WRU Annual Report 2011

Contents
Financial highlights Neges y Llywydd / Presidents message Chairmans statement Group Chief Executives summary Operating and financial review Financial review Elite rugby Community rugby Stadium Key performance indicators and business risks Directors report Consolidated profit and loss account Consolidated statement of total recognised gains and losses Balance sheets Consolidated cash flow statement Notes to the financial statements Independent auditors report Welsh Rugby Union governance Registered office and advisers Commercial partners
02 04 06 08
14 20 36 44 52 53 56 56 57 58 59 80 81 84 88
THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011
Financial highlights
60 54.3 50
P&L extract - 2011 & 2010

58.5
40
30
30.9 28.0 19.3 20.0 26.2 27.6
20
10 7.0 0 2011 Turnover Operational costs Allocations to affiliated organisations Amount remaining to service other costs 2010
7.6 3.8 2.7 4.4 (0.5) Year 2011 EBITDA Operating profit before exceptional items Loss before tax & exceptional items 2010
Analysis of turnover
60 55 50 45 40 35 m 30 25 20 15 10 5 0 2011 Year 2010 30.6 34.2 Other event income Other income 17% 9.1 2.7 0.7 11.2 9.2 2.0 2.2 10.9 Match income Competition income Commercial income 5% 1%
21%
2011
56%
EBITDA = Earnings before interest, depreciation, allocations and exceptional items
Turnover v EBITDA
60 58.5 54.3 50.3 50 43.8 m 49.4
40
30 23.6 21.1 20 2007 2008 2009 EBITDA Turnover 24.5
27.6
26.2
2010
2011
EBITDA v Allocations
30 27.6 26.2 25 21.1 20.0 20 m 17.0 14.9 15 11.0 10 11.4 12.1 15.2 14.2 15.0 19.3 23.6 24.5
2007
2008 Allocations - Regions
2009 Allocations - all
2010 EBITDA
2011
Allocations
15 14.2
15.0
12.1 12 11.0 11.4
9 m 6 4.5 3.8 2.9 3 1.0 0 2007 2008 Regions 2009 Community Rugby 2010 Semi-professional 2011 1.0 1.1 1.2 1.2 2.8 3.1
Neges y Llywydd
Rwyn cyfrir cyfleoedd a gaf bob blwyddyn i wneud cyfeillion newydd drwy gyfrwng rygbi Cymru yn ychwanegu at y fraint ar anrhydedd a deimlaf o gael gwasanaethu fel Llywydd URC. Maer gamp arbennig hon on heiddon denu cefnogaeth nifer o unigolion ymroddedig syn byw wrth werthoedd ac egwyddorion rydym ni gyd yn eu coleddu ac yn gweithion galed iw cadw. Gwelaf y gwerthoedd hynnyn cael eu cynrychioli o frig y gm yng ngharfan hy Cymru drwodd ir clybiau yr n ymwelaf hwy bob wythnos ac o fewn calon weithredol ein corff llywodraethol yn ogystal. Eleni rydym wedi tystio i rai digwyddiadau pryderus sydd wedi siglo hyder y cyhoedd gan beri i rai amau achosion y fath anniddigrwydd ac anhrefn. Soniwyd am gymdeithas sl, am gymunedau toredig a rhanedig, am bobl ifanc yn cicio yn erbyn y tresi a theuluoedd ar chwl. Rwyn hollol bendant fod gan rygbi, ac yn arbennig rygbin lleol neun gymunedol, nawr yn fwy nag erioed, ran bwysig iw chwarae, a lle bynnag mae rygbin ganolog mewn cymuned, mae iechyd, bywiogrwydd a lles y gymuned honnon ddiogel. Rwyn ffyddiog fod y gwerthoedd a gynrychiolir gan rygbi Cymrun dal yn gadarn ac y byddant yn parhau i ffynnu. I fi, feu hymgorfforir gan y fyddin dawel o wirfoddolwyr syn cynnal ein gm dwy weithio mor galed oddi ar y cae a thu l ir llenni. Maen clybiaun cynrychioli curiad calon y cymunedau a wasanaethant. Maeu strwythur au trefniadaeth yn batrwm, ac maer rheiny syn ymrwymo i ddatblyguu clybiau, am ddim neu am fawr o fydd ariannol, yn rhoi esiampl werthfawr i eraill a rhaid i ni fyth beidio u tanbrisio. Maeu gwasanaeth di-dl yn cwmpasu estyn croeso cynnes i ymwelwyr yn y clwb ar ddiwrnodau gm, gwirfoddoli i dreulio oriau yn hyfforddi a chymell ac annog y plant sydd nawr yn ymgymryd at rygbi yn eu lluoedd. Bob mis rwyn mynychu cyfarfodydd Bwrdd Cyfarwyddwyr URC lle rwyn gwrando ac yn dysgu am drylwyredd y gweithgarwch ar drefniadaeth syn amlwg o fewn ein gm. Wrth gwrs ein bod nin wynebu heriau a phryderon, ond rwyf wastad yn gweld ac yn clywed am enghreifftiau clodwiw or modd mae rygbi Cymrun gwneud gwahaniaeth. Eleni maen clybiau wedi profi fod ganddynt y dycnwch i gynnal statws rygbi fel camp genedlaethol Cymru. Yn 2011 buom yn dathlu 130 o flynyddoedd bodolaeth Undeb Rygbi Cymru fel corff llywodraethol ac mae
honnon garreg filltir y gallwn fod yn falch ohoni. Rhan om cyfrifoldeb yw cynrychioli Cymru yng nghwmni cynrychiolwyr gwledydd eraill, pobl syn gweithredu ar amrywiol lefelaur gm ledled y byd, Ac maen amlwg i fi fod ein henw da fel grym byd-eang yn y gm hon heb wanychu na phylu. Gwn fod ein Prif Hyfforddwr Warren Gatland yn ymwybodol iawn o bwysigrwydd cysylltu brig y gm yng Nghymru gydar gwreiddiau ar sylfeini grymus o ble tardd y goreuon on chwaraewyr. Maer dynion hynny syn ddigon ffodus i gael eu dewis i wisgo crys coch Cymrun cydnabod bod llawer ou llwyddiant yn deillio o ymdrechion cymaint a oedd mor barod iw helpu au cefnogi yn y dyddiau cynnar hynny wrth iddynt giciou pl gyntaf. Bur flwyddyn yn un hynod heriol yn economaidd ir gymdeithas gyfan ond maen bleser nodi y dengys yr Adroddiad Blynyddol hwn fod ein hundeb mewn dwylo da ac mewn cyflwr da. Er gwaethaf yr amodau heriol hynny rwyn falch i ddatgan bod cysylltiad URC gyda gwaith elusennol yn dal yn gadarn ac yn ystyrlon. Nid wyn esgusodi rhag nodi unwaith yn rhagor pa mor falch ydwyf o Ymddiriedolaeth Elusennol Rygbi Cymru ar gwaith gwirfoddol a wneir i gefnogir chwaraewyr rygbi a anafwyd yn ddifrifol yng Nghymru a cheisio gwella ansawdd eu bywyd. Mae cwrdd r chwaraewyr hyn yn ysbrydoli ac maent yn cynrychioli popeth sydd yn dda ynghylch rygbi Cymru. Edrychaf ymlaen at gwrdd chymaint phosib o gwmpas y gm yng Nghymru yn y flwyddyn sydd i ddod a chyfoethogir llu atgofion sydd gennyf or modd mae rygbi Cymrun rym cadarnhaol all hybu iechyd a lles ein cymunedau.
Dennis Gethin Llywydd Undeb Rygbi Cymru Cyfyngedig
Presidents message
Dennis Gethin, President
the intensity of activity and organisation at work within our game. Of course we face challenges and concerns, but I constantly see and hear of real working examples of how Welsh rugby makes a difference. This year our clubs have proved they have the resilience to maintain the status of rugby as the national sport of Wales. In 2011 we celebrated 130 years of the Welsh Rugby Union as a governing body and that is a landmark of which we can all be proud. Part of my remit is to represent Wales in the company of the representatives of other nations, people who operate at all the different levels of the game from around the globe, and it is clear to me that our reputation as a world force in this game is undiminished. I know that our Head Coach, Warren Gatland, is particularly conscious of how important it is to link the very top of the game in Wales with the powerful roots and foundations from where the elite players emerge. Those men fortunate enough to be selected to wear the red jersey of Wales recognise that they owe much of their success to the efforts of so many willing to help and support them when they played their first rugby as young boys. The year has been an economically challenging one for the whole of society but it is refreshing to note that this Annual Report shows our union to be in good hands and good shape. Despite those challenging conditions I am delighted to report that the WRUs association with charitable work remains strong and meaningful. I make no excuses for again mentioning how particularly proud I am of the Welsh Rugby Charitable Trust and the voluntary work undertaken to support the seriously injured rugby players in Wales and try and improve their quality of life. Meeting these players is truly inspirational and they represent everything that is good about Welsh rugby. I look forward to meeting as many people around the game in Wales as possible in the year ahead and enriching the store of memories I have of how Welsh rugby is truly a positive force for the health and welfare of our communities.
Dennis Gethin presents George North with his first cap
The new friendships I forge each year through Welsh rugby are a bonus to the honour and privilege I feel in serving as President of the WRU. This great sport of ours attracts the support of many committed individuals who live by values and principles we all cherish and work hard to preserve. I find those values represented from the very top of the game in the senior Wales squad right through to the clubs I visit each week and also inside the operational heart of our governing body. This year we have borne witness to some troubling events which have shaken public confidence and caused many to question the causes for such unrest and disorder. There has been talk of a sick society, of fractured and fragmented communities, of disengaged youth and dysfunctional families. It is my firm belief that rugby, and most particularly grassroots or community rugby, now has an even more important role to play than ever, and that wherever rugby is at the heart of a community its health, vitality and wellbeing is assured. I am confident that the values represented by Welsh rugby remain strong and will continue to flourish. For me, they are epitomised by the silent army of volunteers who sustain our game by working so hard off the field and behind the scenes. Our clubs represent the heartbeat of the communities they serve. Their structure and organisation provides a model, and those who devote themselves to developing their clubs, for little or no financial reward, set an invaluable example to others and we must never underestimate their worth. Their unpaid service stretches from the warm welcome extended to visitors in the clubhouse on match days, to the volunteers who spend so many hours coaching and encouraging the children who are now taking up the game of rugby in droves. Every month I attend meetings of the Board of Directors of the WRU where I listen and learn of
Dennis Gethin President The Welsh Rugby Union Limited
Chairmans statement
David Pickering, Chairman
We have undoubtedly emerged successfully from a financial year which has tested the corporate mettle of the Welsh Rugby Union as an effective and efficient governing body. The wider economic climate placed significant pressure on our ability to sustain the progress we have achieved over recent years. It is therefore extremely comforting and rewarding to note that the financial results delivered in this Annual Report prove that our planning, structures and corporate vigilance are all strong. We should all note that this success is not down to luck or the uncontrollable influences of fate but the Executive team, operating under the direction of the Board. The WRU today is a well organised and efficient organisation which relies on its planning and delivery strengths to counter challenges and achieve success in a planned and strategic way and, as Chairman, I have helped drive this modern outlook. I have spoken before of the successful and timely introduction of a professional Executive Board to interpret the aims of the elected representation approved by the clubs and associated organisations. That Executive team, with the approval of the Board of Directors, has introduced a five year rolling strategic and financial plan which is the roadmap for all our actions and aims going forward. This level of planning allows us, as an organisation, to test our priorities and aims against sound financial measures so that we are always realistic and informed about our strategies. As Chairman I have observed how this modern outlook on our corporate planning helps the Union in two distinct ways. Firstly, when I look inwardly at our day to day and week by week operation I am conscious of our progress in a sure footed and controlled manner. Secondly, with my wider remit within the game I can see how the rest of the rugby world respects us as a major force in rugby. It is important we all take some pride as a nation in the fact that we are able to achieve this status against the backdrop of our geographical and population limitations. During the year ended 30 June 2011 the Executive team monitored the Participation Agreement which we now have in place with our four Regional organisations through until 2014 with an option to renew until 2019.
David Pickering spreads the word about Welsh rugby
This is yet another example of how the WRU is putting in place the kind of structures which future-proof its work as a governing body and enable proper investment in the right areas of the game to the benefit of all. The negotiations that took place within the year to conclude a contract with our international players, confirms the detail of how they will be rewarded in the national jersey of Wales right up until 2016. Yet another example of our efficiency is the announcement during the year of a schedule of international fixtures which takes Wales right through to 2019. This delivers the kind of certainty in our activity which helps us engage with sponsors, broadcasters and other stakeholders with confidence and through a meaningful dialogue. The sound foundations of the WRU have also enabled us to take important decisions which will shape the game for years to come. During the year, a comprehensive review was undertaken which concluded with an announcement which will reform not only the Premiership Division from season 2012/13 but all our other league structures as well. I know this was a difficult call to make, but I am confident that the Board fully tested the findings of the review before delivering its approval and I am certain the reforms will open up a new and positive pathway for the game in Wales. We need to create the right competitive environment for our best players and we have taken action which will help us achieve those standards and continue to improve and develop.
Roger Lewis and David Pickering at the launch of the Grassroots Photography Project to celebrate community rugby
I spend a proportion of my time as Chairman engaging with our stakeholders within Wales and beyond our borders, so I know our progress is being noted and influences how those partners engage with us. The Welsh Government deserves particular praise as do many of the local authorities who work so hard to align their strategies with the work of the WRU. As Chairman of Six Nations Rugby Limited and through my wider remit within the International Rugby Board I am fully aware of how loud the voice of Wales now resonates throughout the rugby world. That is achieved through the respect within which we are held by our colleagues fighting the same battles and seeking to achieve the same aims elsewhere. The WRU has focused extremely hard on putting in place the teams and facilities which enable all our elite sides to prepare in ways which ensure that the talent we have available is always identified and developed. Our senior team may not have achieved all the success they aimed for but they have played consistently well against some of the best teams in world rugby to a degree which ensures no side can face Wales without being at their very best. Now the WRU is focusing more closely than ever on the community game and as Chairman I am delighted at the progress we can look forward to in the future. I am further delighted to have played a significant part in ensuring Wales will host several games in RWC 2015 placing Wales at the centre of the rugby world again.
Also, as Chairman of Six Nations Rugby Limited, I am especially pleased to report that we have extended our broadcasting deals in the UK and France, ensuring our most valuable income stream is protected. I am delighted to have been asked to extend my role as Chairman unanimously by our Six Nations partners. So, in looking back across the past twelve months, I can reassure you all that we have plenty to look forward to. Now in my ninth year in post, I want to again thank our President, Dennis Gethin, and my Vice-Chairman, Ken Hewitt, for their unwavering support and growing friendship throughout the period. The Board of Directors too have worked tirelessly and I thank them sincerely. My gratitude to them is expressed in equal measure but, in particular, to our Group Chief Executive, Roger Lewis for his leadership of the Executive Board and the chairmen of the sub-committees, Martin Davies in Finance, Mal Beynon of Regulatory and Alan Jones for Game Policy. So I am confident that after 130 magnificent years the WRU is well placed to meet the challenges of the future and we continue along that path with our values intact and our ambitions undiminished.
David Pickering Chairman The Welsh Rugby Union Limited
Group Chief Executives summary

Roger Lewis, Group Chief Executive
Coaching Mini Rugby
Introduction This is my fifth report as Group Chief Executive to the members of the Welsh Rugby Union. We have asserted, since 2006, we have asserted that the creation of long term sustainability for all of our activities, both on and off the field, based upon sound financial management, must be our over-arching strategy for the Welsh Rugby Union and the Millennium Stadium. Achieving this has been particularly challenging this year in such an uncertain economic climate. We have again had to make some difficult decisions. However, I am pleased to report that following the record turnover of 2010 and the powerful figures of 2008 and 2009, we have once more produced another strong financial performance this year. Our rolling five year financial and strategic plan is robust. It is being managed with the right systems and structures in place and delivered by the right staff with the appropriate skills. During the year, I have strengthened the Executive Board of the Group with the new external
appointments for the roles of Head of Legal Affairs (Rhodri Lewis) and Head of Sales & Marketing (Craig Maxwell). We have continued to enhance our position and in doing so we are creating long term sustainability for the Welsh Rugby Union Group. Across the game there have been very encouraging signs with increased participation in certain areas of grass roots rugby and a refreshed and youthful national team at the elite end. The reforms announced for the Principality Premiership Division and the proposed introduction of a new National Championship will improve the talent pathway even further during the years ahead. The Millennium Stadium continues to be regarded as one of the worlds great venues. I thank everyone in the Welsh Rugby Union Group at all levels and all of the staff for producing these results. I emphasise though that the challenges ahead of us all will again be considerable. They must not be underestimated. There will be more difficult decisions to make in the years to come.
Launched the 130th Anniversary Debenture Issue; and Negotiated and renegotiated key contracts and developed new relationships which include our broadcasters, BBC Network, BBC Wales and S4C; our jersey manufacturer, Under Armour; a new jersey sponsor for the Wales national team, Admiral; the Principality Building Society; SWALEC; Thomas Cook; Guinness; SEAT; Ticketmaster; Trinity Mirror and DHL. In Community Rugby we: Continued to align our community strategies with the Welsh Government, Sport Wales and certain Local Authorities, which have benefited clubs throughout Wales Continued to welcome the former clubs of the Welsh Districts Rugby Union in to the WRU; and Launched the myWRU website to support, monitor and target development across grass roots clubs. In Elite Rugby we:
Warren Gatland signs new four year contract
Invested more in facilities, staff and resources for the national team than ever before Negotiated a ground breaking five year contract, until July 2016, with our international players Signed a new four year contract with our national coach, Warren Gatland, until after the 2015 Rugby World Cup Developed further our relationship with the four Regions through decision making forums established within the terms of the Participation Agreement Agreed a reform of the Premiership Division with key stakeholders and the introduction of a National Championship, both from the 2012/13 season Commenced a comprehensive review of our age grade pathways with all key stakeholders in Welsh rugby; and Provided a new Head Coach and Assistant Coach for the Dragons from within our WRU age grade coaching structure. In our Millennium Stadium we: Upgraded the audio-video facilities in a 3.0m project with the assistance of a 1.7m grant from the Welsh Government
That said, these results and the decisions taken over the past twelve months give us greater confidence for the future. Highlights Over the course of the coming pages we review in great detail our financial and operational performances, including Elite Rugby, Community Rugby and our Millennium Stadium. Below are the highlights for the year ended 30 June 2011; In Financial and Commercial we: Recorded a turnover of 54.3m. Since 2007, we have increased turnover by 24% Allocated 19.3m to our affiliated organisations. Since 2007, we have increased allocations by 30% Invested 3.1m in the community game Reduced our net bank debt by 5.9m to a record low of 26.2m Reduced our bank interest charge from 2.5m to 0.8m Introduced the Official Hospitality Operator initiative

(continued)
The Groups mission The Groups mission is based upon: Leading Welsh rugby to the forefront of the global game in performance and reputation Maximising participation and performance at all levels Developing grass roots rugby, supporting clubs, schools and colleges and bringing communities together Promoting the Millennium Stadium as a unique, must play, must visit venue.
Roger Lewis, Gethin Jenkins and Matthew Rees sign new five year international player contract
Our Values Our purpose, vision and mission are underpinned by values and beliefs which embrace integrity, excellence, success, courage, family and humour. Outlook For the past three years I have forecast that, the future promises to be very positive for the Welsh Rugby Union this continues to be the case for the year ahead. Again though I urge caution, whilst always encouraging us to continue to seize the moment when it arises. The recent and measurable success delivered through our operational structure and effective decision making is defined in this and our other recent Annual Reports, inspiring me with confidence in the Groups ability to face the challenges of the future. Our rolling five-year financial plan, as I have mentioned previously, has identified the issues surrounding the cyclical nature of our business. This is supported by the rolling five year strategic plan which recognises the business risks and opportunities which need to be managed. The plan contains specific objectives, actions, responsibilities and timelines for all aspects of our activities agreed by the Board of the Welsh Rugby Union. We have developed a very clear strategy to take us forward. Once more, there are a number of major initiatives which we will continue to develop and which we have enhanced once more over the past period. We reviewed and updated the plan during the past 12 months. Our Five Year Strategic Plan objectives continue to include: Improving our community rugby facilities and equipment and supporting the volunteers who are vital to the game
Welcomed 0.8m paying visitors to enjoy a range of rugby, music, tours, soccer and other sporting and varied events Hosted a record 6th Heineken Cup Final, which resulted in an economic impact on Cardiff in excess of 24m. We hosted the Ryder Cup Welcome to Wales Concert Presented Take That live in concert on two consecutive evenings Welcomed England to play Wales in international soccer Hosted the Wales Varsity match, broadcast live on S4C Continued to develop our strategy for the land to the east of the stadium; and Near completion to achieve the award of BSI 8901 for Sustainable Management Systems for Events Our purpose, vision, mission and values remain constant. The purpose of the WRU The purpose of the WRU is to promote, foster, encourage, control and improve rugby football in Wales. The Groups vision The Groups vision is three fold: Taking Wales to the world with our rugby Welcoming the world to Wales in our Stadium Defining Wales as a nation
10
11

(continued)
Roger Lewis and Admiral CEO Henry Engelhardt sign new jersey sponsorship deal
Developing world class players, coaches and officials Supporting our national team of players, coaches and support staff focussed upon winning Continuing the development of the womens game and understanding the opportunity that Olympic Sevens rugby will provide
The new screen in the South Stand
Maximising participation and fulfilling potential at all levels in the game based upon recruitment and retention Improving the health and well-being of our communities in partnership with our rugby Providing the right competitive environment for community rugby at all levels Creating a new strategy for rugby with schools and colleges, which has proved to be elusive Developing further the North Wales Strategic Plan Identifying and maximising the funding for the community game from public, private and charitable sources Ensuring all of the above points are measured against past and present achievements and that targets are set for the future Delivering world class facilities, systems and practices to support the elite rugby performance pathways
Ensuring the long term financial and physical sustainability of the Millennium Stadium and its digital technology facilities Enhancing our sponsorship and inventory strategy Expanding the reach of the WRU and MS brands, particularly through new media Increasing revenue opportunities through our licensing, broadcast and online platforms Developing our strategy for the land to the east of the stadium and consider other opportunities; and Recruiting and retaining the right individuals with the right values and skills Conclusion We have begun the new financial year with confidence. A win against England at home in August as part of our Rugby World Cup 2011 warm up games, following an extraordinary period of preparation for the national team, means we head down to New Zealand in a very positive frame of mind.
12
Gwernyfed Minis get stuck in to training
Attendances at the two England games and the fixture against Argentina show that our fan base is very solid. Our international team of players, confidently led by Warren Gatland and his outstanding coaching, conditioning and management staff, may not have delivered all the results in the 2011 Six Nations that they and we would have wanted, but the style of rugby once more produced has been recognised around the world by fans and media alike as truly compelling and engaging. At the time of writing this report we are about to head towards the 2011 Rugby World Cup in New Zealand. Our international schedule over the past 12 months has been the most demanding in our 130 year history. Our preparation both on and off the pitch has never been better. In the autumn of 2011 we welcome Australia to the Millennium Stadium and in the 2012 RBS 6 Nations tournament we host Scotland, Italy and France. Once more we will play the Barbarians in June 2012, before embarking on a three test match tour of Australia. We are also actively planning for the 2012 Olympic Games when we host eleven Olympic soccer matches in the Millennium Stadium. There are a number of additional events being planned for the next twelve months, details of which will be announced in due course.
All these factors are key in securing for Wales a pivotal role in maintaining and developing rugby union as a dynamic and dominant sport enjoyed by millions of participants, volunteers and supporters around the world. I conclude by personally thanking my Executive Board for their continued endeavour and hard work. I sincerely thank David Goldstone, our Special Advisor on Estates, for his wise counsel and his time generously given. I once more thank the Board for their help and guidance and, in particular, I thank David Pickering, our Chairman, for his constant support of myself and the Executive team. As I said on joining the WRU in October 2006, rugby defines us as a nation, and unites us as a nation and I am confident that the Welsh Rugby Union and all of its members, continues to be united around the goal of placing Wales at the forefront of world rugby, with passion, with pride and with dignity. Diolch yn fawr iawn.
Roger Lewis Group Chief Executive Officer The Welsh Rugby Union Limited
13
Operating and financial review

Year ended 30 June 2011
Steve Phillips, Group Finance Director
The Groups business and objectives Group activities The Welsh Rugby Union Limiteds (Company) principal activity is to promote, foster, encourage, control and improve the game of rugby football throughout Wales. The Company wholly owns, amongst others, the Millennium Stadium plc (MS) and the WRU National Centre of Excellence Ltd (WRUNCE) and collectively they are referred to as the Group. Dynamics of the business The activities, both operational and financial, of the Company and MS are so intrinsically linked that there is little merit in assessing the performance of one without the other. Whilst they are two separate legal entities and are obliged to prepare separate financial statements, it is the Groups performance that is the only meaningful measure. The Group must deliver on its commercial activities to allow re-investment in both elite and community rugby and to support financial allocations to affiliated organisations. Accordingly, the Groups income generation is paramount to delivering on its stated objectives. The key economic income driver of the Groups business is the hosting of events at the Millennium Stadium; particularly, the hosting of international rugby events featuring the Welsh team and especially a winning Welsh team. The more matches that are played, the greater the Groups revenues and profits that are available for re-investment in Welsh rugby. The Group welcomed 396,000 (2010: 531,000) rugby spectators through its turnstiles for the Invesco Perpetual Autumn Series, the RBS Six Nations Championship and the DHL Challenge in June, analysed as follows:
2011 No. of home matches 2011 000 2010 No. of home matches 2010 000
Wales v Barbarians - DHL Challenge
The primary reasons that the overall attendance has decreased in 2011 were due to: a reduction in the Autumn Series for the year ended June 2011 (YE11) against the period ended June 2010 (PE10); playing two Six Nations matches as compared to the three in 2010; and a reduction in the Summer Test due to playing the Barbarians in YE11 as opposed to South Africa in PE10. The average ticket income per attendee at matches held at the Millennium Stadium in YE11 was 43 (2010: 40). Commercial income, including sponsorship income, club and box seat income, programme income, stadium tours and hospitality income are also critical to the financial performance of the Group. Within reason, our operational cost base is relatively fixed; albeit there are incremental costs if more Group controlled events are staged. As a consequence, incremental events should mean incremental profits, which can be reinvested into the game across all levels. Changes in the period to 30 June 2011 In respect of the financial performance of the Group for the year, it is important to note that the prior period was thirteen months in duration so much of the data, particularly costs, will be more than YE11. The year end date was changed as it was felt that more rugby was being extended into the June period.
Autumn series Six Nations June Test
4 2 1 7
223 144 29 396
4 3 1 8
255 216 60 531
The average attendance per match was 57,000 (2010: 66,000) and equated to an average of 77% (2010: 89%) when expressed as a measure of capacity attendance.
14
featuring the National Squad - including, in the two periods indicated above, pop concerts, motorsport, football and the Heineken Cup Final. These two forms of income amount to some 22% (2010: 19%) of the Groups income. The remaining income arises from ancillary activities and various grant sources. There was a decrease in YE11 due to a contribution from the British & Irish Lions of 1.7m in PE10. 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. The surplus of 32.2m (2010: 33.5m) made by the Group which is invested in Welsh Rugby can be analysed as follows: 2011 m Operational costs - Elite rugby - Community rugby 4.0 1.9 5.9 2010 m 3.8 2.1 5.9
Youth training session
Financial Performance Overview of Performance The Group generates income from its international matches (including sponsorship and broadcast rights) and incremental revenue from the use of the Millennium Stadium. This income meets the operating costs of the Group to allow the majority of the surplus to be invested in Welsh Rugby, as follows: 2011 m 54.3 (5.6) (12.0) (4.5) 32.2 2010 m 58.5 (6.5) (13.1) (5.4) 33.5
Group income Business and administration Direct costs Stadium costs surplus
Allocations to affiliates - Regions (Professional) - Clubs (Semi - professional) - Community rugby
As analysed later on page 16, the Group earned some 54.3m (2010: 58.5m) predominantly from international rugby matches staged at the Millennium Stadium. These matches generated 56% (2010: 58%) of the Groups overall income. Commercial income at 11.2m contributes 21% (2010: 19%) of the Groups overall income and has increased by 3% on the prior period. Two other income streams, not generated from staging international rugby matches, arise from: Competition income, which represents the income from competitions including the Heineken Cup and the RaboDirect Pro12 (formerly the Magners League); and Other events, which represent events staged at the Millennium Stadium apart from rugby matches
15.0 1.2 3.1 19.3 25.2
14.2 1.3 4.5 20.0 25.9
Total investment in Welsh Rugby The balance is analysed as follows: Surplus Total investment in Welsh Rugby
32.2 (25.2) 7.0 3.1 1.0 0.2 0.7 2.0 7.0
33.5 (25.9) 7.6 3.2 0.3 3.1 1.8 (0.1) (0.7) 7.6
Deprecation (net of grants) Exceptional items (see Note 4) Interest costs Fair value losses on derivative financial instruments Tax Transferred to reserves
15

Year ended 30 June 2011 (continued)
Match income decreased by 3.6m predominantly due to one less home match in the Six Nations and the June match against South Africa in PE10 attracting greater income compared to the Barbarians match in YE11. Match income can be further analysed as follows: 2011 m Autumn internationals Six Nations June Test Other broadcast income 11.8 17.6 0.6 0.6 30.6 2010 m 11.8 20.5 1.9 34.2
The camaraderie of Welsh rugby
The allocations to the four Regions have increased by 5% (2010: 18%) to 15.0m (including the competition income referred to above). These allocations cover all international player release and provide core financial support for the four Regions and reflect the new Participation Agreement signed in September 2009. The allocation to the Groups semi-professional league has decreased slightly on the previous year and stands at 1.2m. The allocations to the Groups community clubs have decreased by 31% to 3.1m; this decrease includes the participation points scheme of 1.0m in PE10. Excluding the participation points scheme, the reduction was some 11% and this primarily relates to the lower take up of the cash-back scheme by community clubs. This has resulted in the Group investing more in the marketing of international matches. On a pre-exceptional basis, the Group generated an operating profit of 3.8m (2010: 4.4m) from which net debt service of 1.0m (2010: 3.1m) is deducted, the fair value losses on derivative instruments of 0.2m (2010: 1.8m) were deducted, resulting in a profit before exceptional items and tax of 2.7m (2010: loss of 0.5m). Revenues Revenues are analysed as follows: 2011 m Match income Competition income Commercial income Other event income Other income 30.6 9.1 11.2 2.7 0.7 54.3 2010 m 34.2 9.2 10.9 2.0 2.2 58.5
Commercial income increased by 3% to 11.2m due to increases in the sponsorship programme and one-off hospitality sales. Other event income increased by 35% to 2.7m; mainly due to the return of the Heineken Cup Final, the Wales v England soccer international and two consecutive nights of Take That. Operational costs As shown in Note 2(b), recognising that PE10 was a thirteen month period, the Groups operational costs have decreased by some 9% to 28.1m. With the exception of Elite Rugby, there are decreases across all elements of operational costs, and an overall decrease of 2.8m. This overall decrease includes an increase in staff costs of 2% to 7.9m. Business and administration costs have decreased by 14% to 5.6m as a result of: the effect of PE10 being a thirteen month period, which amounts to c. 0.5m; a decrease in legal costs as this was brought in-house during the year; and a reduction in discretionary one-off spend given less revenues. Direct costs are costs incurred directly in relation to attaining revenues and will include all National Squad costs and third party costs incurred in delivering events at the Millennium Stadium. These costs have decreased by 1.1m, which is mainly as a result of: reduced costs associated with staging one less international match at the Millennium Stadium;
16
a change in the contractual arrangement for broadcast income relating to the RaboDirect Pro12 (formerly the Magners League); the effect of PE10 being a thirteen month period; and an offsetting increase in the marketing costs for international matches. The costs in respect of elite rugby have increased by 4% to 4.0m and include managing the age-grade structures, player development, referee costs, centre of excellence and insurance which collectively amount to some 69% (2010: 65%) of the total with the balance of the 31% (2010: 35%) comprising staff costs, including the staff costs of the academy structures. The primary increases arise from increased investment in the WRUNCE, running additional programmes in North Wales and additional referee costs. The costs in respect of community rugby have decreased by 8% from last year to 1.9m and include coach development, referee costs and insurance, which amount to some 38% (2010: 42%) of the total, with the balance of the 62% (2010: 58%) comprising staff costs, including the district development officers. Stadium costs have decreased by some 0.9m to 4.5m mainly due to an accelerated preventative maintenance programme in the prior period. As shown in Note 5, staff costs have increased by 0.1m, which is largely due to an increase in the coaching staff for the National Squad in preparation for RWC11 and employing an in-house solicitor to reduce external professional fees. These staff costs are included within the cost categories shown above. EBITDA and net result One of the key measures of the Group is the earnings before interest, tax, depreciation, exceptional items and allocation to affiliates (EBITDA). This is a key measure as it is the best proxy for cash generated from the Groups operational activities. This provides the cash to fund the Groups strategic objectives. The Groups EBITDA was 26.2m (2010: 27.6m), which financed the Groups funding of Welsh rugby. The Groups pre-exceptional profit before tax was 2.7m (2010: loss 0.5m); after exceptional items, a profit before tax of 2.7m (2010: loss 0.8m). This can be analysed as follows:
Company WRUNCE MS Group EBITDA Allocations to affiliated organisations Exceptional items Depreciation (net of grant release) Operating profit Net interest Fair value losses on derivative financial instruments Proft/(loss) before tax Tax Proft/(loss) after tax Net interest expense
2011 m 24.6 0.2 1.4 26.2
2010 m 25.8 0.1 1.7 27.6
(19.3) (20.0) - (0.3) (3.1) (3.2) 3.8 (0.9) (0.2) 4.1 (3.1) (1.8)
2.7 (0.8) 1.9
(0.8) 0.1 (0.7)
The Group cancelled its previous derivative instruments on 30 June 2010 at a cost of some 5.1m. As a consequence of this, despite PE10 being a 13 month period, the Group has enjoyed considerable interest savings, which can be analysed as follows: 2011 2010 m m Bank interest payable & similar 0.8 2.6 Other interest payable 0.3 Bank charges 0.2 0.2 Interest receivable (0.1) Total 0.9 3.1 Provided that LIBOR remains in line with current levels, it is anticipated that these interest savings can be continued for the year ending 30 June 2012.
17

Year ended 30 June 2011 (continued)
Taxation The Group has been in discussions with HM Revenue & Customs (HMRC), regarding the treatment of certain matters for corporation tax purposes, for some time. HMRC have been challenging the eligibility of certain expenditure on the Millennium Stadium for the purposes of capital allowances. If HMRC's challenge should prove successful, this would have a detrimental effect on the Group's tax position. These discussions have been ongoing for a number of years and the Directors have taken the advice of independent leading counsel. On the basis of this advice, the Directors believe the Group has meritorious arguments relating to HMRC's challenges. These discussions with HMRC are on-going, and negotiations are unlikely to be concluded in the short term. Although the outcome of these negotiations could impact on the future tax position of the Group, the Directors do not believe that it is necessary to reflect any further provisions in the financial statements in excess of those tax provisions already included. Cashflow and Net Debt The Groups net cash inflows from operating activities were as follows: 2011 2010 m m EBITDA 26.2 27.6 Allocations to affiliated organisations Working capital movements Net cash inflows from operating activities (19.3) (20.0) 2.2 2.0 9.1 9.6
Matthew Rees leads his team out with the mascot at the Millennium Stadium
The Group issued 73 new debentures at 6,000 each during the year; the cost of issuing these debentures was some 0.2m. Net debt, which is defined as bank loans, debenture loans and hire purchase agreements less cash balances, as at 30 June 2011 was 73.8m (2010: 79.8m). Net bank debt, which is bank loans less cash balances, was 36.2m (2010: 42.1m). Included within these amounts is some 10.0m which is repayable only in the event of certain defined events occurring. As explained in Note 13, the Group refinanced its arrangements with Barclays Bank PLC on 2 July 2010. As part of this refinancing, the primary debt and the associated derivatives are now shown in the Company; prior to that they were shown in MS. In order to properly understand the refinancing during the year, the net bank debt position and the cashflow performance of the Group, the following, excluding the 10.0m debt referred to above, is relevant: 30 June 2011 m Loans Term loan Revolving credit facility (RCF) Cash Net bank debt 23.1 3.5 26.6 (0.4) 26.2 2 July 30 June 2010 2010 m m 25.0 8.0 33.0 (0.9) 32.1 31.6 1.5 33.1 (1.0) 32.1
From this amount in YE11, the Group paid net interest costs of 1.0m, paid 3.8m in respect of fixed assets, repaid a grant to Letheby and Christopher of 0.1m, received a grant from the Welsh Government in respect of the new audio/visual facilities at the stadium of 1.7m and paid tax of 0.1m leaving a net cash increase of 5.8m. The Group paid some 0.3m in respect of hire purchase capital repayments and repaid, on a net basis, some 6.5m of its bank borrowings. The hire purchase liabilities of the Group were terminated ahead of the due date during the year in order to avoid unnecessary interest costs.
18
These bank covenants are typical of those applying to commercial businesses. It is in the Groups best interests to comply with these covenants as a breach would be a default of the loan agreements. The Groups financial management and controls are structured so that the Group comply with these covenants. Capital expenditure During YE11, the Group invested in some 3.8m of capital expenditure; the main categories of investment were as follows: m Centre of Excellence Audio/visual facilities at the stadium Pitch pallets and other stadium related expenditure Other capital expenditure 0.2 3.0 0.4 0.2 3.8
Balance sheet and reserves The increase in the Group's net assets from 3.1m to 5.3m arises from the retained profit for the year and the actuarial gain on the defined benefit scheme. The fixed assets of the Group reduced by some 1.0m, reflecting the capital expenditure of 3.8m offset by the depreciation charged in the year of 4.8m. Operating working capital fluctuates from year to year depending upon the timing of events arising immediately prior to the year end. Pension Funds As shown in Note 21, the Group has no deficit on the defined benefit pension scheme which it operates as at 30 June 2011; this replaced the deficit in the previous year of 308,000. This change, net of deferred taxation, was released to the Groups statement of total recognised gains and losses. This defined benefit pension scheme has been closed to new members for some time and the scheme is now also closed to further accrual. The Group, in conjunction with the trustees, are currently considering winding-up this scheme and are in discussions with its professional advisors.
Shane Williams; from Amman United to Wales
The decrease in net bank debt from 2 July 2011 to 30 June 2011 of 5.9m includes a 1.9m reduction in the term loan in line with the terms of that loan together with a 4.5m reduction in the RCF. As shown above the new RCF was 8.0m drawn as at 2 July 2010, 3.5m drawn as at 30 June 2011 and had a maximum and minimum draw of 8.5m and 0.5m respectively during the year. As set out in Note 13, as at 30 June 2011, the Group had unutilised facilities of 11.5m (2010: 8.5m). As part of the banking agreements the Group has to comply with bank covenants which require the Group to, inter alia, meet certain levels of cashflows and surpluses. This enforces normal business practices on the Group, but limits the extent to which the Group can invest, make allocations to affiliated organisations and access the facilities above.
19

Elite rugby
George North scores a try against the Barbarians
Overview The 130th anniversary of the WRU was celebrated with a Wales international fixture in June 2011 against a Barbarians team containing players recognised as world class performers. It was the second year in which the WRU has staged an early June international match. This will now be enshrined as a key element of the elite rugby sporting calendar in Wales. Some years will be marked with an international fixture against a major nation, but on other occasions a variety of options will be considered. The June home international will normally take place before the senior Wales squad embark on a summer tour. In 2010, the first June fixture against South Africa preceded a tour of New Zealand for the squad. The Barbarians game in 2011 took place against the backdrop of a year dominated by Rugby World Cup preparations and the WRU established its determination to sustain the development of elite rugby in Wales by announcing a four year extension to the contract of the senior Wales Coach, Warren Gatland, which confirms his position until after the 2015 Rugby World Cup. This level of international activity reflects a sustained and measurable interest in elite rugby across Wales from the general population. Research carried out on behalf of the RBS 6 Nations Championship showed that the Wales versus England game in Cardiff in February 2011 attracted a peak audience of some 7.7m people in the UK. Their associated research also revealed that 38% of the population of Wales expressed an interest in rugby, while 75% of the population are interested in sport in general. These figures place the interest in rugby in Wales ahead of the rest of the UK per head of population in each nation. The television audience figures for the RBS 6 Nations in Wales during 2011 exceeded the audience penetration for the rest of the UK and helped confirm rugbys status as the national sport of Wales. The WRU continued to develop its relationship with broadcasters, which reflect a TV coverage landscape which remains the envy of other rugby nations. A new and
20
extended domestic rugby coverage contract was signed with BBC Wales and S4C, which ensures the breadth of that coverage continues up to and including season 2013/14. The contract covers all domestic league rugby up to the Premiership Division. It also covers the Welsh age grade international game, Sevens rugby arranged through the WRU, womens rugby and Regional friendly games such as pre-season fixtures. The television coverage enjoyed by rugby in Wales also impacts on the wider reporting in the mainstream written media, with the Media Wales titles and including the Daily Post in North Wales and also the South Wales Evening Post in Swansea and the South Wales Argus in Newport, maintaining robust and regular daily reports and analysis. The challenges faced by rugby from other sports and leisure activities remained front of mind during the year and a major step was taken by the WRU to develop Welsh rugby at Principality Premiership Division level. The WRU have, through its Head of Rugby, Joe Lydon and Regulatory and Game Policy Committees worked in partnership with the various stakeholders of the game, under the collective banner of the Criteria Review Panel, to seek a formula to ensure the sustainability and growth of the division. Following presentation to, and agreement by, the WRU Board, it was agreed and announced that from season 2012/13 the division will be reformed to consist of ten Principality Premiership clubs. The composition of the division is to be decided on a formula based on the achievement of current off the field criteria as well as a period of historic on the field performance across 6 previous seasons. To compliment the Premiership reforms and to provide a highly competitive national competitive pinnacle for community rugby a new National Championship will also be created. This new 14 club National Championship sits below the Premiership and above the existing Divisions One East and West. These reforms are collectively geared to help maintain the quality of competition and ensure that more young players are exposed to high intensity and quality rugby and in so doing support the intention of developing more talent of regional and elite rugby quality. YE11 also saw the WRU and the four Regional Organisations operate the Participation Agreement through monthly meetings of the Management Board and the Rugby Board. These forums managed interpretation of the agreement in practice and generated meaningful and continuing debate about all aspects of elite rugby in Wales. Although the Wales senior side and the four Regional
Sam Warburton is named as Wales Captain for the first time
teams faced challenging results, there was clear evidence of player development across the period. The Dragons and Scarlets both increased their representation within the senior Wales squad and young Regional players from each of the other Regions secured their first caps for Wales. This development of home grown talent was utilised in a senior squad fixture schedule, which now pits Wales regularly against the best opposition available in world rugby. Although victories have been sparse, there is clear evidence that opponents now realise they have to select their best XVs against a senior Wales side capable of questioning any rugby nation on the field. During the year the Wales National Squad backroom team was bolstered by a series of new appointments and replacements. Adam Beard was appointed Head of Physical Performance, Dan Baugh and John Ashby both became Assistant Strength and Conditioning Coaches and Prav Matheema arrived as National Medical Performance Manager. This elite focus on player development leading to senior squad recognition, was also enhanced through the WRU international pathway coaching structure, which during the year again announced strong management teams for all squads. The strength of this line up was reflected in the recognition of the talent it contained from outside the Welsh international environment. The U20 Head Coach, Darren Edwards, was recruited as the new Head Coach of The Dragons during the year and the U18 Head Coach, Gruff Rees, was seconded to coach the Italian side Aironi under the leadership of another Welshman, Rowland Phillips. The U20 Assistant Coach, Rob Appleyard, also took an important career step during the year when he joined The Dragons as an assistant coach. There was yet
21

Elite rugby (continued)
of the stadium facility. The elite game in Wales was boosted further during the year with the launch of the colleges league which recognises the importance and emergence of the college game. The Millennium Stadium also staged the annual varsity match between Swansea and Cardiff University teams and this proved to be a popular and well attended match, securing live TV coverage on S4C. The wider value of elite rugby in Wales was epitomised by a series of off the field events throughout the year. One of the most profound and historic achievements was the launch of the attempt by former international flanker Richard Parks to conquer the seven tallest peaks on the planet and the north and south poles all within one calendar year. Following a send-off from the Millennium Stadium in the autumn, Richard went on to defy a series of gruelling challenges and by the end of the YE11 he was well on his way to achieving his incredible goal. Also during the year, fifteen former Wales captains and the current Wales Head Coach Warren Gatland staged a charity climb of Mount Kilimanjaro in aid of the Felindre Hospital appeal. The event was organised by the WRU official photographer Huw Evans, whose wife Sue has suffered from lung cancer. Then, in April, there was a gala dinner for former senior internationals to mark the 130th anniversary of the WRU. This again emphasised the recognition of the importance of retired elite players as ambassadors for Wales national sport. Commercial A great deal of sales and marketing activity has been undertaken within the year, with key agreements across all levels of the game coming up for renewal and with the extensive work undertaken across marketing the commercial activity has been its highest for recent years. Major contracts with the Principality Building Society and the WRU official kit manufacturers, Under Armour, were renewed during the period. The Group is extremely grateful for the level of support and energy these companies apply to their relationships with Welsh rugby. Both organisations retain high profile links with the game in Wales through activities and initiatives which reach all four corners of Wales. The relationship with Principality was reflected with
Matthew Rees interviewed at open training session
more recognition of Welsh coaching talent when the Cardiff Blues coach joined London Wasps as Director of Coaching. These movements from within the core age grade management team and from Welsh Regional rugby during YE11 are clear proof of the success of the elite pathway environment and the Regions in developing coaches and managers capable of success at the highest level. Within the WRU international pathway structure a coaching skills support unit was established to connect coaching strategies, philosophies and player development, as well as the identification of talent throughout the player pathway. The continued growth and visibility of Wales on the international 7s circuit was sustained through involvement in the HSBC 7s World Series and in YE11 participation in the Commonwealth Games served to increase the importance of Wales 7s in world terms. Many of the emerging elite player pathway and 7s squad players played important roles in their regional squads across the season. In North Wales there were advances along the strategic route towards securing an elite representative foothold in senior rugby. A WRU National Academy for North Wales was unveiled with key WRU staff in place to develop the pathway infrastructure. There was also an important landmark when the First Minister, Carwyn Jones, attended the official opening of the project to develop Parc Eirias as a key sporting centre in the region. The ceremony was also attended by WRU Chairman, David Pickering, President, Dennis Gethin and Head of Rugby Joe Lydon to symbolise the key role rugby is playing in the development and use
22
Neil Jenkins, Robin McBryde, Rob Howley and Warren Gatland enjoy training
another successful awards night, which celebrated the success of the Principality Premiership Division and its progress as an elite force in the Welsh game. There was also a raft of new activity underpinned by contracts with Thomas Cook as the WRUs official travel partner, Guinness as an official partner and DHL as an international match sponsor. There were also new strategic partnerships with Ticketmaster and the publishers Trinity Mirror for programme and other publication production. Much of the commercial activity surrounding the elite game in Wales attracted wider attention, which reflects the focus the Group continues to achieve. Through the year a great deal of work took place alongside Under Armour to achieve the new Wales Rugby World Cup playing and training kit in time for a pre-tournament launch during the YE11. This relationship with the US based kit supplier ensured that the kit worn by Wales for RWC 2011 in New Zealand was engineered to a degree unparalleled in the history of the Welsh game. There were record levels of online sales of merchandise throughout the year, which reflects the change in the ever increasing demands of consumers to be associated with the game outside of typical match day opportunities. A great amount of focus on ensuring consistent consumer services provided all year round is going to be a key learning point for the future. A new contract agreement was secured with Tri Distribution to sell the Groups range of merchandise
throughout the world. Another reflection of the sustained interest in the national sport of Wales was the agreement with the international match rights sales organisation, Pitch, to sell broadcast rights of Wales home games abroad for the next four years. Comprehensive ticket marketing programmes running throughout the year saw the Group attract a new demographic of consumer and opened the Millennium Stadium experience to a different audience high level marketing has seen the Group benefit from successful ticket and hospitality programmes within a challenging spectator environment across all sports. In another move to reflect the continued interest in elite Welsh rugby, several initiatives were launched to utilise the increased interest in social media as a means to drive interest in the national sport of Wales and associated merchandise and other sales opportunities. Although the economic climate remains challenging, the level of new and renewed commercial activity can be regarded as a success for the Group Professional - International Wales went one better than in 2010 when they won only two RBS 6 Nations matches but the Welsh challenge for Championship honours in 2011 was always about playing catch up after they lost at home to England in the opening round. Building momentum is vital and, although Matthew Rees
23

RBS 6 NATIONS CHAMPIONSHIP 2011

P England France Ireland Wales Scotland Italy W D L F A PD TF Pts
5 5 5 5 5 5
4 3 3 3 1 1
0 0 0 0 0 0
1 2 2 2 4 4
132 117 93 95 82 70
81 91 81 89 109 138
+51 +26 +12 +6 -27 -68
13 10 10 6 6 6
8 6 6 6 2 2
team won three of the remaining four matches, that 2619 Millennium Stadium reverse on 4 February handed England an advantage they never let slip on course to the title. Wing Morgan Stoddart scored Wales only try in the second half, while prop Craig Mitchell left his side a man short when he was yellow carded in the 46th minute. There were two more yellow cards against Scotland Wales were down to 13 men for six minutes when Bradley Davies was joined in the bin by Lee Byrne while the more pleasing double came when Shane Williams took his Test try tally to 53 with a brace as Wales triumphed 24-6 at Murrayfield. Rising Scarlets stars Rhys Priestland and Josh Turnbull made their international debuts as replacements; the only Welsh debutants of the campaign. Wales won on the road again in Round 3, beating Italy 2416 in Rome with tries from Stoddart and Sam Warburton, and followed that up with a 19-13 Millennium Stadium victory over Ireland in which the ball Mike Phillips used to score his try, created plenty of talking points. However, Wales tournament and winning run ended at Stade de France in a 28-9 defeat, the boot of James Hook supplying all the Welsh points, with Wales, Ireland and France all ending level on six points but Wales pushed down to fourth on points difference. In keeping with the Groups commitment to provide Warren Gatlands national team with the opportunities to test themselves against the best in the world, there were 10 internationals in total during the year, culminating in the special WRU 130th anniversary celebration match against the Barbarians in which Warburton captained Wales for the first time.
Wales scored four tries through Stoddart, Phillips, George North and Aled Brew but Isa Nacewa broke Welsh hearts with his second try scored in the final minute to snatch a dramatic 31-28 win for the star-studded invitation club. With the 2011 World Cup in New Zealand very much in mind, Wales took the opportunity to blood new internationals in starters Toby Faletau and Ryan Bevington along with replacements Scott Williams, Scott Andrews and Lloyd Burns. However, the season had begun with a disappointing Invesco Perpetual Series in which a 16-16 draw against Fiji saved a series whitewash. Australia opened the series with a 25-16 win and then Wales let a 17-9 half-time advantage slip against South Africa as the reigning World Champions came back for a 29-25 victory. The match saw North become the second youngest Welsh try scorer when he crossed the Springboks line after just six minutes and he finished with another to announce his arrival on the world stage in style. Wales had to rely on a penalty try to rescue a draw against Fiji before New Zealand wrapped up the series with a 3725 win, with 20 points from outside half Stephen Jones, a Welsh record against the All Blacks. Invesco Perpetual Series 2010 Wales 16 25 Australia Wales 25 29 South Africa Wales 16 16 Fiji Wales 25 37 New Zealand
24
The powerful Wales pack prepares to scrummage against Scotland
RBS 6 Nations 2011 Wales 19 26 England Scotland 6 24 Wales Italy 16 24 Wales Wales 19 13 Ireland France 28 9 Wales WRU 130th Anniversary Match Wales 28 31 Barbarians The Regions Magners League The competition was improved with the inclusion of two Italian teams for the first time this year. Once again the Ospreys flew the flag for the Regions in the Magners League as they were the only one of the four to make it into the end of season Play-Offs. But whereas they had been good enough to earn a home draw in the semi-finals, against Glasgow Warriors, with a second place finish in the regular league season the previous year, their fourth place finish in 2010/11 meant an away trip to Munster in the last four. Thomond Park has proved the graveyard for many Welsh teams down the years and despite a strong performance it was the home team who came out on top, 18-11, to make it four wins out of five over their Welsh rivals during the season.
That set up an all-Irish Grand Final in Limerick against Leinster. Whereas the Ospreys had gone to Dublin and beaten Leinster in the inaugural Grand Final in 2010, Leinster werent able to scale the same heights they had reached the previous weekend in Cardiff in winning the Heineken Cup and failed to do the double, going down 19-9. The race for the Play-Off places once again came down to the wire with the Ospreys, Blues and Scarlets all in with a chance of reaching the top four in the final round of regular league games. The Scarlets rallied to beat the Blues 38-23 to secure a bonus point at Parc y Scarlets, but a 75th minute penalty from James Hook gave the Ospreys a 1210 win in Aironi to lift them into fourth place. The Welsh Regions finished in a row in the final Magners League table: 4 5 6 7 Ospreys Scarlets Blues Dragons 63 points 62 points 60 points 49 points
Play-Offs Leinster 18 3 Ulster Munster 18 11 Ospreys Grand Final Munster 19 9 Leinster
25

MAGNERS LEAGUE 2010-2011

P Munster Leinster Ulster Ospreys Scarlets Cardiff Blues NG Dragons Edinburgh Connacht Treviso Glasgow Aironi W D L F A BP Pts
22 22 22 22 22 22 22 22 22 22 22 22
19 15 15 12 12 13 10 9 7 9 6 1
0 1 1 1 1 1 1 0 1 0 1 0
3 6 6 9 9 8 11 13 14 13 15 21
496 495 480 553 503 479 444 421 394 374 401 247
327 336 418 418 453 392 462 460 459 502 543 517
7 8 5 13 12 6 7 7 9 2 7 8
83 70 67 63 62 60 49 43 39 38 33 12
LV= Cup For the second successive season in the six-year history of the Anglo-Welsh tournament the final was again a single nation affair, Gloucester beating Newcastle Falcons 34-7 at Worcesters Sixways Stadium, after Welsh interest had ended at the semi-final stages when Newport Gwent Dragons were beaten 45-17 at Gloucester. The clubs had met in Round 1, the Dragons winning that one 18-12 at Rodney Parade, the Gwent club then going down 28-3 against Northampton Saints at Franklins Gardens. However, they did win on the road and took a giant step towards qualifying for the knock-out stages when they went to Sale Sharks and triumphed 28-20. The last semi final place was booked with a 26-9 Rodney Parade win against the Scarlets but Gloucester at Kingsholm was one step too far. The Ospreys accounted for Leicester Tigers, Cardiff Blues and London Wasps; the Scarlets beat Leeds Carnegie and London Irish but the Blues managed only a home 23-23 draw with Exeter Chiefs from their four matches. Heineken Cup, Amlin Challenge Cup The prestigious knock-out stages of the 16th Heineken Cup tournament were, once again, a Welsh free zone.
It was the third time in just seven seasons that no Welsh team qualified for the last eight of European club rugbys elite competition and, with the May 2011 finals of both the Heineken Cup and Amlin Challenge Cup awarded to Cardiff, local interest came to a premature end in late January. The one saving grace for the nation was that the Millennium Stadium final on Saturday, 21 May, was widely regarded as possibly the best and most spectacular of the 16 showpiece matches. With the retractable roof closed, the atmosphere was electric as Leinster staged a remarkable second half comeback that turned a 16-points half-time deficit against Northampton Saints into a stunning 33-22 victory. However, while the home of Welsh rugby was a runaway winner, it was the absence of all four Regions from the business end of the tournament just as it was back in 2004/05 and 2005/06 that was a real concern. Cardiff Blues, the Ospreys and the Scarlets each won three of their six pool matches but Newport Gwent Dragons failed to record a single win with home and away defeats by Toulouse, London Wasps and Glasgow Warriors. The Blues did finish second in their Pool, thanks to the double over Edinburgh and a home win against Castres Olympique with their back-to-back contests with Northampton Saints fiery affairs.
26
Ospreys versus Scarlets in a traditional derby encounter
The Ospreys won all three of their Liberty Stadium group matches, against London Irish, Munster and Toulon but drew blanks on the road to finish third and miss out on the knock-out stages for the first time in four campaigns. The Scarlets launched their challenge with one of the most entertaining matches of the tournament, a 43-34 Parc y Scarlets try fest against Perpignan, but that win and the double over Benetton Treviso only meant a third place finish for them as well. It added up to France supplying four of the quarter-finalists and England and Ireland two each, while Wales joined Scotland and Italy in taking no further part in the tournament. Three of the Heineken Cup group runners-up again qualified for the Amlin Challenge Cup knock-out stages the route the Blues had taken a year earlier to be the first Welsh team to win a European title but the last eight of that tournament was also noticeable for the absence of any Welsh interest. The final was staged at the Cardiff City Stadium the day before the Heineken Cup final; Harlequins becoming the first team to win three of that tournaments titles by beating Stade Franais Paris 19-18. Wales U20 Wales U20 finished seventh in the 2011 IRB Junior World Championship in Italy, an identical placing to their final standing in the 2010 competition. Hopes of a top five finish were dashed when Fiji beat Wales 34-20 but Macauley Cooks team picked themselves up to beat Ireland 38-24 to clinch that seventh place.
Wales opened with a win over Argentina but were crushed 92-0 by eventual and regular tournament winners New Zealand to suffer a hammer blow to their confidence. There was a second win, against Italy, before the defeat by Fiji with coach Richard Webster welcoming the win over Ireland. "It was pleasing to finish the tournament on a high note, the players came back from a very ugly place to get to this point and they deserve credit for that. However, following the defeat by the Junior All Blacks, the WRUs Head of Rugby, Joe Lydon, announced details of a dual focused study of the Player Performance Pathway within Welsh rugby, a more detailed examination of the development structures, standards and intensity of competition elements that support the performance tier of the game. Meanwhile Wales had drawn 26-26 with Ireland in the earlier Six Nations tournament, beginning and ending with
U20 Six Nations 2011 - Edward Siggery dives in for try
27

defeats by England and France respectively. The high points were away wins, 33-3 in Scotland and 46-15 in Italy, adding up to a third place finish behind England and France. U20 Six Nations Wales 20 26 England Scotland 3 33 Wales Italy 15 46 Wales Wales 26 26 Ireland France 29 22 Wales IRB Junior World Championship Argentina 8 34 Wales New Zealand 92 0 Wales Italy 6 - 56 Wales Wales 20 - 34 Fiji Wales 38 - 24 Ireland Wales U18 Wales U18 produced a magnificent performance against France to finish third in the French-based FIRA-AER U18 tournament. To do that they had to beat the host nation in Auch and they proceeded to do that with a superb 15-6 win. The victory signified a massive turnaround for Gruff Rees' youngsters after losing 34-17 the previous month to the same opponents in their first qualification game for the European championships hosted by the Armagnac-Bigorre region of south west France. Wales had to bounce back in Auch after losing 34-38 to England to a try in the last move of the game in the semifinals the previous weekend. Despite torrential rain and difficult conditions, Wales displayed guts and commitment up front to match the physical French outfit and this time showed an ability to grind out a win, Cardiff High School Old Boys outside half Rhys Patchell in fine form. "We are all delighted with the win," said Wales U18 team manager Gethin Watts. After losing so narrowly to England in a game we could and should have won, there was a determination to put that right and to try to reverse the disappointing result of the France game in Swansea. In their other tournament qualification matches, Wales lost 26-12 in Italy before beating Scotland 45-29 in Swansea. FIRA Tournament Wales 17 34 France Italy 26 12 Wales Wales 45 29 Scotland Elite Division - Semi-final: England 38 34 Wales 3rd place Final
Luke Hamilton Wales U20 Eli Walker Wales U18
France 6 15 Wales
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Jevon Groves scores during IRB Sevens World Series
Sevens The HSBC World Sevens Series continues to be a highly competitive environment throughout which players and coaches can be truly tested and developed within the abbreviated version of the game. Wales finished seventh overall in the Series, an improvement of two places and 28 points on the previous year. That was for winning the second tier Plate Competition in Hong Kong, when they beat Argentina 14-7 in the final. They kicked-off their series with a commendable 21-21 draw with the reigning champions Samoa in Dubai and went on to face New Zealand in the quarter-finals. Defeat in the last eight meant a semi-final clash with Australia in the Plate, which was lost 26-12. Next up was George, in South Africa, and there was instant revenge over the Wallabies with a 33-15 triumph in the Pool stages. This time there was a clean sweep in the Pool, but Samoa beckoned in the quarter-finals and they ran out 19-14 victors. That meant another Plate semi-final and a first meeting in the series against the Springboks. There was only a point in it at the end, in favour of South Africa, and that launched a run of five wins for them during the series over Paul Johns men. Wales reached their third successive quarter-final in
Wellington, despite a 33-7 Pool defeat against England, but once again New Zealand proved too strong. Then came South Africa and Wales fell in the Plate semi-final for the third time. There was a shock in Las Vegas when Kenya ran out 1912 winners over Wales in the Pool stages and a second defeat to New Zealand meant a first outing in the series in the Bowl Competition. This time it was the Scots who inflicted a semi-final defeat. Australia proved the venue for the one major success of the series as once again Wales reached the quarter-finals. This time England were the stumbling block, winning 1712 in a tense affair, but the fourth Plate semi-final of the season brought a 22-21 triumph over Fiji. Alex Cuthbert proved the Welsh hero with two late tries in the second half and the Blues wing laid the platform for a 14-7 win over the Pumas in the final. The final two rounds, in London and Edinburgh, brought the most consistent performances as Wales reached the semi-finals of the Cup competition at both events. Spain and Kenya were beaten in the Pool stages at Twickenham before the French were overcome 19-12 in the quarterfinals. That triumph set-up another clash with the Springboks and a Kristian Phillips try at the death gave Gareth Davies a
29

conversion attempt to try to take the game to extra-time. In the end, his kick drifted wide and South Africa won 21-19. There was a significant 19-12 Pool win over England at Murrayfield and earned Wales another quarter-final Cup clash with the French. This time a last gasp try from Jevon Groves earned his side a 13-10 win that meant another showdown with South Africa. Having raced into a 12 point lead with tries from Cuthbert and Phillips, Wales slowly saw their advantage eroded as the Springboks hit back. They scored four tries without response before Wales grabbed a consolation score at the end to make it 22-19. IRB Sevens World Series (Dubai, UAE) Wales 21 21 Samoa Wales 17 12 Kenya Wales 47 5 Arabian Gulf Q-Final Wales 7 35 New Zealand Plate Competition S-Final Wales 12 26 Australia (George, South Africa) Wales 33 15 Australia Wales 19 7 Scotland Wales 29 12 France Q-Final Wales 14 19 Samoa Plate Competition S-Final Wales 21 22 South Africa (Wellington, New Zealand) Wales 31 12 Cook Islands Wales 36 5 USA Wales 7 33 England Q-Final Wales 5 26 New Zealand Plate Competition S-Final Wales 5 22 South Africa
(Las Vegas, USA) Wales 12 19 Kenya Wales 33 10 Uruguay Wales 5 26 New Zealand Bowl Competition Q-Final Wales 54 0 Guyana S-Final Wales 12 17 Scotland (Hong Kong) Wales 35 12 Hong Kong Wales 28 5 Spain Wales 12 45 South Africa Bowl Competition Q-Final Wales 29 14 Argentina S-Final Wales 17 24 Canada (Australia) Wales 10 36 New Zealand Wales 26 14 Kenya Wales 53 0 Cook Islands Q-Final Wales 12 17 England Plate Competition S-Final Wales 22 21 Fiji Final Wales 14 7 Argentina (London) Wales 33 10 Spain Wales 29 12 Kenya Wales 12 31 New Zealand Q-Final Wales 19 12 France S-Final Wales 19 -21 South Africa (Murrayfield) Wales 7 5 Spain Wales 35 12 Portugal Wales 19 12 England
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Ken Owens sister, Vici Owens achieving her first cap
Bowl Competition Q-Final Wales 13 10 France S-Final Wales 19 22 South Africa FIRA Sevens Tournament The Sevens squad competed in four FIRA European tournaments in June/July 2011. The FIRA campaign afforded an opportunity for the Sevens coaches and management to both identify and develop potential future Sevens players who have the requisite skills and potential to compete for Wales within future IRB Sevens World Series. Wales finished 6th in both Lyon and Moscow, 9th in Barcelona and 8th in the final tournament in Bucharest, giving an overall ranking position of 8th across the FIRA tournament as a whole. Wales Women At the highest level, a young and inexperienced Wales Women side showed plenty of promise in the Six Nations. At Cross Keys Pandy Park, they pushed England, ranked the second best team in the world, all the way before eventually succumbing 19-0.
Wales bounced back immediately with a comprehensive 12-41 triumph against Scotland with centre Elen Evans running over for a hat-trick. Italy then stunned Wales 12-8 at home before Catrin Edwards led her side to a hard fought 15-14 against Ireland at Pandy Park before finishing the campaign with a 15-0 defeat against France. After last years World Cup, coaches Rhys Edwards and Liza Burgess were left with plenty of holes to plug. Even though results didnt always go their way, the likes of Shona Powell-Hughes and Charlie Murray showed the future looks bright. On the domestic front Neath Athletic defeated Pontyclun to secure the National Cup while Seven Sisters claimed the Plate trophy after beating Caernarfon. Womens 6 Nations Wales 0 19 England Scotland 12 41 Wales Italy 12 8 Wales Wales 15 14 Ireland France 15 0 Wales
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WOMENS 6 NATIONS CHAMPIONSHIP 2011

P England France Ireland Wales Italy Scotland W D L F A PD TF Pts
5 5 5 5 5 5
5 4 2 2 2 0
0 0 0 0 0 0
0 1 3 3 3 5
223 113 74 64 68 20
8 51 70 72 130 231
+215 +62 +4 -8 -62 -211
16 13 12 9 6 3
10 8 4 4 4 0
Semi-Professional Game Pontypridd were the form side in the semi-pro tier of Welsh rugby, yet only came away with one of the three trophies they had targeted. The one they won was the SWALEC Cup, beating Aberavon in the final at the Millennium Stadium, but they also reached the semi-finals of the British & Irish Cup and the final of the Principality Premiership Play-Offs. Chris Dicomidis side, expertly coached by Paul John and Dale McIntosh, were unbeaten at home in the regular Premiership campaign and ended 16 points clear of eventual champions Llanelli to earn a home draw in the Play-Off final. Splitting the two were former champions, Neath, who were one of only two sides to topple Pontypridd and who finished on 100 points, seven behind the league leaders. But even with home advantage in the semi-final they were overwhelmed by Llanelli, who set up a title clash with Pontypridd at Sardis Road. The home side remained firm favourites, but having been hit with an early try from Dan Newton they finally fell to a shock 24-18 defeat as the Premiership title went west. Cross Keys had a fine season, finishing fifth overall, and went on to beat arch-rivals Newport in a play-off match to secure a place in the B&I Cup. Jonathan Westwood, Greg Woods, and Mark Ring guided Keys off the field and unearthed a potential star for the Dragons in outside half Steffan Jones. The 20-year-old was given his regional debut at the end of the season to cap a campaign that saw him score 327 points for his club in the Premiership and playoff. Aberavon finished fourth in the Premiership and were runners-up to Pontypridd in the SWALEC Cup. The Wizards
weaved their magic to beat Tonmawr in the quarter-finals and former champions Llandovery in the semi-final before going down 35-24 in the final at the Millennium Stadium. Former Wales and British & Irish Lions star Richard Webster was another top level coach to help nurture another talent for the regional game in Wales, in outside half Matthew Morgan. The Wales U20 cap played for the Ospreys and caused mayhem in most defences with his running. The battle for survival at the bottom of the table saw Glamorgan Wanderers finish last and forced into the relegation Play-Offs. While they beat SWALEC Division 1 East champions Ebbw Vale 16-13 in the semi-finals, they were comprehensively beaten 38-19 by Division 1 West winners Bridgend. That meant a return to the Premiership for the Ravens, under the guidance of former Ospreys flanker Steve Tandy. In the B&I Cup, Pontypridd and Llanelli made it through to the quarter-finals, but found themselves facing each other in a preview of the Principality Premiership Play-Off Final. This time it was Pontypridd who came out on top, 12-10, to set-up a home semi-final with Bristol. Gallant as they were, Dicomidis side found the full-time pros from just across the Severn Bridge too powerful up front and they were beaten 25-6 at Sardis Road. Bristol went on to win the final by beating Bedford Blues 17-14. Principality Play-Offs Semi-finals (Bridgend bye): Glamorgan Wanderers 16 13 Ebbw Vale Final: Glamorgan Wanderers 19 38 Bridgend
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Llanelli win Principality Play-Off final
Premier play-off (club 2 v club 3): Neath 5 - 46 Llanelli Premier Play-Off final: Llanelli 24 - 18 Pontypridd SWALEC Cup 2011 Quarter-finals: Cardiff 17 19 Aberavon Merthyr 30 38 Pontypridd Swansea 39 34 Newport Tonmawr 13 23 Llandovery Semi-finals: Llandovery 12 18 Aberavon Pontypridd 35 22 Swansea Final: Aberavon 24 35 Pontypridd BRITISH & IRISH CUP Quarter-finals: Bedford Blues 50 15 Leinster A Bristol Rugby 29 19 Ayr Pontypridd 12 10 Llanelli
Worcester Warriors 57 15 Moseley Semi-finals: Bedford Blues 43 27 Worcester Warriors Pontypridd 25 6 Bristol Rugby Final: Bristol Rugby 17 14 Bedford Blues Regional Age Grade Championships There was sweet revenge for the Blues as they retained the WRU U18 Regional title with a thumping 51-25 triumph over the Scarlets at St Helens. The young Scarlets had been the only team to topple the Blues in the Pool stages. Not only did they gain a 15-13 home win, but they drew 1616 with them away. But there was no doubt which was the better team in the winner- takes- all final in Swansea, as the Blues, who had triumphed 11-9 against the same opponents the previous year, ran in seven tries to the visitors three. Harry Robinson, who played for Wales U20 and the Blues regional team before the end of the season, crossed twice and Rhys Patchell helped himself to 21 points. In the U16 final the Scarlets reversed the roles as they won 27-5 against Blues North to clinch their first Regional title since 2004/05, when they swept the board in three finals. The new format meant the top four sides met in semi-finals,
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Pontpridd v Bristol in B&I Cup semi final
Nigel Owens
where the Scarlets beat the reigning champions the Ospreys 16-11 and Blues North overcame the Dragons 5-3. Match Officials The WRU Referees Academy completed its first full season of operation during the year. Under the operational control of Nigel Owens, Nigel Whitehouse and Strength and Conditioning coach Wayne Proctor, a series of initiatives and projects were completed. Sixteen referees formed the core of the group to take part in the training and development programmes. There was also significant success in achieving recognition for the strength of the match official complement in Wales with a number of important appointments. Nigel Owens was selected as a referee for the Rugby World Cup 2011 in New Zealand and Tim Hayes was chosen as an Assistant Referee for this significant and high profile competition. Leighton Hodges was selected and achieved a high standard of performance at the Junior World Cup in Italy and Leighton Hodges, David Jones and Neil Hennessy all refereed in Six Nations U20 international matches. Neil Hennessy and David Jones also made their debuts as match officials in the Magners League. Another successful graduate of the WRU match officials structure was Rhys Thomas who officiated in the U18 Tournament in Tarbes. Coach Development Throughout the year the level four entry criteria and assessment procedure was developed within the
department. Level Four represents the elite level of coaching and formal interviews now take place to finalise candidates for this level. The assessment process was amended to take in all aspects of the coaches role from practical sessions to managing a team in training sessions and at games. A new 7s coaching course was written and produced and two 7s pilot courses were organised during the year. This course is now advertised through the WRU website along with all other coaching course details. To assist the promotion of this course the National Sevens Head Coach, Paul John, conducted 7s coaching practical sessions across Wales. During the year, twelve coaches attended the general Level Four training programme. Eight of these coaches were from Principality Premiership Division clubs with the other four from SWALEC Division One clubs. Six coaches from Wales attended the annual RBS 6 Nations conference in Italy. Two of these were from the Principality Premiership, two were age grade coaches and two were Regional coaches. In support of the elite coaching development programme a wide range of activity took place which is explained in the Community section of this Annual Report. In line with the Principality Premiership Division Criteria the WRU produced a Premiership Manual and CD for the clubs to utilise. Meetings were also held with Premiership coaches and match officials to help develop standards of play. The Wales Assistant Coach, Rob Howley, conducted a back play session for Premiership and National age grade coaches to help this process.
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35

Community rugby
Maesteg Quins receive SWALEC League 4 South West Trophy
Overview The focus on community rugby as a priority for the Group remained sharp throughout the year. The appointment of Jason Lewis as the new National Development Manager was further evidence of how the Group engaged with its commitment to the grassroots game. His role is to take charge of player development from the grassroots level upwards with a key focus on schools and club rugby. He also oversees the continued development of womens and girls rugby. He reports directly to the WRU Head of Rugby, Joe Lydon, and during the year has reviewed the status of the grassroots game in Wales and instigated a series of changes and initiatives to enhance community rugby. Part of his role has been to establish robust measures of facilities, player numbers and club activity to establish a firm base for the sustainability and development of grassroots rugby. As National Development Manager he was closely involved during YE11 in monitoring planned reform of the Principality Premiership Division to ensure the proposed and agreed changes impact positively across the game in Wales.
Those changes involve the introduction of a new National Championship from season 2012/13 which will become the effective bridge between the elite and community games in Wales. During the year it was agreed by the WRU Board that the new National Championship will exist above the current Divisions One East and West. Clubs were informed of the changes during the year but it was agreed the reforms will become active at the start of season 2012/13. The absorption of the former WDRU clubs into the WRU continued during the year and it was decided that the WRUs community structure will consist of leagues from divisions one through to seven from season 2011/12 onwards. A major review of the player pathway structure was undertaken during YE11 to identify ways of improving the game for minis and juniors in Wales. By the end of YE11, the review was nearing completion with agreed reforms to be announced during 2011. One priority of this review panel was to identify the means of keeping more young players in the game and creating
36
Taibach v Morriston in Port Talbot
a steady supply of more skilful players through the community game into the elite pathway structure. The review panel took soundings from coaches, schools, clubs and other interested parties in order to reach their conclusions. The review questioned the role of competitive representative rugby for young players aged below 14 and also looked at the rules of the game for mini and junior level rugby. A product of the review will be a skills curriculum for coaches and players with clear targets to help young players develop properly through the various age grade structures. The rugby department liaised closely with the Welsh Government throughout the year to align strategies relevant to the grassroots game and the potential for clubs to engage more widely in positive community initiatives. The levels of participation within the community game through YE11 continued to improve with a key emphasis on the growing number of junior and mini teams being developed by clubs. March 2011 saw the launch of the online audit system on the myWRU website to assist with the management of the Development Grant. The system, developed by both the WRU Compliance and IT Departments, in conjunction with Writemedia, allows Clubs the opportunity to input the data required for the Annual Development Grant throughout a given season, updating the WRUs central database as this information is completed.
In addition, the system has been designed to allow multiple users from one Club, therefore removing the focus from the Secretary having to undertake the complete task. The first season of the online submission process showed a considerable rise in the number of submissions by the deadline date, with over 90% of the 217 Clubs providing their completed data by the 31 May 2011. Support for the Clubs using the system was given by both the WRU Compliance and IT Departments, with representatives undertaking a series of presentations at a number of District meetings, and providing training days at the Millennium Stadium. In addition, each Club received a User Guide and a telephone support line was put in place. The system has also provided the opportunity for Community Managers and their teams to verify the information provided by the Clubs utilising a link to the new online audit system. This, and the overall positive reception to the system from all users, has resulted in the WRU having an up to date picture of the Community Game, allowing the opportunity to see the areas that require development and focus in the future. During the year, statistics were gathered from 217 clubs within divisions one to five which qualify for the range of funding related to the achievement of set criteria. Most clubs submitted data to the WRU relating to team numbers which means an accurate reflection of the level of team activity within the core community sector of the Welsh game can now be achieved.
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Community rugby (continued)
Number of Teams being run by WRU Member Clubs: Division 1-5

100
80
60
40
20
0
Senior Side Only Senior Side +2 2008/09 Senior Side +2-5 2009/10 Senior Side +6-9 2010/11 Senior Side +10 or more
Statistics based on information declared by WRU Member Clubs in Divisions 1-5 as part of the Development Grant submission process
YE11 was the first year of U7s rugby in Wales and a total of 95 teams were registered throughout the period.
Number of Active Teams being run by WRU Member Clubs: Division 1-5
200
150
100
50
0
Under 8s Under 9s Under 10s Under 11s Under 12s Under 13s Under 14s Under 15s Under 16s 2008/09 2009/10 2010/11 Youth Senior 2nds
Statistics based on information declared by WRU Member Clubs in Divisions 1-5 as part of the Development Grant submission process
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Volunteers prepare the changing rooms on match day
This growth within the game in Wales is also reflected in the number of volunteers now active within Welsh rugby. The statistics held by the WRU range across match officials, coaches, club coach co-ordinators, safeguarding officers and qualified first aiders. The figures show that more than 3,000 active volunteers operate within these categories. There is no doubt that the number of volunteers involved in all aspects of the game in Wales is vastly enhanced from the levels expressed in these official figures.
Another boost to the grassroots game was delivered in YE11 through the distribution of equipment ordered via the Participation Points Project. This scheme involved measuring clubs against existing criteria and awarding points which could be exchanged for rugby equipment. More than 1m was allocated to the project from Group funds and during the year equipment was delivered to 227 clubs throughout Wales. Within community rugby the WRU actively seek to identify strategies and projects which help develop the sustainability of the club as the hub. For that reason, initiatives are often linked to set criteria which are designed to improve clubs and make them fit for purpose. One such scheme involved the WRU aligning with St John Wales to teach lifesaving first aid skills to rugby volunteers. A project was launched to invite volunteers from clubs to receive first aid training through specially designed and organised courses. This was fully integrated with the aims of the WRU because clubs are rewarded under the grant funding criteria for the number of first aiders they have. The first course took place at the St John Training Centre in Cardiff during December 2010. The visibility and volume of activity related to the community game achieved wider recognition in YE11 when the WRU was asked to sponsor the volunteer award within the Leading Wales Awards scheme. This scheme recognises leadership across a range of disciplines and highlights exceptional individual examples throughout Wales. The WRU was asked to participate because of the
Volunteers funded through the WRU Development Grant Season 2010/11: WRU Member Clubs (Division 1-5)
772 938
Referees Coaches Club Coach Co-ordinators
186 176 803
Safeguarding Officers 1st Aiders
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tested on an elite global measuring scheme, for a variety of performance related attributes, to help identify some potential stars of the future. It is worthy of note, that across the game in Wales small businesses and commercial operations continued to support the community game on a club by club basis. This activity underpins the sustainability and development of some clubs and was achieved in YE11 against a challenging financial backdrop. SWALEC National Leagues Ebbw Vale did all they could to make an immediate return to the Principality by winning the Division 1 East title by a wafer-thin margin from Gwent rivals Newbridge. Both sides ended with 89 points, but Ebbw Vale took the title thanks to their 19 victories from 22 games.
Cardiff v Swansea Varsity match
recognition of the impact the game makes in helping develop leadership skills amongst volunteers throughout the amateur game. Commercial The extension of the SWALEC agreement sees the relationship go from strength to strength and further developed their relationship across the community game through a series of initiatives and aligned projects. The most high profile activity remains SWALECs sponsorship of league rugby alongside the re-emergence of the SWALEC Cup and the associated plate and bowl competitions. The wider impact was reflected in the success of the Junior Stars project for young rugby players, with the reward of excellence in sporting prowess and teamwork being a training session with the national team at the WRU National Centre of Excellence. The combined pursuit of development and awareness of the community game has lead to a very successful partnership. There were also community awards for clubs which proved their worth as hubs of local communities, with the main prize being a visit from a national squad member who hosted team training. Similarly, the commercial relationship with Under Armour led to the successful International Combines sessions where youngsters from the grassroots game in Wales were
Newbridge lost one more, although they were one of only three teams to defeat the champions, 27-17 at home on the second weekend of the season. Ebbw Vale qualified for the Play-Offs, but were beaten 16-13 by Glamorgan Wanderers in the semi-finals. Division 1 West champions Bridgend then took up the cudgel for the SWALEC League clubs and beat the Premiership outfit 38-19 in the Play-Off final to reclaim their place in the top flight and condemn the Wanderers to relegation. Coached by former Ospreys back row man Steve Tandy, Bridgend secured 96 points in a season that saw them draw 13-13 against Narbeth and be beaten only once, 3230 by arch-rivals Bridgend Athletic. Caernafon won the Division 1 North title by a clear 20 points, losing only one of their 18 games at Bethesda, while Bala pipped Llandiloes by one point to win the Second Division crown and return to the top flight in the North. Further down the SWALEC League ladder, Mountain Ash ended the season in Division 2 East with a perfect record of 22 wins, although second placed Tredegar managed to score four more tries than them in the campaign with 107. Crymych won the Division 3 West title with a 100% record, as did Maesteg Quins in Division 4 South West. Calidcot were unbeaten in Division 5 East, drawing one and winning the rest of their 20 games, while Senghenydd took the Division 4 East crown after losing only one of their 22 matches.
40
Furnace United ran in 156 tries to ensure they took the Division 5 West title despite losing to Burry Port on the last day of the season. Their 22-5 defeat was one of only three all season and meant Burry Port finished on the same number of points, but were still condemned to second place. Glynneath lost only once in gaining promotion from Division 3 South-West, while Ammanford lost twice in clinching the Division 2 West title with 96 points and a century of tries. SWALEC Leagues 20010-11 SWALEC NATIONAL LEAGUE DIVISIONAL CHAMPIONS One East One West Two East Two West Three East Three West Three South East Three South West Four East Four West Four South East Four South West Five East Five West Five South East Five South West Five South Central Six East Six West Six South East Six Central One North Two North Ebbw Vale Bridgend Mountain Ash Ammanford Rhymney Crymych Abercynon Glynneath Senghenydd Tenby United Rhiwbina Maesteg Quins Caldicot Furnace United Penygraig Trebanos Resolven Abertysswg Falcons Nantgaredig Hafodyrynys Clwb Rygbi Caernarfon Bala SWALEC PLATE Quarter-finals: Ammanford 87 20 Risca Glynneath 31 13 Aberdare Gorseinon 37 22 Tylorstown Tondu 76 15 Pontypool United Semi-finals: Gorseinon 26 58 Ammanford Tondu 3 16 Glynneath Final: Ammanford 35 13 Glynneath SWALEC BOWL Quarter-finals: Amman United 6 13 Porth Quins Cardiff Medicals 14 16 Vardre Senghenydd 69 10 Monmouth Tonyrefail 15 27 Maesteg Quins Semi-finals: Maesteg Quins 31 30 Porth Vardre 10 34 Senghenydd Final: Senghenydd 28 18 Maesteg Quins
Volunteers at work at Ynysddu
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Coaching youngsters in North Wales
Coach development There was a steady intake of candidates across the range of formal coaching courses held by the WRU. The tag courses attracted 531 individuals, 662 attended Level One courses, 129 Level 2 and 15 attended the Level Three courses which began operating late in YE11. To aid the development of delivery on these courses, a coach educators course was run with twelve candidates attending. These coach educators will be deployed throughout Wales to assist on future courses. In order to try and promote the work of our volunteer coaches the WRU produced a DVD to accompany the Level One course. It features the Wales RBS 6 Nations Captain Matthew Rees praising the work of junior coaches and highlights how vital the coaches contribution is to Welsh rugby. A leadership course was also introduced which offers an introduction into coaching, planning and event organising. The course also explains details of how to coach children in local primary schools. As part of the on-going commitment to developing a safer game, the WRU helped the IRB upgrade the Rugby Ready course. To aid the production of the associated DVD, the WRU assisted the IRB with the use of the WRU National Centre of Excellence indoor facilities to film all rugby aspects of the Rugby Ready course utilising players from Neath and Port Talbot College. The implementation of the new player pathway was delivered via a new pathway booklet. A DVD was created
during the year to assist the roll out of the changes during the off season. This work led to the review of law changes which eventually resulted in the Minis to Millennium concept. As part of the commitment to help develop emerging nations, the WRU have sent coach educators to various parts of Europe to deliver IRB coaching courses. These coach educators have been in Serbia, Germany, Luxembourg, Ukraine and Romania as these are the countries to which the WRU has made a commitment to help and develop. Match Officials More than 600 people attended Level 1 Referee courses conducted around Wales throughout the year which signifies a healthy new influx of match officials to the system in Wales. Bad weather again served to disrupt fixture schedules which caused major logistical problems in completing all league matches in time for the seasons close. All WRU match officials, advisors and Regional Appointments Officers must accept the WRUs gratitude for the heavy workload achieved throughout the year. Again through the season referee abuse featured as an undercurrent of the WRUs activity and this will not be tolerated either operationally or as part of the Welsh rugby culture. The WRU operates under the banner of No Ref, No Game and that principle has to be recognised at all levels of the game.
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43

Stadium
Katherine Jenkins, Shirley Bassey and Catherine Zeta Jones at the Ryder Cup concert in the Millennium Stadium
The Millennium Stadium maintained its international standing as a prominent multi-events venue. Leading with a programme of international and European rugby the stadium continues to attract a range of diverse entertainment events including concerts, motor sport and exhibitions in line with the commitment to welcome the World to Wales. This years events included Six Nations rugby against England and Ireland, the Autumn Series against Australia, South Africa, Fiji and New Zealand and a summer fixture between Wales and the Barbarians. For the sixth time in the competitions 16 year history the stadium hosted the final of the Heineken Cup between Leinster and Northampton which resulted in an economic impact on Cardiff in excess of 24m. Cardiff has become the premier host city for this event with more cup finals being held at Cardiff than any other host city.
Underpinning the premier fixtures, the finals of the WRU domestic competitions were showcased at the Millennium Stadium including the SWALEC Cup, Plate and Bowl and youth and schoolboys finals. The stadium also hosted the 15th Anniversary Varsity Match between Swansea and Cardiff Universities with its success, as a crowd-pleaser and TV attraction live on S4C, leading to proposals to invite the players back as a regular event in the Welsh sporting calendar. Rugby League returned to the Millennium Stadium this year following a two year visit of the Millennium Magic Weekend to Edinburgh. By popular demand from the league supporters, the weekend extravaganza witnessed all 14 Super Clubs competing in seven games played over two days. SJM, one of the countrys top concert promoters, brought two consecutive appearances by Take That to the stadium
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45

Stadium (continued)
The Saturdays perform at the Wales v Fiji match
performing to over 126,000 spectators, confirming the stadiums status as a European premier rock and concert venue. Motor sport figured prominently in the summer programme with the British Speedway Grand Prix and Monster Jam visiting the stadium. This year was the eleventh consecutive appearance of the Speedway Grand Prix in Cardiff as part of the European Grand Prix circuit. The stadium demonstrated its versatility as a multi-event venue in hosting the Ryder Cup Welcome to Wales Concert. Utilising the stadium acoustic drape system the stadium was divided in half to accommodate a formal dinner for 1,100 guests on one side followed by a concert on the other. An audience of 13,500 witnessed performances by Catherine Zeta Jones, Shirley Bassey, Katherine Jenkins and Only Men Aloud. This curtain raising event for the Ryder Cup Golf competition was broadcast to a worldwide audience.
Millennium Magic
46
47

Stadium (continued)
The Millennium Stadium turned blue in support of Diabetes UK Cymru
The stadium maintained its commitment to supporting community and charitable organisations in Wales with 16 community event days being held. Organisations such as the Welsh Government Education Skills Initiative, Diabetes UK, Anti-Racism in Sport, Cancer Charities and the NSPCC took advantage of this initiative to promote their aims and objectives. For each ticket sold for all events at the stadium a levy is paid to the Millennium Stadium Charitable Trust, the purpose of which is to provide financial support to communities and charities in Wales. This year almost 0.4m was donated to the trust, which has now received over 4.5m since the stadium was opened in 1999.
Continued interest in the Millennium Stadium as an iconic venue is evidenced by the increasing attendances for stadium tours. The route undertaken by the tour and its content was revised this year and saw some 45,000 participate in the one hour visit programme. Working with the Former International Players Association a plan was devised to refurbish the former WREX bar within the stadium. The new facility will provide state of the art restaurant and bar facilities, administered by the WRU, for all international players and was reopened during the World Cup warm up games.
48
Katherine Jenkins performs at the Ryder Cup Concert
In another move to develop the economic potential of the venue, a new Official Hospitality Operator scheme was introduced to police the unofficial hospitality market and ensure that income generated by WRU events is retained for the development of rugby around Wales. The scheme licenses official hospitality operators and therefore, individuals or groups who secure match tickets from unofficial sources are not guaranteed entry to the stadium. This licensed structure will also safeguard the rights of hospitality customers to ensure standards are maintained going forward. Behind the scenes during non-event periods the stadium staff have completed a comprehensive maintenance and works programme. Maintaining a safe and secure venue with facilities and services to meet modern spectator demands remains a key priority. Supported by the Welsh Government, a 3.0m audio visual project, the first of its kind in Europe, was completed during the reporting year. The scheme involved the installation of 470 new flat-screens throughout the stadium and the replacement of the two screens in the north and south stands; these are all linked to a television broadcast quality studio that enables a stadium production
team to film, edit, and present images and sound content to any or all parts of the stadium, The new technology, designed by American world leading company Cisco, provides an in-house live television broadcast facility which will enhance both the spectator experience and improve our commercial advertising opportunities.
Wales v England Euro 2012 qualifier
49

Stadium (continued)
Speedway at the Millennium Stadium supported by the Welsh Government
In 2008, as part of the WRU Group Strategic Plan it was announced that the stadium would develop and deliver a project to become a stadium with recognised accreditation in the field of sustainable management, to evidence its commitment to managing its social, economic and environmental impact. In pursuit of this goal, the stadium has sought to achieve the award of BSI 8901 for Sustainable Management Systems for Events. Final external audits have been completed and it is anticipated that the announcement of the award is imminent. Success in this field will see the Millennium Stadium become the first stadium in the UK to reach this sustainability standard.
Stadium staff mark BS 8901
50
51

Key performance indicators (KPIs) and business risks
The key performance indicators (KPIs) of the Group are: Rugby performance Success of the National Squad Performance of the Groups four Regions Performance of the Age-Grade teams Participation in rugby Development of the elite player talent within Wales Participation levels in Community Rugby, including women and junior numbers Financial performance Generation of sufficient earnings before interest, depreciation, allocations and exceptional items (EBITDA), over the medium term, to fulfil the Groups objectives and obligations Number of and attendances at international rugby matches, featuring the National Squad, held at the Millennium Stadium Utilisation of the Millennium Stadium for nonNational Squad events Provision of consistent and affordable levels of funding to clubs and affiliated organisations to allow them to implement long term plans to fulfil their objectives
Business risk The Group feels that the principal risks facing the business include: The performance of the National Squad The identification, nurturing, development and retention of Welsh players The identification, nurturing, development and retention of coaches and officials alongside appropriate elite systems and structures The sustainability of the four Regions The extent of involvement and enjoyment in recreational, grass roots, community rugby The securing of non-National Squad related events and activities at the Millennium Stadium The alignment of commercial strategies to deliver the rugby and stadium strategies The provision of adequate banking facilities The physical security and insurance of our main assets, primarily the Millennium Stadium; and The implementation of appropriate business systems and controls covering financial management, commercial operations and other key business areas All the above risks are regularly assessed by the Executive Board and actions are taken to mitigate any issues that arise.
WRU Referees Academy
52
Directors report
for the year ended 30 June 2011
Gareth Williams, Company Secretary
The Directors present their report and the Group and Companys audited financial statements for the year ended 30 June 2011. 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 Chairmans Statement, the Group Chief Executives Summary and the Operating and Financial Review. Results for the period The results for the period are set out in the consolidated profit and loss account on page 56 and show a profit before tax of 2.7m (2010: 0.8m loss). Financial risk factors The Group is exposed to financial risks from interest bearing assets and liabilities and interests in overseas companies. These expose the Group to financial risks including foreign currency risk, interest rate risk, credit risk and liquidity risk. Foreign exchange risk Where applicable, the Group mitigates foreign exchange risk with the use of forward contracts. As at 30 June 2011, the Group has no material foreign exchange risk (2010: nil). Interest rate risk The Group has interest bearing liabilities. As shown in Note 14, the Groups policy is to part hedge against any interest risk on liabilities by using derivative instruments to effectively hedge the interest rate risk. The Group has interest bearing assets which are invested at differing interest rates; these interest rates are fixed at the outset of the investment. Credit risk The Group has no significant concentration of credit risk. The Group has implemented policies that require appropriate credit checks on potential credit customers before sales commence. Interest bearing assets are only invested with financial institutions that have excellent credit ratings.
Liquidity risk The Group maintains a balance between continuity of funding and flexibility. As at 30 June 2011, only 22% (2010: 15%) of the borrowings were due to expire within five years. On 2 July 2010 the Group restructured its debt facilities; details of the restructure are shown in Note 13.
Fixed assets The Millennium Stadium, recorded at a carrying value in the financial statements of some 98m (2010: 98m) is a unique asset. The asset is recorded at historical cost and due to the unique nature of the asset an alternative use valuation is not considered appropriate. If the Millennium Stadium was valued at replacement cost the carrying value recorded in the financial statements would be in excess of 250m. Directors The Directors who held office during the period and up to the date of signing the financial statements are noted on page 81. Donations The Groups primary charitable donation was 61,000 (2010: 114,000) to the Welsh Rugby Charitable Trust. This trust, which is independent from the Group, was set up to provide support to players who were injured whilst playing rugby in Wales. There were no political donations (2010: nil). Policy on payment to creditors The Groups policy, concerning the payment of the majority of its trade creditors, is to: set the terms of payment with those suppliers when agreeing the terms of each transaction ensure that those suppliers are made aware of the terms of payment by inclusion of the relevant terms in contracts pay in accordance with its contractual and other legal obligations.
53
Directors report
for the year ended 30 June 2011 (continued)
Dennis Gethin, Joe Lydon and First Minister Carwyn Jones at Parc Eirias
Corporate social responsibility The Group recognises its responsibility to the communities which are affected by its businesses and continually reviews its policies with regard to social, ethical and environmental matters. Any matters in any of these categories which may materially affect the business of the Group are reviewed periodically by the Board. Employment of disabled persons The Groups policy for the employment of disabled persons gives full and fair consideration to all applications for employment made by such persons, having regard to their aptitudes and abilities and to the Groups operational requirements. Once employed, a career plan is developed so as to ensure suitable opportunities for each disabled person. Arrangements are made, where possible, for retraining employees who become disabled, to enable them to perform work identified as appropriate to their aptitudes and abilities in line with the Groups operational requirements. Employee involvement During the period, regular consultations and briefings took place with employees to increase their knowledge and understanding of the Groups performance and the financial and economic factors which affect it, and to enable the Group to take into account the views of the employees when making decisions likely to affect employees interests. The interests of employees in the defined benefit pension schemes were represented in the period by the trustees of those schemes.
Going concern The Directors believe that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future and it therefore continues to adopt the going concern basis in preparing the financial statements. Statement of directors responsibilities The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations. Company law requires the Directors to prepare financial statements for each financial period. Under that law the Directors have prepared the Group and Company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (UK Accounting Standards and applicable law). Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to: select suitable accounting policies and then apply them consistently; make judgements and accounting estimates that are reasonable and prudent; state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
54
Wales Women play England in the Six Nations
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business. The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Companys and Groups transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence 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 Companys 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 So far as the Directors are aware, there is no relevant audit information of which the Companys auditors are unaware
and the Directors have taken all the steps necessary to make themselves aware of any relevant audit information and to convey that information to the Companys auditors. Independent auditors PricewaterhouseCoopers LLP have indicated their willingness to continue in office and a resolution to reappoint them will be proposed at the forthcoming Annual General Meeting. By Order of the Board
Gareth Williams Company Secretary 22 September 2011
55
Consolidated profit and loss account

Note Turnover Administrative expenses 2 (a) 2 (b)
2011 000 54,254 (50,501)
13 months to 30 June 2010 000 58,492 (54,373)
Operating profit before depreciation, exceptional items and allocations to affiliated organisations (EBITDA) Allocations to affiliated organisations Exceptional items Depreciation (net of grant release) Operating profit Financing costs: - Interest payable and similar charges - Interest receivable and similar income - Fair value losses on derivative financial instruments Profit/(loss) on ordinary activities before tax Tax on profit/(loss) on ordinary activities Profit/(loss) for the financial period
26,173
27,641
2 (d) 4 4
(19,281) (3,139) 3,753
(19,964) (22) (3,536) 4,119 (3,117) 1 (1,762) (759) 33 (726)
3 3 3
(1,015) 128 (161) 2,705
6 18
(789) 1,916
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 2011 13 months to 30 June 2010 000 (726) (512) 147 (365) (1,091)
2011 000 Profit/(loss) for the financial period Actuarial gain/(loss) on pension scheme Movement in deferred tax on pension scheme Net effect of pension schemes Total gains/(losses) recognised in the period 1,916 428 (120) 308 2,224
56
Balance sheets
as at 30 June 2011
Note Fixed assets Tangible assets Investments 8 9
2011 Group 000 140,338 140,338
2010 Group 000 141,421 141,421
2011 Company 000 38,614 60 38,674
2010 Company 000 38,819 60 38,879
Current assets Stock Financial Assets - Derivative financial asset - Debtors - Cash and cash equivalents
10 14 11 12
318 51 3,568 382 4,319
61 212 5,872 1,000 7,145
51 68,909 309 69,269
26,871 941 27,812
Current liabilities Creditors amounts falling due within one year Net current (liabilities)/assets Total assets less current liabilities Creditors amounts falling due after more than one year Accruals and deferred income Provisions for liabilities and charges Net assets excluding pension liabilities Pension liabilities Net assets including pension liabilities Capital and reserves Other reserves Profit and loss account Capital employed
13
(23,944) (19,625) 120,713
(21,430) (14,285) 127,136 (77,421)
(18,962) 50,307 88,981 (68,059)
(12,800) 15,012 53,891 (37,325)
13
(68,410)
15 16
(43,001) (4,023) 5,279
(43,029) (3,323) 3,363 (308) 3,055
20,922 20,922
16,566 (308) 16,258
21
5,279
18 18
2,314 2,965 5,279
2,314 741 3,055
2,610 18,312 20,922
2,610 13,648 16,258
These financial statements were approved by the Board of Directors on 22 September 2011 and signed on its behalf by:
David Pickering Chairman

The Welsh Rugby Union Limited Company Number 3419514
Roger Lewis Group Chief Executive Officer
The notes on pages 59 to 79 form an integral part of these financial statements.
57
Consolidated cash flow statement

Note
2011 000
2011 000
13 months to 30 June 2010 000
13 months to 30 June 2010 000
Net cash inflow from operating activities
22
9,107
9,602
Returns on investments and servicing of finance Interest received Interest paid Realised loss on derivative financial instrument Payments to acquire new derivative instruments Interest element of hire purchase repayments Net cash outflow from returns on investments and servicing of finance Taxation Capital expenditure and financial investment Purchase of tangible fixed assets Grant repaid Grant received Net cash outflow for capital expenditure and financial investment Financing Drawdown of bank loans Repayment of bank loans Debenture issue Capital element of hire purchase repayments Net cash outflow in respect of financing Decrease in net cash in the period 23
128 (1,098) (970) (64) (3,750) (100) 1,766 (2,084)
1 (3,136) (5,033) (212) (46) (8,426) (2,768) (1,100) 539 (3,329)
3,500 (10,044) 236 (299) (6,607) (618)
1,500 (2,309) (208) (1,017) (3,170)
The notes on pages 59 to 79 form an integral part of these financial statements.
58
Notes to the financial statements

1. Accounting policies The Groups financial statements are prepared on the going concern basis, under the historical cost convention, excluding adjustments to historical cost attributable to fair value movements, in accordance with the Companies Act 2006 and applicable accounting standards in the United Kingdom. The Groups accounting policies, which have been applied consistently, are as set out below. a. Basis of consolidation The consolidated financial statements incorporate the financial statements of The Welsh Rugby Union Limited and its subsidiaries, Millennium Stadium plc, WRU Supporters Club Limited, WRU National Centre of Excellence Limited and WRU Debentures Limited, all of which are made up to 30 June 2011 and prepared using consistent accounting policies. All intergroup transactions are eliminated on consolidation. b. Turnover Turnover represents amounts invoiced, excluding value added tax, in respect of the sale of goods and services. Ticket income, sale of hospitality packages, competition income and other event income are recognised as revenue when the related event is staged. Revenue determined by commercial contracts, which makes up the majority of broadcasting revenue, sponsorship and royalty revenue and lease of hospitality boxes is recognised based on the relevant contractual terms. Where consideration is received in kind, income and expenditure are grossed up on the basis of arms length commercial rates. c. Exceptional Items In order to improve the understanding of the financial statements, the Directors have identified separately, on the face of the profit and loss account, those items of income and charge which by their size, nature and/or incidence are exceptional to the financial statements for the period. These are shown as exceptional within the categories of expenditure to which they relate. d. Tangible fixed assets Tangible fixed assets are stated at historic cost less accumulated depreciation. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use. The tangible fixed assets of the Group, excluding land, are depreciated on a straight line basis calculated to write down their cost to estimated residual values over their estimated useful economic lives as follows:
Buildings Fixtures and fittings Plant and machinery
Up to 50 years Up to 5 years Up to 10 years
Leasehold buildings are depreciated over the lower of 50 years and the remaining life of the lease. e. Investments in subsidiaries Investments in subsidiaries are included at cost less any provision for impairment. f. Trade investments Trade investments are valued at cost less any provision for impairment. g. Leased assets Where the Group enters into a lease which entails taking substantially all the risks and rewards of an asset, the lease is treated as a hire purchase arrangement. The present value of the minimum lease payments is recorded in the balance sheet as a tangible fixed asset. Future instalments under such leases, net of finance charges, are included within creditors. Rentals payable are apportioned between the finance element, which is charged to the profit and loss account, and the capital element which reduces the outstanding hire purchase liability. All other leases are accounted for as operating leases and the rentals charged to the profit and loss account on a straight line basis over the life of the lease. h. Stock Stock is valued at the lower of cost and net realisable value and consists of finished goods purchased for resale. Where necessary, provision is made for obsolete, slow moving and defective stock. Cost is determined on a first in first out basis. i. Deferred tax Deferred tax is provided in full on all material timing differences. Deferred tax assets are recognised where their recovery is considered more likely than not. Deferred tax assets and liabilities have not been discounted. j. Pension costs The Group operates defined contribution schemes and a defined benefit pension scheme. The pension costs in respect of the defined contribution pension schemes comprise contributions payable in respect of the period. The assets of the defined benefit scheme are measured using closing bid-market rates. Pension scheme liabilities are measured
59

using the projected unit method and discounted at the current rate of return on a high quality corporate bond of equivalent term and currency to the liability. The increase in the present value of the liabilities of the defined benefit scheme expected to arise from employee service in the period is charged to operating profit. The expected return on the schemes assets and the increase during the period in the present value of the schemes liabilities, arising from the passage of time, are included in net interest payable. Actuarial gains and losses are recognised in the statement of total recognised gains and losses. 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 period 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 Groups derivatives do not qualify for hedge accounting under FRS 26 in either 2011 or 2010. 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 and cash equivalents Cash and cash equivalents include highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of change in value.
60
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 Turnover is analysed as follows: Match income Competition income Commercial income Other event income Other income 2011 000 30,543 9,111 11,241 2,657 702 54,254 2010 000 34,150 9,240 10,914 2,031 2,157 58,492
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 includes 0.1m (2010: 0.1m) of grants received from the Sports Council of Wales matched by expenditure included in community rugby costs and nil (2010: 1.7m) from the British & Irish Lions. (b) Total costs are as follows: Operational costs (see (c) below) Exceptional costs Depreciation net of grant release Accelerated depreciation (exceptional) Allocations to affiliated organisations (see (d) below) 2011 000 28,081 3,139 19,281 50,501 2011 000 5,587 12,046 4,020 1,921 4,507 28,081 2011 000 14,954 1,210 3,117 19,281 2010 000 30,851 22 3,274 262 19,964 54,373 2010 000 6,428 13,092 3,847 2,081 5,403 30,851 2010 000 14,227 1,233 4,504 19,964
(c) Operational costs: Business & administration Direct Elite rugby Community rugby Stadium
(d) Allocations to affiliates These are analysed as follows: Regions professional rugby Clubs semi-professional rugby Clubs community rugby & affiliates
61

3. Financing costs 2011 000 Interest payable and similar charges Interest payable on bank and similar loans Amortisation of arrangement fees on bank loan Interest on finance lease and hire purchase arrangements Bank charges Charges arising on re-financing and new derivative instruments Other finance charges in respect of pensions (see Note 21) Total Interest receivable and similar income Short term deposits Total Fair value losses on derivative financial instruments Interest rate swaps Interest rate cap Interest rate floor Total Total net financing costs 842 173 1,015 2010 000 2,500 62 46 210 296 3 3,117
128 128
1 1
84 77 161 1,048
644 251 867 1,762 4,878
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 Groups 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/(loss) on ordinary activities before tax Profit/(loss) on ordinary activities before tax is arrived at after charging/(crediting): 2011 000 4,833 (1,694) 3,139 319 68 Notes (a) (b) (c) (d) 2010 000 4,877 100 262 (1,703) 3,536 238 275 83 (154) (56) 149 22
Depreciation on owned assets Depreciation on leased assets Accelerated depreciation (exceptional) Release of deferred income (grant release) Net charge to the profit and loss account Rental of land and buildings Trade debtors impairment Exceptional items Litigation costs Rebate from rates reassessment Reduced provision for doubtful debts & similar adjustments Reorganisation costs Total exceptional items
62
4. Profit/(loss) on ordinary activities before tax (continued) During the previous period, the Group incurred charges/received income that due to their size and incidence were considered exceptional. In order to assist in understanding the Groups results and, in view of the materiality of the exceptional items to the previous periods results, the Directors believe that it is 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 2010 arose from ongoing disputes or disputes settled in the period. (b) Following the 2005 rateable value assessment, the Group challenged the value ascribed to the Millennium Stadium. The Group received notification during the previous period that this challenge had been successful. The revised assessment resulted in lower rates charges for the period 2005 to 2010. Refunds that were received in respect of overcharged rates for the period 2005 to 2009 were treated as exceptional income. (c) In 2009 the Group performed a detailed review of accounts receivable and liabilities and concluded that, inter alia, further provisions were required as certain amounts were doubtful of recovery and certain liabilities were under accrued. During the period to June 2010 certain of these amounts considered doubtful in 2009 were recovered and the provisions were reversed. (d) During the period to June 2010 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 period, the Group obtained the following services from the Groups auditor: 2011 000 26 23 21 60 2010 000 25 20 51 53
Fees payable to Company auditor for the audit of the parent company and consolidated accounts Fees payable to the Companys auditor for other services: The audit of the Companys subsidiaries pursuant to legislation Taxation services Other services 5. Staff numbers and costs Staff numbers The average number of employees, including directors in a service contract, during the period was: Management and administration Direct Elite rugby Community rugby (including district development officers) Stadium 55 22 33 37 37 184 53 23 26 38 34 174 2011 Group 2010 Group
2011 Company
2010 Company
33 19 33 37 122
32 16 26 36 110
The above staff numbers do not include any players representing national teams, stewards employed for events nor do they include the non-executive directors of the Company. However, the staff numbers include 3 (2010: 4) (full time equivalents) District Development Officers (DDOs) who are employees of various local authorities.
63

5. Staff numbers and costs (continued) Staff costs 2011 Group 000 6,852 650 433 7,935 2010 Group 000 6,923 705 (242) 409 7,795 2011 Company 000 5,243 502 326 6,071 2010 Company 000 5,415 545 (242) 319 6,037
The staff costs during the period were as follows: Wages and salaries Social security costs Pension income defined benefit schemes Pension costs defined contribution schemes
Included in the above costs are contributions amounting to nil (2010: 0.1m) towards the DDOs. In addition to the above amounts, 1.3m (2010: 1.5m) 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 The Directors emoluments, during the period, were as follows: Aggregate emoluments Benefits Company contributions to defined contribution pension scheme 2011 000 329 16 18 363 2010 000 298 8 17 323
The emoluments above include 35,000 (2010: 38,000) payable to the Chairman. The Group received 18,000 (2010: 17,000) from third parties in respect of the above emoluments. There is one director (2010: one) accruing benefits under a defined contribution pension scheme. No directors (2010: none) are accruing benefits under a defined benefit pension scheme. Emoluments of the highest paid director The emoluments of the highest paid director, during the period, were as follows: Aggregate emoluments Benefits Company contributions to defined contribution pension scheme 6. Tax on profit/(loss) on ordinary activities 2011 000 (a) Analysis of charge in the period Current tax UK corporation tax on result for the period Adjustment in respect of prior periods Total current tax (Note 6(b)) Deferred tax Origination and reversal of timing differences Pension contribution relief in excess of pension cost charge Changes in tax rates and laws Total deferred tax Total tax charge/(credit) on profit/(loss) on ordinary activities 104 (15) 89 69 581 650 2010 000 2011 000 294 8 18 320 2010 000 260 8 17 285
937 (237) 700 789
(750) 67 (683) (33)
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6. Tax on profit/(loss) on ordinary activities (continued) (b) Factors affecting the current tax charge for the period The current tax assessed for the period is different from the standard rate of corporation tax in the UK of 27.5% (2010: 28.0%). The differences are explained below: 2011 2010 000 000 Profit/(loss) on ordinary activities before tax Profit/(loss) multiplied by standard rate of corporation tax in the UK of 27.5% (2010: 28.0%) Effects of: Accelerated capital allowances and other timing differences Permanent differences Pension contribution relief in excess of pension cost charge Adjustment in respect of prior periods Current tax charge for period (Note 6(a)) 2,705 744 (974) 334 (15) 89 (759) (212) 218 130 (67) 581 650
In addition to the changes in rates of corporation tax disclosed above, a number of further changes to the UK corporation tax system were announced in the March 2011 UK Budget Statement. Legislation to reduce the main rate of corporation tax from 26.0% to 25.0% from 1 April 2012 is included in the Finance Act 2011 which was enacted on 19 July 2011. Further reductions to the main rate are proposed to reduce the rate by 1.0% per annum to 23.0% by 1 April 2014. These further changes had not been substantively enacted at the balance sheet date and, therefore, are not included in these financial statements. The effect of the changes in the Finance Act 2011 would be to reduce the deferred tax liability provided at the balance sheet date by approximately 155k. This 155k decrease in the deferred tax liability would increase profits by approximately 155k. This decrease in the deferred tax liability is due to the reduction in the corporation tax rate from 26.0% to 25.0% with effect from 1 April 2012. The proposed reductions of the main rate of corporation tax by 1.0% per year to 23.0% by 1 April 2014 are expected to be enacted separately each year. The overall effect of the further changes from 25.0% to 23.0%, if these applied to the deferred tax balance at the balance sheet date, would be to further reduce the deferred tax liability by an additional 310k (being 155k recognised in 2013 and 155k recognised in 2014). 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 period in respect of the Company was 5.8m and 4.4m (2010: 5.4m and 3.9m) respectively.
65

8. Tangible fixed assets Stadium 000 Cost At 1 July 2010 Additions Transfers Disposals At 30 June 2011 Accumulated depreciation At 1 July 2010 Charge for the period Disposals At 30 June 2011 Net book value At 30 June 2011 At 30 June 2010 135,152 3,038 116 138,306 36,894 3,881 40,775 97,531 98,258 Centre of Excellence 000 2,411 151 2,562 224 227 451 2,111 2,187 Other buildings 000 1,806 7 (116) (10) 1,687 753 105 (10) 848 839 1,053 Other fixed assets 000 000 37,629 37,629 37,629 37,629 5,047 554 (922) 4,679 2,753 620 (922) 2,451 2,228 2,294 Land Group Total 000 182,045 3,750 (932) 184,863 40,624 4,833 (932) 44,525 140,338 141,421 Company Total 000 40,506 87 (116) (894) 39,583 1,687 176 (894) 969 38,614 38,819
Included in the cost of the stadium are cumulative capitalised interest costs of 4.6m (2010: 4.6m). The depreciation charge includes an amount of 0.1m (2010: 0.1m) representing the depreciation of interest previously capitalised. All the Land and Other buildings are held under a freehold interest. Elements of the Stadium are subject to a 999 year lease and the Centre of Excellence is subject to a 99 year lease. During the year, the Group exercised its option to settle all outstanding hire purchase arrangements early. The net book value of the Groups tangible fixed assets include nil (2010: 0.5m) (Company: nil (2010: nil)) in respect of assets held under hire purchase arrangements. The depreciation charge on these assets amounted to nil (2010: 0.1m) (Company: nil (2010: nil). 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 2011 and 30 June 2010. 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 2011 and 30 June 2010 were: Company Millennium Stadium plc WRU Supporters Club Limited WRU National Centre of Excellence Limited WRU Debentures Limited Six Nations Rugby Limited European Rugby Cup Limited Celtic Rugby Limited British and Irish Lions Limited Principal activity Stadia operation Marketing Provision of training facilities Dormant Competition management Competition management Competition management Overseas rugby tours Country of incorporation United Kingdom United Kingdom United Kingdom United Kingdom Republic of Ireland Republic of Ireland Republic of Ireland Republic of Ireland % holding of ordinary shares 100% 100% 100% 100% 17% 17% 33% 25%
66
9. Investments (continued) Given the disposition of the other shareholdings, the Groups 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) own one share in Millennium Stadium plc; this share grants only certain rights and does not grant CCC any dividends nor any rights to amounts receivable upon winding up. 10. Stock Group 2011 000 Goods for resale 11. Debtors Amounts due within one year: Group 2011 000 2,211 638 (823) 2,026 1,520 3,546 Group 2010 000 2,703 1,300 613 (1,107) 3,509 2,341 5,850 Company 2011 000 473 638 (731) 380 1,127 1,507 Company 2010 000 1,313 1,300 613 (714) 2,512 840 3,352 318 Group 2010 000 61 Company 2011 000 Company 2010 000 -
Trade debtors Loans due from Regions Loans due from clubs Less: provision for impairment of receivables Prepayments and other debtors
Amounts due after more than one year: Amounts due from subsidiary undertakings Loans due from clubs
22 22 3,568
22 22 5,872
67,380 22 67,402 68,909
23,497 22 23,519 26,871
Total debtors
As a result of the refinancing undertaken on 2 July 2010, all bank loans that had previously been held by a subsidiary company, Millennium Stadium plc, were repaid. New loans were subsequently taken out by the Company (Note 13). 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 from subsidiary undertakings. The carrying amount of debtors is a reasonable approximation of fair value and the carrying amounts of the Groups debtors are all denominated in UK Sterling (GBP). As of 30 June 2011, trade debtors and loans due from clubs with a carrying value of 0.7m (2010: 1.2m) were impaired and provided for. The amount of the provision was 0.8m as of 30 June 2011 (2010: 1.1m). The ageing of these debtors is as follows: 2011 000 3 to 6 months past due Over 6 months past due 127 606 733 2010 000 29 1,175 1,204
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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 pursing these amounts due. Trade debtors that are less than three months past their due date are not considered impaired. As of 30 June 2011, trade debtors of carrying value of 0.6m (2010: 0.6m) 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: 2011 000 Up to 3 months past due 3 to 6 months past due Over 6 months past due 521 57 3 581 2010 000 326 182 120 628
Movements on the provision for impairment of trade debtors are as follows: 2011 000 At start of period Debtors written off during the period New amounts charged to profit and loss At end of period 12. Cash at bank and in hand Group 2011 000 Cash balance at bank 13. Creditors Amounts falling due within one year: Group 2011 000 Bank loans Amounts due under hire purchase arrangements Trade creditors Amounts due to subsidiary undertakings Corporation tax Other tax and social security Other creditors Accruals and deferred income 6,094 2,501 4,184 339 258 10,568 23,944 Group 2010 000 3,466 199 3,797 4,159 254 266 9,289 21,430 Company 2011 000 6,094 187 62 3,972 258 258 8,131 18,962 Company 2010 000 1,204 62 3,947 205 266 7,116 12,800 382 Group 2010 000 1,000 Company 2011 000 309 Company 2010 000 941 (1,107) 352 (68) (823) 2010 000 (1,044) 212 (275) (1,107)
The amounts due to 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 to subsidiary undertakings.
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13. Creditors (continued) Amounts falling due after more than one year: Group 2011 000 Bank loans Amounts due under hire purchase arrangements Debentures Deferred income 30,498 37,561 326 68,410 Group 2010 000 39,670 100 37,325 326 77,421 Company 2011 000 30,498 37,561 68,059 Company 2010 000 37,325 37,325
Maturity analysis: Bank loans are due: Group 2011 000 6,094 2,364 7,500 20,634 36,592 Group 2010 000 3,466 2,014 6,130 31,526 43,136 Company 2011 000 6,094 2,364 7,500 20,634 36,592 Company 2010 000 -
Within one year Between one and two years Between two and five years In more than five years
On 2 July 2010 the Group replaced its existing loan facilities with a revised arrangement. The 31.6m term loan held by a subsidiary company was repaid and immediately replaced with a new 25.0m facility in the Company. The Group also amended its revolving credit facility. The previous 10.0m facility held by a subsidiary company was replaced with a new 15.0m facility in the Company. The Groups 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. The Group has not, during the period, amended the agreed repayment profile but 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 2011 000 3,500 23,092 10,000 36,592 2010 000 1,500 31,636 10,000 43,136
Revolving credit facility Revolving credit facility Term loan Tranche C
LIBOR plus 1.50%, loan repayable on maturity date LIBOR plus 2.00%, loan repayable on maturity date LIBOR plus 1.50%, loan repayable in instalments by 2033 Interest and capital is payable only in the event of default or certain other defined events
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 2011 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 Groups borrowings approximate their value. The carrying amounts of the Groups borrowings are all denominated in GBP.
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13. Creditors (continued) Security provided on bank loans Bank loans totalling 36.6m (2010: 43.1m) are secured by fixed and floating charges over the assets of the Company and certain of its subsidiaries. Borrowing facilities The Group has 11.5m (2010: 8.5m) of undrawn committed borrowing facilities available at 30 June 2011 in respect of which all conditions precedent had been met at that date. Obligations under hire purchase agreements are due: Group 2011 000 Within one year Between one and two years Between two and five years Less: finance charges allocated to future periods Group 2010 000 214 123 337 (38) 299 Company 2011 000 Company 2010 000 -
During the year, the Group exercised its option to settle all outstanding hire purchase agreements. The hire purchase agreements above in the prior period were secured on the assets for which this finance was used to acquire. Debenture loans are repayable in: Group 2011 000 360 24,587 438 2,425 350 4,833 1,795 2,975 37,763 (202) 37,561 Group 2010 000 360 24,587 2,425 350 4,833 1,795 2,975 37,325 37,325 Company 2011 000 360 24,587 438 2,425 350 4,833 1,795 2,975 37,763 (202) 37,561 Company 2010 000 360 24,587 2,425 350 4,833 1,795 2,975 37,325 37,325
2021 2024 2026 2027 2028 2030 2035 2050 Unamortised issue costs
All debenture loans are unsecured and bear no interest. The Group undertook a new debenture issue during the year. These debentures will be repayable in 2026. The issue costs associated with the debenture issue are held as a deduction to the debenture balance. These issue costs will be amortised over the life of the debentures. Bank and debenture loans repayable by instalments wholly or partly after 5 years Bank loans, with a total value of 36.6m (2010: 43.1m), are repayable wholly or partly from the balance sheet date by instalments. Of these amounts, 20.6m (2010: 31.5m) is repayable after five years. Debenture loans, with a total value of 37.6m (2010: 37.3m), are repayable wholly from the balance sheet date. Of these amounts, 37.6m (2010: 37.3m) is repayable after five years.
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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 2011 the Group had no material foreign exchange risk (2010: nil). Interest rate risk operations are financed through a mixture of bank borrowings, debenture loans and hire purchase arrangements. 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 2011 some 60% (2010: 54%) of bank borrowing was subject to hedging arrangements. Liquidity risk the Groups policy is to maintain a balance between continuity of funding and flexibility. As at 30 June 2011, 22% (2010: 15%) of borrowings were due to mature within five years, some 48% (2010: 70%) were due to mature between five years and fifteen years and some 30% (2010: 15%) were due to mature after fifteen years.
Financial instruments As a result of the refinance undertaken on 2 July 2010, the financial instruments entered in to on 30 June 2010 and previously held in a subsidiary company were transferred to the Company at fair value. At 30 June 2011 the notional principal amounts of derivatives relating to interest rate cap and collar agreements were 16.0m and are analysed as follows: Instrument Principal 000 Interest rate cap 3.00% (effective from 30 June 2010) Interest rate cap 3.75% (effective from 30 June 2012) Interest rate floor 2.10% (effective from 30 June 2012) 16,000 15,200 15,200 Fair market value 000 16,000 14,902 15,247 Gain/(loss) 000 298 (247) 30 June 2012 30 June 2018 30 June 2018 Maturity date
At 30 June 2010 the notional principal amounts of derivatives relating to interest rate cap and collar agreements were 18.0m and were analysed as follows: Instrument Principal 000 Interest rate cap 3.00% (effective from 30 June 2010) Interest rate cap 3.75% (effective from 30 June 2012) Interest rate floor 2.10% (effective from 30 June 2012) 18,000 15,200 15,200 Fair market value 000 17,981 14,837 15,370 Gain/(loss) 000 19 363 (170) 30 June 2012 30 June 2018 30 June 2018 Maturity date
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14. Borrowings and financial instruments (continued) During the period to 30 June 2011, none of the Groups derivatives qualified for hedge accounting under FRS 26 (2010: nil). These instruments are carried at fair value as analysed below: Group 2011 000 Interest rate cap Interest rate floor Derivative financial asset 298 (247) 51 Group 2010 000 382 (170) 212 Company 2011 000 298 (247) 51 Company 2010 000 -
In accordance with FRS 26, Financial instruments: Recognition and measurement, the Group has 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. The Group has no such embedded derivatives as per FRS 26. 15. Deferred income Grants Group 2011 000 43,029 1,766 (100) (1,694) 43,001 Group 2010 000 45,560 272 (1,100) (1,703) 43,029 Company 2011 000 Company 2010 000 -
At start of period Grant received Amounts repaid Released to the profit and loss account As at end of period
During the period some 1.7m (2010: 1.7m) was released to the profit and loss account from the grant amount shown above. Included within the grants amounts above is an amount received from the Big Lottery Fund (formerly the Millennium Commission) amounting to 31.9m (2010: 33.1m). This grant will be released to the profit and loss account as follows: Group 2011 000 Within one year Between one and two years Between two and five years In more than five years 1,196 1,196 3,588 25,967 31,947 Group 2010 000 1,196 1,196 3,588 27,163 33,143 Company 2011 000 Company 2010 000 -
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.
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16. Provisions for liabilities and charges Deferred tax The movement on deferred tax is as follows: Group 2011 000 Balance at start of period Released to the profit and loss account At end of period Deferred tax provided/(recognised) is made up as follows: Accelerated capital allowances Other timing differences 3,323 700 4,023 Group 2010 000 4,073 (750) 3,323 Company 2011 000 Company 2010 000 -
4,031 (8) 4,023
4,265 (942) 3,323
The Group is currently in discussions with HM Revenue & Customs regarding the extent to which the expenditure on the Millennium Stadium qualifies for tax relief. When these discussions are concluded, it is possible that an adjustment will be required to the provisions for corporation tax and deferred tax but it is not possible to quantify the likely amount and direction of this adjustment at this time. The Directors believe, based on external opinion, that the Group has meritorious arguments as regards the treatment adopted and that no significant further liability is expected from that already 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 Companys 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 Companys liabilities contracted before a member ceased to be a member. The number of members is 251 (2010: 241). 18. Reserves Profit and loss account 000 Group At 1 July 2010 Retained profit for the period Actuarial gain on pension fund Deferred tax movement on pension schemes At 30 June 2011 741 1,916 428 (120) 2,965 Profit and loss account 000 Company At 1 July 2010 Retained profit for the period Actuarial gain on pension fund Deferred tax movement on pension schemes At 30 June 2011 Company - retained profit for the period is analysed as follows: Profit before tax Tax charge 13,648 4,356 428 (120) 18,312 Other reserves 000 2,314 2,314 Other reserves 000 2,610 2,610 Total 000 3,055 1,916 428 (120) 5,279 Total 000 16,258 4,356 428 (120) 20,922 2011 000 5,761 (1,405) 4,356
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19. Contingent liabilities Group The Group had the following contingent liabilities as at 30 June 2011: Company The Company had the following contingent liabilities as at 30 June 2011: The Company has guaranteed the performance of one of its subsidiaries under the terms of grant arrangements amounting to 43.0m (2010: 43.0m). The Company has guaranteed the performance of some member clubs in respect of loans that member clubs have received from Barclays Bank PLC. The current balance is 1.4m (2010: 1.4m). 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 1.4m (2010: 1.4m).
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: 2011 000 221 2010 000 2,984
Authorised and contracted: The Company has no capital commitments (2010: nil) Operating lease commitments:
At the balance sheet date, the Group had the following annual commitments, under non-cancellable operating leases: 2011 000 Land and buildings Expiring after five years 21. Pension costs 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 period amounting to some 0.4m (2010: 0.4m). There are no material amounts included in creditors in respect of these pension costs in 2011 or 2010. The Group operates a defined benefit pension scheme as follows: The Welsh Rugby Union Limited Senior Employees Pension Scheme (WRUSEPS) WRUSEPS is a defined benefit scheme which is closed to new entrants and to future accrual. The WRUSEPS assets are held in separate trustee administered funds. Contributions to WRUSEPS are assessed in accordance with the advice of an independent qualified actuary on the basis of triennial valuations. The latest valuation of WRUSEPS, prepared as at 1 May 2010, was based on the Projected Unit Method of Valuation and the market value of its assets at that date was some 1.6m. The contribution rates of the Group were 0% of pensionable pay from 1 June 2009. The Groups contributions for the period amounted to nil (2010: nil). No material amounts at 30 June 2011 or 30 June 2010 were included in creditors. 320 2010 000 316
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21. Pension costs (continued) The Group has elected to account for defined benefit pension schemes in accordance with FRS 17 which prescribes the basis for valuing defined benefit scheme assets and liabilities. The prescribed basis for valuing the schemes liabilities differs from the basis used by the schemes actuaries in producing periodic valuations of the scheme. The main financial assumptions used in the valuation of the pension schemes under FRS 17 are: 2011 % Assumptions Inflation Rate of increase in salaries Rate of increase of pensions in payment Rate of increase of pensions in deferment Discount rate 3.5 0.0 3.8 2.8 4.3 Years Life expectancy of a 65 year old woman at end of period Life expectancy of a 65 year old man at end of period 90 87 2010 % 3.4 0.0 3.4 3.4 4.1 Years 90 87 2009 % 3.8 5.4 3.4 3.4 5.4 Years 90 87
Life expectancy assumptions for 2011 and 2010 are derived from: 115% of the rates published in actuarial tables PNMA00 for males, with a medium cohort projection, subject to a minimum of 1.5%; and 110% of those published in actuarial tables PNFA00 for females, with a medium cohort projection, subject to a minimum of 1.0%. For 2009, life expectancy assumptions are derived from the rates published in actuarial tables PMA92/PFA92, projected to calendar year 2040, with a one year age deduction. WRUSEPS has a number of purchased annuities in respect of past retirements. These are understood to match fully the associated liabilities and so have been excluded from both the assets and liabilities. In addition, WRUSEPS has additional voluntary contributions invested; these are also understood to match fully the associated liabilities and so have been excluded from both the assets and liabilities. Expected rate of return % Assets Group pension contract Cash 4.8 4.3 2011 000 1,618 1,618 Expected rate of return % 4.7 4.1 2010 000 1,296 3 1,686
The following amounts at end of period have been measured in accordance with the requirements of FRS 17: 2011 000 Fair market value of assets Actuarial value of liabilities Excess of liabilities over assets Related deferred tax asset Net pension liability The amounts recognised in the financial statements are as follows: Operating profit Current service costs Cost of settlements and curtailments 1,618 (1,618) 2011 000 2010 000 1,299 (1,727) (428) 120 (308) 2010 000 20 262 (242)
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21. Pension costs (continued) 2011 000 Other finance income Expected return on pension scheme assets Interest on pension scheme liabilities Net return 2010 000 86 (89) (3)
2011 000 Statement of total recognised gains and losses Actual return less expected return on pension scheme assets Experience gains arising on the scheme liabilities Changes in assumptions underlying the present value of the scheme liabilities Actuarial gain/(loss) recognised in the consolidated statement of total recognised gains and losses Reconciliation of present value of scheme liabilities 258 322 (152) 428
2010 000 (147) 63 (428) (512)
2011 000 1,727 (109) 1,618 2011 000 1,299 61 258 1,618
2010 000 1,841 20 89 3 (329) (262) 365 1,727 2010 000 1,686 86 3 (329) (147) 1,299
At beginning of the period Movement in period: Current service cost Interest cost Member contributions Benefits paid Settlements and curtailments Actuarial (gain)/loss Present value of scheme liabilities at end of the period Reconciliation of fair value of scheme assets
At beginning of the period Movement in period: Expected return on scheme assets Member contributions Benefits paid Actuarial gain/(loss) Fair value of scheme assets at end of the period
The expected return on scheme assets is determined by considering the expected returns available on the assets underlying the current investment policy. Expected yields on fixed interest investments are based on gross redemption yields as at the balance sheet date. Expected returns on equity investments reflect long-term real rates of return experienced in the respective markets. The actual return on scheme assets in the period was 319,000 (2010: (61,000)).
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21. Pension costs (continued) Movement in liability during the period 2011 000 (428) 428 2010 000 (155) (20) 262 (3) (512) (428)
Liability at beginning of the period Movement in period: Current service cost Settlements and curtailments Other finance (cost)/income Actuarial gain/(loss) Pension scheme liability at end of the period
Amounts for current period and previous four periods 2011 Defined benefit obligation (000) Plan assets (000) (Deficit)/surplus (000) Difference between the expected and actual return on scheme assets: Amount (000) Percentage of scheme assets Experience gains and losses on scheme liabilities: Amount (000) Percentage of the present value of the scheme liabilities Total amount recognised in statement of total recognised gains and losses: Amount (000) Percentage of the present value of the scheme liabilities (1,618) 1,618 2010 (1,727) 1,299 (428) 2009 (1,841) 1,686 (155) 2008 (1,404) 1,815 411 2007 (1,573) 1,855 282
258 16% 322 20%
(147) (11%) 63 4%
(123) (7%) (214) (12%)
(219) (12%) 365 26%
77 4% 15 1%
(152) (9%)
(428) (25%)
(175) (10%)
(26) (2%)
42 3%
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22. Reconciliation of operating profit to net cash inflow from operating activities 2011 000 EBITDA Allocations to affiliated organisations Exceptional items Depreciation Release of deferred income Operating profit Non-cash items: Depreciation Release of deferred income Working capital adjustments: (Increase)/decrease in stock Decrease in debtors Increase/(decrease) in creditors 26,173 (19,281) (4,833) 1,694 3,753 2010 000 27,641 (19,964) (22) (5,239) 1,703 4,119
4,833 (1,694) 3,139 (257) 2,337 135 2,215 9,107
5,239 (1,703) 3,536 51 2,937 (1,041) 1,947 9,602
Net cash inflow from operating activities
23. Reconciliation of net cash flow to movement in net debt 2011 000 Decrease in cash in the period Cash outflow from movement in debt and hire purchase arrangements Non-cash changes Decrease/(increase) in net debt during the period Net debt at the beginning of the period Net debt at the end of the period (618) 6,607 5,989 (79,760) (73,771) 2010 000 (3,170) 1,017 (62) (2,215) (77,545) (79,760)
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24. Analysis of net debt Cash Bank debt due within one year 000 (3,466) (34) (2,594) (6,094) (1,862) 1,869 (3,473) (3,466) Bank debt due after one year 000 (39,670) 6,578 2,594 (30,498) (42,021) (1,060) 3,411 (39,670) Hire purchase arrangements 000 (299) 299 (507) 208 (299) Debentures Total
000 At 30 June 2010 Cashflow Non-cash changes At 30 June 2011 At 31 May 2009 Cashflow Non-cash changes At 30 June 2010 1,000 (618) 382 4,170 (3,170) 1,000
000 (37,325) (236) (37,561) (37,325) (37,325)
000 (79,760) 5,989 (73,771) (77,545) (2,153) (62) (79,760)
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.
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Independent auditors report

to the members of The Welsh Rugby Union Limited
We have audited the group and parent company financial statements (the financial statements) of the Welsh Rugby Union Limited for the year ended 30 June 2011 which comprise the Consolidated Profit and Loss Account, the Group and Parent Company Balance Sheets, the Consolidated Cash Flow Statement, the Consolidated Statement of Total Recognised Gains and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
Respective responsibilities of directors and auditors
Opinion on financial statements
In our opinion the financial statements: give a true and fair view of the state of the groups and the parent companys affairs as at 30 June 2011 and of the groups profit and cash flows for the year then ended; have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and have been prepared in accordance with the requirements of the Companies Act 2006.
As explained more fully in the Directors Responsibilities Statement set out on page 54 the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Boards Ethical Standards for Auditors. This report, including the opinions, has been prepared for and only for the companys members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
Scope of the audit of the financial statements
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Directors Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or the parent company financial statements are not in agreement with the accounting records and returns; or certain disclosures of directors remuneration specified by law are not made; or we have not received all the information and explanations we require for our audit.
An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the groups and parent companys 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 identify material inconsistencies with the audited financial statements. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.
Mark Ellis (Senior Statutory Auditor) For and on behalf of PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors Cardiff 22 September 2011
80
Welsh Rugby Union governance

for the period ended 30 June 2011
Patron and Office Bearers: Patron
Welsh Rugby Group Executive Board Chairman: Executive: Tim Burton Rhodri Lewis Joe Lydon Craig Maxwell Julie Paterson Steve Phillips Gerry Toms John Williams Head of Operations (resigned 15 July 2010) Head of Legal Affairs (appointed 2 August 2010) Head of Rugby Performance & Development Head of Sales and Marketing (appointed 1 November 2010) Head of Compliance Group Finance Director Stadium Manager Head of Communications Roger Lewis (Group Chief Executive)
Her Majesty Queen Elizabeth II Vice Patron His Royal Highness Prince William President Dennis Gethin Governance of Welsh Rugby The principal activity of the Group is to promote, foster, encourage, control and improve the game of rugby throughout Wales. The Board of The Welsh Rugby Union Limited (Board) is responsible for ensuring that the principal activity is managed which it does through the Welsh Rugby Group Executive Board. The Board comprises a non-executive chairman, sixteen non-executive directors and one executive director. The Board of The Welsh Rugby Union Limited Non-executive chairman: David Pickering Executive: Roger Lewis (Group Chief Executive)
Board Committees During the period, the Board operated three principal subcommittees to assist in its business. The role and membership of the sub committees were as follows:
Non-executive members: Kenneth Hewitt (vice non-executive chairman) Mal Beynon Gerald Davies CBE, DL Martin Davies Geraint Edwards Humphrey Evans Gordon Eynon (appointed 3 June 2011) Brian Fowler Stuart Gallacher (resigned 10 October 2010) Roy Giddings (appointed 30 August 2011) Richard Gwynn1 Russell Howell Peredur Jenkins (resigned 30 June 2011) Anthony John2 Alan Jones John Jones (resigned 3 June 2011) Aurwel Morgan Steve Pike2 (appointed 1 September 2011) Ray Wilton Company secretary Gareth Williams
Brian Fowler assists Australia Team
1 A number of Clubs were admitted to membership of the Company during the year. As a result of the increased membership, as stipulated by Companys Articles of Association, the number of Clubs now comprising District E gives rise to the need for an additional director in that District. 2 At 30 June 2010, District G was without a representative non-executive Board member due to the resignation of Anthony John. Steve Pike was appointed as sucessor to Anthony John on 1 September 2011.
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for the period ended 30 June 2011 (continued)
Joe Lydon and Ken Hewitt at an away day discussion
Gareth Edwards, Gerald Davies and Roger Lewis at the launch of the Star for Richard Burton
The Finance Committee, chaired by Martin Davies comprised David Pickering, Kenneth Hewitt, Roger Lewis, Humphrey Evans, John Jones, and Steve Phillips. Gordon Eynon replaced John Jones following his resignation on 3 June 2011. The Finance Committee is responsible for all financial matters of the Group other than dealing with the Groups auditors The Regulatory Committee, chaired by Mal Beynon, included Russell Howell, Geraint Edwards, Brian Fowler, Ray Wilton and Aurwel Morgan. It is responsible for disciplinary matters and the management of all the leagues and cup competitions in operation. The Game Policy Committee, chaired by Alan Jones, included Roy Giddings, Stuart Gallagher, Gerald Davies, Joe Lydon, Peredur Jenkins and Anthony John. Anthony John and Stuart Gallagher tendered their resignations as directors, and with it membership of the Game Policy Committee, on 30 June 2011 and 10 October 2010 respectively. A successor to Anthony John will be appointed in due course. Non-Board members of the Game Policy Committee included Mike Rein (who replaced David Matthews who resigned during the period), Ian Parker, Sophie Bennett, Martyn Ryan and Jason Lewis. The Game Policy Committee is responsible for the development of the game at all levels, including age groups, coaching and referees.
Development of Corporate Governance Both the Board and the Executive Board remain committed to the continuing development of governance structures, in order to meet the evolving needs of the game of rugby union. The Board and Executive Board acknowledge the value of the principles of good governance as set out in the combined code. The Group are committed to adopting the principles of best practice in corporate governance. Where applicable, all Board members have undergone training in the role of the non-executive director, delivered by the Institute of Directors. The Group are committed to further training and development of the Board. Board and Executive Board There is a clear division of responsibility between the role of non-executive Chairman and Group Chief Executive. There is a detailed limit of authority protocol in place for both the Board and the Executive Board. All Executive Board members have detailed job descriptions in addition to limits of authority. The Board meets on a monthly basis and considers all matters under its terms of reference which include the development and monitoring of the Groups strategic plan, allocation of financial resources, reviewing the
82
WRU Board members Alan Jones, Peredur Jenkins, Ray Wilton and Russell Howell
performance of the Group Chief Executive and Executive Board and approval of annual budgets. In addition, the Board considers the recommendation of the Boards standing committees, whose responsibilities relate to Finance, Regulatory and Game Policy as shown above. Appointments and Remuneration Panel The Appointments and Remuneration Panel advises the Board on the remuneration and terms and conditions of the Group Chief Executive and the Executive Board. The Panel consists of the Chairman of the Board, the ViceChairman of the Board and the three heads of standing sub-committees: Finance, Game Policy and Regulatory. Alun Thomas (FCA) served as a non-Board member of the panel during the year but resigned on 4 July 2011. A successor has yet to be appointed. The Audit Panel The Audit Panel, chaired by Martin Davies, included John Jones. David Hammond acted as a non-Board member.
Following John Jones resignation on 3 June 2011, Martyn Ryan was appointed as a further non-Board member. The Audit Panel is responsible for assisting the Board discharge its responsibilities for accounting policies, financial reporting, internal control, risk management and liaising with the Groups auditors. The Group is aware of David Hammonds intention to step down from the Panel and a replacement is currently being sought. Remuneration and benefits of the Board Under the Groups remuneration policy, no fees are payable to non-executive Board members, other than the non-executive chairman who receives an annual fee of 35,000. In addition, the Board are represented on other rugby bodies including The International Rugby Board (IRB), Six Nations Rugby Limited, European Rugby Cup Limited, Celtic Rugby Limited and British and Irish Lions Limited, all of whom have a policy of financially compensating the representatives serving on these bodies.
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for the period ended 30 June 2011 (continued)
WRU staff workshop
The Board of Millennium Stadium plc Non-executive chairman: David Pickering Executive: Roger Lewis (Group Chief Executive)
Registered office and advisers Registered office Millennium Stadium Westgate Street Cardiff CF10 1NS Independent auditors PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors One Kingsway Cardiff CF10 3PW Principal solicitors Hugh James Hodge House 114 - 116 St. Mary Street Cardiff CF10 1DY Bankers Barclays Bank PLC 3rd Floor Windsor Court 3 Windsor Place Cardiff CF10 3ZL The Welsh Rugby Union Limited & Millennium Stadium plc Millennium Stadium, Westgate Street, Cardiff CF10 1NS Tel: + 44 (0)870 013 8600 Email: info@wru.co.uk www.wru.co.uk www.millenniumstadium.com
Non-executive members: Councillor Nigel Howells (vice non-executive chairman) Mal Beynon David Collins Martin Davies Geraint Edwards Ken Hewitt Jonathan House (appointed 30 December 2010) Tom Morgan (resigned 30 December 2010) Joanne Stanford Roy Thomas Company Secretary Steve Phillips
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Commercial partners
TITLE SPONSORS
BROADCAST PARTNERS
PRINCIPAL PARTNERS
COMMUNITY PARTNERS
SPONSORS/SUPPLIERS
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WRU Annual Report 2011

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Contents

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

P&L extract - 2011 & 2010

30.9 28.0 19.3 20.0 26.2 27.6

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

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

30 23.6 21.1 20 2007 2008 2009 EBITDA Turnover 24.5

2008 Allocations - Regions

2009 Allocations - all

12.1 12 11.0 11.4

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Dennis Gethin Llywydd Undeb Rygbi Cymru Cyfyngedig

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Dennis Gethin presents George North with his first cap

Dennis Gethin President The Welsh Rugby Union Limited

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

David Pickering Chairman The Welsh Rugby Union Limited

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Group Chief Executives summary

Coaching Mini Rugby

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Group Chief Executives summary

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Group Chief Executives summary

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Gwernyfed Minis get stuck in to training

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Operating and financial review

Wales v Barbarians - DHL Challenge

Autumn series Six Nations June Test

223 144 29 396

255 216 60 531

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Youth training session

Allocations to affiliates - Regions (Professional) - Clubs (Semi - professional) - Community rugby

15.0 1.2 3.1 19.3 25.2

14.2 1.3 4.5 20.0 25.9

32.2 (25.2) 7.0 3.1 1.0 0.2 0.7 2.0 7.0

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Operating and financial review

The camaraderie of Welsh rugby

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

2011 m 24.6 0.2 1.4 26.2

2010 m 25.8 0.1 1.7 27.6

2.7 (0.8) 1.9

(0.8) 0.1 (0.7)

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Operating and financial review

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Shane Williams; from Amman United to Wales

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Operating and financial review

George North scores a try against the Barbarians

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Sam Warburton is named as Wales Captain for the first time

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Operating and financial review

Matthew Rees interviewed at open training session

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

THE WELSH RUGBY UNION LIMITED - ANNUAL REPORT 2011

Operating and financial review