The Otago Rugby Football Union has achieved a million dollar turnaround, with chief executive Richard Reid calling it a "fantastic achievement", but warning there is plenty of hard work ahead.
The union reported a loss for last year of $467,724, including depreciation, but taking out depreciation of $652,504, has recorded an operating profit of $184,780.
The loss in 2007 was $1.5 million.
The turnaround came from both a cut in expenses and an increase in revenue.
Reid said expenses were down by $475,000 while income was up by $555,000.
Hosting a sold-out Springboks-All Blacks test helped the union by about $400,000 while Reid said there were also increases in sponsorship, ground rentals and match tickets.
Player expenses were cut in the vicinity of $250,000, administration costs had decreased by $200,000, and ground operating costs had decreased by about $30,000.
The union shed 11 player contracts last year, and Reid said it would continue to have 26 player contracts, the minimum allowed for a union in the Air New Zealand Cup.
"While it is really good to get through 2008, it does not hide the issues that we face over the next while. The union is not immune to the global financial crisis and it is carrying an expense line, particularly the interest payable on borrowings, which is problematic in the medium to long term."
Interest on borrowings was costing $531,757 annually.
"We need to make prudent and correct decisions year on year. You can't keep clocking up millon dollar losses or you won't survive."
The union owed $2 million to the Dunedin City Council and $4 million to the Bank of New Zealand.
The Carisbrook Stadium Trust announced last week the union had agreed to sell Carisbrook to the Dunedin City Council, subject to agreement.
The price was confidential but selling the ground and repaying the loans will be a huge benefit for the union.
Reid said no discussions had taken place on what would happen to the ground if the new stadium proposal did not go ahead.
