Skip to main content

Player sales key to Southampton business model

The authoritative Swiss Ramble has analysed Southampton's financial results for 2017/18. Pre-tax profit fell from £42m to £35m, as revenue dropped 16% (£30m) to £153m, due to the poor performance on the pitch, though this was largely offset by profit on player sales increasing by £27m to £69m. Profit after tax was down from £34m to £29m. This was the first season under the ownership of Lander Sports (UK), controlled by Chinese businessman Jisheng Gao.

The £30m revenue fall was driven by broadcasting’s £26m (18%) decrease from £143m to £117m, mainly due to lower Premier League position and no Europa League money. Match day was down £3.2m (14%) to £19.2m, while commercial was £0.5m (3%) lower at £16.4m.

The £35m profit is actually the fourth highest to date in 17/18 Premier League, only behind Liverpool £125m, Arsenal £70m & Chelsea £67m. MD Toby Steel said, 'We continue to be self-sustaining', which is not to be sneezed at considering large losses at Watford £32m, Swansea City £30m and Everton £13m. Saints made a small £7m loss in their first season after promotion to the Premier League in 2012/13, but since then they have delivered £126m of profits in the last five years.

Saints £69m profit on player sales is actually the seventh highest ever made by an English club. Clearly, player sales has become a key part of the club's business model. In the last 4 years, they made a hefty £184m profit from this activity with only Chelsea £272m and Liverpool £260m ahead of them.

If Southampton are relegated, their TV money would fall considerably from last season’s £107m to around £45m in the first year in the Championship, including a £41m parachute payment, though this would still be a lot higher than the £8m most clubs receive in that league.

The wage bill slightly increased by £1m to £113m, mainly due to contract renewals, offsetting lower bonuses. Player remuneration dropped from £87m to £85m, while total employees rose from 380 to 429. Wages to turnover rose from 62%, to 74% due to the revenue reduction, slightly above the 70% level recommended by Uefa.

Labels:

Comments

Post a Comment

Popular posts from this blog

Wolves get raw deal from FFP

  I used to see a lifelong Wolves fan for lunch once a month.   He was approaching ninety, but still went to games.   Sadly he passed away the other week. As football finance guru Kieran Maguire has noted, Wolves continue to be constrained by financial fair play rules.  Radio 4 this morning described them as this year's 'crisis club' and the pessimists have certainly been piling in. Martin Samuel wrote sympathetically in the Sunday Times yesterday, saying that the Premier League drives talent away with regulatory red tape: 'Why could Al-Hilal sign Neves? Because Wolves needed the money. And why did Wolves need the money? Because the club had to comply with an artificial construct known as financial fair play. So Wolves are going skint, yes? No. There is no suggestion that Wolves are in financial trouble, only that they are failing to meet the rigours of FFP. Wolves’ owners appear to have the money to run the club, and invest in the club, and in fact came up with a pow
Post a Comment
Read more

Gold standard ground boosts Tottenham's income

The gold standard in European football grounds is the Tottenham Hotspur stadium in north London, a £1bn construction project completed in 2019. Its impact on the club’s finances has become increasingly clear as the effects of the pandemic have faded. Previously, the average fan would spend less than £2 inside the ground on a typical match day, but now that figure is about £16, thanks to new facilities including the longest bar in Europe and an on-site microbrewery. Capacity has gone up from 36,000 at the club’s previous home of White Hart Lane to 62,000.  The new stadium — built on land adjacent to White Hart Lane — has opened the door to a broad range of other events that have helped to push commercial income up from €117mn in 2018 to €215mn in 2022. Last year, Tottenham hosted US singer Beyoncé for five nights on her global Renaissance tour, two NFL matches, as well as rugby games and heavyweight boxing bouts.  Money brought in from football has gone up too. Match day income is
Post a Comment
Read more

Charlton takeover approved

The long awaited takeover of Charlton Athletic by SE7 Partners from Thomas Sandgaard has been approved:  https://londonnewsonline.co.uk/se7-partners-obtain-efl-approval-for-charlton-athletic-takeover/ Charlton have had unhappy experiences with owners for over a decade, so how this works out will remain to be seen.  There is certainly potential there, but will it be realised? This interview with Charlie Methven gives detail not available elsewhere:  https://thecharltondossier.com/charlie-methven-on-the-record/
Post a Comment
Read more