Big losses at Cardiff

Cardiff’s pre-tax loss more than doubled from £11.2m to £26.6m. Revenue fell by nearly two-thirds (£35m) from £55m to £20m, due to the cessation of parachute payments from the Premier League.  This was only partially compensated by cutting operating expenses by £18m (27%) and profit from player sales slightly increasing by £1.4m to £4.2m. 

Cardiff’s £26.6m pre-tax loss is one of the largest reported to date in the 2021/22 Championship, only surpassed by Bournemouth £55.5m and Bristol City £28.5m. Very few clubs make money in this incredibly competitive league which arguably has the craziest finances in football.   £153m in parachute payments over the years have arguably been wasted.

In the 12 years since Vincent Tan bought Cardiff City in May 2010, the club has accumulated £181m of losses, including £50m in the last three years alone. During that period the club has only made two (small) profits, £4m in 2015 and £3m in 2019. They even contrived to lose £12m in the Premier League in 2014.

Cardiff’s average attendance fell from 22,746 in 2019/20 (for games played with fans) to 18,048 last season. This means that crowds have dropped by 42% (more than 13,000) from the 31,409 they achieved in the Premier League.

Cardiff’s wages were cut by £4.3m (13%) from £33.5m to £29.2m, as player salaries were reduced from £26.0m to £22.2m. Likely to further fall this season, as 11 players came to the end of their contracts on 30th June 2022.  Wages have decreased by £24m (46%) since relegation, but worth noting that Cardiff’s £54m in the top flight was really low. Cardiff’s wages to turnover ratio shot up from 61% to 146% after parachute payments stopped. 

In the last decade Cardiff have been very reliant on owner financing of £194m with another £26m coming from external loans. This has been used to fund £117m of player purchases (net), £21m infrastructure investment and £6m interest payments, while covering £72m of operating losses.

There is no doubt that the owners have provided significant funding, but it is the same owners who have been responsible for Cardiff’s downward trajectory, which has left them perilously close to the relegation zone.