The author of the Swiss Ramble blog has turned his attention to Burnley whose latest accounts were released recently. They relate to last season in the Premiership where the Clarets seem very likely to return.
The author of the Swiss Ramble blog has turned his attention to Burnley whose latest accounts were released recently. They relate to last season in the Premiership where the Clarets seem very likely to return.
If they do, they will presumably once again follow a prudent financial strategy, seeking to punch above their weight which is more than possible given the talents of manager Sean Dyche. However, it is a risky strategy. The three teams relegated in 2014/15 had the lowest revenues.
The new television deal should make a difference, but the club is constrained by the relatively small population in its catchment area. It is not a brand that attracts big commercial revenues. They were up 63 per cent at £6.2m, but that is dwarfed by Manchester United at £197m. A more relevant comparison are clubs like Swansea City and West Bromwich Albion who bring in £10m-£12m.
Reading through the usual forensic analysis of the Swiss Ramble blog, one is struck by the number of times the words ‘smallest’ and ‘lowest’ occur. For example, revenue was up from £19.6m to £78.8m, but that was the lowest in the Premier League. The increase was largely down to broadcast income which went up from £11.9m to £66.6m.
The wage bill at £29.4m was the lowest in the Premier League and at 37 per cent of turnover was well below the recommended 50 per cent level. Burnley rely a lot on performance related bonuses, which is shrewd enough, but could mean that they make a loss if they go up this year.
Debt is just £0.6m and very little of their profit comes from player sales. It is also interesting to note that they received £43m in parachute payments between 2011 and 2014, payments which are increasing and mean that there is not a level playing field in the Championship.
Assuming that Burnley do go up, it remains to be seen whether they are a yo yo team. That would be frustrating for fans, but financially it is sustainable. Perhaps, however, they should be a little more ambitious in their spending if they are promoted.
A Burnley fan commented, ‘Much credit goes to Barry Kilby, our former chairman, for his strategic vision which involves prioritising survival over glory. But he was able to succeed in this over gung-ho opposition because of two events which changed the fan culture.’
‘The first was the near-extinction in 1987 which created a realisation that long term survival was an issue. The second was the democratisation of shareholding to a bunch of grizzled old fans (including myself) which meant the board had to account for the state of the club in public to long-established fans.’