Article Taxonomy: Financial Results

Articles on football club company financial results – interim or full-year.

Tough finances in the Championship

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With all the clubs in the Championship in 2015/16 having now published their accounts (except Bolton Wanderers), the author of the authoritative Swiss Ramble blog has now come up with some fascinating statistics.  

Of course, it is well known that Championship clubs like to splash the cash in an effort to reach the Premier League.   However, these figures show how difficult it is to avoid a loss in the Championship and how much parachute payments distort the financial picture.   One wonders if their level stops clubs reining in wages as much as they should.

Big losses at Charlton

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Charlton Athletic have reported a loss of £13.5m for the 2015-16 season, up by £9.5m from the previous twelve months.   These ‘unsustainable’ losses are attributed to efforts to maintain the club’s Championship status in what turned out to be a rather expensive relegation.

Spurs get stadium funding

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Tottenham Hotspur’s stadium redevelopment is a significant step closer after the club agreed a £350 million funding package with three investment banks.

HSBC, Goldman Sachs and Merrill Lynch will provide almost half of the money required to complete the £750 million rebuilding of White Hart Lane. The rest of the funding will come from advanced ticket sales, a ten-year ground rental arrangement with the NFL and a possible naming-rights deal.

Big losses at Boro

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Middlesbrough’s push for promotion to the Premier League led to big losses in the year to 30 June 2016. The club lost £31.9m compared with £9m in the previous year.  Wages went up from £18.1m to £28.6m, well above 100 per cent of income when the recommended level is 50 per cent.

Big loss at Liverpool

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Liverpool recorded a loss of £19.8m in the year to May 2016.  Investment in players was the main reason for the loss, along with the cost of compensating Brendan Rodgers and his staff.   Costs for the Main Stand extension also contributed to the loss.

The club’s revenue increased by £3.9m to a record £301.8m.   Match day revenue was up £3.4m to £62m. Commercial revenue was down £700,000 to £115.7m.   This was partly because of a lack of non-matchday access to the Main Stand.

£44m of debt at Coventry City

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Coventry City made a profit of £700,000 in the year to May 2016, but there was an operational loss of £1.75m before player trading was taken into account.   Turnover was up from £4.76m to £5.44m.

The club has debts of £44m, almost of which is owed to owners Sisu or companies controlled by them. The club is only a going concern if that debt is not called in, but the owners have no plans to do so.

Profits up at Arsenal

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Despite a record £110.5m spend on players, Arsenal reported profits of £12.6m in the six months to 30 November 2016 compared with a £6.2m loss in the corresponding period last year.  Once again Arsene Wenger shows that he is following a successful commercial formula.

Turnover was up substantially from £158m to £191.1m year on year.  45 per cent of revenue came from broadcasting, boosted by a bigger share of the Uefa pool.   This was even more valuable given the fall of the pound as it is paid in euros.

‘A merchandising company that happens to play football’

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As Manchester United report a good set of quarterly results, it is worth recalling the description of them in the Lex column of the Financial Times last month: ‘a merchandising company that happens to play football.’