With Newcastle now in the Europa League next season almost a certainty, Newcastle will be bringing in a lot more money next season.
Mike Ashley – expect owner to remain thrifty
That will help the revenues, and it could be that in the financial year through June of next year, the club could break the £100M revenue target.
There is a good interview in the Newcastle Journal today with Vinay Bedi, of investment management firm Brewin Dolphin, and he talks about the impact European football will have on Newcastle, and especially if Newcastle can qualify for the Champions League:
“The premise of football is Champions League gets you everywhere and the rest are nowhere,” “If you can consistently be in that group it completely changes the whole perspective of the business.”
“Even just a one-off visit is very nice. It really does just kick on the whole football club and bring in some serious amounts of revenue.” “If you can get there and get a couple of wins in the group stages you are talking about substantial amounts of money.”
“It is £600K for a win in the group stages – and that is just prize money.” “Newcastle will actually make more money from winning a couple of games than if they win the Europa League, which is a sobering statistic. It is a massive, massive difference.”
“Rangers made something in the region of £17.5M by making it through to the group stages a couple of years ago.” “Now with Newcastle and the potential for full houses, it is realistic to say they could make £20M by qualifying for the group stages and winning even one or two games.”
So if we make the Champions League it looks like it could be £20M or so, and that’s almost 25% of the revenues reported for the last financial year.
Newcastle will want to keep to their financial thrifty ways, and not go back into making trophy signings like we used to do under Freddy Shepherd, when lots of money was simply wasted in the transfer market and on players’ excessive wages.
That will not happen under Ashley, but nevertheless there are new dangers for Newcastle, as Beday explains:
“Newcastle, like any club, have got to be extremely careful,” “I bow to the knowledge of my friends who are Newcastle supporters who say they would need to strengthen their squad if they were to get into the Champions League but practically, that creates issues.”
“There is the burden of extra wages and of course, Leeds managed to bankrupt themselves signing players with money they thought would be coming in from the Champions League.” “It looks as though Mike Ashley is running things prudently though, so I would not see that as a problem.”
Newcastle need to remain prudent, but also they will have more money available in the summer transfer window, and will need to bring in more players than they had initially planned.
That will happen, and if necessary players could come in during next January, if the right player(s) are available at that time.
But with the extra money coming in Newcastle will have more to spend, as the Newcastle plans seem to be to invest all profits back into the club, and if we continue to be successful then Newcastle will become a richer club and be able o afford better players.
But we know that Mike Ashley will remain thrifty, and it today’s financial picture in football, with clubs like Glasgow Rangers still managing to go bankrupt, that’s a good thing.
What do you think?