2022/23 Accounts

Out today, £5.8m operating loss, £1.8m transfer profit, net loss £4.0m.

 

On the plus side, the flatbreads provided a welcome boost to the income from catering. Up over 200 grand!

 

Over £5.7m less from league distribution. When people talk about the cost of relegation that is it. I assume the increased TV and broadcasting was down to the playoffs. Impressive that we increased our sponsorship revenue.

 

Shows how vitally important it is to get promoted this year.

 

I think you're reading it wrong. TV revenue dropped from 580k to 330k and sponsorship dropped from 700k to 550k

 

Yeah my mistake, I was thrown off as that means match day and catering revenue increased which I really wouldn't have expected. I suppose we did have some big games & crowds last season.

 

It's the FL distribution that is the big difference of c.£6m.

 

Cost of sales is player wages I’m assuming?

 

Boo, get some money spent!!!!

 

The year to May 2023 highlights just how hard it is for the club financially in League one.

Turnover for the year was down from £15m in the prior year to £9.5m. The big factor was the reduction in the football league distribution from £8.6m to £2.9m. This is the often talked about £6m cost of relegation. There were some positives with matchday income up from £2.8m to £3.4m.

Costs were also cut with overall salaries down from £13.1m to £9.3m. Despite the cost cutting the operating loss for the year was £5.8m.

Taking account of player sale profit the loss of £5.8m was trimmed to £4m. The club did spend around £400k on player additions.

Over the last three years total losses stand at £15m, the club is heavily reliant on the £10m injected through equity from the owners. This also helps with football FairPlay with the equity injections added to turnover to enable the club to have a salary roll of £9m and still be 60% of turnover.

The need for further equity injections, post year end, was absolutely necessary with the net assets of the club -£2.8m.

Long term debt remains just over £4m with the bulk, £3m, owing to Oakwell holdings in respect of the legal settlement. This debt is interest free and no repayments had been paid by end May 2023.

 

They should have some decent installments to come over the next few years from Anderson & Kitching, what's remaining? £7m?

 

Transfer fees are recognised in totality in the accounts. If they are paid in instalments the instalments would be shown as a debtor.

With operating losses of £6m pa, even after a 30% reduction in the payroll, the likelihood is that the totality of the proceeds from the sales of Andersen and Kitching will be absorbed in running the club over a 12 month period.

Worth remembering that the loss of £4m is after the profit from the sales of Carlton Morris, Cauley Woodrow, Callum Brittain and Michal Helik.

 

In short, we're fecked without promotion.

 

Am I right saying transfer proceeds agreed are carried forward into following years, so the whole sum isn’t accounted for just in one year. The reason Chelsea got away with spending loads on 8yr contracts?

The debtors list appears to show healthy figures carried forward for this purpose.

 

The amount received is recognised in totality, the exception being any conditional payments, (an extra £x if they play for England etc).

The debtors will reflect the timing of instalments but the profit on intangible sales will reflect the total payment.

The point you make about amortisation is how a club accounts for the cost of a player. Say a player is bought for £1m over a fiver year contract the annual amortisation is £200k and would be accounted for as intangible asset amortisation. This is where Chelsea tried to spread the costs over 8 years by signing players on 8 year contracts. The premier league deemed that five years is now the maximum amortisation period.

Amortisation does not represent any transfer instalment schedule rather the spreading of the purchase cost of a player over the term of their contract up to a maximum of five years.

 

So we only got 2.2m combined for all of those players?

 

That’s not correct, the total receipts are £3.278m plus the book value of the players at the time of their sale.

The profit on intangibles of £1.845m comes after deducting amortisation (£1.328m) and impairment (£91k).

 

Then they need to find a way of running the business a bit better....

All those players you mention were sold on the cheap, we barely got owt for them (Morris etc)