Higher costs have impacted substantially on the year end accounts for the Royal Highland and Agricultural Society of Scotland, which runs a whole host of events and, of course, the Royal Highland Show.

Members heard at its agm this week that its loss for the year totalled £1.2m, on the back of an £0.8m loss in 2021 which, of course, was impacted greatly by the tail end of Covid restrictions.

The challenging economic climate, though, did not deter an income recovery to £11m, which was a rise of £2.8m over 2021, but spiralling costs had eaten into that revenue, said the society. Within that, membership revenues increased to £0.6m and sponsorship contributed £0.7m – with a late flush of life memberships purchased prior to a rise in fees for this year.

However, taking into account deficits for depreciation and loan interest, the background figure showed an operating profit of £0.1m, £400,000 less than in 2021. A movement in funds to £16.9m – £2.5m less that in 2021 – reflected in the headline deficit and a negative revaluation of a RHASS investment property by £1.4m.

This revaluation coincided with the UK Government’s mini budget and its associated short-term shocks to the investment market. All its property, which includes the Moxy Hotel, is held for investment and its value is anticipated to rise back to previous levels.

Long-term loan repayments resumed in mid-2021, resulting in a reduction of £600,000 in debt to £8.7m – despite interest-paid increasing from £143k to £299k in the year.

RHASS chairman, Jim Warnock, met the challenges head on at a press conference this week: “The directors knew that this was going to be a difficult year as we returned to normal after Covid-19. However, we are confident that the society’s financial outlook is positive and in line with expectations, with plans to bring it back to a positive financial footing.

“We would like pay tribute to our members who have remained steadfast in their support throughout the difficult times – it is very much appreciated.”

However, Mr Warnock remained realistic for trading in the next 12 months. “While we are confident that the appeal of the show will remain and the Royal Highland Centre is on track to continue its upward trajectory, the impact of reduced household income and the increased cost of doing business remains very real. Under our directors’ careful stewardship, I am confident that RHASS will continue to be a financially secure organisation supporting rural Scotland.”

Highland Centre, RHASS’s wholly-owned trading company which generates income to support RHASS’s charitable remit, returned a higher-than-budgeted profit due to an increased number of high-profile live events, coupled with non-event business, including Royal Mail and the NHS vaccination use.

It also should not be forgotten that RHASS has a considerable charitable presence across the industry in Scotland. Total grants awarded totalled £227,664 – slightly less than in 2021 – with more than £167,000 in prize money additionally awarded to Royal Highland Show competitors. Mr Warnock also revealed that entry fees had not changed this year, despite increased costs in staging the show and also that prize money had been increased by 25% – which, he said, reflected the increased costs that producers were also experiencing

The wider economic impact of the Royal Highland Show was also unveiled in 2022. An independent report detailing the event’s contribution to Edinburgh’s economy, was calculated at £39.5m annually – more than Edinburgh’s Hogmanay event.

RHASS chief executive, Alan Laidlaw, added: “The return to normal post-Covid has been taxing due to the challenging economic climate, including a significant escalation in costs to deliver the Royal Highland Show and operational increases on the day-to-day running of RHASS, along with much-reduced availability of financial support, which was available through the pandemic.

“We are, however, heartened by a significant increase in revenue generated by the Royal Highland Centre, which is set to continue into next year. We were pleased to host a full Royal Highland Show in 2022 despite the ever-changing Covid-19 landscape, with sold-out days on Friday and Saturday reflecting the continued appeal of the event.

“This year will again see the return of a full Royal Highland Show with the exciting addition of the Golden Shears world sheep shearing and woolhandling championships and are welcoming significant demand for our event facilities through this year and beyond.”