Newcastle Will Find It Difficult To Explain This Situation


Newcastle United will announce their financial results next week and the results will certainly be received with some astonishment.

lee charnley and MikeAshley -Getty_3215046b

Lee Charnley and Mike Ashley

We already know that the clubs revenues for the financial year ended last June 30th are about £129.5M from the Deloitte Money League that was issued earlier this month and had Newcastle the 19th richest football club in the world.

nufc revenues small letters

The revenue increase was about £33.6M from the previous year, and in that year we made a profit of £9.9M.

The increase was due almost entirely to the new Premier League TV deal that kicked in last season.

Assuming the costs have not gone up appreciably since that year then that revenue increase goes straight to the bottom line as profits – so we could be talking about £43.5M in profits.

In this graph we have put down £40M as the estimated profit for last year, to show what the profit picture looks like at Newcastle – the trend is very good indeed.

NUFC profits with 40M

Whatever the profits turn out to be, they are likely to be huge, and maybe even the most profits of any Premier League club for some time.

You have to remember that top clubs like Manchester City lost £52M for their last financial year reported (2012-2013),  and a loss of £98 for the previous year.

They spent a lot of money they didn’t even have on the playing staff – so you know what their priority is, even though it is reckless financially.

The question Newcastle will have to answer is how come we have spent no money in each of the last two January transfer windows to strengthen the squad, and we have limped through to the end of the season each time.

And in fact right now one of the problems that John Carver is struggling with is we have only five fit defenders.

We sold Yanga-Mbiwa to Roma, loaned out Davide Santon to Inter-Milan and let Alan Pardew go to Crystal Palace – all in January – and that gave Newcastle around £10M – but also helped decimate the squad.

Mike Ashley has done very well indeed with the financial side of Newcastle – let’s acknowledge that – it’s true.

But what’s the point if Mike will not spend the money now available on making Newcastle into a top team?

You can either have stellar financial results or a top side and in some rare cases both.

Newcastle fans would love to see the money spent to build another top side.

But the facts show that Mike Ashley’s goal seems to be to return stellar financial results,

Again – what good is that to a football club?

Comments welcome.

Note: Will Leversuch is a final year University of Greenwich student conducting some research into the marketing of Premier league Football Clubs. As part of that work Will needs lots of questionnaires filled in – see if you can help him by filling out this short questionnaire – thanks.

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21 comments so far

  • beermonkey

    Feb 28, 2015 at 11:36 AM

    Comment #1

    Newcastle Will Find It Difficult To Explain This Situation

    no they wont the club don’t explain anything

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  • Reyantoon

    Feb 28, 2015 at 11:39 AM

    Comment #2

    Finance is not important now,proper manager is!!

    Lesh – I take LC’s word here,the interview..
    because it makes sense!
    JC can talk whatever he like,but I don’t think he will get it unless they are Idiots!!

    Jamestoon
    No chance! Galtier,unlike Bielsa,fits our bill and policies.I don’t know much about Bielsa but he usually had bad luck wherever he goes.Galtier is managing st’n
    since 2009.So he perfectly knows how to manage the squad and the club plus has good relationship with the board.

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  • catchy in norway

    Feb 28, 2015 at 11:48 AM

    Comment #3

    Tim nice but dim = Jeff

    so are you telling me that if 2 clubs had 50mil to spend on players
    club 1 spends 50 mill on players
    club 2 spends 10 mill on players

    at the end of the year club 2 has 40 mill sitting not used , your saying this does not go into the profit section on a balance sheet.

    I recon it goes down as profit ,

    what surprises me is why is our profit margin not more ,
    TV money is pretty much the same for most teams from 8th-16th a couple of mill difference , the very fact that we sell out a 52 thousand seater stadium , shirt sales and all other merchandise, we are huge compared to most other teams in that same 8-16 bracket

    something is sadly wrong at our club, most know this

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  • BandB

    Feb 28, 2015 at 11:53 AM

    Comment #4

    Catchy,

    Jeff is trying to make money disappear by calling it by another name.

    It is claimed the reckless transfer spending of the bad old days had such a baleful effect on club debts that it has required years of prudence by Ashley to sort it out.

    But it seems transfer profits have no effect on the balance of the ledger at all.

    Clearly, it can’t be be both.

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  • AncientC

    Feb 28, 2015 at 11:56 AM

    Comment #5

    catchy in norway: According to Jeff, “transfer fees” have “nothing to do with profit.”

    It is difficult not to laugh.

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  • the white tino

    Feb 28, 2015 at 12:06 PM

    Comment #6

    Pennywell jiffy I’ve said this before and will say it again biggest tit on here transfer fees have nowt to do with profit eh explain that again jiffy!!

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  • MonkseatonMag

    Feb 28, 2015 at 12:27 PM

    Comment #7

    “The revenue increase was about £33.6M from the previous year, and in that year we made a profit of £9.9M”

    “We” made a profit. Not quite Ed, Mike Ashley made the profit!!.

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  • croftus5678

    Feb 28, 2015 at 12:30 PM

    Comment #8

    it makes no difference to me !

    yes he’s got the club very well off financially but if we are not trying to win anything and he’s not signing better players than what we currently have with that profit whats the point ?

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  • catchy in norway

    Feb 28, 2015 at 12:37 PM

    Comment #9

    bandB / Ancient

    it’s amazing how naive some people really are

    my baby girl is only 3, she thinks money just comes from the hole in the wall, just use a bank card ,

    I equate jeff to this kind of thinking

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  • SUTTY1978

    Feb 28, 2015 at 12:40 PM

    Comment #10

    NUFC didn’t make a profit on the last set of results, they actually made an operational loss of around 600k. The 9.9m was based on player amortisation. You can’t just say that they made 10m last time and we had an extra 30m from the to deal so it’s 40m profit.
    I’m sure that most of the “profit” will be offset against the training ground upgrades. Why would MA want to make an operational profit? It makes sense @ SD as it’s all about the stock value. Doing the same at NUFC will just result in a huge tax bill and zero benefit.

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  • croftus5678

    Feb 28, 2015 at 12:55 PM

    Comment #11

    lfc u18’s vs nufc u18’s on lfc tv now guys for those interested.

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  • croftus5678

    Feb 28, 2015 at 1:02 PM

    Comment #12

    we get to see our new upcoming youngster mccenzie heaney 🙂

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  • croftus5678

    Feb 28, 2015 at 1:16 PM

    Comment #13

    omg nice to see our u18’d doing the same silly defensive errors as our first team lol

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  • beermonkey

    Feb 28, 2015 at 1:27 PM

    Comment #14

    nothing like the impending accounts to bring out the amateur accountants to the blog justifying this and that

    should we really care, mind you there is nothing interesting happening on the pitch so I spose the accounts are our entertainment now

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  • croftus5678

    Feb 28, 2015 at 1:31 PM

    Comment #15

    yep heaney’s great cross and longstaff who’s a big lad noded it in 🙂 1-0 to toon

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  • croftus5678

    Feb 28, 2015 at 1:40 PM

    Comment #16

    longstaff’s second 2-0 heaney with great vision and passing again and a rb we have named cobain is doing great also.

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  • optimistic prime

    Feb 28, 2015 at 1:55 PM

    Comment #17

    Hooray, I’m off for a pint to celibate

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  • Ron Knee

    Feb 28, 2015 at 2:04 PM

    Comment #18

    Palace lead by 3-0.

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  • Graeme

    Feb 28, 2015 at 2:15 PM

    Comment #19

    Palace score from a corner – ball to back post, No6 jumps, beats defender & keeper 0-1. How come he couldn’t do it here??

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  • toonluvva

    Feb 28, 2015 at 5:47 PM

    Comment #20

    It’s all about the money, the income streams, the revune, the profits for Mr Ashley.

    It doesn’t matter a jot to him that a modicum of investment in the squad could lead to a chance of climbing up the table, or being able to compete in cup competitions.

    Never mind the league position, just look at the balance sheet!

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  • Brazilianbob

    Mar 1, 2015 at 8:29 AM

    Comment #21

    The problem is indeed Ashley but not for the reason we all think. Pardew basically told Ashley that because he didn’t understand football,t the club were too small to challenge for anywhere higher than 10th and Ashley bought it, especially as it meant no capital outlay. Of course we all know that the reason Pardew took this line was it made him look like an achiever by finishing 10th when we all know any decent manager could have finished a lot higher with the squad he had available to him.

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