Financial Results

Every club in the Championship has made an operating loss in the last 2 years. See the attached graph. Championship clubs therefore have to be shored up by their owners with millions every season. That's what owners of Championship clubs have to do. The only clubs which made a profit over this period were Watford and Coventry who made some serious dosh from player transfers but they are the exception.

 

Indeed. They won't dry up entirely but few clubs in the Championship make sufficient money on transfers to offset the losses elsewhere. Last season, Watford made a profit on player transfers of £29 mill and Coventry made a profit on transfers of £24 mill. They were needed to offset enormous losses for the clubs and to earn a modest profit overall. And they were the exceptions. Welcome to the world of the Championship, Stefan.

 

It's highly unlikely imo with our current owner. Why would he choose to plough a substantial portion of his own fortune into the club where he has little emotional attachment? There would have to be a fundamental change in the financial structure of football before it would be considered. It's bonkers at the moment. If football clubs were a 'normal business' making widgets, I'd question the mentality and business acumen of those owners investing in it.

As the old adage goes, how do you make a small fortune in Championship football? Start with a large one!

I recall ML once saying that his mate Dean Hoyle who was the owner of Town at the time put over £60mill into his club over a fairly short period to fund their losses in the Championship. It was one of the reasons why ML decided to sell the club to somebody with the means to take it forward.

 

I can't see that comment. It may be because I don't have an X account of course!

It's an interesting comment though. Is there a suggestion that there is somebody in the wings who is interested in buying VP? No doubt it will set some hares running.

 

Just to be clear, the £2.5mill shown in the Financial Results as the Net Asset Deficiency is not the same as the club's debt. It is simply a coincidence to be so similar. It's a weird number to be included in the Financial Results highlights. One interpretation of it is that it represents the nominal value of the equity in the club when it was originally bought 20 or so years ago less the accumulated annual losses incurred since then! Or if you like, the negative funds of the shareholders in a loss making business.Yes, really! Does it make any sense at all to know that? It makes less sense to me as a chartered accountant compared to some things which have not been disclosed.

Coincidentally, the club's debt outstanding in loans (strictly speaking those due in more than 12 months time) is a similar(ish) value of £2.9 mill. There's no mention of that in the Financial Results which is surprising to me. It doesn't expressly say why it has increased in the past 12 months (we could all hazard a guess) nor where it was sourced, again we could all speculate. Both could be pieces of good news imo and yet the club chooses not to share that with its principal sources of funds, its fans. That's puzzling.