Skip to main content

Posts

Bleak prospects at Derby

No football fan can be happy with what has happened at Derby County, but it is a blatant case of financial mismanagement.   Championship clubs too often overspend in the hope of trying to reach the Premier League, but Derby have also tried to bend the rules. The Athletic  has been speaking to people with knowledge of the club’s financial position and they have not been very upbeat. “It’s 50/50 they get liquidated,” said one source, while another said: “I can’t see how they get out of this — they’re ****ed.”  The picture they painted in such depressing tones was one of a club that is worth less than nothing. Much less.  They said any prospective buyer would need to shell out more than £50 million simply clearing Derby’s debts before spending a penny on rebuilding the club and putting a competitive team on the park. This is because the club has football creditors, who must be paid up to £10 million in full, as well as secured debt of £20 million owed to an American private equity f
Recent posts

United lose over £200m from Covid

The authoritative Swiss Ramble reviews the latest annual accounts of Manchester United, once again deploying his in depth knowledge and forensic analytical skills. The pre-tax loss was up from £21m to £24m, as revenue dropped £15m (3%) from £509m to £494m and profit on player sales fell £11m to £7m, while expenses rose £16m (3%). Operational decline offset by interest swinging £39m from £26m payable to £13m recoverable thanks to forex gains. Net loss after tax rose £69m from 23m to £92m, due to April 2023 increase in corporation tax from 19% to 25%, which meant that United wrote down the value of a US deferred tax asset, as it is no longer expected to give rise to a future economic benefit. This is a non-cash impact. The main reason that revenue only fell 3% was £115m (82%) increase in broadcasting to £255m, mainly due to return to Champions League, which compensated for COVID driven reductions in match day, down £83m (92%) to £7m, and commercial, down £47m (17%) to £232m. As a s

'Robust business model' at Celtic

Celtic have published an abbreviated set of financial data for 2020/21, reports Kieran Maguire. Income held up well due to record sales of merchandise and somehow generating £20m from the stadium operations during lockdown. Day to day losses just under £25m but reduced by £5m ‘other income’ and player sales. Celtic balance sheet strong with £19m cash in bank mainly from season ticket sales receipts for 2021/22. The full statements is here, referring to the club's 'robust business model':  https://www.celticfc.com/news/2021/september/Celtic-plc-annual-results-2021/

Wycombe watching developments at Derby

Wycombe Wanderers owner Rob Couhig is monitoring the fall-out from Derby County’s decision to enter administration and has told  The Athletic  his side lost £10 million through their relegation to League One last season — when Derby stayed up on the final day by a point. Couhig says there could be as much as another £10 million of “residual loss”. He and Wycombe are assessing their next move. “There is no doubt in my mind, and everybody knows, that Derby should have been penalised last season, that we should be playing in the Championship now and that this has cost the club upwards of £10 million that we can immediately show,” Couhig says. “There is then a residual loss that’s probably another £10 million. “It’s a lot to digest, but for a club like Wycombe that had never played in the Championship in 133 years of existence, to be there and stay for a second year would be transformative. It changes the whole basis of things, with sponsors and the like.” The EFL published interch

United losses increase

Manchester United's losses have widened after the pandemic kept fans out of stadiums and prevented the team from taking part in lucrative pre-season tours. In the full year to 30th June, revenues were down by 3 per cent to £491m.  The club blamed the loss of ticket income, the closure of its megastore hitting merchandise sales and a fall in sponsorship income because the team was unable to go on a summer tour of exhibition matches. There was a net loss of £93.2m, up from £23.2m, although this was blamed mainly on accounting charges related to an increase in the UK corporate tax rate.  The club said that its operating loss of £36.8m, compared with a profit of £5.2m the year before, was a better reflection of the impact of the pandemic on the business. However, it appears to have weathered the crisis better than many other top European clubs, with an increasing in broadcasting income partly because of the team's return to the Champions League.  Net debt fell by 11 per cent to £41

Derby County to enter administration

Derby County are to enter administration and face a 12 point deduction as a consequence:  https://www.bbc.co.uk/sport/football/58604851 The club blames the effects of Covid-19, but that has affected all clubs and as the local BBC correspondent suggests there has been financial mismanagement at the club,