As expected after we had a report in the Sunday papers yesterday that Newcastle would be willing to spend up to £60M on players this summer, Newcastle finally issued their financial figures for the financial year – July 2013 through the end of June last year – and both revenues and profits are club records – again as expected.
Mike Ashley – pleased with financial figures
The profits just about doubled from last year’s £9.9M to a best-ever £18.7M, although we still expected the profits to be a lot higher if our costs remained the same, given the massive increase of revenue.
However these are still the best financial results in Newcastle’s history, so one good thing Mike Ashley has done is made Newcastle a very stable club financially – and yes – let’s be fair – he deserves credit for that.
Here are the basic financial results of Newcastle’s last seven seasons since Ashley bought the club in the summer of 2007, and the £52.4M revenue was when we were in the Championship and didn’t get the big money of the Premier League which has since become massive.
When Freddy Shepherd ran the club we had some great teams under Sir Bobby Robson, but the profits were nowhere near these numbers, but we were still successful on the field.
And it’s not easy for a business to get costs under control and to grow the revenue, and when Ashley bought the club he quickly found that Newcastle were in debt to the tune of £100M.
And we still are – but we are not paying any interest on that debt of £129M, with an interest-free loan form Ashley.
Ashley doesn’t want paid back anytime soon, and we suppose in Ashley’s eyes that may be justification for Sports Direct getting the “free” world-wide publicity at St. James’ Park when our games are shown live around the world.
And when Mike Ashley first came on board, the club was losing over £30M for each of the first three years – so he’s done a stellar job financially for the club.
But that’s where the praise for the owner ends.
We should have a much better team than we have at the moment and we have finished in the top nine only once since Ashley became the owner.
And after doing the hard part – and being successful with getting the financials (totally) under control – the easy part seems to be to build a good team again.
With the massive money coming in from the Premier League TV rights over the following four seasons (at least), all PL clubs will have a big advantage financially over the other clubs in Europe.
The Tyneside club now needs to spend some of that money and bring in some good players and build a top side again.
It looks like we will start doing that this summer, but we also have to keep our best players in the summer, and also over the next few years, so we can indeed be challenging for Europe every season.
The Financial Fair rules say that you must only break even, so in the last two years we could have done that and spent an extra £28M net on players – the profits of the last two years.
Lee Charnley is boasting that we beat the Financial Fair Play requirements – but we don’t need to do that – Newcastle need to spend any profits on building a top side.
A football club is created to compete well and win trophies for its fans – its created for the fans – and its purpose is not to make big money every year.
Newcastle United shouldn’t forget that.
Howay The Lads!!
Note: Mark Hammell is an avid reader of the blog and he has signed up for 7 endurance events totaling over 600 miles, after he has just recovered from a serious ACL injury.
Mark is doing this to raise money for the Sir Bobby Robson Foundation. Here is Mark’s Justgiving page – see if you can help him out and help Bobby’s Foundation.
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