Millwall financial results 2017: Our House


I like Millwall for many reasons. I was born in Southwark, so they were the nearest club to me as a kid. My Uncle Tom had trials for them in the early 50’s. My Uncle Terry, who taught me how to play football, love the game and hate Crystal Palace, supported them for over 60 years. Add to that the Danny Baker factor (and ignoring that Rod Liddle is a CJTC) and there’s a lot of positives.

2016/17 was a successful year in League One, with the club returning to the Championship via the playoffs, and there was some success in the FA Cup too, reaching the quarter final stage.

Off the pitch things were not so good. Lewisham council’s behaviour in trying to arrange a compulsory purchase order for land occupied by the club led to accusations of skulduggery and whitewash by fans.

At present there’s no guarantee about where the club will be playing its fixtures in the medium term if the land is sold to property developers.

Key financial figures for 2016/17:

Income £10.0 million (up 20.5%).

Wages £9.4 million (up 17.3%)

Losses before player sales £5.5 million (down 5.5%)

Player signings £923,000

Player sales £514,000

Debts £18.1 million (no major change)

Millwall’s set up is tricky to follow. Millwall Football Club Limited are owned by Millwall Holdings plc, who are owned by Chestnut Hill Ventures (CHV) LLC, based in the USA.

CHV is controlled by American businessman John Berylson, who sued Steve ‘Shagger’ Norris successfully for libel last year in relation to Millwall related issues, and therefore, for the benefit of any doubt, we think that John Berylson is a very very nice man, who helps little old ladies cross the road, and likes puppies.


All clubs generate money from three sources, matchday, broadcasting and commercial. Being stuck in League One for the last two seasons has had a detrimental impact on Millwall’s finances.

Matchday income rose by just over 20%, reflecting Millwall’s success in reaching Wembley for the playoff final, as well as a lucrative FA Cup match against Spurs. We would expect matchday income to at least hold steady in 2017/18 due to the number of clubs in the Championship with large away followings.

Relegation from the Championship in 2015 significantly reduced Millwall’s broadcasting income.

In terms of boradcasting income, EFL clubs generate cash from two sources.

‘Solidarity’ payments from the Premier League (EPL) are from the £5.1 billion domestic TV deal with BT and Sky. This is given as a fixed percentage of the deal, and works out as about £645,000 for each League 1 club. Promotion to the Championship will result in a significant increase to Millwall of £4.3 million for 2017/18.

In addition, the EFL has its own TV deal with Sky, but this generates only £88 million per season to be split between the 72 EFL clubs, skewed towards clubs in the Championship. This will also benefit Millwall in 2017/18.

If matches are broadcast live, Millwall will earn £100,000 for each home game and £10,000 for every away game broadcast live on Sky. In a division featuring clubs such as Leeds, Villa, Sunderland, Wolves, Millwall are unlikely to be a first pick for the broadcasters unless they are playing one of the bigger clubs, who can generate decent TV ratings for Sky.

Millwall will have to compete with clubs who have been relegated from the EPL and receive parachute payments. These dwarf income from other sources.

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Other income, mainly commercial and retail, has been broadly constant over the last five years.

We anticipate that Millwall be towards the bottom of the income table for 2017/18 for Championship clubs, based on the latest figures we have for other clubs in the division.


The main costs for a club are in relation to players, and come in the form of wages and player amortisation.

Wages rose by 17% to £9.4 million. The only other clubs we have figures for from League One last season to date are Sheffield United (promoted) at £10.0 million and Walsall at £3.4 million.

Relegation to League One in 2015 meant that Millwall had to slash the wage bill and offload players on well paid contracts.

This is because  Financial Fair Play operates as a wage cap in League One. Clubs can only pay out 60% of income in terms of playing staff wages (this cap ignores non-player wages).

It is possible for club owners to contribute here if they invest money into the club in the form of new shares, as these are added to the income figure. So, if a club owner invests £1 million into a League One club the playing staff wage budget can be increased by £600,000

The wage/income ratio for Millwall was the lowest for many years at 94%, or to put it in more simple terms, the club paid out £94 in wages for every £100 they generated from revenue. This of course leaves effectively nothing to pay for all the other overheads of the club, such as ground maintenance, heat and light, HR, finance and so on.

The above table also highlights how difficult was for Millwall the last time they were in the Championship, as the wage/income ratio was over 130%.

The Championship is a car crash of a division, with wages averaging 101% of income for 2015/16, despite so many clubs receiving large sums in the form of parachute payments.

We would expect Millwall’s wage bill to rise substantially in 2017/18, but to be still significantly less than those of clubs such as relegated Norwich, who paid out £55.1 million in 2016/17, and promoted Brighton, with £31.3 million plus a further £9 million in promotion bonuses.

We estimate that average wages in the Championship are about £12,000 a week, compared to £2,500 a week in League One. This means that Millwall were probably one of the big payers last season, but that will be reversed in 2017/18.

Millwall’s best hope for promotion is to strike lucky in terms of player recruitment in terms of signings and loan deals for relatively unknown players. The likes of Huddersfield, Wigan, Burnley and Blackpool over the last decade shows that this is achievable.

The other player related expense is that of player amortisation. This is the cost of signing a player spread over the length of his contract. This is how the club deals with player signings, and spreads the cost of a new player over the life of his contract.

So, if Millwall sign a player for £1 million on a four-year contract this works out as £250,000 amortisation a year for four years.

In League One, there are opportunities to sign players for relatively low sums. This is reflected in the amortisation charge being only £0.2 million in 2016/17. The average figure in the Championship is about £6 million.

The advantage of focussing on amortisation instead of just looking at transfer fees is that it removes some of the volatility from making one big signing in a single year.

We would expect the amortisation charge to continue at these levels at least for 2017/18.

Finance costs:

Millwall has debts of about £18 million, and interest is charged on these. Some of the debts are due to the owners at CHV.

The total interest cost was just over £1 million, or £20,000 a week. CHV charges interest at 12% per annum, but appears to have waived this for 2016/17 (and for many previous years too). The accounting for this is complex, and for the present CHV are keeping the club afloat.

Directors pay

Millwall have a moderate policy in relation to director pay compared to League One clubs, but low for the Championship. £164,000 compared to over £190,000 for both Sheffield United and Walsall. In the Championship seven clubs paid over £200,000, and some over a million.


Losses are income less costs, and were £5.3 million last season, (£101,000 a week), before considering player sales, which reduced this figure by half a million.

Over the last five years Millwall have lost money each season. Total losses before player sales were £35.4 million, and the highest position during that period was 19th in the Championship.

Player sales reduced these losses by £1.5 million, but it is still a substantial level of commitment required from owner John Berylson (who remember, is a very, very nice man if his lawyers are reading this) to underwrite these losses.

Losses in the Championship are expected to total over £400 million last season. This is only sustainable if owners continue to fund clubs.

Player trading:

Millwall invested a reasonable amount by League One standards last season in pushing for promotion.

The club spent £923,000 on new signings, and sold others for £514,000. Promoted Sheffield United paid out £3.1 million, but fifteen clubs in League One spent less than £100,000 on player additions.

This season in the Championship Millwall be up against clubs with very large player budgets. Last season the relegated clubs splashed out their parachute payments on new players attempting to bounce back to the EPL with Aston Villa (£76 million) Newcastle (£57 million) and Norwich (£20 million) having varying success.

The Owner

John Berylson’s investment increased further in 2016/17 as he invested a further £3 million in the club via a new share issue.

This takes his total investment to just over £56 million, in the form of shares and loans.

Realistically, Berylson will have to subsidise the club by a minimum of £5 million a year for the foreseeable future, unless promotion to the Premier League is achieved. His biggest battle is going to be with the council, and their behaviour in relation to the New Den. Regardless of the team you support, this is one issue around which all fans should unite in campaigning for the club to stay at their present home.

It looks as if Berylson (very nice man) has put a further £4.3 million into the club in December 2017 too, according to documents lodged at Companies House.


Millwall are in a tricky position. They have the infrastructure to be successful in League One, but as a community club, the owner does not want to compete with some of the big spenders in the Championship, which is understandable.

Continued membership of the Championship is likely to be an expensive exercise, despite the additional income that generates, mainly due to the struggle to compete with higher wages.

The biggest battle awaits with the council, and it’s one match that is essential the club wins.

Walsall: Mama Weer All Crazee Now

Football, it’s all about money, footballers are a bunch of greedy tossers, all clubs lose a fortune and are bankrolled by overseas millionaires, the game is going to destroy itself etc.

But here’s a different club. It lives within its means, makes a profit every year, and that’s without selling a single player for a fee, and has 128 staff who between them earn just over half of what Manchester United pay Jesse Lingard.  Perhaps it could make you fall in love with the game again?

The club is Walsall, in the Black Country, nice little stadium, shame about the lack of decent pubs nearby, but other than that the epitome of a stable lower league outfit who have spent the last ten years in League One. (I now await revelations from angry Saddlers fans who spill the dirt on their club).

As a Brighton fan, I have mixed reactions about Walsall, watching my team lose 2-1 in an insipid Capital One Cup game at the start of 2015/16 season. and seeing the mighty Chris O’Grady’s last kick for the club as he put a penalty for the Albion into Row Z before being immediately substituted and running off the pitch faster than he’d moved during the match.


Most clubs show three types of income in their accounts, but somewhat frustratingly Walsall only show two, by combining broadcasting and commercial streams.

Walsall’s income was almost unchanged at £6.6 million in 2016/17, although a £493,000 increase in commercial/broadcast offset a £425,000 (28%) fall in matchday income. The latter was partially due to a playoff finish and reasonable runs in cup competitions benefitted the club in 2015/16 when they played Chelsea in the League Cup and made it to the fourth round of the FA Cup.

A new BT/Sky TV deal for the Premier League resulted in an increase in solidarity payments that trickle down to League One clubs from £360,000 to £645,000.

Over the last five years Walsall’s income has been growing steadily, mainly due to non-matchday sources.

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Footballs main costs are in relation to players, and here Walsall seem to have a lid on their ambitions.

The total wage bill for 2016/17 was £3.12 million, or just over £60,000 a week, before adding in pension and national insurance costs. This works out as an average of £470 a week for the staff. Even so this represents a 36% increase in the wages paid in 2012/13 of £2.29 million, where the average Walsall employee was on £390 a week.

The club clearly have a tight wage budget set each year, and this is why the wage to income ratio fluctuates in a narrow range around 50%. This compares to an average of 101% for clubs in the Championship.

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The employees who have perhaps done most well from the club are the directors, whose pay has increased from £106,000 to £192,000 over the five years of our analysis.

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The club appears to rent its stadium and training ground. The rent fluctuates from year to year, and went up from £400k to £449k in 2017. This appears somewhat strange, as the club appears to both own and rent the Bescot.

Talking to some fans on Twitter, it appears that the club owns the stadium, but the land it occupies is rented. Apparently the land is owned by Chairman Jeff Bonser’s pension fund.

This has been investigated by the excellent David Conn in The Grauniad.

The club is therefore committed to paying about another £5m in rent for land at the stadium until the next review.

It therefore appears that the board are generating money from the club directly and indirectly in three areas, fees (£192k), rent (£440k) and interest on loans (not too clear but at least £6k).

This doesn’t mean that Posner and his colleagues are in the Monty Burns category of evil company owners, but neither are the likely to be nudging the likes of local philanthropists at other clubs such as Steve Gibson (Boro), Peter Coates (Stoke) and Tony Bloom (Brighton) off their crowns either.


Profits are income less costs. Walsall seem to be able to break even each year, just. This could be manipulated by the directors’ tweaking their pay to ensure the club finishes in the black each season.

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Player trading

You don’t see Walsall mentioned too often in the transfer gossip columns of the papers or sports broadcasters, and there’s a good reason for that.

It initially appears that during  the four years leading up to 2016/17 the club neither sold nor bought a player for a fee.

This record was broken during the last season, when Cypriot striker Andreas Makris was signed for a supposed record fee of £270,000 (€300,000). This was funded by Walsall’s success the previous season.

This fee is at odds with the accounts though, which reveal that the actual amount paid was £179,000 (€200,000). Makris’s season proved to one of disappointment, with one goal in 32 games. After proving to be shite a disappointment Makris’s value was written down in the accounts, and he was sold back to Cyprus in the summer of 2017. Whilst the fee wasn’t disclosed, it looks, from a bit of number triangulation, the fee was about £110,000.

In relation to the sale of players, the issue is muddied by the way the club appears to have dealt with the issue. Normally, when a club makes a disposal, it is shown separately on the profit and loss account, as the club is not in the actual business of selling players.

Sheffield United do this in their accounts, as do practically all others.

What Walsall appear to have done is fold in the profit on player sales within their ‘football and commercial income’ heading. That’s at best reducing transparency, we think it’s a shabby way to deal with the subject, and inconsistent with what we believe is best business practice.


Walsall have shown that a club can break even, by managing their wage budget carefully, and being cautious in the transfer market (ten clubs in League One did not sign players for fees in 2015/16 for example).

Had they been promoted to the Championship in 2015/16 after finishing third and making the playoffs, they would have had a season in the sun, playing the likes of local rivals Villa, Birmingham and Wolves. Having done so once, and seen the likes of Shrewsbury have a good season to date in League One, it’s difficult to see the Saddlers change their business model for the foreseeable future.

The club does have debts of around £2 million from the directors, but these are serviceable. Part of these loans are interest free.

From an analysts’ perspective, it’s also a breath of fresh air to see a club being so transparent and putting out its full results in the public domain for fans to see. Clubs are a part of the community, and the community have a moral right to know about how the club is financed.

However what should be three cheers is reduced to two.

The methods used to extract money from the club by some who are responsible for its long term welfare, and the way that some figures (such as player disposals) are not disclosed.

This is harsh on those who travel the length and breadth of the country watching the team play every week.

Fans invest more than money into their clubs, and have a degree of moral and emotional right to know the extent to which the club has benefited from player trading.

The Numbers

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Celtic: Inbetween Days


Celtic’s accounts for 2016/17 arrived in our inbox 24 hours before the club lost its 69 game domestic unbeaten run.

We recently reported on the financial situation of Rangers, who were promoted to the Scottish Premiership (SPL) in 2016/7.

They highlight the paradox of being in their current position, too rich compared to their peers to make Scottish football competitive (although Hearts fans may now query that), but too poor to be able to challenge in the Champions League, leading to their fans searching through Google Maps as they try to find how easy it is to get to St Petersburg on public transport for the forthcoming Europa League match against Zenit.

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Key figures for 2016/17

Income £90.6m (2016 £52.0m)

Wages £52.2m (2016 £36.9m)

Profit before player sales £3.7m (compared to £13.6m loss in 2016)

Player signings £13.8 m (2016 £8.8m)

Player sales £4.2m (2016 £14.0m)


According to the accounts the club generates its income from three main sources. Matchday, merchandising and broadcasting.

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Matchday income was up 50%, the main reasons for this were:

  • Champions League qualification and attractive ties against Munchengladbach, Barcelona and Manchester City.
  • Higher season ticket sales as fans wanted to ensure they saw their team play against Rangers in the Scottish Premiership for the first time in years.
  • Preseason tournament against Leicester, Barcelona and Inter Milan.

Matchday income contributed 41.5% of total revenues for the club. Compared to the English Premier League (EPL), this is a far higher proportion than for any club in that competition.

Celtic’s matchday income would place them seventh if they had been in the EPL, which shows the contribution made by fans to the club.

Broadcast income more than doubled, again driven by a Champions League qualification. The payout was €31.7 million, compared to only €5.8 million the previous year, when the club only qualified for the Europa League.

Celtic also benefited with the payouts being made in Euros, as the pound fell in value at the UK’s economy was downgraded as a result of the Brexit vote. This added a further 15% to the sterling value of the sum received by Celtic.

Other/merchandising income was up 30%, as the club launched three new kits during the season.

Compared to rivals Rangers, who have the second highest level of income in Scotland, Celtic’s income was substantially higher in all three main areas. The figures also show that the Scottish Premiership’s TV deal with Sky is paltry compared to the riches available in the Champions League.

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Having three times as much income as the next largest club makes it very difficult for anyone to compete with Celtic when it comes to paying out the costs of running a club.


The main expense for a football club is in relation to players. These consist of two main elements, wages and amortisation.

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Wages rose by over 40% because Brendon Rogers signed the likes of Scott Sinclair, Kolo Toure, Cristian Gamboa and Eboue Kouassi, all of whom were on lucrative contracts by Scottish standards. Players would also have been paid bonuses for featuring in the Champions League.

At £52.2million, Celtic’s wages were three times those of Rangers (£17.6m). The next highest in Scotland was Aberdeen at £6.8m.

For the first time a Celtic director received pay of more than £1 million, with Peter Lawwell taking home in total £1,167,000. Somewhat bizarrely, for the four previous years the highest paid director had always been paid £999,000, perhaps not wanting to upset fans with the thought of one of the suits trousering more than a million for being to help mastermind the defeat of the likes of Ross County and ICT.

Celtic seem to have their wage levels under control, even with the increased amounts being paid. The wage/income ratio, which in the English Championship was over 100%, was more in line with the EPL, which averages 68%.

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Player amortisation represents the transfer fee cost being spread over the life of the contract signed by the player. So. if Scott Sinclair signed for £3million on a four year deal, this would result in an amortisation charge of £750,000 a year.

The amortisation charge arose as a result of Celtic spending £13.8 million on players for the 2016/17 season. Over the last five years Celtic have spent a total of £49.8 million on new players, which will get you one very good full back in the Premier League.

This contrasts with Rangers spending £10.3 million in their first season back in the SPL, although that was in marked contrast to the £4 million they spent in total over the four preceding years.

Celtic did have a further £1.5 million of costs in 2016/17 that were called ‘exceptional’. These are expenses that are one off in nature and so not expected to recur every year.

This included £287k in relations to signings that proved to be shite less impressive than when the club bought the player, and so had to be written down. There were also payments to former employees and over £1 million.

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Profits and losses

Ask an accountant what they mean by profit, and they will start to sweat, loosen their tie, and look nervously around the room.

There are many levels of profit that can be calculated, but here at the Price of Football we concentrate on three.

The first is operating profit. It is total income less all day to day operational costs of running the club.

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Celtic’s operating profit rose by a factor of ten to £7.5 million in 2016/17, driven by the increased income mentioned above. Rangers had an operating loss of £6.8 million during the same period.

The problem with operating profit is that it can be distorted, especially by player disposals. We therefore also calculate profit before player sales and other one off items. We refer to this as EBIT (Earnings Before Interest and Tax) This removes the volatility in relation to selling one player in a single season at a huge gain (such as Van Dijk), and having no such sale the following year.

Despite the domestic success and European qualification over recent years, Celtic made an EBIT loss of over £31 million in the last five seasons.

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This shows that the club is dependent upon selling players each year to help make the books balance.

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Gary Hooper and Victor Wanyama contributed most of the gain in 2014, and Virgil Van Dijk that for 2016. These gains are used to offset the EBIT losses. Celtic have had a negative net transfer spend of £600,000 over the last five years as a result of these sales.

The final profit figure adds on player amortisation and depreciation of the stadium and other long-term assets. We call this EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation). This is the nearest figure we have that is a ‘cash’ profit total. This is what is used by analysts when they are trying to calculate a price for a club that is up for sale (such as Newcastle at present).

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Celtic’s EBITDA profit of £12.9 million, compared to a loss of £6.9 million the previous season shows how critical it is for the club to have Champions League qualification. This compares to an EBITDA loss of £0.7 million for Rangers.


Celtic are debt free, having cash of £24.5 million of cash at 30 June 2017, compared to outstanding loans of £13.5 million. This should be good for Rodgers if he is looking to strengthen the squad in the January transfer window. He did spend over £6 million on signings in the summer 2017 window. Rangers, by comparison, had a net receipt of £240,000 during the same window, as they sold more players than they signed.

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Celtic are in a strong position financially. Qualification for the Champions League in 2017/18 guaranteed the club another £30 million in broadcasting income. Whilst, as expected in a group featuring PSG and Bayern, they did not qualify for the knock-out stage, they are now in the Europa League, albeit with a tough first draw against Zenit.

The financial gap between them and Rangers is substantial, which gives them a playing advantage too. Whilst Celtic fans don’t care, how good the lack of competition is for Scottish football, especially if it is trying to negotiate new TV and commercial deals, is uncertain.

The numbers

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Sheffield United: Crushed by the wheels of industry


We’ve always considered Sheffield United to be a big club. Whether that’s due to Tony Currie being a favourite player when I was a kid, Brian Deane scoring the first ever Premier League goal, or Sean Bean’s very public support of the club, we’ve always been well supported, with a decent stadium, so one would expect them to be in the top two divisions.

It’s therefore a surprise to see that it took the Blades six years to return to the Championship, since being relegated in 2011.

Key figures for 2016/17

Income £11.4m (up 7.5%).

Wages £10.0m (down 11.5%)

Losses before player sales £7.7m (down 18.1%)

Player signings £3.1 million

Player sales £2.8 million


United have certainly been one of the biggest teams in League One for the last six years. Although they were unable to keep with those clubs who dropped into that division who were receiving parachute payments during that period (Wolves and Wigan come to mind), they had income higher than most other clubs during that period.

In League One the majority of income for a club comes from matchday income, as the EFL TV deal with Sky, and parachute payments, are skewed towards clubs in the Championship.

Attendances were slightly up at an impressive 21,892 (compared to 19,803 in 2015/16), but made little difference to matchday income, as the previous season included a lucrative FA Cup match at Old Trafford.

Broadcast income was slightly up, partially due to EFL clubs receiving a proportion of the new Premier League TV deal with BT and Sky.

Promotion to the Premier League will increase broadcast income to about £6.6 million in 2017/18.


The main cost for clubs at all levels is wages. United managed to keep a lid on their wages in 2016/17, paying out £10 million, down from £11.4 million. This is still high by League 1 standards (the median is about £4 million).

United have backed their managers during their time in League One in terms of a player budget. Wages have matched or exceeded income three times during that period.

The club had to cut back on wages significantly in 2013 to ensure compliance with FFP rules in League One.

The other main cost is player amortisation. This is accounting talk for the way that clubs deal with player transfers. The fee paid is spread over the life of the contract signed by the player. So a £1 million signing on a four year contract will give an amortisation charge of £250,000 a year.

In addition to this the club showed an impairment of £614,000 during 2016/17. An impairment arises when a club signs a player for a fee, and then realises he is rubbish (or has a career ending injury) and has to write his value down in the accounts. Who this player was for 2016/17 has not been disclosed in the accounts.

A £3.1 million spend on signings in 2016/17, high by League One signings (ten clubs in the division paid no transfer fees), combined with the inspirational management of Blades fan Chris Wilder, meant that the club was promoted with over 100 points.

The club has traded well with their existing playing staff, making significant profits from selling players every season, with the likes of Jamie Murphy, Kyle Walker, Harry Maguire being sold, and generating over £13 million over the six years in League One.

Hidden away at the back of the accounts is a little disclosure that will benefit the club substantially in 2017/18. It shows that United earned over £7 million as a result of sell on fees in respect of former players. Again, no details are given, but the smart money is on a 10% fee for the sales of Kyle Walker to Manchester City and Harry Maguire to Leicester.

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Losses are total income less costs. United’s losses, before taking into account player sales, were £7.7 million in 2016/17, or about £150,000 a week. Total similar losses during the League One years were £31.2 million, although player sales reduced this by £12.5 million.

The club did make a profit of over £30 million in 2013/14, but this is more to do with the dark arts of accounting than actual trading. This arose when another member of the group wrote off a £30 million loan.


United have returned to where many would consider their natural place is in the football hierarchy, but it has taken time and a lot of money to achieve promotion.

Being competitive in the Championship is expensive (we estimate losses to exceed £300 million for clubs in 2016/17).

The ownership of the club is a little muddy. The McCabe family, who had owned the club for a long time, sold a 50% share of the parent company Blades Leisure Limited to a Saudi investor via a company called UTB LLC, registered in the West Indies in 2013. Hopes of a Manchester City style splashing of the cash from Middle East ownership have never materialised though. This may change perhaps in the Championship, with the allure of Premier League exposure being so close.

In recent months there has been musical chairs in the boardroom, with directors leaving and then returning. It would appear that the McCabe family, who have bankrolled the losses for many years, are still in effective control.


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The Numbers

Stoke City 2016/17 Results: Bring on the dancing horses


We like Stoke City, owned by a local who has underwritten the club’s rise to the Premier League, free coaches organised for fans to away matches, decent ticket prices, oat cakes (if you’ve not tried them you are missing out), cheap beer…and Peter Crouch, one of the game’s most likeable players.

The club’s financial results are similar to the club itself. Nothing too flash, solid, dependable.


Stoke’s income rose by over 30% in 2016/17, which on the face of it, despite falling from their traditional 9th place to 13th, looks impressive.

Stoke are a club who are very dependent upon continued membership of the Premier League as broadcasting income is the key element of their finances.

A new Sky/BT domestic deal, coupled with the Premier League’s amazing ability to extract increased fees for broadcasting rights overseas, especially in emerging markets such as Asia, means that EPL clubs are sharing just over £8 billion over the three seasons commencing 2016/17.

As a consequence, the proportion of total income that comes from broadcasting for Stoke has increased from 69% to 80% since 2013. There is nothing wrong with this, but if the club were relegated, then even with parachute payments, there would be a big hole to fill.

The decrease in the final position from 9th to 13th in the table cost Stoke about £7.5 million in ‘merit payments’ in terms of broadcasting rights distributions. This is because 25% of the amount paid out is based on the final league position.

A further 25% of broadcast distribution is linked to the number of times a club appears on live domestic TV. Stoke had the third lowest number of matches (nine) broadcast, and so suffered relatively to small London clubs such as Crystal Palace (who had 14) but have more local derbies, which are popular with the TV companies.

Stoke sell out the Bet365 stadium every week, but it is not a huge cash generator. The Potteries is not a wealthy area of the country, and the Coates family, who own the club, have kept prices low.

Matchday income for 2016/17 was down 14% to £7.2million, which is the lowest for a number of years. This may be partly due to work undertaken to expand the capacity of the Bet365 stadium to over 30,000 for 2017/18.

There are not many figures available for other clubs yet for 2016/17, but an analysis of Stoke’s matchday income for the previous season shows that it is towards the bottom of the division in this regard.

Stoke’s ‘other’ income, which includes commercial deals and sponsorship, rose by 23% to just over £20 million. How much of this comes indirectly via the owners at Bet365, who are shirt sponsors as well as stadium rights, is unclear.


Despite the overall 30% increase in income, Stoke managed to keep a lid on wages in 2016/17. The wages bill only rose by £2.7m (3%) to £84.9 million. The previous season wages increased by 24%, so it appears that the club decided to gamble to a degree in 2015/16 on spending on players (and wages) prior to the new TV deal in 2016/17.

This is evidenced by the amortisation charge (player costs spread over the contract term) rising by nearly a third to £23 million.

The reason for such an increase is that after a couple of cautious seasons, Stoke had record spending in 2015/16, with mixed results, as Imbula, Shaqiri and Joselu were signed.

Last season Stoke somewhat bizarrely signed Said Beharinho, who most West Brom fans would have driven to the Potteries for nothing, and Joe Allen took up the bulk of the £35.9 million.

As most of these recent signings are on long term contracts, the amortisation costs will remain relatively high for a few more seasons.

The summer 2017 transfer window was a relatively quiet one for Stoke, the accounts show a net income of £1.9m as the signings of Wimmer and Indi were offset by Arnautovic and Joselu leaving.

It’s not just the players for whom wage restraint exists at Stoke, one director, in all probability chief executive Tony Scholes, had a 14% pay cut in 2016/17. Admittedly this took his paypacket down to a still considerable £806,000, which is the cost of a good night out in Hanley or Burslem.

Such levels of pay are quite common in the Premier League, with  ten clubs having highest paid directors on a million plus a year,  a decent return for deciding on what colour next season’s away kit will be.



As a family run club funded by the Coates family, the owners are not particularly motivated by making profits.

Profit is the residue after subtracting the running expenses of the club from the income. Prior to 2014 most clubs in the Premier League were losing money. Despite the riches of the game, income went out almost immediately in what Alan Sugar referred to as the ‘prune juice effect’. As each new TV deal was signed, players agents would negotiate improved contracts for their clients to ensure the extra money was swallowed up by higher wages.

Premier League owners managed to reduce the prune juice effect by introducing Short Term Cost Control (STCC) rules, which meant that the wage bill could only be initially increased by £4 million a year, unless the club also managed to increase its non-TV income.

The impact on Stoke shows how successful STCC has been, as the club has gone from losing over £30 million in 2012/13 to making a small profit in subsequent years.


Stoke have a solid financial base, but are still reliant on the Coates family, via Bet365, and are presently owed over £60 million, interest free, by the club.

It’s difficult to know where the club go next. 9th in the Premier League was about as much as they could realistically hope for, although there is always the allure of a decent cup run.

Provided fans are happy with this situation then the club can carry on in their present role, ruffling the feathers of some of the ‘Big 6’ who don’t fancy playing in front of a hostile local crowd, hopefully a cup run as a distraction now and then…and that’s it. So long as this is acceptable then the club has potentially a decent stay of execution in the Premier League.

Five year summary

Below are all the numbers from the analysis. Apologies for any mistakes!


Manchester City: Some girls are bigger than others


No trophies, third in the league, and the costs of embedding a new managerial regime may have had some thinking City would struggle financially in 2016/17

The headline figures are mixed, income is up significantly, profit before interest down 80%, but the club claims to have no debt and is self sufficient.

Direct comparatives with the previous year’s profit and loss account figures are slightly distorted by City having a 13 month period of account for 2016/17, so bear this in mind when looking at growth compared to 2015/16. There’s nothing sinister in our opinion in changing the year end to 30 June.


Clubs have three sources of income.


Matchday income at City fell slightly, mainly due to a relatively early knockout in the Champions League. The expansion of the Etihad in recent years has allowed City to generate £50m plus a season from matchdays, but this is still way behind United (£111m) and Arsenal (£100m).

City have always priced their tickets towards the lower end of the market, which is great for fans. Initiatives such as the ‘Tunnel Club’, where (presumably corporate) fans get to sit behind the dugout and see the players in the tunnel pre and post match show that City are trying to extract more from the prawn sandwich brigade.

Matchday income was only 11% of City’s total revenues. You would perhaps expect this from a small club in the Premier League such as Crystal Palace, but it does seem low for a behemoth such as City. United had 19% of income and Arsenal 24% from this source.


Broadcasting income was up 26% and tops £200m for the first time. This is mainly due to the impact of the new domestic TV deal with BT/Sky. UEFA TV monies actually fell by £13m due to City being knocked out of the last 16 round of the Champions League compared to the semi-final the previous year.

Compared to their closest rivals who have reported to date, at £204m City are slightly ahead of both United (£194m) and Arsenal (£199m)

Any growth in TV income in 2017/18 will be dependent upon City’s progress in the Champions League, as the domestic deal runs for three seasons. Even if City win the Premier League they will only receive about an extra £4m in terms of merit payments.


Commercial income at City normally causes Arsene Wenger, an intelligent man who is nonetheless known for whining at events at the Etihad both on and off the field, to start muttering ‘Financial Doping’ as his handlers reach for the smelling salts.

This income source rose over 22% to £218 million. The reason why eyebrows are raised in relation to City in this regard is the club’s commercial links with related parties to the Abu Dhabi owners.

City’s critics accuse the club of negotiating deals at above market rates, overinflating income and therefore allowing the club to pay more for wages and transfers whilst complying with Financial Fair Play (FFP) regulations.

City have fallen foul of FFP issues in the past, but we suspect they have been very careful to adhere to the rules in the present climate of UEFA inspectors.

Can clubs manipulate their finance to comply with the rules? The answer in our opinion is an unequivocal yes, but that is the subject of a separate blog post. Are City guilty of such behaviour? We have no idea, but expect City to not be subject to any UEFA sanctions (the Premier League’s own FFP rules are much easier to satisfy than those of UEFA).

City’s commercial income is still some way behind that of United (£275.5m) but United are in a league of their own when it comes to global appeal, and their commercial department negotiates deals accordingly.

City are way ahead of Arsenal (£125.4m) in this income source, which is perhaps a testament to Arsenal’s inconsistent appeal to sponsors and their commercial department’s rather disappointing performance.


The main costs for a club are player wages and player amortisation (transfer fee costs spread over the life of the contract).

City’s wage costs, which had been under relative control for three seasons, rose over a third to £264.1 million. This compares to United (£263.5m) and Arsenal (£199.4m). When Sheik Mansour acquired City, the club had to play over the odds in wages to attract high quality players, as Champions League appearances were not in the offing. This explains why wages were so high in 2013.

Clearly recruiting Pep Guardiola and his team, new signings and improved contracts for some squad members came at a cost.

Despite the increase in wages, City’s wage expense as a proportion of total income, which has risen in the year, is a healthy 56%, although notably higher than United (45%) and Arsenal (47%).

Amortisation charges are up nearly 30% to £121.7 million.

‘Other’ costs rose 23% to £104.3 million. It’s not clear what has driven such an increase.

One thing that may have Arsene Wenger once again being only allowed to eat with a spoon is directors’ pay. This is in the City accounts at a zero figure.

City’s parent company, City Football Group Limited, (which is not subject to FFP as such, and has not yet published its results) had ‘key management compensation’ (presumably director pay) of £4.4 million in 2015/16. Such behaviour prompts City’s critics to accuse the club of transferring some costs to other outposts of the City group empire to ensure the club of complying with FFP.

Whilst City have no direct bank debt, they do show an interest cost in relation to the Etihad stadium. Whilst not wanting to bore you with accounting dullardness, because the Etihad is rented on a 250 year lease, which is effectively its useful life, the stadium is treated as being an asset of the club, funded by a loan from the council.

Offset against the above costs is gains on profit sales of £34.6 million (see below for more detail).


Profit is an abstract concept, in theory it should simply be income less costs. In practice there are a range of profits quoted, depending on which costs are included.

City are quoting a profit of £1.1 million for the year. This is however after taking into account gains on player disposals. Whilst we expect to see clubs making a profit on player sales each year due to the way player signings are treated in the accounts, this figure is volatile as it depends on individual player disposals.

Excluding player disposals, City’s EBIT (which is ‘recurring’ profit before interest and tax) was a loss of £30.2million, compared to a profit of £2.8m the previous season.

Adding back the non-cash expenses in the form of depreciation and amortisation gives an EBITDA profit of £105 million, which is very close to the previous year’s £109m. United made an EBITDA profit of £200m and Arsenal £145m, reflecting City’s relative generosity in terms of wages compared to the two other clubs.

City had a negative tax expense in 2016/17.

Player activity

City spent £203.5 million on the likes of Stones, Jesus, Gundogan and Sane in 2016/17 (what about Nolito and Claudio Bravo some of you will of course also cry? We’ve not mentioned them as they are, in the words of former Manchester legend Frank Sidebottom, a bit bobbins, and we don’t want to embarrass Pep, especially as my wife fancies him).

If these players are each on five year contracts then this gives an extra amortisation cost of £40.6 million (£203.5/5), which ties into the cost analysis above.

In terms of disposals, City sold players for £51 million, to give a net spend for 2016/17 of £153m.

Hidden in the footnotes to the City accounts are a couple of interesting figures (interesting only to those who are still reading this tedious summary we suspect). The first is contingent liabilities. This is the sum City have to pay to players and former clubs if certain achievements (appearances, trophies, international caps etc.) are met. This is £111 million at the end of June 2017.

City had a spending spree in Summer 2017, mainly on signing Mendy, Walker, Bernardo Silva, Ederson and Danilo. A number of players left the club too, but the accounts reveal a net spend of £161 million in the window.


City’s owners are not motivated by making profits, so the breakeven in the year is more to do with keeping the beancounters at UEFA happy more than bringing a smile to face of Sheik Mansour.

Their business model in relation to being part of a group with tentacles in many clubs across the globe will fuel idle gossip and accusations from the club’s detractors.

For those who think that all this financial analysis is a load of old cobblers, there’s a case for saying, just watch the football, which is possibly the best seen in the Premier League since its inception (although of course no trophies are won in November).

Financial Summary

Key figures from the accounts shown below