Why Increased Revenues Are Newcastle’s Number One Financial Goal

Newcastle Managing Director has said today in the Sunday Sun that Newcastle have had some interest in companies wanting to acquire the naming rights to St. James’  Park.

Derek LLambias – have had some inquires on naming rights

And Derek was adamant that it is not the plan to keep Sports Direct owning the naming rights to the Stadium, and as soon as a company comes along with a decent offer to the club – Newcastle want around £10M a year for the rights – then the name of the Stadium will change again.

The majority of Newcastle fans seem to be opposed to the name change, and the initial attempts by the Newcastle Board to somehow keep St. James’ Park in the name, didn’t attract much interest from companies.

And of course it will not have helped that the renaming of St. James’ Park is so much opposed by Newcastle fans, and they even removed the Sports Direct signs at the Reserve game with Sunderland last week.

And that will hardly help Newcastle have a company come in and buy the naming rights, when they will have visions of their signs possible being vandalized.

This is what Derek Llambias told the Sunday Sun today:

“It has been nibbles here and there. We are trying.” “There are a lot of people out there who will say ‘We can do it, we can do it’. There are a lot of tire kickers out there though. It is just like people claiming they are going to buy the club – there were a lot of tire kickers there then.”

“There are big companies out there and the Premier League is a global brand.” “Can you imagine the publicity they will get? It has never been done before.” “We are not trying to antagonise anyone – we are just trying to put a player on the pitch.”

“We put it out there with St. James’ in the name and there was no interest.”  “We took some branding advice. It was not just something where we thought ‘Let’s just do it’. We took advice on it, we took advice on the arena signs as well.”  

“Some might say ‘Why do it in November?’  “But we had a two-week break, the players were away and Mike and I can take the beating.”  “By the time the players and manager are back everyone is aware of it, it may affect the game or it may not.”

Newcastle must grow their revenues from the £88.4M we had in the last financial year, and before Mike Ashley arrived on Tyneside the revenues were around £100M.

So in that sense the club have gone backwards, while other clubs like Manchester United, Liverpool, Chelsea and Arsenal, the once perennial top four clubs in England,  have all moved forward big time.

Our relegation in 2009 hardly helped things of course, but now Newcastle are in much better shape both financially and on the playing side of things, but the new strips deal with Virgin Money only brings in £5M/year.

Compare that with £25M a year that Liverpool will be getting with Boston-based company Warrior Sports, a subsidiary of New Balance, for their shirt deal over the next five years.

And the Manchester United deal with Nike is worth £23.5M each year.

Manchester City will get £400M over ten years for the naming rights of their stadium with Etihad Airways.

But we think that’s illegal, because of the links that the owner has with the owner of the airlines – and we expect UEFA to move on that – when they get around to it.

Etihad are owned by the Abu Dhabi government and the airline has an association with the Manchester City owner, Sheikh Mansour, who is himself a member of the Abu Dhabi royal family, and that means it’s really what is called a sweetheart deal, and illegal. The rates offered must be what is commercially viable.

It would be akin to Mike Ashley offering Newcastle £400M for the naming rights to St. James’ park over 10 years by Sports Direct – hey that might not be a bad idea! 😀

But you can at least see why the Board are looking for ways to increase the Newcastle revenues, so Newcastle can compete with the biggest clubs in the country.

Certainly the costs have been brilliantly contained by excellent financial management since we were relegated, there’s no getting away from that, as last week’s financial results demonstrated.

Comments welcome.

10 comments so far

  • Cardboy

    Mar 11, 2012 at 11:21 AM

    Comment #1


  • moonraker

    Mar 11, 2012 at 11:24 AM

    Comment #2

    The naming rights would be more attractive if the club had some success. Llambias has it the wrong way round. Win something first and make it more attractive. Nobody wants to be associated with perceived “losers”

  • steve

    Mar 11, 2012 at 11:37 AM

    Comment #3

    Pointless discussing it really, they have no intention of selling the naming rights. It will be the SDA for the rest of MA ownership

  • nufc786

    Mar 11, 2012 at 11:37 AM

    Comment #4

    shows ashley in a good light me thinks

  • nufc786

    Mar 11, 2012 at 11:39 AM

    Comment #5

    •When Mike Ashley took over Newcastle the club had £65m of external debt, which has now gone
    •Turnover has increased by 69%
    •Newcastle paid £6.5m in debt interest in 2007 and 2008. That figure is now £212,000 a year

  • nufc786

    Mar 11, 2012 at 11:41 AM

    Comment #6

    •23 May 2007 – Takes over at Newcastle
    •9 January 2008 – Manager Sam Allardyce sacked
    •16 January 2008 – Kevin Keegan appointed new manager
    •29 January 2008 – Dennis Wise named director of football
    •4 September 2008 – Keegan resigns
    •14 September 2008 – Fans protest over Keegan departure, forcing Ashley to release statement saying he wants to sell the club. Joe Kinnear installed as interim manager
    •28 December 2008 – Takes club off the market
    •1 April 2009 – Club legend Alan Shearer named interim manager with side deep in relegation battle
    •24 May 2009 – Newcastle relegated to Championship
    •4 November 2009 – Ashley renames St James’ Park the sportsdirect.com @ St James’ Park Stadium
    •6 April 2010 – Under new manager Chris Hughton, Newcastle win Championship and return to Premier League
    •7 December 2010 – Hughton sacked with club in 11th place in league table. Alan Pardew appointed successor
    •31 January 2011 – Top scorer Andy Carroll sold to Liverpool for club-record fee of £35m
    •June-August 2011 – Ashley sells high-earners Jose Enrique, Kevin Nolan and Joey Barton. Brings in France international Yohan Cabaye and Senegal striker Demba Ba
    •9 November 2011 – St James’ Park renamed Sports Direct Arena after Ashley’s own company
    •8 March 2012 – Club close to breaking even with losses having dropped from £33.5m to £3.9m for the year ending June 2011

  • Offkey

    Mar 11, 2012 at 12:12 PM

    Comment #7

    “Mike and I can take the beating.”

    Care to put our money where your mouth is DL.

  • geordiejamie89

    Mar 11, 2012 at 1:01 PM

    Comment #8

    I think going on the last years financial loss of under 4 million, I think we’ll have made a decent little profit in this financial year so far. However I do think that the financial figures will get in the way of buying the calibre of player required to compete at a higher level. I hope Newcastle do release their naming rights, I think Mike Ashley should be even more bold, and set a date on the sale of the naming rights, so that the highest bidder must come in by that date to take the naming rights. That could increase the naming rights, rather than having a set price of around 10 million a year.

  • jesperfuglsang

    Mar 11, 2012 at 1:33 PM

    Comment #9

    Just to clarify something. Newcastle’s strip deal is with Puma and not Virgin Money. Don’t know how much is on though.

    Virgin Money is our sponsor. A bit of a difference especially when you compare to the likes of Liverpool and United and talk about Warrior Sports and Nike 😉

    Just a small correction even though I know what you mean Ed 😉

  • MacToon

    Mar 11, 2012 at 3:03 PM

    Comment #10

    The shyster says “wanna buy some diamonds?”.


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