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Championship club finances

For anyone who likes to pore over club finances, this Swiss Ramble blog swissramble.blogspot.co.uk/2015/05/middlesbrough-take-me-to-river.html, dated Tue 19 May 2015, goes into a detailed comparison of Championship clubs, based on 2013-14. It concentrates on Middlesbrough, but there's stuff about CAFC's place in the league tables of turnover, debt, matchday revenue, etc.

Says CAFC were 9th in terms of net total debt (looks like about £40-45 mill in the bar chart) - worse than Bournemouth, Leeds, Wigan, Watford, Derby, Leicester, etc.

There's a link to another piece on the same day about how well Palace are doing.

Comments

  • Amazing blogger to set up these figures for us fans. Our figures look scary to me but we re better than several others.
  • So 5 out of the top 6 clubs, in terms of profit/minimal losses in 2013/14 have been relegated.
    Yeovil, Doncaster, Barnsley, Blackpool & Wigan.

    The only anomoly is Watford surviving instead of Millwall.

    You see, this is what worries me. If our aim is to break even the most likely outcome is relegation.
  • We did relatively well in terms of matchday income (before the new catering, etc), but our commercial revenue was pathetic. Our player salaries were reasonable in themselves and not as mad as a %age of turnover as some clubs. Millwall show up as spending unsustainably on wages.

    Agree that it's an incredible piece of research, even if there may be the odd typo or transcription error in the data.

    Interesting that Gibson converted £50 mill in debt to equity a few years back, a move similar to Fernandez at QPR recently, but it seems to have been in anticipation of FFP, not a trick to evade it. But I think that shows that you can get some weird looking financial changes from year to year.
  • A tremendous piece of work by Swiss ramble and thanks for posting.

    At £2 million, our commercial income is particularly poor and the Club are trying to do something about that. Leaving aside the fixed income from broadcasting and solidarity payments, the third area of gate receipts really depends upon our performance on the field and it always takes some time to get the numbers up anyway.

    The differences in turnover and wage bills between Championship clubs do emphasise the magnitude of the task facing us.
  • Amazing blogger to set up these figures for us fans. Our figures look scary to me but we re better than several others.

    Yes, it's an amazing piece of work and the basis of an informed discussion.

    The first thing I notice is how the majority of clubs have losses of 6-10m. This because FFP kicked in with loss limits of £8m plus academy and stadium costs. Forget QPR because their owners gifted £50m in an attempt to sidestep fines. And Boro losses were much lower on a 12 month basis - they weren't penalised under FFP because they cut costs when their parachute monies ran out.

    Unfortunately clubs voted to double loss limits last November which means it's inevitable typical losses will go up. Obviously not everyone will win promotion to the FAPL so that means more and more clubs debts will spiral - approaching and surpassing £100m! Before long certain clubs may go bust.

    I've not had a chance to look at the detail but for the season before I noticed that there's a strong link between total costs and league position. Not revenue nor debt but costs. Obviously if you build up costs without revenue you need to get promoted or have very deep pockets.

    Put another way clubs like Blackpool didn't spend very much and we know how that ended.

    I can see why people make the link between break even and relegation but I would suggest that it depends upon how you aim to break even. If you cut costs dramatically then thats a recipe for a bottom six struggle - just cast your mind back to 2013-14.

    But if you maintain budgets and increase revenue, especially player sales then one can reduce losses. Growth and development then depends upon recruitment of more players and the calibre of academy graduates - and that's the bit which we are about to see unfold over the next three months.
  • So, SR, if we keep costs under control but buy and develop better than any other club in our division has shown is possible in the last few years, and continue to do this consistently for the long term, we can break even at this level.
  • So, SR, if we keep costs under control but buy and develop better than any other club in our division has shown is possible in the last few years, and continue to do this consistently for the long term, we can break even at this level.

    In short, if Gomez is sold for the rumoured £8m bid then the end result for 2014-15 is a break-even finish on the financials, a mid-table finish and a net improvement in the squad over May 2014

    The impossible made possible in just 17 months!


    I think it's safe to say that we have bought and developed in the last 12 months to a much higher standard than our recent past although I'm not sure anyone said anything about being the best in the division?

    Personally I don't think it's unreasonable nor arrogant to say we've been improved at a faster rate than most Championship clubs these last 12 months. For sure Brentford, Ipswich, Watford and Bournemouth improved a hell of a lot last season. That's four and people might find another three... but that leaves us improving at a faster rate than 16 clubs or 2/3 of the division. We've certainly left the bottom six clubs a long way behind.

    The trick is to repeat that this summer. And the reason for doing that is the £160M of FAPL/parachute monies guaranteed for securing promotion. Many now believe we have the foundations of a decent challenging squad next season if the right five or six players are acquired this summer.

    I would maintain that it's a reasonable proposition that we can repeat the recruitment of last summer so as to complete the biggest squad rebuild since 2011. If the board can't do that (for whatever reason) then you have to wonder club whether there is any ambition.
  • We did relatively well in terms of matchday income (before the new catering, etc), but our commercial revenue was pathetic. .

    Why should this be so bad? If I was Roland I would asking Katrien for a plan to increase this significantly. May need some investment
  • redman said:

    We did relatively well in terms of matchday income (before the new catering, etc), but our commercial revenue was pathetic. .

    Why should this be so bad? If I was Roland I would asking Katrien for a plan to increase this significantly. May need some investment
    I think it is fairly clear that, in some cases, clubs have used commercial revenue (defined in the blog as "sponsorship and commercial income ... and merchandising") as a way of channelling in money from their owners, to avoid FFP penalties, but I don't think you can get away from the conclusion that our brand has lost its mojo, as Championship clubs go. I doubt that we did a lot better in the season just gone, but it clearly isn't an easy task to change things around.
  • I don't doubt that we generate less commercial income than some clubs but the outsourcing of the club shop means, IIRC, that that income is shown elsewhere on the balance sheet. The same will be true of the catering income. So we may not be comparing like with like.

    But KM and David Jones did say at the VIP meeting that increasing the commercial income significantly would be a major factor in breaking even.

    To that end the shop will come back in - house at the end of next season.

    Which begs the question of why outsource the catering? I suspect that was a short term attempt to "sweat that asset" without considering the long term impact on flexibility or quality control.

    With the very recently appointed commercial manager having left, we don't know why, we have to wait and see what happens next on that front.

    But regardless our income is lower than most clubs. The 13m FFP limit will mean that those clubs with owners willing to spend up to 13m over and above their income will have a huge advantage over CAFC. Their spending will increase while ours will drop.

    The easiest way to raise income, and our traditional method, is to sell players. It will happen as it always has but we all know the dangers. Don't assume that money from selling the likes Gomez or JBG will all be spent on strengthening the squad or that the people who bought Le Point and Polish Pete will spend any money they are given wisely
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Roland Out!