Golfer Rory McIlroy saw earnings from royalties and management fees almost treble last year to $17.4 million (€18m), according to figures for the business that manages them.
However, an accountancy writedown of $18.1 million in the star golfer’s image rights saw Dublin-based Rory McIlroy Management Services Ltd record a loss of $6.29 million before tax. The company had a $261 million book value placed on McIlroy’s image rights at the start of the year. That was reduced to $243 million at the end of last year.
The main activity of the company is managing royalty earnings and management fees for the golfer.
Prize money and other such earnings are not part of the Irish company’s revenue because they tend to be treated as income and taxed accordingly by the country where the earnings are won.
The golfer won $4.4 million on the US tour in 2018. He has already nearly doubled that figure this year to $7.78 million.
McIlroy works in many countries, but opted to locate everything to do with his brand and intellectual property in Ireland by setting up the firm here as part of a strategy to simplify his business affairs.
In setting up the firm in the Republic McIlroy spurned the route often taken by superstar sports personalities by creating a complex structure that would have located his management company in the US while protecting his wealth with tax havens such as the Virgin Islands or Bermuda.
The earnings for the McIlroy company from royalties and management fees last year increased by $11.34 million or 180 per cent from $6.29 million to $17.64 million.
The company trading as Rory McIlroy Inc was established towards the end of 2013 by McIlroy. His father, Gerry, sits on the board with MD Donal Casey and Sean O’Flaherty. Rory McIlroy joined the board in January of this year.
Operating loss
The accounts disclose that the cash generated by the company from operating activities after tax totalled $12.9 million for 2018.
The company recorded an operating loss of $4.3 million. Interest payments of $1.9 million pushed that out to a $6.29 million loss. After paying corporation tax of $1.146 million, the loss for the year was $7.4 million
The directors of the company state that “income levels were in line with expectations”.
Last year the pay to directors almost doubled from $1.056 million to $1.993 million. At the end of last year the firm employed six, made up of three directors and three in administration. Staff costs last year increased from $1.78 million to $2.77 million
The company’s cash pile increased from $829,219 to $2.14 million.
