The authoritative Swiss Ramble reviews Norwich City's recently published accounts. He states: '£2m profit is not huge, but they have done well, given that Manchester United, the only other club to post 2019/20 accounts to date, lost £21m.' Very few Premier League clubs enjoyed operating profits in 2018/19, so Norwich’s small surplus is actually one of the best performances.
The Canaries made money despite profit on player sales of only £1.6m, the lowest in the Premier League, as they decided to retain their talented young players.
The club have been profitable in six of the last nine years: they made money in all five seasons in the Premier League, but reported losses in three of the four Championship seasons. The only exception was £18m in 2017/18, due to the significant £48m profit on player sales.
Like most clubs, Norwich City's bottom line is very influenced by player sales. These averaged annual profit of £24m between 2015 and 2018, either leading to overall profit or lower losses. The last two years have only averaged £2m, but there will be large gains here in 2020/21 (£40m of summer sales).
Revenue obviously grew significantly after promotion by £86m to £119m, though this would have been as high as £130m without the £10m COVID impact. It was still £21m (22%) higher than the £98m they generated the last time they were in the Premier League in 2016. Nevertheless, the £119m revenue was still one of the lowest in the Premier League.
76% of the club's total revenue came from broadcasting, though to be fair this is far from unusual in the top flight In fact, 13 of the clubs in the Premier League earned more than 70% of their total income from television. TV money will fall following relegation, though will be cushioned to some extent by parachute payment (£43m in 2018/19). Will only receive two years (£77m in total), as relegated after one season.
Commercial income rose £7m (48%) from £14m to £21m. as sponsorship increased tripled from £3.4m to £10.3m. Includes £4.6m catering, though not too surprising with Delia Smith as an owner. Very respectable figure compared to similar sized clubs.
The underlying wage bill rose by £38m (74%) from £51m to £89m following promotion (previous season included sizeable promotion bonuses), as many players were given new deals. Player contracts have relegation clauses (reportedly 50%), so wages will be much lower in the Championship.
The £89m wage bill was still one of the smallest in the Premier League, so it is perhaps not surprising that they struggled to compete. For some perspective, it was less than a third of Manchester United at £284m.
Unlike many Championship clubs, the Canaries have no FFP concerns, as their £19m loss over the 3-year monitoring period is lower than £61m limit (2 Championship years of £13m, one Premier League year of £35m), even before allowable deductions (£18m).
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