Wolves Post Profit Despite Increased Player Trading
Tue 28th Feb 2012 | Money & Finance
Wolverhampton Wanderers have posted a healthy pre-tax profit of £2.2m for the year, which ended 31st May 2011
In the latest financial figures released today, Wolves generated a pre-tax profit for the year, after player trading and net interest, of £2.2m, compared with a £9.1m profit at the end of the previous financial year (2009/2010 season).
The results show Wolves continued trend of being a significant net spender in the transfer market as it attempted to improve on the previous season's league position (15th place, on 38 points). In the end the team slightly improved its points tally but finished in a lower league position (17th place, on 40 points).
Operating costs were higher than the previous financial year, primarily because of higher player payroll costs taking the overall company payroll to £37.9m compared with £29.8m in the previous year.
Turnover for the reporting period increased to £64.6m, compared to £60.4m during the 2009/2010 season. This uplift in turnover can be primarily attributed to the benefit of the new central Premier League three year deal, including television rights and other central deals and sponsorships.
At year end the Club's holding company, (WW (1990) Ltd) had a strong balance sheet with net assets totalling £72.7m. This figure includes the Club's property assets such as Molineux Stadium and the Sir Jack Hayward Training Ground.
However, transfer market valuations of players are not included. In accordance with accounting guidelines, the cost of players bought is included on the balance sheet, initially at the acquisition cost but subsequently written down over the life of their contracts.
Wolves were granted full planning permission for the Compton Park development in December 2011, which will result in a new Academy facility, adjacent to the club's existing training complex. Wolves will build a new indoor pitch on the vacated St Edmund's Catholic School site and improve existing pitches in the hope of creating a Premier League 'Category 1' Football Academy, in accordance with the new Academy accreditation system.
At Molineux, Wolves are currently progressing with the redevelopment of the Stan Cullis Stand, which is on track to be completed for the start of the 2012/2013 season. This will include much better facilities for fans and, over the long-term, increase the Club's revenue both on match day and non-match days, through the new WV1 hospitality facilities, new Megastore and the new Club Museum.
Jez Moxey, Wolves' Chief Executive, said: "We are pleased to announce our annual financial results, which we always share first with our supporters, via the Fans' Parliament.
"These are solid results, which reflect the Club's strong financial health. We are committed to running the Club on this firm financial footing, whilst continually looking to invest in the first team. The investments in infrastructure - whether that be the redevelopment of Molineux Stadium or the new Academy - have both been made with the future success of the first team in mind.
"The prospect of increased revenues, over the long-term, potentially means more money to invest in the squad, and our aim to become a 'Category 1' Premier League Football Academy puts the Club in a good position to secure the best young talent in the face of intense competition from other teams.”
Posted by: Aaron Gourley
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