Hibernian’s 2023/24 accounts covered a season when the club finished in “a very disappointing eighth position”. However, they did somewhat better in the cup competitions, reaching the quarter-finals of the Scottish Cup and the semi-finals of the League Cup.
This was the second time that Hibernian had finished 8th in
the last three seasons, which is clearly below expectations. These are their
worst finishes since 2013/14, when they ended up being relegated, spending
three seasons in the Championship before returning to the top flight in 2017.
The club has not been helped by frequent changes in the
manager with four men being handed the reins after the sacking of Jack Ross in
December 2021. Shaun Maloney only lasted four months, while Lee Johnson
survived for more than a year before also exiting stage left.
In terms of ownership, there was a lengthy period of
stability after Sir Tom Farmer, the former Kwik-Fit CEO, bought the club and
the stadium from the receivers in 1991. During his tenure, the club launched a share
issue which allowed supporters to invest in the club. As a result, by June 2019
Hibernian Supporters Limited held 15.5%, while another 17.3% was held directly
by supporters.
After 28 years as majority shareholder, Farmer sold his
67.2% controlling stake to American Ron Gordon (Bydand Sports) in July 2019.
Tragically, the businessman died from cancer in February 2023, though control
of the club remained with the Gordon family in the shape of his wife Kit and
son Ian.
A year later the club’s shareholders agreed to new
investment from Bill Foley’s Black Knight Football Club UK Limited, who
purchased a significant minority stake of 25% for £6m. The Gordon family still
hold the majority with 62.3%, though the supporters’ stake was greatly reduced. Foley also owns Bournemouth, New Zealand
club Auckland FC and a significant share in French club Lorient. As a result,
Hibernian are the first club in Scotland to be part of a multi-club network.
Losses double
Hibernian’s pre-tax loss more than doubled from £3.9m to a
club record £8.3m, which the board understandably described as “disappointing”.
This was despite revenue rising £3.5m (28%) from £12.4m to £15.9m, a new club
high.
There were three reasons for the deterioration in the bottom
line:
- Operating
expenses shot up by £4.7m (24%) from £19.3m to £24.0m.
- Profit
from player sales was down by two-thirds from £3.2m to £1.0m.
- There
was an exceptional £1.1m write-off of money owed to the club by a company
that went into liquidation.
Hibernian’s losses have increased two seasons in a row,
adding up to a £13.7m deficit in the last three years, compared to a £1.6m
profit in the preceding 3-year period. In fact, Hibs posted four profits in the
seven years up to 2020/21.
Not
all clubs have published accounts for 2023/24, but Hibernian’s £8.3m loss is
the second worst financial result in Scotland to date, albeit less than half of
Rangers’ awful £17.3m deficit. Most
Scottish clubs run a tight ship, so almost all of the deficits are on the low
side. The only one to make money last season was Celtic with a hefty £17.8m
profit.
Looking at Scotland’s leading clubs over the last three
years, we can see that Hibernian’s £13.7m loss is only better than Rangers’
£22.6m. In contrast, Aberdeen and Hearts only lost £1.9m and £2.4m respectively
in this period, while Celtic generated a substantial £64.7m profit. Hearts benefited from £5.5m of donations,
split between benefactors £4.0m and the Foundation of Hearts £1.5m, while Hibs
were hit by a £1.1m exceptional charge.
One area that Hibernian have improved is player trading,
where they have made a £6.3m profit in the last three years. This is not a huge
amount, but it is nearly twice as much as the £3.3m in the preceding 3-year
period. However, it looks like this
season will not be great in terms of player trading, as the only player sales
that attracted a fee were for small amounts, e.g. Ewan Henderson to Beerschot
and Josh Landers to West Ham, with quite a few players leaving on free
transfers.
Revenue
Hibernian’s revenue shot up last season, so has now grown by
£5.1m (47%) from the pre-pandemic peak of £10.8m to an all-time high of £15.9m,
which implies that some good work has been done on the commercial side. In fact, Hibernian have almost tripled their
revenue from the £5.6m in the Championship in 2014/15. That’s obviously excellent news, but it
should be noted that their revenue might well fall this season, due to not
qualifying for Europe.
As it stands, Hibernian’s £15.9m revenue is the fifth
highest in Scotland, though there is a huge gap to the big two Glasgow clubs.
In fact, Celtic’s £125m is nearly £110m higher, while Rangers’ £88m is more
than five times as much. More
relevantly, even after the strong growth, they are still a fair way below
Aberdeen £23.6m and Hearts £20.3m.
Hibernian have only earned €1.7m in Europe TV money in the
last five years. This is obviously significantly lower than Celtic and Rangers,
who received €99m and €85m respectively, but was also less than Aberdeen €7.9m
and Hearts €6.6m.
Hibernian’s average attendance decreased from 17,453 to
16,933, which was still the fourth highest in Scotland, just below Hearts’
18,402. This was miles below Celtic 58,867 and Rangers 49,106, but ahead of
Aberdeen 16,055.
The club has spent a fair bit on improving the Easter Road
stadium, financed by a specific capital injection from the shareholders.
Including work completed in 2024/25, the total amount invested is over £3m.
Hibernian had a new shirt sponsor last season, as the
wonderfully named Bevvy.com, a mobile application for whisky lovers, replaced
Utilita in a deal that the club described as “the biggest of its kind” for
Hibs.
Wages
Hibernian’s wages increased by £2.6m (26%) from £10.1m to a
new club record £12.7m, due to continued investment in the first team squad and
bonuses for Europa Conference League qualification. Hibernian’s £12.7m wage bill remains the
fifth highest in Scotland, slightly less than Aberdeen’s £12.7m, but a fair way
below Hearts’ £16.5m. For more
perspective, Celtic £66m and Rangers £61m pay around £50m more. Put another
way, wages at the Big Two are an incredible five times as much as Hibs.
Some high earners will be out of contract at the end of this
season, which the club said “will allow a tighter focus on the playing budget”,
so the expectation is for a sharp reduction in the wage bill.
Hibernian’s gross financial debt was cut from £5.2m to
£1.6m, as the £3.5m owed to Bydand Sports (i.e. the Gordon family) was
converted to equity as a result of Bill Foley’s investment.
The board noted, “The club has done everything to maximise
other revenue streams, but ultimately it is reliant on the steadfast support of
the shareholders who continue to underwrite losses.” The good news is that Ian
Gordon has said that his family are still willing to provide that support,
“Obviously, there's an overspend at the moment because we're chasing football
success and with all the turnover over the last couple of years, we're needing
to chase that.”
This is a pretty poor set of financial results, as Hibernian
have managed to lose £8.3m on a turnover of £15.9m, which takes some doing. The
significant investment in the squad can be seen as a sign of the club’s
ambition, but it was a gamble that has not really worked out, given the low
finishes in the league.
Ian Gordon admitted, “We know we need to do better. I take
it very hard personally. I live and breathe this club and me and my family want
to bring success, but there have been more poor performances than we would have
liked.”
The board added, “The current climate is very challenging
for football clubs of a similar size to Hibs, and clubs are often reliant on
their shareholders or benefactors while trying to increase competitiveness.”
Hibernian are fortunate that they have wealthy backers, so
their losses can be absorbed, but they will have realised that it is important
to not just spend money, but to spend it wisely. Hibs started the current campaign badly,
even finding themselves at the bottom of the table at one stage. However, a
recent upsurge in form has taken them up to fifth place, so there is a chance
of a better outcome this season.
A Hibetnian season ticket holder commented in an email: 'It's a fair and even slightly generous analysis given the scale of the losses, for which the recently departed chief executive should take some responsibility. The rapid turnover in players and managers has been expensive, and there will be big changes in the squad again this summer because so many players will be out of contract or at the end of a loan period. Hibs current fifth place is a great improvement but the mid and lower part of the league is so tight that Hibs could finish anywhere from third (minimal chance!) to second bottom.'
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