Worldwide TV audiences also watched the stadium take part in a tournament which The WRU also publicly stated its intention to tender for the defined the sporting identity of Britain during the summer Rugby World Cup Sevens in 2018, which would involve of 2012. Group employees were seconded to the London the Millennium Stadium as the host venue. Organising Committee For Olympic Games (“LOCOG”) to With planning for the Rugby League World Cup Opening ensure their expertise and experience in operating major Ceremony later in 2013 reaching its final stages during the events at the stadium in Cardiff were fully utilised. year, the Millennium Stadium’s continued involvement in The use of the Stadium in tournaments focused or a wide range of sporting events was assured. organised outside Wales was given another fillip with the The Stadium continues to prove a magnet for major non- announcement during the year that eight Rugby World sporting events thanks to its reputation for event delivery, Cup 2015 international matches, including two quarter city centre location, unique retractable roof and removable finals, will be hosted at the Stadium. This announcement pitch. successfully concluded years of negotiation by the WRU

60 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Record breaking year for hospitality

The venue showcased its multi-functionality to the world witnessed another exciting event and the agreement in when it hosted the first ever Olympic football event played place ensures speedway fans will continue to enjoy visiting under a closed roof when it rained in Cardiff for the the Stadium until at least 2016. womens’ football match between Japan and South Africa. The Millennium Stadium gained international recognition In March, the Stadium was the venue for the RBS 6 Nations for its efforts to further improve the sustainability of events tournament decider between Wales and England. A at the home of Welsh sport. remarkable 30 points to 3 victory for the home nation The venue achieved the new International Organisation for again secured the Championship title. In the build-up and Standardisation (“ISO”) standard for events management, during the game the operational delivery off the field of an international framework to reward the event industry play ensured a unique atmosphere which attracted for integrating sustainability with their activities. The ISO compliments from many of those who attended or 20121 management system identifies the potentially watched on television. negative social, economic and environmental impacts of This involved a sophisticated use of the Stadium screens, events by removing or reducing them through improved sound systems and production output to support the epic planning and processes. The Millennium Stadium nature of the rugby centrepiece. completed the ISO event sustainability management system just over one year after earning the British Standard Another new direction for the Stadium was realised during for sustainable events (“BS8901”) ahead of any other UK the year when it played host to the new Judgement Day stadia. event which saw all four Welsh Regions play at the venue on the same day in back to back derby matches. More Within this remit the Stadium also earned a significant than 36,000 supporters attended this festival of rugby accolade for its drive to reduce waste. The Stadium which the WRU is confident can grow as a showpiece pledged its support to cut food and package waste at the occasion to champion Regional Rugby in Wales for a wider venue, signing up to a new sector-wide Hospitality and audience. Food Service Agreement. The agreement launched by ‘WRAP’ on behalf of Welsh Government aimed to cut this Just weeks later, the Swansea University rugby team beat waste by five per cent by the end of 2015. their counterparts at Cardiff University for the Welsh Varsity 2013 title, another fixture which is fast building its The initiative also set out to increase the overall rate of reputation as a key event on the Welsh sporting calendar. food and package waste being recycled through anaerobic digestion or composted to at least 70%. In fact, the As the rugby season came to a close, the Speedway Grand Stadium now recycles some 98% of all its waste. Prix returned to the Stadium for its thirteenth event. Fans

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 61 Stadium review

Gerry Toms retires Shane Williams hosts a Legends’ Tour

The Stadium Tours continued to welcome tens of The Stadium’s concert activity was recognised at the Live thousands of visitors to the venue. Music Business Awards which are voted for by readers of Live Music UK. They chose the Millennium Stadium for the One significant addition to the tour route was the portrait Best Venue Teamwork award. of Her Majesty the Queen, commissioned by the WRU to commemorate the 60th anniversary of her accession to the In another announcement during the year it was confirmed throne. It was painted by the Welsh artist Dan Llywelyn that the Stadium would play host to the Cardiff-Wales Hall and was created in his award winning, and sometimes LGBT Mardi Gras which is an annual celebration of Equality controversial style. The painting now boasts pride of place and Diversity. The LGBT celebration comes to Wales' iconic in the Stadium at the foot of the stairs to the players’ Stadium thanks to the WRU's community events initiative entrance where all international teams enter the building. which offers the venue free of hire charge to up to 15 community and charity organisations in Wales each year. The Millennium Stadium also introduced the successful Legends’ Tours to the calendar of events. Welsh rugby A major catalyst in the success of events and activities at greats Gareth Edwards, Scott Quinnell, Shane Williams, the venue has undoubtedly been the presence and Jonathan Davies and Phil Bennett welcomed visitors to the stewardship of Stadium Manager Gerry Toms. In June 2013 home of Welsh sport for a unique behind-the-scenes he retired after seven years in the role which followed experience, followed by an informal Q&A session. closely after he completed a successful career with South Wales Police. In a timely tribute before his retirement at Despite a global fall off in the volume of large rock band the Stadium Business Awards in London, Mr Toms was tours, the Stadium hosted the singer Rihanna when she honoured with a lifetime achievement award. staged the opening concert of her UK tour in Cardiff in front of over 60,000 fans.

62 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 63 Operating and financial review Key performance indicators (“KPIs”) and business risks

Key performance indicators (“KPIs”) Business risk The KPIs of the Group are: The Group feels that the principal risks facing the business include: Rugby performance • The performance of the National Squad • Success of the National Squad • The identification, nurturing, development and • Performance of the four Welsh Regions retention of Welsh players • Performance of the Group’s Age-Grade teams • The identification, nurturing, development, Participation in rugby recruitment and retention of coaches and officials alongside appropriate elite systems and structures • Development of the elite player talent within Wales • The sustainability of the four Welsh Regions • Participation levels in community rugby, including women and junior numbers • The extent of involvement and enjoyment in community rugby Financial performance • The securing of non-National Squad events and • Generation of sufficient earnings before interest, activities at the Millennium Stadium depreciation, allocations and exceptional items (“EBITDA”), over the medium term, to fulfil the • The alignment of commercial strategies to deliver the Group’s objectives and obligations rugby and stadium strategies • Number of and attendances at international rugby • The provision of adequate banking facilities matches, featuring the National Squad, held at the • The physical security and insurance of its main assets, Millennium Stadium primarily the Millennium Stadium • Utilisation of the Millennium Stadium for non- • The implementation of appropriate business systems National Squad events and controls covering financial management, • Provision of consistent and affordable levels of commercial operations and other key business areas funding to clubs and affiliated organisations to allow All the above risks are regularly assessed by the Executive them to implement long term plans to fulfil their Board and actions are taken to mitigate any issues that objectives arise.

Legal pro bono scheme launch

64 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Directors’ report for the year ended 30 June 2013

Gareth Williams, Company Secretary

The Directors present their report and the Group and Company’s audited financial statements for the year ended 30 June 2013. Principal activities and review of the business The principal activity of the Group is to promote, foster, encourage, control and improve rugby football throughout Wales. This activity and the likely future development of the Group are reviewed in the Chairman’s Statement, the Group Chief Executive’s Summary and the Operating and Financial Review. Results for the year Lord Coe at Millennium Stadium for Olympics 2012 The results for the year are set out in the consolidated (2012: 26%) of the borrowings were due to expire profit and loss account on page 68 and show a profit within five years. before tax of £2.3m (2012: £2.4m). Fixed assets Financial risk factors The Millennium Stadium, recorded at a carrying value in The Group is exposed to financial risks from interest the financial statements of some £90m (2012: £94m) is a bearing assets and liabilities and interests in overseas unique asset. The asset is recorded at historical cost and companies. These expose the Group to financial risks due to the unique nature of the asset an alternative use including foreign currency risk, interest rate risk, credit risk valuation is not considered appropriate. If the Millennium and liquidity risk. Stadium was valued at replacement cost the carrying value • Foreign exchange risk recorded in the financial statements would be c.£200m. Where applicable, the Group mitigates foreign Directors exchange risk with the use of forward contracts. As at The Directors who held office during the year and up to 30 June 2013, the Group has no material foreign the date of signing the financial statements are noted on exchange risk (2012: nil). page 90. • Interest rate risk Donations The Group has interest bearing liabilities. As shown in The Group’s primary charitable donation was £57,000 Note 14, the Group’s policy is to part hedge against (2012: £37,000) to the Welsh Rugby Charitable Trust. This any interest risk on liabilities by using derivative trust, which is independent from the Group, was set up to instruments to effectively hedge the interest rate risk. provide support to players who were injured whilst playing The Group has interest bearing assets which are rugby in Wales. There were no political donations (2012: invested at differing interest rates; these interest rates £nil). are fixed at the outset of the investment. Policy on payment to creditors • Credit risk The Group and Company’s policy, concerning the payment The Group has no significant concentration of credit of the majority of its trade creditors, is to: risk. The Group has implemented policies that require appropriate credit checks on potential credit customers • set the terms of payment with those suppliers when before sales commence. Interest bearing assets are only agreeing the terms of each transaction invested with financial institutions that have excellent • ensure that those suppliers are made aware of the credit ratings. terms of payment by inclusion of the relevant terms • Liquidity risk in contracts The Group maintains a balance between continuity of • pay in accordance with its contractual and other legal funding and flexibility. As at 30 June 2013, only 30% obligations.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 65 Directors’ report for the year ended 30 June 2013

WRU Board at work

Corporate social responsibility Company law requires the Directors to prepare financial statements for each financial year. Under that law the The Group recognises its responsibility to the communities Directors have prepared the Group and Company financial which are affected by its businesses and regularly reviews statements in accordance with United Kingdom Generally its policies with regard to social, ethical and environmental Accepted Accounting Practice (UK Accounting Standards matters. Any matters in any of these categories which may and applicable law). Under company law, the Directors materially affect the business of the Group are reviewed must not approve the financial statements unless they are periodically by the Board. satisfied that they give a true and fair view of the state of Going concern affairs of the Group and the Company and of the profit or loss of the Group for that year. In preparing these financial The Directors believe that the Company and the Group statements, the Directors are required to: have adequate resources to continue in operational existence for the foreseeable future and it therefore • select suitable accounting policies and then apply continues to adopt the going concern basis in preparing them consistently the financial statements. • make judgements and accounting estimates that are Statement of Directors’ responsibilities reasonable and prudent The Directors are responsible for preparing the Annual • state whether applicable UK Accounting Standards Report and the financial statements in accordance with have been followed, subject to any material applicable law and regulations. departures disclosed and explained in the financial statements

66 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 WRU Game Policy meeting

• prepare the financial statements on the going and the Directors have taken all the steps necessary to concern basis unless it is inappropriate to presume make themselves aware of any relevant audit information that the Company and the Group will continue in and to convey that information to the Company’s auditors. business. Independent auditors The Directors are responsible for keeping adequate PricewaterhouseCoopers LLP have indicated their accounting records that are sufficient to show and explain willingness to continue in office and a resolution to the Company’s transactions and disclose with reasonable reappoint them will be proposed at the forthcoming accuracy at any time the financial position of the Company Annual General Meeting. and the Group and enable them to ensure that the financial statements comply with the Companies Act 2006. By Order of the Board. They are also responsible for safeguarding the assets of the Company and the Group and for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors are responsible for the maintenance and integrity of the Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Disclosure of information to auditors Gareth Williams So far as the Directors are aware, there is no relevant audit Company Secretary information of which the Company’s auditors are unaware 18 September 2013

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 67 Consolidated profit and loss account for the year ended 30 June 2013

Note 2013 2012 £’000 £’000

Turnover 2 (a) 60,962 63,183

Administrative expenses 2 (b) (57,133) (59,068)

Operating profit before depreciation, exceptional items and allocations to affiliated organisations (“EBITDA”) 29,018 27,632 Allocations to affiliated organisations 2 (d) (22,063) (20,132) Exceptional items 4 - (235) Depreciation (net of grant release) 4 (3,126) (3,150)

Operating profit 3,829 4,115

Interest payable and similar charges 3 (1,712) (1,083) Interest receivable and similar income 3 15 77 Fair value gains/(losses) on derivative financial instruments 3 201 (723)

Profit on ordinary activities before tax 2,333 2,386

Tax on profit on ordinary activities 6 3,270 (1,770)

Profit for the financial year 18 5,603 616

There is no material difference between the profit on ordinary activities before tax and the profit for the financial year stated above and their historical cost equivalents. The turnover and operating profit shown above are derived from continuing operations. There are no recognised gains and losses other than those shown above and the net actuarial loss on the pension scheme as disclosed in the consolidated statement of total recognised gains and losses below. Consolidated statement of total recognised gains and losses for the year ended 30 June 2013 2013 2012 £’000 £’000

Profit for the financial year 5,603 616

Actuarial loss on pension scheme - (211)

Total gains recognised in the year 5,603 405

68 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Balance sheets as at 30 June 2013

2013 2012 2013 2012 Group Group Company Company Note £’000 £’000 £’000 £’000

Fixed assets Tangible assets 8 132,010 136,159 38,357 38,462 Investments 9 - - 60 60 132,010 136,159 38,417 38,522 Current assets Stock 10 188 191 - - Deferred tax asset 16 - - 199 222 Financial assets - Debtors 11 6,071 4,051 77,416 74,472 - Cash at bank and in hand 12 791 831 90 565 7,050 5,073 77,705 75,259 Current liabilities Creditors – amounts falling due within one year 13 (28,698) (30,888) (22,977) (23,237)

Net current (liabilities)/assets (21,648) (25,815) 54,728 52,022

Total assets less current liabilities 110,362 110,344 93,145 90,544

Creditors – amounts falling due 13 (58,100) (61,360) (58,100) (61,106) after more than one year

Accruals and deferred income 15 (39,307) (41,154) - -

Provisions for liabilities 16 (1,668) (2,146) - -

Net assets 11,287 5,684 35,045 29,438

Capital and reserves Other reserves 18 2,314 2,314 2,610 2,610 Profit and loss account 18 8,973 3,370 32,435 26,828

Capital employed 11,287 5,684 35,045 29,438

These financial statements were approved by the Board of Directors on 18 September 2013 and signed on its behalf by:

David Pickering Roger Lewis Chairman Group Chief Executive Officer The notes on pages 71 to 88 form an integral part of these financial statements. The Welsh Rugby Union Limited Company Number 3419514

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 69 Consolidated cash flow statement for the year ended 30 June 2013

2013 2013 2012 2012 Note £’000 £’000 £’000 £’000

Net cash inflow from operating activities 22 3,650 9,715

Returns on investments and servicing of finance Interest received 15 77 Interest paid (1,799) (1,110)

Net cash outflow from returns on investments (1,784) (1,033) and servicing of finance

Taxation (1,743) (471)

Capital expenditure and financial investment Purchase of tangible fixed assets (724) (718) Grant repaid (100) (100)

Net cash outflow for capital expenditure and (824) (818) financial investment

Financing Drawdown of bank loans 7,500 19,600 Repayment of bank loans (6,825) (26,592) Debenture issue - 48 Debentures redeemed (14) -

Net cash inflow/(outflow) in respect of financing 661 (6,944)

(Decrease)/increase in net cash in the year 23 (40) 449

The notes on pages 71 to 88 form an integral part of these financial statements.

70 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Notes to the financial statements for the year ended 30 June 2013

1. Accounting policies Leasehold buildings are depreciated over the lower of 50 years and the remaining life of the lease. The Group’s financial statements are prepared on the going concern basis, under the historical cost convention, excluding e. Investments in subsidiaries adjustments to historical cost attributable to fair value Investments in subsidiaries are included at cost less any provision movements, in accordance with the Companies Act 2006 and for impairment. applicable accounting standards in the United Kingdom. The Group’s accounting policies, which have been applied In accordance with the Companies Act 2006, the Group has consistently, are as set out below. taken advantage of the exemption afforded to certain subsidiary companies to be audited. The Welsh Rugby Union Limited has a. Basis of consolidation given a guarantee to its subsidiary WRU Supporters Club Limited The consolidated financial statements incorporate the financial under section 479C of the Companies act 2006. statements of The Welsh Rugby Union Limited and its f. Trade investments subsidiaries, Millennium Stadium plc, WRU Supporters Club Limited, WRU National Centre of Excellence Limited and WRU Trade investments are valued at cost less any provision for Debentures Limited, all of which are made up to 30 June 2013 impairment. and prepared using consistent accounting policies. All intergroup g. Leased assets transactions are eliminated on consolidation. Where the Group enters into a lease which entails taking b. Turnover substantially all the risks and rewards of an asset, the lease is Turnover represents amounts invoiced, excluding value added tax, treated as a “hire purchase arrangement”. The present value of in respect of the sale of goods and services. Ticket income, sale the minimum lease payments is recorded in the balance sheet as of hospitality packages, competition income and other event a tangible fixed asset. Future instalments under such leases, net income are recognised as revenue when the related event is of finance charges, are included within creditors. Rentals payable staged. Revenue determined by commercial contracts, which are apportioned between the finance element, which is charged makes up the majority of broadcasting, sponsorship and royalty to the profit and loss account, and the capital element which revenue and lease of hospitality boxes is recognised based on the reduces the outstanding hire purchase liability. relevant contractual terms. Where consideration is received in All other leases are accounted for as “operating leases” and their kind, income and expenditure are grossed up on the basis of rentals are charged to the profit and loss account on a straight arms’ length commercial rates. line basis over the life of the lease. c. Exceptional items h. Stock In order to improve the understanding of the financial Stock is valued at the lower of cost and net realisable value and statements, the Directors have identified separately, on the face consists of finished goods purchased for resale. Where necessary, of the profit and loss account, those items of income and charge provision is made for obsolete, slow moving and defective stock. which by their size, nature and/or incidence are exceptional to Cost is determined on a first in first out basis. the financial statements for the year. These are shown as exceptional within the categories of expenditure to which they i. Deferred tax relate. Deferred tax is provided in full on all material timing differences. d. Tangible fixed assets Deferred tax assets are recognised where their recovery is considered more likely than not. Deferred tax assets and liabilities Tangible fixed assets are stated at historic cost less accumulated have not been discounted. depreciation. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its j. Pension costs working condition for its intended use. The Group operates a defined contribution scheme. The Group The tangible fixed assets of the Group, excluding land, are previously operated a defined benefit pension scheme, which was depreciated on a straight line basis calculated to write down their wound up during the year. cost to estimated residual values over their estimated useful economic lives as follows: The pension costs in respect of the defined contribution pension schemes comprise contributions payable in respect of the year. Buildings Up to 50 years Fixtures and fittings Up to 5 years Plant and machinery Up to 10 years

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 71 Notes to the financial statements for the year ended 30 June 2013

k. Grants Grants receivable in respect of tangible fixed assets are credited to the profit and loss account over the expected useful economic lives of the relevant assets to which they relate. Grants received but not yet released to the profit and loss account are included as deferred income in the balance sheet. Revenue grants are released to the profit and loss account in the same year as the related expense. l. Capitalisation of interest Interest is capitalised on major development projects and capital works in progress where appropriate. Capitalisation ceases when substantially all the activities necessary to get the asset ready for use are completed. Capitalised interest is amortised to the profit and loss account over the useful economic life of the asset to which it relates. m. Financial instruments The derivative instruments utilised by the Group are interest rate swaps and foreign currency forward contracts. Derivatives are initially accounted for and measured at fair value on the date a derivative contract is entered into and subsequently measured at fair value based on market price data from relevant counterparties. The gain or loss on re-measurement is taken to the profit and loss account except where the derivative is a designated cash flow hedging instrument. Whilst the Directors are of the belief that these derivatives are commercially effective hedges, the Group’s derivatives do not qualify for hedge accounting under FRS 26 in either 2013 or 2012. The instruments are carried at fair value with changes in fair value being recognised immediately in the profit and loss account. n. Trade debtors Trade debtors are recognised initially at fair value and subsequently measured at amortised cost less provision for impairment. They are first assessed individually for impairment, or collectively where the debtors are not individually significant. Where there is no objective evidence of impairment for an individual debtor, it is included in a group of debtors with similar credit risk characteristics and these are assessed collectively for impairment based on their ageing. Movements in the provision for impairment are recorded in the profit and loss account. o. Cash at bank and in hand Cash at bank and in hand includes highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of change in value.

72 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 2. Segmental information As set out in the Directors’ report, the Group has only one business segment and all income is derived from activities within the UK. The information below is provided as additional information. Business analysis (a) Turnover 2013 2012 Turnover is analysed as follows: £’000 £’000 Match income 32,106 35,200 Competition income 9,123 9,177 Commercial income 13,140 12,264 Other event income 3,476 516 Other income 3,117 6,026 60,962 63,183

Other event income represents amounts receivable in respect of staging fees and other similar income arising within the Millennium Stadium for events which are not promoted by the Company. Other income in 2013 includes income derived from the British & Irish Lions Tour, £0.3m (2012: £4.8m due to RWC11) in respect of a grant from the International Rugby Board Trust and £0.4m (2012: £0.2m) of grants received from Sport Wales. The grant received from Sport Wales is matched by expenditure included in community rugby costs. (b) Total costs are as follows: 2013 2012 £’000 £’000 Operational costs (see (c) below) 31,944 35,551 Exceptional costs - 235 Depreciation – net of grant release 3,126 3,150 Allocations to affiliated organisations (see (d) below) 22,063 20,132 57,133 59,068

(c) Operational costs: 2013 2012 £’000 £’000 Business & administration 6,012 5,831 Direct 13,705 15,831 Elite rugby 4,228 4,126 Community rugby 2,691 2,079 Stadium 5,308 7,684 31,944 35,551

(d) Allocations to affiliates 2013 2012 £’000 £’000 These are analysed as follows: Regions 16,849 15,137 Premiership 1,226 1,163 Community rugby & affiliates 3,988 3,832 22,063 20,132

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 73 Notes to the financial statements for the year ended 30 June 2013

3. Financing costs 2013 2012 £’000 £’000 Interest payable and similar charges Interest payable on bank and similar loans 959 792 Interest payable on corporation tax settlement 547 - Amortisation of debenture issue costs 13 13 Bank charges 193 278 Total 1,712 1,083

Interest receivable and similar income Short term deposits 15 76 Other finance charges in respect of pensions - 1 Total 15 77

Fair value (gains)/losses on derivative financial instruments Interest rate cap (1) 233 Interest rate floor (200) 490 Total (201) 723

Total net financing costs 1,496 1,729

Fair value losses on derivative financial instruments Derivative financial instruments are held for economic hedging purposes although they do not qualify as accounting hedges under FRS 26. Consequently, the Group’s derivative instruments are fair valued at each balance sheet date with the net loss or gain recognised in the profit and loss account. 4. Profit on ordinary activities before tax Profit on ordinary activities before tax is arrived at after charging/(crediting): 2013 2012 £’000 £’000

Depreciation on owned assets 4,873 4,897 Release of deferred income (grant release) (1,747) (1,747) Net charge to the profit and loss account 3,126 3,150 Rental of land and buildings 358 319 Trade debtors impairment 12 132

Exceptional items Notes Litigation costs (a) - 175 Reorganisation costs (b) - 60 Total exceptional items - 235

74 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 4. Profit on ordinary activities before tax (continued) During the previous year, the Group incurred charges that due to their size and nature were considered “exceptional”. In order to assist in understanding the Group’s results the Directors believe that it was appropriate to show separately the operating profit of the Group before exceptional items on the face of the profit and loss account as additional information. Detailed commentary is shown below: (a) The litigation costs in 2012 primarily arose from the Group’s defence to the case brought by Pontypool, contesting the composition of the revised Principality Premiership. (b) During the year to June 2012 the Group undertook a programme of restructuring. The costs for redundancies and compensation for loss of office were identified as an exceptional cost. During the year, the Group obtained the following services from the Group’s auditor: 2013 2012 £’000 £’000

Fees payable to Company auditor for the audit of the parent company and consolidated accounts 27 26 Fees payable to the Company’s auditor for other services: The audit of the Company’s subsidiaries pursuant to legislation 19 23 Taxation services 28 21 Other services 110 131

5. Staff numbers and costs Staff numbers 2013 2012 2013 2012 Group Group Company Company The average number of employees, including Directors in a service contract, during the year was:

Management and administration 61 55 32 31 Direct 23 20 20 17 Elite rugby 35 31 35 31 Community rugby 57 52 57 52 Stadium 39 36 - - 215 194 144 131

The above staff numbers do not include any players representing national teams, stewards engaged on a casual basis for events nor do they include the non-executive Directors of the Company.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 75 Notes to the financial statements for the year ended 30 June 2013

5. Staff numbers and costs (continued) Staff costs 2013 2012 2013 2012 Group Group Company Company £’000 £’000 £’000 £’000 The staff costs during the year were as follows: Wages and salaries 7,996 6,930 6,110 5,106 Social security costs 883 794 704 623 Pension costs – defined contribution schemes 507 475 390 356 9,386 8,199 7,204 6,085

In addition to the above amounts, £2.4m (2012: £5.4m) is paid as remuneration to the players whilst representing the National Squad. These costs are included in Direct costs within Operational costs (see Note 2 (c)). Directors’ emoluments 2013 2012 £’000 £’000 The Directors’ emoluments, during the year, were as follows: Aggregate emoluments 362 335 Benefits 21 17 Company contributions to defined contribution pension scheme - 14 383 366

The emoluments above include a fee of £35,000 (2012: £35,000) payable to the Chairman. The Group received £17,000 (2012: £18,000) from third parties in respect of the above emoluments. There are no Directors (2012: one) accruing benefits under a defined contribution pension scheme. No Directors (2012: none) are accruing benefits under a defined benefit pension scheme. Emoluments of the highest paid Director 2013 2012 £’000 £’000 The emoluments of the highest paid Director, during the year, were as follows: Aggregate emoluments 327 300 Benefits 10 7 Company contributions to defined contribution pension scheme - 14 337 321 6. Tax on profit on ordinary activities 2013 2012 £’000 £’000 (a) Analysis of (credit)/charge in the year Current tax UK corporation tax on result for the year 945 2,630 Adjustment in respect of prior years (3,737) 1,017 Total current tax (credit)/charge (Note 6(b)) (2,792) 3,647

Deferred tax Origination and reversal of timing differences (397) (1,655) Changes in tax rates and laws (81) (222) Total deferred tax (478) (1,877)

Total tax (credit)/charge on profit on ordinary activities (3,270) 1,770

76 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 6. Tax on profit on ordinary activities (continued) (b) Factors affecting the current tax (credit)/charge for the year

The current tax assessed for the year is different from the standard rate of corporation tax in the UK of 23.8% (2012: 25.5%). The differences are explained below: 2013 2012 £’000 £’000 Profit on ordinary activities before tax 2,333 2,386

Profit multiplied by standard rate of corporation tax in the UK of 23.8% (2012: 25.5%) 554 608 Effects of: Accelerated capital allowances and other timing differences 212 596 Permanent differences 179 1,426 Adjustment in respect of prior years (3,737) 1,017 Current tax (credit)/charge for year (Note 6(a)) (2,792) 3,647

In addition to the changes in the rates of corporation tax disclosed above, further changes to the UK corporation tax rates were substantively enacted as part of the Finance Bill 2013 on 2 July 2013. These include reductions to the main rate to reduce the rate to 21% from 1 April 2014 and to 20% from 1 April 2015. As the changes had not been substantively enacted at the balance sheet date their effects are not included in these financial statements. The overall effect of these changes, if they had applied to the deferred tax balance at the balance sheet date, would be to reduce the deferred tax liability by £221k and increase the tax credit for the year by £221k. 7. Profit of the Company The Company has not presented its own profit and loss account, as permitted by section 408 of the Companies Act 2006. The profit before and after tax for the financial year in respect of the Company was £5.6m and £5.6m respectively (2012: £10.2m and £8.7m).

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 77 Notes to the financial statements for the year ended 30 June 2013

8. Tangible fixed assets Stadium Centre of Other Land Other Group Company Excellence buildings fixed assets Total Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 Cost At 1 July 2012 138,598 2,718 1,687 37,629 4,941 185,573 39,611 Additions - 430 --294 724 59 At 30 June 2013 138,598 3,148 1,687 37,629 5,235 186,297 39,670 Accumulated depreciation At 1 July 2012 44,754 689 952 - 3,019 49,414 1,149 Charge for the year 4,015 248 105 - 505 4,873 164 At 30 June 2013 48,769 937 1,057 - 3,524 54,287 1,313 Net book value At 30 June 2013 89,829 2,211 630 37,629 1,711 132,010 38,357 At 30 June 2012 93,844 2,029 735 37,629 1,922 136,159 38,462

Included in the cost of the Stadium are cumulative capitalised interest costs of £4.6m (2012: £4.6m). The depreciation charge includes an amount of £0.1m (2012: £0.1m) representing the depreciation of interest previously capitalised. Other fixed assets comprise plant and machinery and fixtures and fittings. The tangible fixed assets of the Company predominantly relate to land as shown above. 9. Investments The Group holds no material investments. The Company held a £50,000 equity investment in Millennium Stadium plc and a £10,000 equity investment in WRU National Centre of Excellence Limited at both 30 June 2013 and 30 June 2012. Both investments are held at historical cost. Subsidiary and other investments held directly by the Company and in which the Company has a beneficial interest, as at 30 June 2013 and 30 June 2012 were: Company Principal activity Country of % holding of incorporation ordinary shares Millennium Stadium plc Stadium operation United Kingdom 100% WRU Supporters Club Limited Marketing United Kingdom 100% WRU National Centre of Excellence Limited Provision of training facilities United Kingdom 100% WRU Debentures Limited Dormant United Kingdom 100% Six Nations Rugby Limited Competition management Republic of Ireland 17% Limited Competition management Republic of Ireland 17% Celtic Rugby Limited Competition management Republic of Ireland 33% British and Irish Lions Limited Overseas rugby tours Republic of Ireland 25%

Given the disposition of the other shareholdings, the Group’s inability to exercise significant influence over the investments above with less than 100% shareholdings and the immateriality of their net surpluses and net assets after receipt of income by the Group in the other investments above, the Directors do not believe that these investments fall to be treated as associate companies. Fixed assets investments are stated at the lower of cost and valuation. Cardiff County Council (“CCC”) holds one share in Millennium Stadium plc; this share grants certain rights only and does not grant CCC any dividends nor any rights to amounts receivable upon winding up.

78 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 10. Stock Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Goods for resale 188 191 - -

11. Debtors Amounts due within one year: Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Trade debtors 3,132 3,047 1,347 975 Loans due from clubs 771 686 771 686 Less: provision for impairment of receivables (931) (948) (776) (764) 2,972 2,785 1,342 897 Prepayments and other debtors 3,099 1,266 2,577 956 6,071 4,051 3,919 1,853

Amounts due after more than one year: Amounts owed by Group undertakings - - 73,497 72,619

Total debtors 6,071 4,051 77,416 74,472

The amounts due from subsidiary undertakings are unsecured and have no fixed dates of repayment. An interest charge at equivalent rates to the bank loan arrangements is levied on outstanding amounts due from subsidiary undertakings. The carrying amount of debtors is a reasonable approximation of fair value and the carrying amounts of the Group’s debtors are all denominated in UK Sterling (“GBP”). As of 30 June 2013, trade debtors and loans due from clubs with a carrying value of £0.9m (2012: £1.0m) were impaired and provided for. The amount of the provision was £0.9m as of 30 June 2013 (2012: £0.9m). The ageing of these debtors is as follows: 2013 2012 £’000 £’000

3 to 6 months past due 185 141 Over 6 months past due 795 815 980 956

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 79 Notes to the financial statements for the year ended 30 June 2013

11. Debtors (continued) The debtors determined as individually impaired were amounts in excess of 3 months past due that were owed by various categories of customer. These debts have not been written off and the Group are pursuing these amounts due. Trade debtors that are less than three months past their due date are not considered impaired. As of 30 June 2013, trade debtors of carrying value of £0.8m (2012: £0.5m) were past their due date but not impaired. These are balances from a number of independent customers and the credit risk on these customers is assessed as low. The ageing of trade debtors that are past due but not impaired is the following: 2013 2012 £’000 £’000

Up to 3 months past due 399 364 3 to 6 months past due 210 132 Over 6 months past due 210 3 819 499

Movements on the provision for impairment of trade debtors are as follows: 2013 2012 £’000 £’000

At start of year 948 823 Debtors written off during the year (29) (7) New amounts charged to profit and loss 12 132 At end of year 931 948

12. Cash at bank and in hand Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Cash balance at bank 791 831 90 565

13. Creditors Amounts falling due within one year: Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Bank loans 10,267 6,788 10,267 6,788 Trade creditors 3,038 1,454 597 641 Corporation tax 2,825 7,360 2,825 6,713 Other tax and social security 372 357 305 43 Other creditors 188 201 188 201 Accruals and deferred income 12,008 14,728 8,795 8,851 28,698 30,888 22,977 23,237

80 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 13. Creditors (continued) Amounts falling due after more than one year: Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Bank loans 20,008 22,812 20,008 22,812 Debentures 37,621 37,622 37,621 37,622 Deferred income - 254 - - Derivative financial liability (note 14) 471 672 471 672 58,100 61,360 58,100 61,106

Maturity analysis: Bank loans are due: Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Within one year 10,267 6,788 10,267 6,788 Between one and two years 2,705 2,578 2,705 2,578 Between two and five years 7,303 8,380 7,303 8,380 In more than five years 10,000 11,854 10,000 11,854 30,275 29,600 30,275 29,600

The Group’s term loan is repayable by fixed amounts per quarter, inclusive of interest and capital. The maturity analysis above is based on an estimation of LIBOR by the Directors for the remaining term. If the Directors’ estimate above is incorrect then the maturity analysis will change accordingly. The principal terms of these loans are set out below: Bank loans Interest and capital repayment terms 2013 2012 £’000 £’000

Revolving credit facility LIBOR plus 2.50%, loan repayable on maturity date 7,500 4,100 Term loan LIBOR plus 2.00%, loan repayable in instalments by 2021 12,775 15,500 Tranche C Interest and capital is payable only in the event of default 10,000 10,000 or certain other defined events 30,275 29,600

The principal terms of the bank loans shown above relate to the primary instrument and do not take account of derivative instruments. Interest on amounts drawn on the revolving credit facility is referenced to the LIBOR rate applicable to the draw period. At 30 June 2013 the revolving credit facility was drawn for a period of 1 month. Interest on the term loan is re-priced every 3 months and referenced to 3 month LIBOR. The carrying amounts of the Group’s borrowings approximate their value. The carrying amounts of the Group’s borrowings are all denominated in GBP.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 81 Notes to the financial statements for the year ended 30 June 2013

13. Creditors (continued) Security provided on bank loans Bank loans totalling £30.3m (2012: £29.6m) are secured by fixed and floating charges over the assets of the Company and certain of its subsidiaries. Borrowing facilities The Group had £10.0m (2012: £13.4m) of undrawn committed borrowing facilities available at 30 June 2013 in respect of which all conditions precedent had been met at that date. Debenture loans are repayable in: Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

2021 360 360 360 360 2024 13,019 24,587 13,019 24,587 2026 486 438 486 438 2027 2,425 2,425 2,425 2,425 2028 350 350 350 350 2030 4,833 4,833 4,833 4,833 2035 1,781 1,795 1,781 1,795 2050 14,543 2,975 14,543 2,975 37,797 37,811 37,797 37,811 Unamortised issue costs (176) (189) (176) (189) 37,621 37,622 37,621 37,622

All debenture loans are unsecured and bear no interest. During the year, the Group invited debenture holders of the 410, 420, 430 and 440 Series to extend the redemption date of their debenture from 2024 to 2050. Some 1,300 debenture holders involving some 2,700 debenture seats, approximately 47% of the total, accepted this invite resulting in the redemption of some £11.5m being extended from 2024 to 2050. Bank and debenture loans repayable by instalments wholly or partly after five years Bank loans, with a total value of £30.3m (2012: £29.6m), are repayable wholly or partly from the balance sheet date by instalments. Of these amounts, £10.0m (2012: £11.9m) is repayable after five years. Debenture loans, with a total value of £37.6m (2012: £37.6m), are repayable wholly from the balance sheet date. Of these amounts, £37.6m (2012: £37.6m) is repayable after five years. .

82 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 14. Borrowings and financial instruments Treasury policy Treasury activity is focused on monitoring working capital, managing external funding and managing interest rate risk. Treasury activity is not a profit centre and the Group neither enters into transactions of a speculative nature nor trades in financial instruments. Treasury risk management policies are summarised below: • Foreign exchange risk – where applicable, the Group mitigates foreign exchange risk with the use of forward contracts. As at 30 June 2013 the Group had no material foreign exchange risk (2012: nil). • Interest rate risk – operations are financed through a mixture of bank borrowings and debenture loans. The Group currently borrows in floating rates of interest and uses derivative financial instruments to generate the desired interest profile and to manage exposure to interest rate fluctuations. At 30 June 2013 some 66% (2012: 78%) of bank borrowing was subject to hedging arrangements. • Liquidity risk – the Group’s policy is to maintain a balance between continuity of funding and flexibility. As at 30 June 2013, 30% (2012: 26%) of borrowings were due to mature within five years, some 24% (2012: 41%) were due to mature between five years and fifteen years and some 46% (2012: 33%) were due to mature after fifteen years. Financial instruments At 30 June 2013 the notional principal amounts of derivatives relating to interest rate cap and collar agreements were £13.3m and are analysed as follows: Instrument Principal Fair market Gain/(loss) Maturity date value £’000 £’000 £’000

Interest rate cap 3.75% 13,300 13,366 66 30 June 2018 Interest rate floor 2.10% 13,300 12,763 (537) 30 June 2018

At 30 June 2012 the notional principal amounts of derivatives relating to interest rate cap and collar agreements were £15.2m and are analysed as follows:

Instrument Principal Fair market Gain/(loss) Maturity date value £’000 £’000 £’000

Interest rate cap 3.75% 15,200 15,265 65 30 June 2018 Interest rate floor 2.10% 15,200 14,463 (737) 30 June 2018

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 83 Notes to the financial statements for the year ended 30 June 2013

14. Borrowings and financial instruments (continued) During the year to 30 June 2013, none of the Group’s derivatives qualified for hedge accounting under FRS 26 (2012: £nil). These instruments are carried at fair value as analysed below: Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Interest rate cap 66 65 66 65 Interest rate floor (537) (737) (537) (737) Derivative financial liability (471) (672) (471) (672)

In accordance with FRS 26, ‘Financial instruments: Recognition and measurement’, the Group and Company have reviewed all contracts for embedded derivatives that are required to be separately accounted for if they do not meet certain requirements set out in the standard. Neither the Group nor the Company have such embedded derivatives as per FRS 26. 15. Accruals and deferred income Grants Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

At start of year 41,154 43,001 - - Amounts repaid (100) (100) - - Released to the profit and loss account (1,747) (1,747) - - At end of year 39,307 41,154 - -

During the year some £1.7m (2012: £1.7m) was released to the profit and loss account from the grants amount shown above.

Included within the grants amounts above is an amount received from the Big Lottery Fund (formerly the Millennium Commission) amounting to £29.6m (2012: £30.8m). This grant will be released to the profit and loss account as follows:

Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Within one year 1,196 1,196 - - Between one and two years 1,196 1,196 - - Between two and five years 3,588 3,588 - - In more than five years 23,575 24,771 - - 29,555 30,751 - -

In certain circumstances, the above grant can become repayable if the Group fails to meet the monitoring requirements of the grant. The Group is currently in full compliance with the monitoring requirements such that no monies are repayable under the terms of the grant.

84 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 16. Provisions for liabilities Deferred tax The movement on deferred tax is as follows: Group Group Company Company 2013 2012 2013 2012 £’000 £’000 £’000 £’000

Liability/(asset) at start of year 2,146 4,023 (222) - (Released)/charged to the profit and loss account (478) (1,877) 23 (222) At end of year 1,668 2,146 (199) (222)

Deferred tax provided/(recognised) is made up as follows: Accelerated capital allowances 1,955 2,373 - - Tax losses carried forward (86) - - - Other timing differences (201) (227) (199) (222) 1,668 2,146 (222) (222)

The Group agreed the treatment of certain matters for corporation tax purposes with HM Revenue & Customs ("HMRC") during the year. These matters include the extent to which expenditure on the Millennium Stadium qualifies for tax relief. Following this agreement with HMRC, adjustments to the provisions of corporation tax and deferred tax are required in the current year. These adjustments include prior year tax credits in relation to the release of liabilities previously reflected in the financial statements. 17. Company limited by guarantee The liability of the members is limited. Every member of the Company undertakes to contribute such amounts as may be required (not exceeding £1) to the Company’s assets if it should be wound up while the member is a member, or within one year after a member ceases to be a member, for payment of the Company’s liabilities contracted before a member ceased to be a member. At the balance sheet date the number of member clubs was 251 (2012: 251). 18. Reserves Profit and loss account Other reserves Total £’000 £’000 £’000 Group At 1 July 2012 3,370 2,314 5,684 Retained profit for the year 5,603 - 5,603 At 30 June 2013 8,973 2,314 11,287

Profit and loss account Other reserves Total £’000 £’000 £’000 Company At 1 July 2012 26,828 2,610 29,438 Retained profit for the year 5,607 - 5,607 At 30 June 2013 32,435 2,610 35,045

Company - retained profit for the year 2013 is analysed as follows: £‘000 Profit before tax 5,565 Tax charge 42 5,607

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 85 Notes to the financial statements for the year ended 30 June 2013

19. Contingent liabilities Group The Group had the following contingent liabilities as at 30 June 2013: ● The Group has guaranteed the performance of some member clubs in respect of loans that the member clubs have received from Barclays Bank PLC. The amounts due are £1.2m (2012: £1.2m). Company The Company had the following contingent liabilities as at 30 June 2013: • The Company has guaranteed the performance of one of its subsidiaries under the terms of grant arrangements amounting to £39.3m (2012: £41.2m). ● The Company has guaranteed the performance of some member clubs in respect of loans that the member clubs have received from Barclays Bank PLC. The amounts due are £1.2m (2012: £1.2m). The Group and Company are dealing with a small number of legal claims. The Directors have reviewed all of these claims and, on the basis of legal advice received, believe that no provision is necessary. Consequently no provision for these claims has been included in these financial statements. 20. Commitments Capital commitments of the Group: Neither the Group nor the Company had any capital commitments at 30 June 2013 or 30 June 2012. Operating lease commitments: At the balance sheet date, the Group had the following annual commitments, under non-cancellable operating leases: 2013 2012 £’000 £’000 Land and buildings Expiring after five years 357 319

21. Pension costs The Group’s defined benefit pension scheme was wound up during the year. Accordingly, there are no scheme assets or liabilities at 30 June 2013 (2012: £nil). The assets of the defined contribution pension schemes are held separately from those of the Group, under independent administration. The pension cost charge for these schemes represents contributions payable by the Group to the schemes in the year amounting to some £0.5m (2012: £0.5m). There are no material amounts included in creditors in respect of these pension costs in 2013 or 2012.

86 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 22. Reconciliation of operating profit to net cash inflow from operating activities

2013 2012 £’000 £’000

EBITDA 29,018 27,632 Allocations to affiliated organisations (22,063) (20,132) Exceptional items - (235) Depreciation (4,873) (4,897) Release of deferred income 1,747 1,747 Operating profit 3,829 4,115

Non-cash items: Depreciation 4,873 4,897 Release of deferred income (1,747) (1,747) 3,126 3,150 Working capital adjustments: Decrease in stock 3 127 Increase in debtors (2,020) (643) (Decrease)/increase in creditors (1,288) 2,966 (3,305) 2,450

Net cash inflow from operating activities 3,650 9,715

23. Reconciliation of net cash flow to movement in net debt 2013 2012 £’000 £’000

(Decrease)/increase in cash in the year (40) 449 Cash (inflow)/outflow from movement in debt and hire purchase arrangements (661) 6,944 Non-cash changes (13) (13) (Increase)/decrease in net debt during the year (714) 7,380 Net debt at the beginning of the year (66,391) (73,771) Net debt at the end of the year (67,105) (66,391)

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 87 Notes to the financial statements for the year ended 30 June 2013

24. Analysis of net debt Bank debt Bank debt due within due after Cash one year one year Debentures Total £’000 £’000 £’000 £’000 £’000

At 30 June 2012 831 (6,788) (22,812) (37,622) (66,391) Cashflow (40) (675) - 14 (701) Non-cash changes - (2,804) 2,804 (13) (13) At 30 June 2013 791 (10,267) (20,008) (37,621) (67,105)

At 30 June 2011 382 (6,094) (30,498) (37,561) (73,771) Cashflow 449 (665) 7,657 (48) 7,393 Non-cash changes - (29) 29 (13) (13) At 30 June 2012 831 (6,788) (22,812) (37,622) (66,391)

25. Related party transactions In accordance with the exemption afforded by FRS 8, ‘related party transactions’, there is no disclosure in these financial statements of transactions with entities that are part of the Group.

88 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Independent auditors’ report to the members of The Welsh Rugby Union Limited

We have audited the group and parent company financial Opinion on financial statements statements (the ‘‘financial statements’’) of The Welsh In our opinion the financial statements: Rugby Union Limited for the year ended 30 June 2013 which comprise the Consolidated Profit and Loss Account, • give a true and fair view of the state of the group’s the Consolidated Statement of Total Recognised Gains and and the parent company’s affairs as at 30 June 2013 Losses, the Group and Parent Company Balance Sheets, and of the group’s profit and cash flows for the year the Consolidated Cash Flow Statement and the related then ended; notes. The financial reporting framework that has been • have been properly prepared in accordance with applied in their preparation is applicable law and United United Kingdom Generally Accepted Accounting Kingdom Accounting Standards (United Kingdom Practice; and Generally Accepted Accounting Practice). • have been prepared in accordance with the Respective responsibilities of directors and auditors requirements of the Companies Act 2006. As explained more fully in the Statement of Directors’ Opinion on other matter prescribed by the Companies Act Responsibilities set out on page 66, the Directors are 2006 responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. In our opinion the information given in the Directors’ Our responsibility is to audit and express an opinion on the Report for the financial year for which the financial financial statements in accordance with applicable law and statements are prepared is consistent with the financial International Standards on Auditing (UK and Ireland). statements. Those standards require us to comply with the Auditing Matters on which we are required to report by exception Practices Board’s Ethical Standards for Auditors. We have nothing to report in respect of the following This report, including the opinions, has been prepared for matters where the Companies Act 2006 requires us to and only for the Company’s members as a body in report to you if, in our opinion: accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving • adequate accounting records have not been kept by these opinions, accept or assume responsibility for any the parent company, or returns adequate for our other purpose or to any other person to whom this report audit have not been received from branches not is shown or into whose hands it may come save where visited by us; or expressly agreed by our prior consent in writing. • the parent company financial statements are not in Scope of the audit of the financial statements agreement with the accounting records and returns; or An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give • certain disclosures of directors’ remuneration reasonable assurance that the financial statements are free specified by law are not made; or from material misstatement, whether caused by fraud or • we have not received all the information and error. This includes an assessment of: whether the explanations we require for our audit. accounting policies are appropriate to the group’s and parent company’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the Directors; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Annual Report to Mark Ellis (Senior Statutory Auditor) identify material inconsistencies with the audited financial For and on behalf of PricewaterhouseCoopers LLP statements. If we become aware of any apparent material Chartered Accountants and Statutory Auditors misstatements or inconsistencies we consider the Cardiff implications for our report. 18 September 2013

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 89 Welsh Rugby Union governance for the period ended 30 June 2013

Patron and Office Bearers: The Board of The Welsh Rugby Union Limited Patron Non-executive chairman: Her Majesty Queen Elizabeth II David Pickering Vice Patron Executive: His Royal Highness The Duke of Cambridge Roger Lewis (Group Chief Executive) President Non-executive members: Dennis Gethin Kenneth Hewitt (non-executive vice chairman) Governance of Welsh Rugby Mal Beynon Gerald Davies CBE, DL The principal activity of the Welsh Rugby Union Group is to promote, foster, encourage, control and improve the Martin Davies game of rugby throughout Wales. The Board of The Welsh Geraint Edwards Rugby Union Limited (“Board”) is responsible for ensuring Gordon Eynon that the principal activity is managed, which it does Humphrey Evans through the Welsh Rugby Union Group Executive Board. Brian Fowler The Board comprises a non-executive Chairman, sixteen Roy Giddings non-executive Directors and one executive Director. Richard Gwynn Russell Howell Peredur Jenkins (resigned 21 October 2012) Anthony John (appointed 21 October 2012) Alan Jones Alwyn Jones (appointed 21 October 2012) Aurwel Morgan Steve Pike (resigned 21 October 2012) Ray Wilton Company Secretary Gareth Williams

Welsh Rugby Union Group – Executive Board Chairman: Roger Lewis New Head of Rugby Josh Lewsey (Group Chief Executive) Executive: Rhodri Lewis Head of Legal Affairs Joe Lydon Head of Rugby (resigned 26 July 2013) Craig Maxwell Head of Group Sales and Marketing Julie Paterson Head of Group Compliance Steve Phillips Group Finance Director Gerry Toms Stadium Manager (retired 27 June 2013) John Williams Head of Communications Since the year end, Josh Lewsey and Mark Williams have been appointed as Head of Rugby and Stadium Manager New Stadium Manager Mark Williams respectively.

90 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 91 Welsh Rugby Union governance for the period ended 30 June 2013

AGM 2012 District G meeting

Board Committees The Board and the Executive Board acknowledge the value of the principles of good governance as set out in the During the year, the Board operated three principal sub- Combined Code. The Group are committed to adopting committees to assist in its business. The role and the principles of best practice in corporate governance. The membership of the sub committees were as follows: Group will ensure that each member of the Board The Finance Committee , chaired by Martin Davies undergoes training in the role of the non-executive comprises David Pickering, Kenneth Hewitt, Roger Lewis, Director to be delivered by an appropriate organisation Humphrey Evans, Gordon Eynon, Anthony John and Steve (such as the Institute of Directors). The Group are Phillips. The Finance Committee is responsible for all committed to further training and development of the financial matters of the Group other than dealing with the Board. Group’s auditors. Board and Executive Board The Regulatory Committee , chaired by Mal Beynon, There is a clear division of responsibility between the role comprises Geraint Edwards, Brian Fowler, Russell Howell, of non-executive Chairman and Group Chief Executive. Aurwel Morgan, Ray Wilton, and Julie Paterson. It is There is a detailed limit of authority protocol in place for responsible for disciplinary matters and the management both the Board and the Executive Board. All Executive of all leagues and cup competitions in operation. Board members have detailed job descriptions in addition The Game Policy Committee , chaired by Alan Jones, to limits of authority. comprises Roy Giddings, Gerald Davies, Richard Gwynn The Board meets on a monthly basis and considers all and Alwyn Jones. In addition to Joe Lydon, non-Board matters under its terms of reference which include the members of the Game Policy Committee included Mike development and monitoring of the Group’s strategic plan, Rein, Ian Parker, Sophie Bennett, Martyn Ryan, Jason allocation of financial resources, reviewing the Lewis, Gethin Watts and Robert Yeman. The Game Policy performance of the Group Chief Executive and Executive Committee is responsible for the development of the game Board and approval of annual budgets. at all levels, including age groups, coaching and referees. In addition, the Board considers the recommendation of Development of Corporate Governance the Board’s standing committees, whose responsibilities Both the Board and the Executive Board remain committed relate to Finance, Regulatory and Game Policy as shown to the continuing development of governance structures, above. in order to meet the evolving needs of the game of rugby union.

92 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Audit Panel members Geraint Davies, Group Finance Director speaks to the media Chairman Martin Davies and new appointment Dyfrig John and Celtic Rugby Limited all of whom have a policy of Appointments and Remuneration Panel financially compensating the representatives serving on The Appointments and Remuneration Panel advises the these bodies. Board on the remuneration and other employment terms Registered office and advisers of the Group Chief Executive and the Executive Board. The panel consists of the Chairman of the Board, the Vice- Registered office Chairman of the Board and the three heads of the standing Millennium Stadium sub-committees: Finance, Game Policy and Regulatory. Westgate Street, Cardiff CF10 1NS The Panel relies on expert independent professional advice Independent auditors when deemed necessary. PricewaterhouseCoopers LLP The Audit Panel Chartered Accountants and Statutory Auditors One Kingsway, Cardiff CF10 3PW The Audit Panel, chaired by Martin Davies, included Martyn Ryan and Geraint Davies as non-Board members. Following Principal solicitors Martyn Ryan’s resignation on 25 July 2013, Dyfrig John Hugh James LLP was appointed as a further non-Board member. The Audit Hodge House Panel is responsible for assisting the Board discharge its 114 - 116 St. Mary Street, Cardiff CF10 1DY responsibilities for accounting policies, financial reporting, Bankers internal control and risk management and liaising with the Barclays Bank PLC Group’s auditors. 3rd Floor Windsor Court Remuneration and benefits of the Board 3 Windsor Place, Cardiff CF10 3ZL Under the Group’s remuneration policy, no fees are The Welsh Rugby Union Limited & Millennium Stadium plc payable to non-executive Directors, other than the non- Millennium Stadium, Westgate Street, Cardiff CF10 1NS executive Chairman who receives an annual fee of Tel: + 44 (0)870 013 8600 £35,000. Email: [email protected] In addition, the Board are represented on other rugby www.wru.co.uk bodies including The International Rugby Board (“IRB”), www.millenniumstadium.com Six Nations Rugby Limited, European Rugby Cup Limited

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 93 Welsh Rugby Union governance Board of Directors for the period ended 30 June 2013

Non Executive Executive Non Executive Vice Mal Beynon Chairman Roger Lewis Chairman Joined the WRU Board in David Pickering (Group Chief Executive) Ken Hewitt 1997 and represents Joined the WRU Board in Appointed as Group Chief Joined the WRU Board in District A. 1998 as a national Executive of the Welsh 1993 and represents He is Chairman of the representative. Rugby Union and the District A. WRU Regulatory Millennium Stadium in He is a member of The Six He has represented the Committee, a member of 2006 and also represents Nations Committee and in WRU on the Board of the the Millennium Stadium the WRU on the boards of 2012 was appointed to European Rugby Cup Ltd, Board and sits on the the European Rugby Cup the board of Rugby World the International Rugby Appointments and Ltd, Celtic Rugby Ltd and Cup Ltd. He is chairman of Board and the Welsh Remuneration Panel. the Six Nations the Board of the Youth Rugby Union. He is Committee. He is also He has been an active Millennium Stadium and a currently a member of the President of Cefn Cribwr member of Brynmawr RFC member of the Millennium Stadium Board RFC. for 60 years, first as a International Rugby Board and sits on the player and then a Council. Before joining the WRU he Appointments and committee member was Managing Director of Remuneration Panel. He He won 23 caps for Wales including terms as ITV Wales. Previously he was on the original between 1983 and 1987 Treasurer, Vice Chairman was Managing Director working party for the captaining the national and Chairman. He is now and Programme Controller Millennium Stadium team eight times and a Life Member of the club. of Classic FM and Board project played his club rugby for Director of its parent Now retired he worked as Neath and Llanelli. He then He played youth and company GWR plc; a scaffolder before coached Neath RFC and senior rugby for Managing Director at EMI managing his own finance later became Manager of Cwmtillery and Abertillery Records: Worldwide business. the Wales A team and before joining President of the Decca then the senior national Abergavenny where he Record Company and team. coached the youth and Head of the BBC Radio 1 senior sides. He was Outside his rugby Music Department. honorary secretary for the involvement he retains club for 20 years along private business interests with a role as honorary and holds a number of secretary of the then directorships. Monmouthshire League. He is a retired head teacher.

94 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Gerald Davies CBE DL Martin Davies Geraint Edwards Humphrey R Evans Joined the WRU Board in Joined the WRU Board in Joined the WRU Board in Joined the WRU Board in 2005 as a national 2003 as a national 1993 and represents 2002 and represents representative. representative. District E. District C. He is also Chairman of the He also currently serves on He also currently serves on He is a former player for Board of the British and the Millennium Stadium the Millennium Stadium Aberdare RFC and since Irish Lions. He won 46 caps Board. Board. He is Chairman of retiring from the game has for Wales and was a British the WRU Disciplinary served on the club and Irish Lion in 1968 and He is Chairman of the Committee and is a committee for 40 years. 1971. He played for WRU Finance Committee, member of the ERC He is a former fixture London Welsh RFC and a member of the Disciplinary Sub secretary and was elected played for and captained Appointments and Cardiff RFC. He was Committee. He is a former Chairman 28 years ago. Remuneration Panel, Manager of the 2009 Lions Citing Commissioner at Chairman of the Audit Now retired he worked for on their tour of South FIRA, ERC and Six Nations Panel and an executive Unilever as a sales Africa. level. He is a Life Member member of the FIRA-AER representative and is now of Dunvant RFC having He has been an Executive committee. a lay preacher for the been a member of the Officer with Sport Wales Unitarian Church and a non-executive He is a former player for club for 55 years having Director and Chairman of Cardiff Youth and played for the club’s youth HTV. He was also Chairman Wanderers and senior sides for 18 of the Welsh Youth and served as Secretary of seasons before fulfilling Agency. He is an author, a Crawshays Welsh. the roles of fixture rugby columnist for The secretary for 25 years and Times, a member of the He is a retired chartered chairman for 10 years. Eisteddfod Gorsedd of accountant and worked Bards and Deputy Lord for Price Waterhouse He is a former tool maker Lieutenant of Gwent. He Coopers (PwC), Standard with ICI and Ford and was has been recognised by his Chartered Banking Group part of the Production former Universities, and Hillsdown Holdings. Management team at Emmanuel College, He was also director of a British Leyland for over 25 Cambridge where he was awarded an Honorary private manufacturing years. He is now retired. Fellowship and company. He was a Cardiff Loughborough University councillor for 29 years. where he received an Honorary Doctorate.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 95 Welsh Rugby Union governance Board of Directors for the period ended 30 June 2013

Gordon Eynon Brian Fowler Roy Giddings Richard Gwynn Joined the WRU Board in Joined the WRU Board in Joined the WRU Board in Joined the WRU Board in 2011 and represents 2002 and represents 1988 and represents 2011 and represents District H. District F. District B. District E. After playing youth rugby He played rugby for St He is a former player for He played for Swansea for Narberth, he Luke’s College Exeter, Pencoed RFC and was Uplands RFC and has been represented Whitland RFC, Llanelli RFC, Ammanford secretary of the club from club secretary for 33 years. Gwernyfed RFC, RFC, Brynamman RFC and 1963-1988. He has been He is also Vice President of Breconshire, Carmarthen Tycroes RFC. He was later secretary of the East Crawshays Welsh. He is a Quins RFC and Crymych secretary of Ammanford District since 1976. former WRU referee and is RFC at senior level. He was RFC for 23 years. a former secretary of the He studied cost head coach at Crymych for Swansea and District He has been a local accountancy before three years before Referees Society. He is a government officer for completing his National becoming club secretary in Citing Commissioner. He Carmarthenshire County Service in 1961 and joined 1989, a position he still was treasurer of the British Council since 1989 having the British Steel holds today and is now a Telecom and Post Office previously worked for the Corporation in 1962 as a Life Member of the club. Rugby Union (affiliated to National Coal Board. departmental cost He has been a District H the RFU) from 1984 to accountant. He later committee member since 1986 became cashier of 1995 and chaired the Llanwern Steelworks until district from 2009 to his retirement in 1999. 2011. He is a former schoolmaster and currently runs a farm in Pembrokeshire.

96 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 Russell Howell Alan Jones Aurwel Morgan Ray Wilton Joined the WRU Board in Joined the WRU Board in Joined the WRU Board in Joined the WRU Board in 1997 and represents 2003 and represents 2005 and represents 1998 and represents District B. District D. District D. District C. He is a WRU representative He chairs the WRU Game He played rugby for He is also a Citing on FIRA - AER. He became Policy Committee, is a Cwmgwrach RFC, Commissioner to test Chairman of Pentyrch RFC member of the University of Wales match level. while still playing for the Appointments and Aberystwyth, Aberystwyth He has been a member of club. He was then club Remuneration Panel and RFC, Cardiganshire, the Tylorstown RFC president for eight years was formerly a member of Winchester, Hampshire, committee for 30 years and is now a Life Member. the WRU League RFC and and represented the club He also chaired District B Management Committee. Bridgend Sports RFC. He on the Mid District before being elected onto has been Chairman of He played for Birmingham Committee from 1971. He the WRU board. District D and was University and Bryncoch became chairman of the secretary of Bridgend He is a retired haulage RFC which he also Mid District selectors. He Sports RFC for 30 years. contractor. captained. He is a Life was also a member of the He is a citing commissioner Member of the club WRU’s League to test match level. having been club secretary Management Committee. for the past 21 years. He He is a retired lecturer in He worked as a was also the club’s Agriculture and Head of development engineer in chairman for 10 years. Department at Glamorgan the power industry and College of Agriculture. He was an IT specialist for was also employed by the Wales Gas, BP and BT. He Hoover washing machine has also carried out manufacturer for 36 years. volunteer work for the Age Concern charity helping elderly people learn IT skills.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 97 Welsh Rugby Union governance Board of Directors for the period ended 30 June 2013

Alwyn Jones Anthony John Company Secretary Alwyn joined the WRU Rejoined the WRU Board Gareth Williams Board in 2012 and in 2012 and represents He is Senior Partner with represents District J. District G. Hugh James, the largest He is a member of the He sat on the WRU League law firm in Wales with WRU Game Policy Management Committee offices in Cardiff and Committee and Trustee of from 1993 to 2003. He London. He is a specialist the Millennium Stadium also sat on the WRU Game in commercial litigation Charitable Trust. Policy Committee from and a sports lawyer. 2003 to 2011. He is a member and He is also a director of former player, captain and Anthony now sits on the Thomas Carroll Group plc. secretary of Bangor RFC. Finance Committee. He is Gareth chairs the Board of also Vice President of the He represented North Directors of the Royal Llanelli and District Rugby Wales as a player, and was Welsh College of Music Union, has served as a secretary of District J for and Drama, Governor of committee member for 16 years. Alwyn is the University of South Kidwelly RFC for 30 years, currently employed by Wales, Trustee of the Fixture Secretary for 10 HMRC. Welsh Rugby Charitable years and is a Trustee of Trust. He is formerly a the club. deputy judge and He captained the Zambian Chairman of the Wales National team while Commercial Law working in the region, and Association. played for Loughor and Kidwelly. He worked as Site Manager for Dwr Cymru Welsh Water for 33 years.

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Cliff Morgan then battled against throat cancer, which forced him to Born: 7 April 1930 – Trebanog have his larynx removed. Died: 29 August 2013 Losing his voice was the cruelest of fates for the man who brought the world one of the greatest pieces of rugby One of Welsh rugby’s golden greats, commentary in the 1973 game between the Barbarians Cliff Morgan, died at the age of 83 and the All Blacks. His description of Gareth Edwards’ try on Thursday, 29 August, 2013. A from that game has remained embedded in the minds of legendary figure for Cardiff, Wales all who heard it. and the British & Irish Lions, he went on to forge a great career in During the 1955 Lions tour to South Africa, when Morgan broadcasting after his playing days were over. became a global star as the tourists shared the series 2-2 against the mighty Springboks, he became the choirmaster Born in Trebanog, in the Rhondda, on 7 April, 1930, the both on an off the field. He scored one of the greatest tries 5ft 7in tall Tonyrefail Grammar School product went on to in Lions history as he steered his side to victory in the first become a giant figure in the world game and arguably the Test and he then captained the Lions to victory in the third greatest outside half around. Test. He scored 38 tries in 202 appearances for Cardiff between In 1997 he was inducted into the International Rugby Hall 1949-1958 and helped them to beat the 1953 All Blacks of Fame, he was a member of the Welsh Sports Hall of and the 1957 Wallabies. He made the first of his 29 Welsh Fame's 'Roll of Honour' and he was made OBE and CVO. appearances against Ireland in 1951 and was an ever Cliff Morgan was not only a great sportsman, but a great present in the 1952 Grand Slam side. Welshman. He lived with his second wife, Pat, on the Isle He helped Wales to share the Five Nations title in 1954 and of Wight. 1955 and was captain in 1956 when they won the title outright, losing only to Ireland in Dublin. He played against Onllwyn Brace South Africa for Wales in the 6-3 defeat in 1951 and then Born: 16 November 1932 – helped Wales to beat the All Blacks two years later in the Gowerton famous 13-8 victory at Cardiff Arms Park – still the last time Wales beat New Zealand. Died: 4 July 2013 Although his playing career came to an end at the tender Onllwyn Brace had a distinguished age of just 28, Morgan continued to be involved in sport career on and off the field. The through his television and radio work with ITV and the Cardiff and University BBC. He became Sports Organiser for BBC Wales in 1958 graduate played nine times for before becoming a hugely popular rugby commentator. Wales, captaining his country on two of those occasions, before becoming Head of Sport at He was one of the original team captains on a ‘Question BBC Wales. The scrum-half began his playing career at of Sport’, alongside boxer Henry Cooper, and rose to the Aberavon before moving to Newport and then Llanelli. He positions of Head of BBC Radio Outside Broadcasts in 1974 was part of the Newport side that faced the touring All and Head of Sport and Outside Broadcasts for BBC Blacks in 1954 and whilst at Llanelli he captained the side Television from 1976 to 1987. for two seasons. He produced the BBC’s flagship sports programmes His international debut came at Twickenham on 21st ‘Grandstand’ and ‘Sportsnight with Coleman’, and also January 1956 in a game that Wales won 8-3. He went on supervised coverage of events including football World to play in all four matches of that season’s Five Nations Cups, Commonwealth and Olympic Games, royal Championship as Wales were crowned Champions. Brace weddings and other national ceremonial occasions. When captained Wales on two occasions, both against Ireland in his career in television came to an end, he returned to radio 1960 and 1961. and was the voice of ‘Sport on Four’ through to 1998. Following his playing career he worked in broadcasting and His courage on the field was matched in later life when he succeeded his former international half-back partner Cliff overcame a life-threatening stroke at the age of 42 and Morgan to become Head of Sport at BBC Wales.

100 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 In that role during the 1970s and 1980s he helped shape William Gwyn Hullin sports coverage at a time of major advances in live Born: 2 January 1942 – Loughor broadcasting. Died: 3 October 2012 Brian Sparks MBE William Gwyn Hullin started his senior playing career at Born: 23 June 1931 – Llanharan Mumbles before moving to Aberavon. He spent a brief season at Swansea RFC before heading east to Cardiff in Died: 30 June 2013 1963. Whilst at Cardiff, Hullin was part of the side that Brian Sparks starred for Neath in the 1950’s for whom he beat Australia 14-8 with the scrum half scoring a try and a made over 100 appearances. The former police officer drop-goal in the victory. He went on to make 152 joined the Welsh All Blacks in 1953 and made his appearances for Cardiff over six seasons and also played international debut for Wales just a year later. for the Barbarians. The flanker’s first cap came against Ireland at Lansdowne The 1966/67 season saw Hullin collect his solitary Road, a match the visitors won 12-9 and which featured international cap away to Scotland in a match that Wales five of Sparks’ Neath teammates. He continued to taste lost 11-5. victory in his next four outings for his country. His banking career created a move to London where he In total, the former Pontypool, Bridgend, Glamorgan Police played for London Welsh for seven further years. and Torquay Athletic player played seven times for Wales, his final appearance came against Scotland in 1957. William Raymond Watkins He took up a teacher training course at St Luke’s College Born: 22 March 1933 – Newbridge in Exeter and whilst there represented Devon County and Died: 19 May 2013 then led St Luke’s to the final of the . William R Watkins played for Newbridge, Pontypool, St Towards the end of that year he joined Halifax Rugby Lukes and Devon before joining Newport RFC in 1957. League side, scoring a try on his debut. The scrum-half made 85 appearances for Newport Upon returning to Wales, he founded the Welsh Schools’ between 1957 and 1962 scoring seven tries and four drop Basketball Association in 1963, the Mini Basketball goals. He was capped once by Wales, away to France Association of Wales in 1972 and Bridgend & District Mini where he partnered his half-back partner from Newport Basketball. His work and effort in school basketball in Malcolm Thomas. He went onto play for the Barbarians Wales was recognised in 2012 when he was awarded an against South Africa in 1961. MBE. In recent years he was still an active member of Neath RFC William Owen Gooding Williams and the Neath Former Players Association. Born: 23 November 1929 – Gowerton Died: 29 March 2013 William James Thomas Born: 1 September 1933 – Bargoed Gowerton born Williams played twenty-two times for Wales between 1951 and 1956 and represented the British Died: 7 March 2013 & Irish Lions in 1955. William James Thomas, ‘Billy’, won two caps for Wales at He began his club career at Gowerton before moving to hooker, making his debut in 1961. Swansea. He made his International debut away to France He represented Wales at Schools U15 and Youth level and in April 1951. In 1955 he toured South Africa with the played club rugby for Bargoed, Newport, Abertillery and British and Irish Lions, a tour that ended with a drawn Cardiff. He made his international debut against France in series. Williams was part of an all Welsh front-row that 1961 and won his second cap two years later against the played in the first test against South Africa alongside Bryn same opposition in 1963. He made 268 appearances for Meredith and Courtenay Meredith. His final match for his Cardiff before retiring in 1967 and went on to coach at country came in 1956 away to Ireland at Lansdowne Road. Bedwas and Pontypridd.

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 101 102 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 103 Commercial partners

TITLE SPONSORS

BROADCAST PARTNERS

PRINCIPAL PARTNERS

COMMUNITY PARTNERS

OFFICIAL SUPPLIERS

104 THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2013 The Purpose of the WRU is to: Promote, foster, encourage, control and improve rugby football in Wales.

The WRU Group’s Vision is three fold: • Take Wales to the world with our rugby • Welcome the world to Wales in our stadium • Define Wales as a nation

The WRU Group’s Mission is based upon: • Leading Welsh rugby to the forefront of the global game in performance and reputation • Maximising participation, performance and enjoyment of the game at all levels • Developing grassroots rugby, supporting clubs, schools and colleges and bringing communities together • Promoting the Millennium Stadium as a unique, must play, must visit venue

Our Values and Beliefs Our purpose, vision, and mission are underpinned by our values and beliefs which embrace, integrity, excellence, success, courage, family and humour. The Welsh Rugby Union Limited & Millennium Stadium plc Millennium Stadium, Westgate Street, Cardiff CF10 1NS Tel: + 44 (0)870 013 8600 Email: [email protected] www.wru.co.uk www.millenniumstadium.com