Fine achievement by Blades

There has been uncertainty over Sheffield United’s ownership ever since Prince Abdullah decided to put the club up for sale, leading to some problems with cash flow.

Prince Abdullah had become Sheffield United’s sole owner in September 2019 after the High Court ruled that Kevin McCabe had to sell his 50% share to the Prince. This also triggered an agreement whereby the club had to purchase the stadium, training facility, gym, hotel and offices.

In the past 12 months two investors have tried to acquire Sheffield United, but both failed to get a deal across the line, as neither Henry Mauriss, nor Dozy Mmobuosi ultimately managed to satisfy the EFL during the Owners and Directors’ Test.

However, it’s fair to say that the that the club may well have dodged a bullet here, as the American businessman has since been jailed for wire fraud, while the Nigerian’s company Tingo has been accused of shady business practices and faked financial statements.

The Prince’s intention is still to sell the club and there are apparently a few interested parties in the Middle East and the USA. Now that United are back in the Premier League, they are clearly a more attractive proposition, though the price will have increased accordingly. In any case, the club will hope that any takeover is resolved before the new season kicks off.

United’s return to the Championship led to a swing from £10m pre-tax profit to a £16m loss, a deterioration of £26m in the bottom line, as revenue dropped £48m (42%) from £115m to £67m, partly offset by profit on player sales increasing £10m from £1m to £11m.

This was the first time that United had posted a loss under Prince Abdullah, though the profits in the previous two seasons were boosted by playing in the Premier League. In the top flight, they made £19m in 2019/20 and £10m in 2020/21.

However, as a rule United tend to lose money. The only other occasion they have reported a profit since 2008 was £31m in 2013/14, though this was entirely due to McCabe writing-off a £35m loan before partnering with the Prince.

United’s revenue has fallen by £76m (53%) from the £143m peak in 2019/20, when they finished 9th in the Premier League, but the £67m last season is still the club’s third best ever and the highest ever outside of the top flight. The vast majority of the decrease was due to the much lower TV deal in the Championship, which reduced broadcasting by £69m.

United’s revenue will be significantly higher next season in the Premier League. This will be dependent on the final finishing position in the league, though revenue for clubs promoted in the last six seasons was on average £134m, which would represent a £62m increase for the Blades.

United’s average attendance of 27,611 in 2021/22 was around 3,000 (11%) lower than the last full season in the Premier League, though much more than the last time they were in the Championship and over 10,000 more than their 2013/14 low in League One. In fact, Sheffield United had the highest average attendance in the Championship in 2021/22. The only club whose crowds came anywhere near the Blades was Nottingham Forest with 25,778, while the next highest was much lower (Derby County 22,214).

The last time the club was in the Premier League, its £57m wage bill was by far the lowest in the top flight, £29m below the next lowest Burnley £86m. Next season will be a tricky balancing act: while United will no doubt follow their tried-and-trusted tight cost control, the flip side is that low wages will make relegation more likely.

Sheffield United’s financial results for 2021/22 were fairly solid, though clearly boosted by the financial advantage provided by their parachute payment. However, there were clearly some issues, especially with cash flow, which led to the brief transfer embargo among other things. Winning promotion in this environment was a fine achievement, given the distractions off the pitch, including the lengthy takeover saga.

The quicker that the club can resolve the ownership question, the better, but the Prince had to admit, “These things never go as you expect, there are always complications.”

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The Political Economy of Football V2

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