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Boro made a profit in the top flight

The authoritative Swiss Ramble has looked at Middlesbrough's 2016/17 accounts, covering their year in the Premiership. Next season is the last season in which they will receive parachute payments as they were relegated after one season.

Following promotion to Premier League Boro converted a pre-tax of £32.0m loss to £6.9m profit, as revenue increased by £100m to a record £121m and profit on player sales was up £7m to £11m.

The club had the third lowest revenue (£121m) in the Premier League, so from that perspective relegation should not have been a great surprise. They did actually have the highest revenue of the three promoted clubs, ahead of Burnley £121m and Hull City £117m.

2016/17 was first time that Boro had made a profit since 2005, though very nearly broke-even in 2009. Since then, they accumulated £112m of losses in the Championship. They really “went for it” in 2015/16, resulting in a record £32m loss.

TV revenue will fall significantly in 17/18 from £99m to an estimated £45m, despite a £41m parachute payment. However, this was significantly higher than the £8m that most Championship clubs averaged.

Even though a striking 84% of revenue came from TV, this level of dependency is far from unusual in the Premier League. No fewer than five clubs were more reliant on this revenue stream: Bournemouth, Burnley, Watford, WBA and Swansea City.

Gate receipts increased £1.4m (20%) from £7.3m to £8.7m, their highest ever, even though season ticket prices were frozen in 2016/17, as attendances rose by almost a quarter from 24,627 to 30,449.

Following promotion the wage bill more than doubled from £32m to £65m, though it is worth noting that the underlying increase was even higher, as 2015/16 included (estimated) £10m bonus payments. Wages to turnover ratio was cut from 149% to 53%, more or less the level recommended by accountants Deloitte.

Even after the increase in the wage bill to £65m, it was still the third lowest in the Premier League, only ahead of the other promoted clubs (Burnley and Hull City, both £61m). It will reduce in 17/18, due to relegation clauses and departures (player sales and loans ending).

The clubmade £48m player purchases in 16/17 (including de Roon, Traoré, Gestede, Bamford, Guédioura, Barragan and Fabio), which is only £5m more than the previous (big spending) Championship season. The combined £90m in those 2 seasons considerably more than £14m in preceding two seasons.

Gross debt rose £3m from £99m to £102m. Almost all of this (£93.6m) is owed to owner Steve Gibson, while there is also a bank loan of £8.6m. Debt would have been even higher if Gibson had not converted £63m into share capital, highlighting the club’s reliance on the owner.

Boro have no issues with financial fair play, as they have a total allowable loss of £61m over the 3-year monitoring period (£35m for 1 Premier League season plus 2 Championship seasons at £13m). In any case, the Swiss Ramble estimates they will make a small profit in 17/18 thanks to hefty player sales.

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