Boro do well on player sales

Middlesbrough reduced their pre-tax loss in 2022/23 (for the third year in a row) from £19.5m to £6.4m, largely because of profit from player sales significantly increasing from £1.4m to £22.3m.

The largest revenue increase was match day, which rose by more than a third (£2.4m) from £6.4m to £8.8m, though there was also good growth in commercial, up £1.6m (19%) from £8.4m to £10.0m. Against that, broadcasting fell £2.3m (19%) from £12.1m to £9.8m.

Even after the significant improvement in the bottom line, the fact remains that Middlesbrough still posted a loss, though their £6.4m was pretty good for the Championship. In fact, it is the best financial performance of the five clubs that have published 2022/23 accounts to date.

Middlesbrough’s profit on player sales shot up from just £1.4m to £22.3m, mainly from the sales of Djed Spence to Tottenham and Marcus Tavernier to Bournemouth. Not only is this the highest gain to date in 2022/23, but it is also more than any other club generated in the previous season.

Traditionally, the only clubs in the Championship that make big money from player trading are those that have recently been relegated from the Premier League, so Middlesbrough have done well here.

Only this week Boro accepted Aston Villa’s offer for young star Morgan Rogers just sis months after buying him from Manchester City’s U-21 team. Villa are reportedly paying £10m plus £5m add-ons, which represents an excellent return (though City are due a 20% sell-on fee).

Boro’s 26,012 average attendance was the fourth highest in the Championship last season, only below Sheffield United 38,480, Nottingham Forest 28,746 and Norwich City 26,131.

Boro’s gross spend on transfers has steadily increased in each of the last three seasons, but the club has still dramatically slowed down its transfer spend in comparison to a few years ago. They have spent £47m since 2019, compared to a noteworthy £156m in the three years between 2016 and 2018, including a massive £66m outlay the season after relegation.

Middlesbrough’s gross debt rose £11m from £148m to £159m. The vast majority is owed to owner Steve Gibson, who increased his loan by £7m to £149m. Middlesbrough’s gross debt of £159m is the third largest in the Championship, only behind two clubs (based on 2022 figures), namely Bournemouth £184m and Blackburn Rovers £163m.

However, this debt has never really been an issue for Middlesbrough with Gibson being such a supportive owner. Indeed, after these accounts closed, the £149m owed to the parent company was converted into capital, effectively writing-off the debt.

Since 2011 Gibson has put £157m into the club via loans, all of which has been subsequently converted into capital.  The accounts once again emphasise the importance of the owner’s financial support, though the amounts provided have reduced, i.e. funding was £55m in the last seven years, which was only around half of the £102m in the preceding 6-year period.

Gibson can hardly be accused of not putting his hand into his pocket, though some owners have been even more generous, e.g. his £86m in the 10 years up to 2022 was pretty good, but much lower than the likes of Fulham £722m, QPR £268m and Cardiff City £194m.

Middlesbrough’s accounts represent a positive step in the right direction, as their loss significantly reduced, but the fact remains that they still posted a loss - and they needed a large profit from player sales to achieve this.

Player trading is therefore very important to the bottom line, but the supporters will hope that the board can resist the overtures of other clubs towards Boro’s talented players, despite Morgan Rogers departing in the January transfer window.

This is a recognition that life is challenging, to say the least, from a financial perspective for Championship clubs that do not benefit from parachute payments, so Middlesbrough are fortunate that owner Steve Gibson continues to provide support year after year.

However, Middlesbrough remain ambitious, stating that “the club will continue to strive for progression and promotion to the Premier League”. That’s easier said than done, of course, but Boro are within striking distance of the play-off places, so there’s still a lot to play for this season.