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Bluebirds report big losses

Cardiff City (Holdings) Limited filed their annual accounts on line at Companies House yesterday where they can be read free of charge. They run to 34 pages and you probably need an accountancy qualification to make full sense of them, but I will try and pick out some highlights.

Like all clubs seeking to access the promised land of the Premier League, Cardiff City reported big losses but they are backed by their owner Vincent Tan. Loans from overseas shareholders (principally Vincent Tan) amounted to £115m. It is stated, 'the Group has the support of the controlling shareholder and consequently, liquidity risk is no longer a significant factor for the Group.'

The operating loss for the year ended 31 May 2017 was £18.35m. To put it another way, the club was losing over £400,000 a week. Revenue was down from £33.2m to £28.7m as a result of the reduction in parachute payments which are such a key element for many Championship clubs. Accumulated losses to 2017 were £139m.

It is admitted that 'the Group has significant net liabilities, the principal indebtedness at the year end was to the controlling shareholder who during the year, converted £8m of the interest bearing shareholder loan due by the Group into equity.'

All staff costs including social security amounted to £29m, slightly over 100 per cent of revenue.

72 per cent of revenue came from central distributions, including parachute payments. Sponsorships raised 16 per cent. 12 per cent came from gate receipts and match day income. Attendances increased marginally from 16,427 to16,554.

Tormen Finance Ltd., a company in which a director of Cardiff City Football Club (Holdings) Limited has significant influence over, advanced £6m to the company at an interest rate of 8 per cent.

Achieving promotion to the Premier League is crucial for the club.

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