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In another thread, an innocuous comment was made by El Guapo about the finances of Championship clubs. This was originally intended to be a response in that thread, but over a few days it has grown to much more than that.
It is long-winded but others may be interested in the figures if not the commentary.
The figures are from analysis and reporting by The Guardian and Insider Media and relate to the accounts filed in mid 2014 (the latest accounts published by most). This means the figures are already 15 months out of date and a lot can happen in 15 months in football. Clubs have new owners, debts has been paid down, funds have been raised, gates have gone up - or down, players have been bought (mainly by Derby) and sold (mainly by Blackburn).
However, the overall state of affairs at the time was clear. A handful of clubs were either in the black (Wolves, Preston, Rotherham) or had “easily manageable” debt (Burnley and MK Dons). A couple of clubs (Bolton and QPR) have huge debts (£360m between them) requiring someone to have deep pockets (but plenty of football investors do). Beyond that it becomes more complex.
A group of clubs had debt up to around £50m that could be reduced by on-field success or commercial revenue, while there’s a smaller group who had bigger debts…up to £85m or so. Two of those – Hull and Cardiff have recent PL residence to add to their coffers – but there are four clubs – Ipswich, Blackburn, Middlesbrough and Brighton – whose fans may be somewhat more concerned for the future. Three of these clubs – all but Brighton – were spending more on wages than their turnover (see table lower down). It’s one thing to have debt but there’s the old adage that if you are in a hole, the first thing you should do is stop digging. If the owner wants to keep funding the losses, then all well and good. But you better hope that owner stays healthy and happy.
Then there are a group of five clubs who had high indebtedness, £30m to £50m, with just one of them (I think) – Reading – benefitting from parachute payments. Three of the other four - Leeds, Charlton and Forest - have had enthusiastic new owners since then so much has probably changed for the better.
Declared Debt and Loans Table at mid 2014 (latest accounts)
Wolves........(£7.0m)
Preston.......(£0.6m)
Rotherham.....(£0.1m)
Watford.......£ 4.1m
Burnley.......£ 4.6m
Wigan.........£ 9.4m
MK Dons.......£10.3m (Debt not stated)
Birmingham....£11.7m (Debt not stated)
Sheff Weds....£12.7m
Derby.........£14.6m
Brentford.....£19.2m
Bournemouth...£21.5m
Fulham........£24.0m
Bristol City..£25.6m
Leeds United..£33.0m (Debt not stated)
Huddersfield..£37.4m
Charlton......£44.1m (Debt not stated)
Nottm Forest..£46.1m
Reading.......£47.1m
Hull City.....£64.8m
Brighton......£62.5m (Debt not stated)
Middlesbrough.£76.0m (Debt not stated)
Blackburn.....£79.8m
Cardiff City..£81.1m
Ipswich.......£82.4m
QPR..........£179.6m
Bolton.......£182.1m
So 15 months ago, the four worst clubs had debts and loans totalling just over £0.5 billion in debt, and just three clubs had cash in the bank. It is perhaps significant that all three of those with net funds in the bank (and six of the nine least-indebted) have recently been in League 1.
Were any of the eight most-indebted clubs to be relegated into League 1, they might struggle to survive let alone get back up again.
So much for debt, what about spending in the 2013/14 and 2012/13 seasons?
Because of the huge difference in everything, it’s appropriate to split the table – shown below – into three to reflect which division the clubs were in at the time.
Turnover and Wages Table (ordered by ‘good’ ratio of turnover to wages)
..................Turnover...Wages...TO/Wages
......................................Ratio
Hull City....(PL)..£88.5m...-£38.6m...2.29
Cardiff City.(PL)..£79.9m...-£46.7m...1.71
Fulham.......(PL)..£91.3m...-£60.4m...1.51
Average............£86.5m...-£48.6m...1.83
Watford......(Ch)..£16.7m...-£11.9m...1.40
Derby........(Ch)..£20.2m...-£14.5m...1.39
Brighton.....(Ch)..£24.0m...-£18.0m...1.33
Leeds United.(Ch)..£25.3m...-£20.1m...1.26
Reading......(Ch)..£38.1m...-£30.1m...1.26
Sheff Weds...(Ch)..£13.9m...-£11.1m...1.25
Wigan........(Ch)..£37.0m...-£30.0m...1.23
Charlton.....(Ch)..£12.7m...-£10.4m...1.22
Birmingham...(Ch)..£20.1m...-£18.0m...1.12
Bolton.......(Ch)..£30.6m...-£27.6m...1.11
Huddersfield.(Ch)..£10.8m...-£11.8m...0.92
Ipswich......(Ch)..£13.6m...-£13.9m...0.98
Middlesbrough(Ch)..£12.8m...-£14.4m...0.89
Blackburn....(Ch)..£30.4m...-£34.5m...0.88
Burnley......(Ch)..£15.5m...-£18.8m...0.82
Nottm Forest.(Ch)..£16.5m...-£24.0m...0.69
Bournemouth..(Ch)..£10.1m...-£17.0m...0.59
QPR..........(Ch)..£38.7m...-£66.4m...0.58
Average..(ex QPR)..£20.3m...-£19.1m...1.06
Rotherham....(L1)..£11.0m...-£ 4.8m...2.29
Wolves.......(L1)..£32.6m...-£17.9m...1.82
MK Dons......(L1)..£ 4.4m...-£ 3.5m...1.26
Preston NE...(L1)..£ 6.1m...-£ 5.7m...1.07
Bristol City.(L1)..£ 6.1m...-£ 9.9m...0.62
Brentford....(L1)..£ 3.3m...-£ 8.9m...0.37
Average............£10.6m...-£ 8.4m...1.26
On the one hand, it’s notable that Hull, Cardiff and Fulham all did the PL quite well, getting more revenue in than paying out for wages. But on closer examination, both Cardiff and Hull seemed to pay a huge price to get to the Promised Land in the first place (£31.0m and £25.6m pre-tax losses respectively the season they went up). Fulham’s debt, possibly as a result of their longer PL tenure, was less than half of Hull and Cardiff’s.
Only eight of the Championship clubs had turnover greater than wages, with Derby and Brighton managing things the ‘right way’ round most conspicuously.
Seven – and it includes the higher-debt teams of Blackburn, QPR, Forest, Middlesbrough and Ipswich – had greater wage bills than their turnover. More surprisingly, this naughty group also includes Huddersfield (because what did they do with all those wages?) and Burnley (because overall their finances are better than most others).
Encouragingly for their long-suffering fans both Bolton or Leeds were on the ‘good’ side of the turnover vs wages line.
With the exception of Brentford, whose wage bill was just over a third of their revenue, and Bristol City, the League 1 contingent seem to be particularly carefully financed, with three clubs paying less wages than revenue (notably Preston and Wolves, although the latter had a Championship wage bill still).
Experience (from their attitude to the transfer market this summer) suggests Bristol City can probably manage their debt and kick on, but I would be worried if I was a Brentford fan: there’s a new ground to build, with quite small gates and lower than average revenue while they were paying almost three times on wages as the club’s entire turnover in 2013/14. If things go wrong at the likes of Leeds, Derby, Wednesday, there’s big gates and the consequent commercial revenue to provide income, but Brentford may find the going tough if young Matthew turns to stamp-collecting or pigeon-racing.
Wages and salaries are always a point of heated discussion, and these are reported by the clubs annually. However, this will include all salaries and wages, except – probably – directors. It also won’t include contract staff such as most stewards and catering staff.
The three PL clubs wages bill isn’t surprising, but it is interesting to compare the Championship and League 1 clubs with the average PL spend (£48.5m) of those three ‘typical’ low-end PL clubs as an index. The second index compares each club’s wages bill with the Championship average (£19.1m) excluding QPR’s wage bill (as including it would absurdly skew the rest of the data).
The finishing league position is also shown.
Wages & Salaries (by Division)
Fulham.......(PL)...£60.4m
Cardiff City.(PL)...£46.7m
Hull City....(PL)...£38.6m
Average.............£48.5m
.........................Index of Wage Bill to:
.............................PL ave....Ch ave
......................................(ex QPR)
QPR..........(Ch 4)..£66.4m....137.....*348
Blackburn....(Ch 8)..£34.5m.....71......181
Reading......(Ch 7)..£30.1m.....62.....*158
Wigan........(Ch 5)..£30.0m.....62.....*157
Bolton......(Ch 14)..£27.6m.....57......145
Nottm Forest(Ch 11)..£24.0m.....49......126
Leeds United(Ch 15)..£20.1m.....41......105
Burnley......(Ch 2)..£18.8m.....39.......98
Birmingham..(Ch 21)..£18.0m.....37.......94
Brighton.....(Ch 6)..£18.0m.....37.......94
Bournemouth.(Ch 10)..£17.0m.....35.......89
Derby........(Ch 3)..£14.5m.....30.......76
Middlesbrough(Ch 12).£14.4m.....30.......76
Ipswich......(Ch 9)..£13.9m.....29.......73
Watford.....(Ch 13)..£11.9m.....24.......62
Huddersfield(Ch 17)..£11.8m.....24.......62
Sheff Weds..(Ch 16)..£11.1m.....23.......58
Charlton....(Ch 18)..£10.4m.....21.......54
(* = in PL that season)
Wolves.......(L1 1)..£17.9m.....37
Bristol City(L1 12)..£ 9.9m.....20
Brentford....(L1 2)..£ 8.9m.....18
Preston NE...(L1 5)..£ 5.7m.....12
Rotherham....(L1 4)..£ 4.8m.....10
MK Dons.....(L1 10)..£ 3.5m......7
QPR spent three times as much on wages as the division average, and almost four times the amount spent by the club that finished one position above them. Despite the obvious retort that they were hampered by PL wages from the previous season, it’s a weak argument. Other clubs – including Reading that season – have managed just fine after being relegated. Some clubs even went down two divisions yet managed to have no debt and run at a profit….
There appears to be less correlation between the wages bill and league position than might be imagined: the three clubs with the lowest Championship wage bills finished 18th, 16th and 17th (remembering that these statistics don’t include clubs that have been relegated: only one of the six clubs that finished below 18th that season is still in the Championship).
Three clubs spent only three-quarters their turnover on wages and finished 3rd (Derby), 9th (Ipswich) and 12th (Middlesbrough): certainly good management all-round at Derby.
Then there are four clubs which paid out in wages around the same as turnover. Burnley were promoted behind Leicester and Brighton finished in the play-offs. Leeds (15th) and Birmingham (21st) had the right idea, the right intent but the wrong players or manager!
Bolton and Forest paid way more for wages than their turnover, paying a small fortune to end up mid-table in 14th and 11th. They could have done what Wednesday did instead and pay half that for mid-table mediocrity.
The pre-tax profitability table pretty much echoes what has already been written. Only Preston and Rotherham were consistently profitable, or thereabouts and at the other end of the scale, red ink supplies were running low at PCWorld near QPR, Bolton and Blackburn’s grounds, with Middlesbrough and Cardiff seemingly keen to emulate these clubs. Wolves had one of the bigger losses sliding out of the Championship but turned a significant profit getting out of League 1.
Regardless of the debt situation, there is a number of clubs who clearly were shooting for break-even (or better) each year….from MK Dons, Wednesday, Birmingham and Reading to Huddersfield and Charlton (and probably Fulham). Big crowds and the discovery of a home-grown superstar should get any of them comfortably into the black. Beyond that, running a loss for a season or two surely would seem to require promotion or big commercial revenues (Derby, Ipswich, Bristol City, Wolves, Brighton).
However, for some, the size of the debts or losses (or both) must surely require daddy’s deep pockets for salvation (Brentford, Forest, Hull, Middlesbrough, Cardiff).
For QPR, Blackburn and Bolton, the future seems bleaker: QPR have a shot at promotion again, but Bolton and Blackburn seem to be heading the other way.
Pre Tax Profits or Losses (showing division for both seasons)
.................2013/14.........2012/13.....2012 to 2014
Preston NE....(L1)..+£16.4m...(L1)..-£ 1.0m....+£15.4m
Wigan.........(Ch)..+£ 2.6m...(PL)..+£ 0.8m....+£ 3.4m
Rotherham.....(L1)..+£ 0.2m...(L2)..-£ 0.4m....-£ 0.2m
Watford.......(Ch)..-£ 0.3m...(Ch)..+£ 0.1m....-£ 0.2m
MK Dons.......(L1)..-£ 1.7m...(L1)..-£ 2.5m....-£ 4.2m
Sheff Weds....(Ch)..-£ 5.6m...(Ch)..-£ 3.7m....-£ 9.3m
Birmingham....(Ch)..-£ 5.5m...(Ch)..-£ 4.1m....-£ 9.6m
Reading.......(Ch)..-£ 7.3m...(PL)..-£ 2.3m....-£ 9.6m
Huddersfield..(Ch)..-£ 6.8m...(Ch)..-£ 4.0m....-£10.8m
Charlton......(Ch)..-£ 5.7m...(Ch)..-£ 6.0m....-£11.7m
Brentford.....(L1)..-£ 8.7m...(L1)..-£ 4.5m....-£13.2m
Derby.........(Ch)..-£ 7.1m...(Ch)..-£ 7.1m....-£14.2m
Burnley.......(Ch)..-£ 7.9m...(Ch)..-£ 7.6m....-£15.5m
Hull City.....(PL)..+£ 9.4m...(Ch)..-£25.6m....-£16.2m
Ipswich.......(Ch)..-£ 7.2m...(Ch)..-£ 9.8m....-£17.0m
Bristol City..(L1)..-£ 9.5m...(Ch)..-£13.0m....-£22.5m
Wolves........(L1)..+£ 8.5m...(Ch)..-£33.1m....-£24.6m
Bournemouth**.(Ch)..-£10.3m...(L1)..-£15.3m....-£25.6m
Brighton......(Ch)..-£10.6m...(Ch)..-£15.3m....-£25.9m
Leeds United..(Ch)..-£20.3m...(Ch)..-£ 9.4m....-£29.7m
Nottm Forest..(Ch)..-£23.9m...(Ch)..-£ 8.0m....-£31.9m
Fulham........(PL)..-£33.0m...(PL)..-£ 2.7m....-£35.7m
Middlesbrough.(Ch)..-£20.4m...(Ch)..-£18.5m....-£38.9m
Cardiff City..(PL)..-£11.7m...(Ch)..-£31.0m....-£42.7m
Bolton........(Ch)..-£ 9.1m...(Ch)..-£50.7m....-£59.1m
QPR...........(Ch)..-£ 9.8m...(PL)..-£65.4m....-£75.2m
Blackburn.....(Ch)..-£41.1m...(Ch)..-£36.5m....-£76.6m
** I think my source for Bournemouth's losses had the figures the wrong way round as the £15.3m loss was for 2012/13 not 2013/14. Now corrected.
Partial Datasets (alphabetical)
Blackpool.....................(Ch)..+£ 4.6m
Leicester City................(CH)..-£34.6m
Millwall......................(Ch)..-£ 1.9m
Conclusions?
Other than “don’t get started on analysing football finances”, none really. It’s all too complex. You are comparing historical figures of clubs who change policies and fortunes very quickly. Few clubs are run very badly, but sadly very few are run well.
I was surprised how little the wages bill was linked to league position, except that a low wages bill did seem to get you quickly into the division below. But once you are spending upwards of around £12m you can get to a good position: Burnley, Derby, Brighton showed that.
The analysis also led me to appreciate that the Burnley, Derby and Wolves management seem cleverer than I thought, but also that Ipswich and Middlesbrough seemed shaky, with considerable debts or loans; that Fulham are quietly “OK”, and how reliant some teams are on their benefactors (Hull and Brentford).
I discovered that neither Birmingham City nor Leeds were as badly off as you might expect, and that I would have been uncomfortable if I were a Brighton or Forest fan with the debts and losses. Much may have changed though.
I am impressed with how Rotherham, Preston and MK Dons made it into the Championship, but also wondering how long Charlton and Huddersfield can stay up. A spell in League 1 might help focus a lot of clubs on the meaning of sustainable financing.
Finally, if your club is not spending in the transfer market, perhaps ask yourself why. If debts were high, or losses were high, or you were spending more on wages than the club's turnover, then your club management is probably now having to focus on club survival: mid- or lower- table mediocrity may be better than your club appearing at The Silverlake in the Vanarama in a few seasons time...or worse. A lack of ambition may actually look a lot like ensuring the books either balance or are capable of balancing in a few years. Before squawking for the owners to go, make sure you have a replacement lined up with pockets at least as deep. So much depends on a wealthy benefactor.
Edits:
24/09/2015
- Watford and Bournemouth figures added (but averages not recalculated)
- Millwall, Blackpool, Leicester, Wigan partial information added
It is long-winded but others may be interested in the figures if not the commentary.
The figures are from analysis and reporting by The Guardian and Insider Media and relate to the accounts filed in mid 2014 (the latest accounts published by most). This means the figures are already 15 months out of date and a lot can happen in 15 months in football. Clubs have new owners, debts has been paid down, funds have been raised, gates have gone up - or down, players have been bought (mainly by Derby) and sold (mainly by Blackburn).
However, the overall state of affairs at the time was clear. A handful of clubs were either in the black (Wolves, Preston, Rotherham) or had “easily manageable” debt (Burnley and MK Dons). A couple of clubs (Bolton and QPR) have huge debts (£360m between them) requiring someone to have deep pockets (but plenty of football investors do). Beyond that it becomes more complex.
A group of clubs had debt up to around £50m that could be reduced by on-field success or commercial revenue, while there’s a smaller group who had bigger debts…up to £85m or so. Two of those – Hull and Cardiff have recent PL residence to add to their coffers – but there are four clubs – Ipswich, Blackburn, Middlesbrough and Brighton – whose fans may be somewhat more concerned for the future. Three of these clubs – all but Brighton – were spending more on wages than their turnover (see table lower down). It’s one thing to have debt but there’s the old adage that if you are in a hole, the first thing you should do is stop digging. If the owner wants to keep funding the losses, then all well and good. But you better hope that owner stays healthy and happy.
Then there are a group of five clubs who had high indebtedness, £30m to £50m, with just one of them (I think) – Reading – benefitting from parachute payments. Three of the other four - Leeds, Charlton and Forest - have had enthusiastic new owners since then so much has probably changed for the better.
Declared Debt and Loans Table at mid 2014 (latest accounts)
Wolves........(£7.0m)
Preston.......(£0.6m)
Rotherham.....(£0.1m)
Watford.......£ 4.1m
Burnley.......£ 4.6m
Wigan.........£ 9.4m
MK Dons.......£10.3m (Debt not stated)
Birmingham....£11.7m (Debt not stated)
Sheff Weds....£12.7m
Derby.........£14.6m
Brentford.....£19.2m
Bournemouth...£21.5m
Fulham........£24.0m
Bristol City..£25.6m
Leeds United..£33.0m (Debt not stated)
Huddersfield..£37.4m
Charlton......£44.1m (Debt not stated)
Nottm Forest..£46.1m
Reading.......£47.1m
Hull City.....£64.8m
Brighton......£62.5m (Debt not stated)
Middlesbrough.£76.0m (Debt not stated)
Blackburn.....£79.8m
Cardiff City..£81.1m
Ipswich.......£82.4m
QPR..........£179.6m
Bolton.......£182.1m
So 15 months ago, the four worst clubs had debts and loans totalling just over £0.5 billion in debt, and just three clubs had cash in the bank. It is perhaps significant that all three of those with net funds in the bank (and six of the nine least-indebted) have recently been in League 1.
Were any of the eight most-indebted clubs to be relegated into League 1, they might struggle to survive let alone get back up again.
So much for debt, what about spending in the 2013/14 and 2012/13 seasons?
Because of the huge difference in everything, it’s appropriate to split the table – shown below – into three to reflect which division the clubs were in at the time.
Turnover and Wages Table (ordered by ‘good’ ratio of turnover to wages)
..................Turnover...Wages...TO/Wages
......................................Ratio
Hull City....(PL)..£88.5m...-£38.6m...2.29
Cardiff City.(PL)..£79.9m...-£46.7m...1.71
Fulham.......(PL)..£91.3m...-£60.4m...1.51
Average............£86.5m...-£48.6m...1.83
Watford......(Ch)..£16.7m...-£11.9m...1.40
Derby........(Ch)..£20.2m...-£14.5m...1.39
Brighton.....(Ch)..£24.0m...-£18.0m...1.33
Leeds United.(Ch)..£25.3m...-£20.1m...1.26
Reading......(Ch)..£38.1m...-£30.1m...1.26
Sheff Weds...(Ch)..£13.9m...-£11.1m...1.25
Wigan........(Ch)..£37.0m...-£30.0m...1.23
Charlton.....(Ch)..£12.7m...-£10.4m...1.22
Birmingham...(Ch)..£20.1m...-£18.0m...1.12
Bolton.......(Ch)..£30.6m...-£27.6m...1.11
Huddersfield.(Ch)..£10.8m...-£11.8m...0.92
Ipswich......(Ch)..£13.6m...-£13.9m...0.98
Middlesbrough(Ch)..£12.8m...-£14.4m...0.89
Blackburn....(Ch)..£30.4m...-£34.5m...0.88
Burnley......(Ch)..£15.5m...-£18.8m...0.82
Nottm Forest.(Ch)..£16.5m...-£24.0m...0.69
Bournemouth..(Ch)..£10.1m...-£17.0m...0.59
QPR..........(Ch)..£38.7m...-£66.4m...0.58
Average..(ex QPR)..£20.3m...-£19.1m...1.06
Rotherham....(L1)..£11.0m...-£ 4.8m...2.29
Wolves.......(L1)..£32.6m...-£17.9m...1.82
MK Dons......(L1)..£ 4.4m...-£ 3.5m...1.26
Preston NE...(L1)..£ 6.1m...-£ 5.7m...1.07
Bristol City.(L1)..£ 6.1m...-£ 9.9m...0.62
Brentford....(L1)..£ 3.3m...-£ 8.9m...0.37
Average............£10.6m...-£ 8.4m...1.26
On the one hand, it’s notable that Hull, Cardiff and Fulham all did the PL quite well, getting more revenue in than paying out for wages. But on closer examination, both Cardiff and Hull seemed to pay a huge price to get to the Promised Land in the first place (£31.0m and £25.6m pre-tax losses respectively the season they went up). Fulham’s debt, possibly as a result of their longer PL tenure, was less than half of Hull and Cardiff’s.
Only eight of the Championship clubs had turnover greater than wages, with Derby and Brighton managing things the ‘right way’ round most conspicuously.
Seven – and it includes the higher-debt teams of Blackburn, QPR, Forest, Middlesbrough and Ipswich – had greater wage bills than their turnover. More surprisingly, this naughty group also includes Huddersfield (because what did they do with all those wages?) and Burnley (because overall their finances are better than most others).
Encouragingly for their long-suffering fans both Bolton or Leeds were on the ‘good’ side of the turnover vs wages line.
With the exception of Brentford, whose wage bill was just over a third of their revenue, and Bristol City, the League 1 contingent seem to be particularly carefully financed, with three clubs paying less wages than revenue (notably Preston and Wolves, although the latter had a Championship wage bill still).
Experience (from their attitude to the transfer market this summer) suggests Bristol City can probably manage their debt and kick on, but I would be worried if I was a Brentford fan: there’s a new ground to build, with quite small gates and lower than average revenue while they were paying almost three times on wages as the club’s entire turnover in 2013/14. If things go wrong at the likes of Leeds, Derby, Wednesday, there’s big gates and the consequent commercial revenue to provide income, but Brentford may find the going tough if young Matthew turns to stamp-collecting or pigeon-racing.
Wages and salaries are always a point of heated discussion, and these are reported by the clubs annually. However, this will include all salaries and wages, except – probably – directors. It also won’t include contract staff such as most stewards and catering staff.
The three PL clubs wages bill isn’t surprising, but it is interesting to compare the Championship and League 1 clubs with the average PL spend (£48.5m) of those three ‘typical’ low-end PL clubs as an index. The second index compares each club’s wages bill with the Championship average (£19.1m) excluding QPR’s wage bill (as including it would absurdly skew the rest of the data).
The finishing league position is also shown.
Wages & Salaries (by Division)
Fulham.......(PL)...£60.4m
Cardiff City.(PL)...£46.7m
Hull City....(PL)...£38.6m
Average.............£48.5m
.........................Index of Wage Bill to:
.............................PL ave....Ch ave
......................................(ex QPR)
QPR..........(Ch 4)..£66.4m....137.....*348
Blackburn....(Ch 8)..£34.5m.....71......181
Reading......(Ch 7)..£30.1m.....62.....*158
Wigan........(Ch 5)..£30.0m.....62.....*157
Bolton......(Ch 14)..£27.6m.....57......145
Nottm Forest(Ch 11)..£24.0m.....49......126
Leeds United(Ch 15)..£20.1m.....41......105
Burnley......(Ch 2)..£18.8m.....39.......98
Birmingham..(Ch 21)..£18.0m.....37.......94
Brighton.....(Ch 6)..£18.0m.....37.......94
Bournemouth.(Ch 10)..£17.0m.....35.......89
Derby........(Ch 3)..£14.5m.....30.......76
Middlesbrough(Ch 12).£14.4m.....30.......76
Ipswich......(Ch 9)..£13.9m.....29.......73
Watford.....(Ch 13)..£11.9m.....24.......62
Huddersfield(Ch 17)..£11.8m.....24.......62
Sheff Weds..(Ch 16)..£11.1m.....23.......58
Charlton....(Ch 18)..£10.4m.....21.......54
(* = in PL that season)
Wolves.......(L1 1)..£17.9m.....37
Bristol City(L1 12)..£ 9.9m.....20
Brentford....(L1 2)..£ 8.9m.....18
Preston NE...(L1 5)..£ 5.7m.....12
Rotherham....(L1 4)..£ 4.8m.....10
MK Dons.....(L1 10)..£ 3.5m......7
QPR spent three times as much on wages as the division average, and almost four times the amount spent by the club that finished one position above them. Despite the obvious retort that they were hampered by PL wages from the previous season, it’s a weak argument. Other clubs – including Reading that season – have managed just fine after being relegated. Some clubs even went down two divisions yet managed to have no debt and run at a profit….
There appears to be less correlation between the wages bill and league position than might be imagined: the three clubs with the lowest Championship wage bills finished 18th, 16th and 17th (remembering that these statistics don’t include clubs that have been relegated: only one of the six clubs that finished below 18th that season is still in the Championship).
Three clubs spent only three-quarters their turnover on wages and finished 3rd (Derby), 9th (Ipswich) and 12th (Middlesbrough): certainly good management all-round at Derby.
Then there are four clubs which paid out in wages around the same as turnover. Burnley were promoted behind Leicester and Brighton finished in the play-offs. Leeds (15th) and Birmingham (21st) had the right idea, the right intent but the wrong players or manager!
Bolton and Forest paid way more for wages than their turnover, paying a small fortune to end up mid-table in 14th and 11th. They could have done what Wednesday did instead and pay half that for mid-table mediocrity.
The pre-tax profitability table pretty much echoes what has already been written. Only Preston and Rotherham were consistently profitable, or thereabouts and at the other end of the scale, red ink supplies were running low at PCWorld near QPR, Bolton and Blackburn’s grounds, with Middlesbrough and Cardiff seemingly keen to emulate these clubs. Wolves had one of the bigger losses sliding out of the Championship but turned a significant profit getting out of League 1.
Regardless of the debt situation, there is a number of clubs who clearly were shooting for break-even (or better) each year….from MK Dons, Wednesday, Birmingham and Reading to Huddersfield and Charlton (and probably Fulham). Big crowds and the discovery of a home-grown superstar should get any of them comfortably into the black. Beyond that, running a loss for a season or two surely would seem to require promotion or big commercial revenues (Derby, Ipswich, Bristol City, Wolves, Brighton).
However, for some, the size of the debts or losses (or both) must surely require daddy’s deep pockets for salvation (Brentford, Forest, Hull, Middlesbrough, Cardiff).
For QPR, Blackburn and Bolton, the future seems bleaker: QPR have a shot at promotion again, but Bolton and Blackburn seem to be heading the other way.
Pre Tax Profits or Losses (showing division for both seasons)
.................2013/14.........2012/13.....2012 to 2014
Preston NE....(L1)..+£16.4m...(L1)..-£ 1.0m....+£15.4m
Wigan.........(Ch)..+£ 2.6m...(PL)..+£ 0.8m....+£ 3.4m
Rotherham.....(L1)..+£ 0.2m...(L2)..-£ 0.4m....-£ 0.2m
Watford.......(Ch)..-£ 0.3m...(Ch)..+£ 0.1m....-£ 0.2m
MK Dons.......(L1)..-£ 1.7m...(L1)..-£ 2.5m....-£ 4.2m
Sheff Weds....(Ch)..-£ 5.6m...(Ch)..-£ 3.7m....-£ 9.3m
Birmingham....(Ch)..-£ 5.5m...(Ch)..-£ 4.1m....-£ 9.6m
Reading.......(Ch)..-£ 7.3m...(PL)..-£ 2.3m....-£ 9.6m
Huddersfield..(Ch)..-£ 6.8m...(Ch)..-£ 4.0m....-£10.8m
Charlton......(Ch)..-£ 5.7m...(Ch)..-£ 6.0m....-£11.7m
Brentford.....(L1)..-£ 8.7m...(L1)..-£ 4.5m....-£13.2m
Derby.........(Ch)..-£ 7.1m...(Ch)..-£ 7.1m....-£14.2m
Burnley.......(Ch)..-£ 7.9m...(Ch)..-£ 7.6m....-£15.5m
Hull City.....(PL)..+£ 9.4m...(Ch)..-£25.6m....-£16.2m
Ipswich.......(Ch)..-£ 7.2m...(Ch)..-£ 9.8m....-£17.0m
Bristol City..(L1)..-£ 9.5m...(Ch)..-£13.0m....-£22.5m
Wolves........(L1)..+£ 8.5m...(Ch)..-£33.1m....-£24.6m
Bournemouth**.(Ch)..-£10.3m...(L1)..-£15.3m....-£25.6m
Brighton......(Ch)..-£10.6m...(Ch)..-£15.3m....-£25.9m
Leeds United..(Ch)..-£20.3m...(Ch)..-£ 9.4m....-£29.7m
Nottm Forest..(Ch)..-£23.9m...(Ch)..-£ 8.0m....-£31.9m
Fulham........(PL)..-£33.0m...(PL)..-£ 2.7m....-£35.7m
Middlesbrough.(Ch)..-£20.4m...(Ch)..-£18.5m....-£38.9m
Cardiff City..(PL)..-£11.7m...(Ch)..-£31.0m....-£42.7m
Bolton........(Ch)..-£ 9.1m...(Ch)..-£50.7m....-£59.1m
QPR...........(Ch)..-£ 9.8m...(PL)..-£65.4m....-£75.2m
Blackburn.....(Ch)..-£41.1m...(Ch)..-£36.5m....-£76.6m
** I think my source for Bournemouth's losses had the figures the wrong way round as the £15.3m loss was for 2012/13 not 2013/14. Now corrected.
Partial Datasets (alphabetical)
Blackpool.....................(Ch)..+£ 4.6m
Leicester City................(CH)..-£34.6m
Millwall......................(Ch)..-£ 1.9m
Conclusions?
Other than “don’t get started on analysing football finances”, none really. It’s all too complex. You are comparing historical figures of clubs who change policies and fortunes very quickly. Few clubs are run very badly, but sadly very few are run well.
I was surprised how little the wages bill was linked to league position, except that a low wages bill did seem to get you quickly into the division below. But once you are spending upwards of around £12m you can get to a good position: Burnley, Derby, Brighton showed that.
The analysis also led me to appreciate that the Burnley, Derby and Wolves management seem cleverer than I thought, but also that Ipswich and Middlesbrough seemed shaky, with considerable debts or loans; that Fulham are quietly “OK”, and how reliant some teams are on their benefactors (Hull and Brentford).
I discovered that neither Birmingham City nor Leeds were as badly off as you might expect, and that I would have been uncomfortable if I were a Brighton or Forest fan with the debts and losses. Much may have changed though.
I am impressed with how Rotherham, Preston and MK Dons made it into the Championship, but also wondering how long Charlton and Huddersfield can stay up. A spell in League 1 might help focus a lot of clubs on the meaning of sustainable financing.
Finally, if your club is not spending in the transfer market, perhaps ask yourself why. If debts were high, or losses were high, or you were spending more on wages than the club's turnover, then your club management is probably now having to focus on club survival: mid- or lower- table mediocrity may be better than your club appearing at The Silverlake in the Vanarama in a few seasons time...or worse. A lack of ambition may actually look a lot like ensuring the books either balance or are capable of balancing in a few years. Before squawking for the owners to go, make sure you have a replacement lined up with pockets at least as deep. So much depends on a wealthy benefactor.
Edits:
24/09/2015
- Watford and Bournemouth figures added (but averages not recalculated)
- Millwall, Blackpool, Leicester, Wigan partial information added
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