There is anticipation this week, because Newcastle’s financial figures through the end of last June are about to be announced.
Mike Ashley – Newcastle owner
Liverpool announced their results yesterday, and on revenues of £255.6M they made £0.9M (£900K) profits (before tax) and after losing £49.8M the year before, they were welcomed as good results.
Newcastle revenues are nowhere near Liverpool’s and are about half of the Reds at around £129.5M – which was kind of pre-announced when Deloitte had Newcastle as the 19th richest clubs in the world based on that revenue. Liverpool were in 9th place.
But Newcastle profits are going to be high and maybe over £40M.
But Liverpool and Newcastle United are two very different clubs these days, with Liverpool wanting to repeat their past successful exploits as Champions of both England and Europe.
They want to be one of the most successful clubs in England, and while you wouldn’t expect them to make huge profits like Newcastle, they need to at least break even to meet the Financial Fair Play rules.
Newcastle are a very different club than we were even just ten years ago, and now we don’t field our strongest sides in the local cups – they are no longer a priority.
And since we have no chance in the Premier League that essentially means there will not more trophies on the horizon, at least not while Ashley remains owner of Newcastle.
And one reason we will continue to make big profits is that we are not spending the money of building a top squad.
As the great Alan Shearer said so accurately over the weekend – Newcastle are now just a business.
But with the excellent financials now in place at Newcastle, it only takes a few changes in the way the club operates – for Newcastle to be able to build a top side that can compete for the top six in England, play in Europe again, and yes – start winning some trophies again.
Here are three of them:
- Invest at least half of the profits each year on improving the playing squad.
Notice that is a net amount and any money we get from selling our best players will be re-invested in the squad. Notice that the money hasn’t got to be spent if the right players are not available – but the point is that money is available to bring in good players and improve the squad. Money is also needed of course to improve the facilities at the club, like Mike Ashley is doing by creating a world-class training center – which is an excellent investment for the club.
- Don’t sell our best players in January without replacing them.
This has caused problems in the past when for the second half of the season we limp through it – much like we are doing now with all our injuries we have and we didn’t spend a penny on new players in January. Doing all deals in the summer like most clubs do also means you have time to replace them if they are sold.
But if a last day bid comes in then turn it down – prioritize the playing squad – otherwise we will never have a good side again – top sides don’t sell their best players without replacing them.
The statement for this should really be don’t sell our best players – but that’s more long term – because if we do invest in the squad, our best players will be much less likely to want to leave Newcastle.
- Field strong teams in the local cups so the fans and the players can look forward to Newcastle challenging for trophies again.
Notice in the past five years how many non-Premier league clubs are doing well in the cups, and clubs like Birmingham City and Wigan Athletic win cups and get relegated in the same season.
With a bigger and better squad the cup runs will have less impact on the squad and therefore on our Premier League performances.
That’s one thing Mike Ashley is worried out, but if we make the squad better and bigger – the problem goes away.
A big problem at the moment is we cannot keep our best players and Mike Ashley is only to willing to sell players at any time for big money.
But if we spend more money on the playing squad we should have a better team, and we should be challenging for things again, and that in itself will help to keep our best players – why would they want to leave Newcastle if we are doing so well?
Because of our (very) strong financial position and the makings of a decent squad – with some good youngsters finally coming through – we are not too far off having a good side.
But more money must be invested in the squad and we have to challenge again for trophies.
And of course one huge opportunity for Newcastle is to appoint a top head coach in the summer – and changes like the above will only help to attract top candidates for the Newcastle job – which used to be a plum job in English football.
When Newcastle announce their results we would like it to be accompanied by some changes in their mode of operation – like the above – which will say how any future profits will be used to make Newcastle great again.
We may be disappointed.
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