Brighton Report Operating Loss Despite Increased Turnover
Fri 7th Feb 2014 | Money & Finance
Brighton & Hove Albion’s annual accounts show that the club made an operating loss of £14.7m in the 2012/13 season.
The financial results for the year to 30th June 2013 reflect the club’s second year at the American Express Community Stadium and show an increase in turnover from £22.1m to £23.3m but a significantly increased operating loss from the £8.6m in the first season at the stadium.
Ticketing, commercial and retail income saw a slight increase, rising to £14.3m from £13.8m but overall turnover growth was held back as the contribution from Football League income dropped from £5.7m to £4.8m due to a new reduced deal for TV rights.
The increased operating loss arises primarily due to a 41% increase in football costs from £14.8m to £20.9m; as a result of new signings and an increase in player wages as the club made a concerted effort to achieve promotion to the Premier League.
There was also a slight increase in administrative and operational costs from £16m to £17.2m, but this figure includes a number of one-off exceptional costs, mainly as the result of a staff redundancy programme, and also the club taking the opportunity to absorb some other one-off operational costs before FFP sanctions are imposed.
Albion chief executive Paul Barber commented, "This set of results shows the reality of football in the Championship in recent years and demonstrates the very high cost of being competitive – with no guarantee of promotion to the Premier League.
"We had the highest average crowd in the Football League last season and we continued to grow the revenues we can control but, in order to compete at the top end of the Championship, we had to once again rely on another considerable investment from our chairman Tony Bloom.
"Not only has Tony provided interest-free funding to build the American Express Community stadium and the new training ground project, which opens this summer, he has also covered the club's losses to date and is committed to funding future losses.
"The board’s short-term ambition remains to see the club promoted to, and established within, the top level of English football.
"On behalf of all Albion fans, the board would like to place on record its sincere thanks to Tony for his incredibly generous personal support that continues to take the club forward.”
For the 2012/13 season Albion recorded a Financial Fair Play deficit, but it was the last season before sanctions are applied to clubs not complying with the new regulations.
The maximum permitted allowance (loss) for the 2013/14 season is £8m, and Barber confirmed the club is on course to meet its Financial Fair Play target for the current season.
He added, "We simply cannot sit back and rely on Tony’s continued generosity alone. The new rules do not allow this, even if it was something Tony was prepared to do.
Therefore, as a club we remain committed to the Financial Fair Play philosophy. The challenge for all of us is to continue to ensure the club is as efficient as possible, while continuing to grow our income streams.
"With regard to the FFP landscape, it is still new territory for all clubs and there has been much talk at both Premier League and Championship level about what other clubs are doing and whether they will comply.
"At this time, our concern is simply Brighton & Hove Albion and what we are doing. We remain absolutely committed to a long-term strategy for the club which ensures our future financial sustainability, so, whilst it may not be a perfect system, we continue to agree with the principle of FFP."
Image: Action Images / Paul Childs
Posted by: Aaron Gourley
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