Bolton Wanderers released some bad news on New Year’s Eve by revealing the full cost of relegation from the Premier League with the figures showing that the club now stands £163.8m in debt following a record loss of £50.7m during the financial year ending June 2013.
Bolton Wanderers released some bad news on New Year’s Eve by revealing the full cost of relegation from the Premier League with the figures showing that the club now stands £163.8m in debt following a record loss of £50.7m during the financial year ending June 2013.
After eleven consecutive seasons in the top flight, the figures bring home the financial penalties associated with relegation after just one season in the Championship. Clubs are desperate to get into the Premier League and even more desperate to stay there. Bolton, of course, were relegated before the enhanced television payments kicked in.
Only Chelsea – who announced a yearly loss of £49.4m to take them back into the red after making a small profit the previous year – Manchester United and Fulham have a greater debt than Bolton, yet the north-west club is the only one of these outside the Premier League.
The large loss in a single year means Wanderers have the unwanted distinction of becoming the fifth club to have lost more than £50m over 12 months. Yet as Manchester City, who have done it four times, Chelsea (seven), Liverpool and Aston Villa (once each) all boast far greater financing and revenue streams than Bolton, their ability to soak up such astronomical losses will be questioned.
A £2.3m outlay on compensation for former manager Owen Coyle and his staff following their dismissal in October 2012, and subsequent fees involved in securing the services of Crystal Palace manager Dougie Freedman, proved to be dwarfed by millions lost due to falls in commercial revenue.
Despite still receiving a £16m parachute payment from the Premier League, Bolton’s turnover between June 2012 and 2013 dropped from £58.5m to £28.5m, although staff costs fell from £55.3m to £37.4m.
Sponsorship revenue dropped from £4.3m to £1.4m, while a 28 per cent decline in attendances at the Reebok Stadium resulted in gate receipts amounting to £3.8m — £1.9m less than in the club’s relegation season.
There were player trading losses of £20m which reflected the need to offload players that were no longer required. In some cases, this would have involved compensation agreements.
With £151m of the debt owed to Moonshift Investment Ltd – the company headed by club benefactor Eddie Davies – Bolton chairman Phil Gartside concedes that the club’s owes its ability to operate to the Isle of Man-based businessman. Under the new Football League financial regulations benefactors will be constrained in the support that they can offer.
However, the club claims to have a five year plan to restore financial balance that does not rely on a return to the Barclays Premier League.