Article Taxonomy: Football Finance

Articles and reports on financial issues within football – soccer – from The Political Economy of Football.

Cup can be a distraction or a lifeline

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For football clubs the FA Cup can be an unwelcome distraction or a lifeline. Wigan’s FA Cup success last year was worth £4m to the club in prize money and gate receipts – before bonus payments are taken into account. The subsequent Europa League run brought in a further £2 million.

Avoiding relegation last season would have been worth at least £63m if Wigan had finished bottom of the Barclays Premier League. But then they might have got relegated anyway if they had not won the cup and they have something to remember.

Cup is a distraction says Villa boss

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Aston Villa manager Paul Lambert believes the majority of top-flight clubs would rather not have the distraction of the FA Cup.

Lambert was asked whether the FA Cup was something Premier League clubs could do without. ‘I think if you asked the majority of them, if they were being honest, they probably would do,’ he told BBC WM. ‘Not just because of the money but survival in the league is vital.’

Charlton become first Belgian owned club

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Charlton Athletic have become the first Belgian owned club in English football with reports that that the takeover by Walloon millionaire Roland Duchatelet has been completed. With no news for some days, Addicks fans had been concerned that the deal had fallen through, but reports of another bidder may have concentrated minds.

However, the price is understood to be £20m not the £14m originally reported. Duchatelet, who made his money in microelectronics, already owns Standard Liege as well as clubs in Germany and Hungary.

Wigan record small profit

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Some of the other financial results released on New Year’s Eve contained bad news, so Wigan Athletic can congratulate themselves on recording a small profit which is an achievement for any football club, even if it was down on last year.

Financial results for the year ending 31 May 2013 show the Championship side made a net profit of £822,000 compared with £4.3m net profit in 2012. The figures cover the season 2012-13 when Latics won the FA Cup for the first time in its history but were relegated from the Premier League in the same week.

Bolton Wanderers have debts of £163m

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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.

Chelsea lose just under £50m

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Quite why Chelsea have chosen to release their financial results on New Year’s Eve is an interesting question, particularly as they feel they tell a good story.

The club made a loss of just under £50m, compared with a small profit of £1.4m last year. Last year’s small profit was influenced by special factors including player sales and the ending of a joint digital venture with Sky with led to a one off payment.

The cost of the Conference

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Hyde FC lost their 21st match of the season yesterday, 2-5 at home to Wrexham. They have not won a single match and drawn just three. Under 1,000 people saw them lose yesterday, whereas there were over 8,000 at Luton.

Luton and benefactor club Forest Green have budgets of £2m a year and can afford to pay their players £800 a week. Hyde have to manage on a budget around a tenth of that.

The team beneath the team

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This was a concept that West Ham United vice-chairman Karren Brady talked about last night on Jeff Randall’s ‘Christmas dinner’ special on Sky TV. She said that one of West Ham United’s challenges was that it lacked the resources to fund the team beneath the team. She also admitted that not being able to score goals was a problem, as was evident in the failure to take chances in the Boxing Day game against Arsenal.

Charlton to become Belgian owned club?

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It is being reported by Belgian Television that Charlton Athletic are to be acquired by the owner of Standard Liege, Roland Duchatelet, who made his fortune in microelectronics. He was estimated to be worth €500m in 2011. He acquired Standard Liege for £35m in 2011, but was initially controversial with fans, although they now top the Belgian Pro League.

Spending and performance

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It is well known that there is a positive relationship between how much a club spends on wages and its performance in terms of points secured.   However, it seems that a few extra million spent at the bottom has a greater effect than additional spending at the top.

The three clubs (in order) currently over performing in terms of the amount spent are Everton, Southampton and Newcastle United.   The under performers are Sunderland, Manchester United and West Ham.