The authoritative Swiss Ramble has reviewed the recently published 2017/18 accounts for Stoke City, the year that saw them relegated after ten consecutive years in the Premier League. He notes that the club 'has experienced a lot of changes in the last 18 months (players, managers, league status). The financial support of the Coates family will be more important than ever if they want to make a rapid return to the Premier League.'
Since 2009 Stoke have had available cash of £245m: (a) £148m from owners’ loans; (b) £96m from operating activities (negative for the first time in ages in 2018). Almost all of this has been used to improve the squad with £217m (89%) spent on player investment. That said, it is noticeable how Stoke City are once again hugely reliant on the Coates family, as they put in a further £47m in 2018. The funding had been cut to just £2m for the two years 2015 and 2016, but it’s now back with a bang. The owners have put in £148m since 2009.
Following the reduction in revenue, the club's wages to turnover ratio increased from 62% to 74%, which would have been the 3rd highest (worst) in 2016/17 (behind Crystal Palace and Swansea City). To be fair, this is not as bad as the 79% Stoke reported in 2016 – or 91% in 2013. Although Stoke's £94m wage bill is a record high for the club, it was still only the 13th highest in the Premier League. This was around the same level as West Ham’s 2016/17 wages, but £18m lower than Southampton and Crystal Palace.
The average attendance of 29,280 was the 13th highest in the Premier League in 2017/18, around 4,000 more than the next club, Crystal Palace 25,063. Prices for 2018/19 tickets have been frozen, which means that they have been held at the same level for an incredible 11 seasons.
Commercial revenue fell 7% (£1.5m) from £20.1m to £18.6m, mainly due to other operating income. This was mid-table in Premier League. Owner bet365 pays a reported £3.2m for shirt sponsorship and also has stadium naming rights. Macron have a 5-year kit deal from 2016/17.
Revenue was 'derived principally' from the Premier League broadcasting contract. In fact, a massive 79% of their turnover came from TV in 2017/18. In fairness, this is not uncommon in the top tier with nine clubs getting 80-90% of their money from TV. Premier League TV money fell £8m from £107m to £99m, as they were adversely impacted by dropping six league places from 13th to 19th (merit payment down £12m), though partially offset by being shown live three more times (facility fee up £2m) and a £2m increase in overseas payments.
The parachute payment will not compensate for the absence of Premier League TV money. The Swiss Ramble's estimate is a £58m (46%) reduction to £69m.
This is the first time that Stoke have reported a loss in five years, though the highest profit in this period was £5.2m in 2015. In fact, four consecutive years in the black only delivered £16m profits in total, as the club has invested almost all of its spare cash in the squad.
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