The Political Economy of Football V2

Gareth Bale says the consortium he is fronting in a takeover bid for Cardiff City has made a new offer for “full control” of the League One club. Speaking to Front Office Sports, Bale said: “I guess exciting news. We have a brand new offer on the table, recently just gone in. “We think it’s a great offer. We’re very happy. We think it’s very fair, if not more than fair, and something we hope the current owners will take serious. We’d love them to accept so we can take full control and get on with what we want to do and create Cardiff into the club we know it can be.” It would have to be considerable improvement on the reported initial £40m offer as Vincent Tan keeps counting the money he has not spent well at the club. Would a serious consortium conduct its business in private?

Former Wales international Gareth Bale is fronting a consortium of US investors that is reportedly looking to purchase Cardiff City. As well as being one of the greatest ever Welsh footballers, Bale is also famously a son of Cardiff, so this story ticks many boxes. The Times reported that the consortium would be prepared to offer £40m for Cardiff, though it is debatable whether such a price would be acceptable to current owner, Vincent Tan, who has ploughed much higher sums into the club since his arrival in 2010. The Supporters Trust clearly thinks that the owner shoulders much of the blame for the club’s current predicament, “Relegation in all honesty has been coming since the 2021/22 season and the failure to address fundamental required changes from the top down has now come home to roost.” There was “a small marginal increase” in Cardiff’s pre-tax loss from £11.4m to £11.7m in 2023/24. Revenue fell £3.5m (13%) from £26.7m to £23.2m, while profit from player sales dropped fro...

Gareth Bale is leading a consortium that has made an approach to buy Cardiff City, reports The Athletic. Bale’s group sent a letter of intent to Cardiff owner Vincent Tan last month, which expressed their desire to purchase the Welshman’s hometown club and included financial numbers. The proposal was rejected but interest from the former Real Madrid winger in Cardiff remains strong — whereas he is not in the frame to acquire Plymouth Argyle, despite recent press reports. Cardiff declined to comment. The Welshman’s potential involvement in Cardiff comes after his former Tottenham Hotspur and Madrid team-mate Luka Modric became a co-owner of their south Wales rivals Swansea City earlier this month. Bale, who announced his retirement as a player in January 2023, would be the latest big name to attach themselves to an ownership group of a team in the English Football League. “We are interested in getting Cardiff,” Bale told Sky Sports .  “It’s my home club, it’s where I grew up...

As part of a shake-up of the domestic game in Wales, plans are afoot for Cardiff, Swansea, Wrexham and Newport to enter the Welsh League Cup, alongside the current Cymru Premier (Welsh Premier League) clubs. The winners, if the proposal is agreed by the Football Association (FA), Football Association of Wales (FAW) and UEFA, the European game’s governing body, would compete at continental level in the following season’s Conference League. For Phil Parkinson, the Wrexham manager, the prospect is an exciting one. “To bring European football back to Wrexham would be amazing,” he says. “Great to test yourself against teams from different countries around Europe. Be fantastic to have that opportunity.” Speak to those pushing for change and there’s a sense it could be given the go-ahead before the end of this calendar year, meaning Cardiff, Swansea, Wrexham and Newport would enter next season’s Welsh League Cup, and its winners would enter the 2026-27  Conference League, UEFA’s ...

Cardiff’s pre-tax loss in 2022/23 more than halved from £26.6m to £11.4m. Revenue increased by a third from £20.0m to £26.7m, though profit from player sales dropped from £4.2m to £1.7m.  Cardiff’s £11m operating loss is actually one of the best to date in the 2022/23 Championship, only bettered by Rotherham United, Blackpool and Coventry City. In the 13 years since Vincent Tan bought Cardiff City in May 2010, the club has accumulated a chunky £192m of losses, averaging around £15m a season. Even after the steep fall following relegation, Cardiff’s £27m revenue is still in the top ten of the Championship, albeit a fair way below clubs in receipt of parachute payments, e.g. Norwich City £76m, Watford £66m and Burnley £65m were £40-50m higher. Cardiff’s revenue increase was almost entirely due to commercial, which more than doubled from £4.7m to £11.1m, though match day also rose £0.6m (12%) from £4.9m to £5.5m. Broadcasting was slightly lower, falling £0.3m (3%) from £10.4m to...

Cardiff City have submitted their 2022/23 accounts, reports Kieran Maguire.  Revenue up by 33% to £26.6m   Wages up 21% to £22.3m.   Underlying loss  wasup 62% to £11m.  Player purchases £5m. Player sales £1.6m.  Borrowings in year £22m.   Emiliano Sala settlement costs £20m. This was in spite of a £8m cut in the wage bill and an increase in turnover:  https://www.bbc.co.uk/sport/football/68489496 More here:  https://www.walesonline.co.uk/sport/football/cardiff-citys-finances-laid-bare-26417539

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 t...

The tireless and authoritative Swiss Ramble examines Cardiff City’s 2020/21 financial results, when they reduced their loss from £12m to £11m. Revenue rose £9m to £55m, as TV i the club’s owners. Losses In the 11 years since Vincent Tan bought the club in May 2010, they have accumulated £154m of losses, £81m in the last five years. In that period the club has only had two (small) profits, £4m in 2015 and £3m in 2019. They even contrived to lose £12m in the Premier League in 2014. Furthermore, the 2015 £4m profit was entirely due to once-off factors (£13m debt-write-off and £13m interest adjustment). If the club is correct that they will not need to pay a transfer fee for Sala, then future financials will be boosted by reversal of £20m provision. The £11m loss is clearly not great, it was nowhere near as much as some others in 2020/21 Championship, e.g. Bristol City £38m, Reading £36m and Boro £31m. Highest profits from two clubs relegated from the Premier League the prior seaso...

Cardiff City are facing 'multi-dimensional' challenges and are seeking additional finances, although it is not clear where they might come from or what form they might take.   The pandemic has hit the club hard because of its reliance on match day income and it has also hit Malaysia hard:  https://www.bbc.co.uk/sport/football/59022910

The authoritative Swiss Ramble has reviewed the 2019/20 accounts of Cardiff City. The club swung from £3m profit to £12m loss, as revenue fell £79m (63%) from £125m to £46m due to relegation and COVID, partly offset by profit on player sales rising £12m to £14m, while expenses were down £33m and no repeat of prior year £20m provision for the Sala transfer. Although the £12m loss is clearly not great, it was around mid-table in the Championship with many clubs reporting much larger losses in 2019/20, including Stoke City £88m. In the decade since Vincent Tan bought the club in May 2010, they have accumulated £142m of losses, half in last 4 years. In that period the club has only had two (small) profits, £4m in 2015 and £3m in 2019. They even contrived to lose £12m in the Premier League in 2014. The £79m revenue fall was largely driven by broadcasting’s £70m (66%) decrease from £107m to £37m, due to lower TV money in Championship, though commercial also dropped £5m (48%) from £10m ...

Cardiff City made losses of £12.2m following relegation to the Premier League.   The club's debt amounts to over £100m owed to owner Vincent Tan:  https://www.walesonline.co.uk/sport/football/football-news/cardiff-city-record-122m-losses-20726022 Other Championship clubs formerly in the Premier League such as Stoke City have made much bigger losses.

The authoritative @SwissRamble continues to produce financial fact sheets for leading clubs which can be accessed via his twitter account.    He states, ' I have now prepared these financial fact sheets for all the clubs that were in the Premier League in 2018/19 (except Crystal Palace  and Newcastle United , who have not yet published accounts for that season) plus those promoted in 2019/20.' His summary on Aston Villa is 'p osted huge £69m net loss. Operating loss even higher at £115m, including £46m promotion payments, but £14m HS2 compensation. Offset by £36m stadium sale and £11m player sales. Revenue fall due to lower parachute payments. Debt-free after write-offs and equity conversion.' Bournemouth ' lost money two years in a row, as revenue has fallen from £136m to £131m, while wage bill has grown from £72m to £111m. Little benefit from low player sales. Debt up to £100m, ninth highest in Premier League. Spent £150m on player purchases in last two years with...

Fortunately, the Swiss Ramble has agreed to continue his in depth analyses of football club accounts during the current emergency. Cardiff City are the latest club to be the subject of his forensic analysis. The financial results for 2018/19 covered a season in the Premier League following promotion, but their stay in the top flight was brief, as it culminated in relegation to the Championship after they finished in 18th place. The Bluebirds swung from a £39m loss before tax in the Championship to £3m profit, thanks to revenue surging £90m from £35m to £125m, though competing in the Premier League increased expenses by £31m. Still reported £0.8m loss after tax, due to £3m tax charge. The £3m profit was not huge, though would have been £22m if £19.5m Sala provision excluded. In any case, this is still better than seven of the 13 Premier League clubs that have reported to date in 2018/19, as they have all made losses. Since Vincent Tan bought Cardiff City in May 2010, the club has ac...

Cardiff City Vincent Tan looks as if he could be setting out to rival former Charlton Athletic Roland Duchatelet as he considers adding to his network of clubs by buying financially troubled Malaga: Vincent Tan As well as Cardiff City, Tan owns Belgian Belgian First Division KV Kortrijk and Bosnian club FK Sarajevo and is co-owner of Los Angeles FC. It's tangled tale at Malaga but the club could be available at a knockdown price. A judicial investigator is now in charge of the club after the Qatari businessmen who owned it was removed for six months: FC Malaga

The authoritative Swiss Ramble has commented on the recently published 2017/18 accounts of Cardiff City. He notes, 'Carfiff paid the price of success, as the loss before tax almost doubled from £21m to £39m, mainly due to £23m of promotion bonuses and other contractual payments.' The loss after tax was £36m following a £3.3m tax credit. Most Championship clubs lose money, but Cardiff loss of £39m is one of the largest in 2017/18. However, it is worth noting that the three biggest losses came from clubs promoted to the Premier League. For Cardiff promotion was very timely, as 2017/18 was the last year of parachute payments, but the club can now expect around £120m in the Premier League in 2018/19. Adding in parachute payments, promotion was worth about £170m. Since Vincent Tan bought the Bluebirds in May 2010, the club has accumulated £133m of losses, averaging £17m a season. The only time they managed to make a profit was £4m in 2015, due to one off factors, while they ev...

Cardiff City lost £654,000 a week last season in the Championship whilst securing promotion to the Premier League or £175m to 31st May 2018. Cardiff were reliant on the final year of parachute payments in 2017/18 which represented over 62% of income. The Bluebirds paid £137 in wages for every £100 of income in 2017/18 as the wage bill increased by 67%. 60 per cent of revenue came from broadcasting, 26 per cent was commercial and 14 per cent match day. Cardiff bought players for £14 million and had sales of about the same amount in 2017/18. The club spent £35 million in the summer 2018 window on players and borrowed £28 million from a new lender. Cardiff have outstanding loans, mainly to Vincent Tan, of £74 million. Interest is due on the loans at 7% but was waived last year. Vincent Tan effectively wrote off £79 million of loans to Cardiff City by converting them into shares. Championship losses likely to top £400 million in 2017/18 and this is with the 'benefits' of FF...

Cardiff City and Newcastle United are considering launching their own cryptocurrencies. Both clubs are involved in talks with SportyCo, a micro-financing and crowdfunding company about holding an Initial Coin Offering (ICO). This would enable fans or investors to buy the new currency in the form of tokens in the hope of securing a future return, as well as providing an additional revenue stream. The Brazilian Serie B team Avia last week became the first club to launch their own cryptocurrency: SportyCo ICO The club aim to raise around £15m through a sale of tokens which can be used to buy tickets and club merchandise. Paris Saint-Germain have announced similar plans. Cryptocurrencies are all the rage and fans may want to take part as a way of supporting their club and facilitating club-related spending. If viewed as an investment, they are high risk and independent financial advice should be sought.

The Swiss Ramble takes an in depth look at Cardiff City's accounts for 2016/17 following their promotion to the Premier League. TV income of £21m was significantly higher than £8m received by most Championship clubs without parachute payments. In the Premier League they will receive £94m even if they finish last. Added to £72m parachute payments, this means promotion is worth at least £166m. Revenue has declined by £54m (65%) from £83m to £29m since relegation in 2014. Most of this decrease is broadcasting £43m, but commercial £6m and match day £5m are also down. Promotion is very timely, as 2017/18 is the last year of parachute payments (around £16m). Tan and his friends have put a huge amount of money into Cardiff City, around £182m (£166m loans & £16m new share capital). This has covered large operating losses, while funding player purchases and infrastructure investment, so that books are balanced from a cash perspective. In 2016/17 owners provided Cardiff City with a n...

Cardiff City (Holdings) Limited filed their annual accounts on line at Companies House yesterday where they can be read free of charge. They run to 34 pages and you probably need an accountancy qualification to make full sense of them, but I will try and pick out some highlights. Like all clubs seeking to access the promised land of the Premier League, Cardiff City reported big losses but they are backed by their owner Vincent Tan. Loans from overseas shareholders (principally Vincent Tan) amounted to £115m. It is stated, 'the Group has the support of the controlling shareholder and consequently, liquidity risk is no longer a significant factor for the Group.' The operating loss for the year ended 31 May 2017 was £18.35m. To put it another way, the club was losing over £400,000 a week. Revenue was down from £33.2m to £28.7m as a result of the reduction in parachute payments which are such a key element for many Championship clubs. Accumulated losses to 2017 were £139m. ...