Newcastles Prudence Produces Profit Of £9.9m
Tue 25th Feb 2014 | Money & Finance
Newcastle United have posted a profit after tax of £9.9m for the year ending June 2013.
The figures, released first at the club's Fans Forum which took place at St. James' Park on Monday evening, before filing them with Companies House show the club has continued to make positive progress in line with UEFA's Financial Fair Play Regulations,
Player trading, a strong commercial performance and a significant reduction in operational losses have contributed to a profit after tax of £9.9million - up from £1.4million in 2011/12.
Newcastle’s cash outlay on players was £28.7million - up more than 30 per cent on the £19.7million spent in the previous season with a trading profit on players of £10.6million after amortisation.
Matchday turnover, which includes tickets sales and hospitality, also rose by 15.9 per cent to £27.8million, representing a £3.9million increase from the £23.9million recorded in the previous year.
The figures are in light of strong season ticket renewal figures, with the average Premier League attendance rising to 50,517 in 2012/13 and seven additional fixtures in the UEFA Europa League.
Media turnover, which is related to the club's success in the Premier League and UEFA Europa League, was down by eight per cent to £51million, with a run into the quarter-final stage of the latter competition unable to fully offset the impact of the club's 16th-place domestic finish.
Operational losses were reduced from £5.1million in 2011/12 to just £616,000 in 2012/13 as they continue towards running at breakeven and meeting UEFA and Premier League regulations
The club's total wage bill fell from £64.1million to £61.7million and wage-to-turnover ratio now stands at 64 per cent - down four per cent. However, this only includes up to six months of the additional wages of six January purchases.
While Newcastle United's use of its overdraft facility stood at £4.5million on 30th June 2013 - up from just £0.3million, the club's debt remains static in the form of a £129million interest-free loan from owner Mike Ashley.
A statement released by the Newcastle United board read, "As supporters will be aware, finances are a significant issue for all football clubs given the introduction of Financial Fair Play into the Premier League in addition to UEFA's Regulations.
"Complying with FFP continues to be a key influence on strategy and something we have been working hard at over a number of years.
"Everyone at this club wants to finish as high up the Barclays Premier League table as they possibly can. If the club can sustain itself as a 'top ten' team year-on-year with a stable structure and the right finances, it gives itself every chance of pushing even further.
"Matchday and commercial revenue is a key driver because that's where the club can compete with - and outperform - its competitors to enhance its spending capabilities.
"Ultimately the income the club generates, particularly, given the restrictions of the Premier League FFP Rules, from matchday, commercial i.e. non-TV income, will directly impact on the strength and quality on the pitch.
"The process requires patience but we remain absolutely committed to growing the club in a responsible and sustainable way."
Image: Action Images / Lee Smith
Posted by: Aaron Gourley
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