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!!
Comments welcome.
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249 comments so far
Ibizatoon
Mar 30, 2015 at 1:49 PM
Comment #41Belfast…Good to see you back. Been getting over the hurt buddy?
optimistic prime
Mar 30, 2015 at 1:50 PM
Comment #42JFA
I think whatever was posted they’d raise eyebrows due to the miss trust Ashley has brought to the club.
I said to you other day I expected minimal profits posted, I was thinking £9mil same as last time. All the accounts have done is raised more questions.
Mister Tuff
Mar 30, 2015 at 1:50 PM
Comment #43I had thought, following popular opinion that the profits this year would have been better. However, I think we need to wait for others who have more experience of “deciphering” these matters to comment once further details of the accounts are revealed.
However it does appear to me, time date now, that Carvers comments about the list of quality players we are after might not have as much quality as we’d hoped for – unless there are some player sales in the summer to boost the kitty. (Equally the numbers of players we might hire in the summer may reflect upon their quality (or their value).
All other clubs will be buying, this will drive costs up, all European teams will know PL teams will have the TV dosh and will/may want more money for their players.
So overall I’m not as optimistic about our summer signings as I was.
Tubbs financial dealings will be like a spiders web, with all the companies he owns -it would take an accountant with magical powers to fathom out what exactly is going on.
Jail for Ashley
Mar 30, 2015 at 1:50 PM
Comment #44JP,
I think Krul, Tiote and one of Janmaat or Sissoko will be sold to fund players.
Belfast
Mar 30, 2015 at 1:51 PM
Comment #45Well Ibiza I decided to quit in solidarity with my old mucka Skunki but I gave in after a week.
Sorry Skunki.
JamesToon
Mar 30, 2015 at 1:52 PM
Comment #46JFA
Got it right on Mcclaren there
Ibizatoon
Mar 30, 2015 at 1:55 PM
Comment #47Taking this amortisation thing a little further, I think I am (hooray) starting to get Jeffs point.
These are simply published accounts, which actually have little impact on the reality of our actual financial position. Stuff like we sell player A for £20m, but we’ll only show £5m coming in a year. But if we’ve already received the whole amount of money – then is it available to spend?
Are we basically saying that even though the club have said we’ve made £18.7m profit last year, there may well actually be this bigger pot of money to play with?
Can I ask then, in windows past, why the club have used previous versions of the yearly accounts (the same as these ones) to justify we have no money available for player purchases?
Once again, I may be missing something, but it appears they just swap and change their accounting methods dependant on who they’re trying to fool.
When trying to show the fans how ambitous they are, whole fees and wages are quoted, when trying to reduce fans expectations (i.e – we don’t have any money to spend on players), we get the reduced, amortised figures?
hibbit
Mar 30, 2015 at 1:58 PM
Comment #48i am not convinced that Mcclaren would want the job why would he work for ashley with all the strings attached
Ibizatoon
Mar 30, 2015 at 1:58 PM
Comment #49Belfast…If that’s all it took, I’d have asked Tsunki to leave years ago 🙂
Don’t leave us, you’re one of the, if not the, best posters on here, remember? 🙂
Jeff from Benwell
Mar 30, 2015 at 1:59 PM
Comment #50Toon-Prodigy // Mar 30, 2015 at 1:26 PM
Howay man where is all this money going?
Well let’s see
(ask the council they ain’t cheap)
Rent (ground is leased )
Wages – Staff and Coaches
Wages – Players (Colo one of the better paid is £3,247,000 p.a. the kids are on £260,000 p.a.))
Electricity (floodlights cost a fortune)
Water
Normal office expenses – phones etc.
Transport and Hotels
Training ground
Tax
AncientC
Mar 30, 2015 at 1:59 PM
Comment #51JFA – Yes I agree, we have a very similar viewpoint on how Ashley runs the club. I wouldn’t have many major issues, if Ashley wasn’t getting free advertising and not quite so negligent in regards to squad additions and coaches/management.
I don’t believe it is going to be a busy summer as some predict. 2 senior players in, current players getting knock-down extensions to contracts… and 1 or 2 fresh faces for the Beardsley academy.
Toon-Prodigy
Mar 30, 2015 at 2:02 PM
Comment #52Another net spend of 10-15 in the summer by the time we sell falling further back.
Cheers Mike. But hey the bank balance is good and the cheaper option is in charge. Grow a pair. This surely can’t get any worse can it?
hibbit
Mar 30, 2015 at 2:03 PM
Comment #53jeff from anywhere all clubs have running costs ….ground rent is pepper corn to the freemen of the city not council
toonbrother
Mar 30, 2015 at 2:10 PM
Comment #54good news.
now we can pay for both mclaren and a world class central defender to replace the sewage pipe that is coloshitty
meanwhile world class coach remi garde continues to remain unemployed despite his world class status lololol
Catchy's Pet Lip
Mar 30, 2015 at 2:13 PM
Comment #55Purchasing my season ticket tomorrow. The figures don’t lie, no other club other than Arsenal can compete with us in the coming years, we’re on to a good thing. Howay The Toon! Long may Mike Ashley reign!
LGFUAD21
Mar 30, 2015 at 2:14 PM
Comment #56AncientC
So glad someone else here has a business mind.
There you have it lads. Not supporting the regime but sick of people’s guesswork on the money available.
£18m should go a long way in the transfer market with amortisation.
Lindisfarne
Mar 30, 2015 at 2:23 PM
Comment #57Its simple when you get it. Are we agreeing that the Operational profit of +4.7£M is part of the £18.7M profit and therefore the cost of running the club rose by +30.3£M to £115.7M, a 35% increase.
Obviously there is nothing corrupt, but I would like to have the piece of mind from knowing where this money was spent.
Jeff from Benwell
Mar 30, 2015 at 2:25 PM
Comment #58On 5 year contracts with amortisation we can afford £90 million for players
However with rolling amortisation we can afford theoretically £450 million fot the next 5 year plan.
Ha Ha Ha
Lindisfarne
Mar 30, 2015 at 2:25 PM
Comment #59£18M will get us three £30M players on five year contracts, excellent!
scout
Mar 30, 2015 at 2:29 PM
Comment #60Credit to Ashley Ed??? Are you having a laugh?
Any club could achieve this by spending nothing and have a 15 man squad.
We are a laughing stock.
jayphoto
Mar 30, 2015 at 2:30 PM
Comment #61@ibiza think the club just adopt which ever method to best persue the point their trying to give (or the lies they are trying to spin)
Personally i did my first degree in economics, but i couldn’t care less about the clubs tax returns or accounts. Wouldn’t give a monkeys if Ashley took 100m a year out if we we’re ambitious and competitive on the pitch. Really unless the clubs being ran into the ground ala Portsmouth then the fans shouldn’t worry themselves about club money. We should have far more to shout about by whats happening on the playing side
hibbit
Mar 30, 2015 at 2:31 PM
Comment #62this 18/19m is no big deal most clubs in the prem would have shown that kind of profit if they had not brought any players for 18 months
Jail for Ashley
Mar 30, 2015 at 2:35 PM
Comment #63http://www.nufcblog.com/2012/12/04/latest-update-on-injuries-to-tiote-santon-and-ba/
A light hearted read of when a lot of peoples suspicions of Ian Toon posting as Pushy Pardew were confirmed. He has a full conversation aimed at himself after forgetting to log out, from post 51 onward.
Ibizatoon
Mar 30, 2015 at 2:35 PM
Comment #64Jayphoto…It really bugs me when other fans criticise fans for showing an interest in the clubs accounts – not that I’m accusing you of that.
It’s as if these fans just woke up and decided to become accountants. The only reason any fan cares these days is that we’ve been beaten the past few years with how we can’t afford this, can’t afford that. Finances have been rammed down our throat and we’re told they are the number 1 priority.
That’s the clubs doing.
However, i agree with what you say, which was my point. They swap and change methods to spin off whatever the spin of the day is.
People wonder why there is no trust. It’s laughable.
Jeff from Benwell
Mar 30, 2015 at 2:42 PM
Comment #65http://www.francefootball.fr/news/Sissoko-le-fidele-lieutenant/546137
I love this me
Sissoko (you know that player from that crap club Newcastle ) is now a shoo in for Les Bleus and that little shitbag Cabaye who jumped ship to find better things and a guaranteed place in the French National side at PSG is nowhere to be seen.
What goes around hey ?
jayphoto
Mar 30, 2015 at 2:43 PM
Comment #66@ibiza – aye i think its the wannabe junior accountants that are annoying. Too many people adding things up without the correct source of information or figures.
One thing that’s always annoyed me is their view on spending. Remember a while ago we spent about 12m in the window and fans were kicking off but we actually signed Cabaye, Ba, Abeid, santon, Elliot. (and obertan and Marveaux). It’s the quality of the players bought that should matter not the transfer fee.
Id happily see the club spend 12m in the summer if it meant cabaye, ba and an italian international defender were signed 🙂
optimistic prime
Mar 30, 2015 at 2:43 PM
Comment #67Jeff from Benwell
March 30, 2015
Toon-Prodigy // Mar 30, 2015 at 1:26 PM
Howay man where is all this money going?
Well let’s see
(ask the council they ain’t cheap)
Rent (ground is leased )
Wages – Staff and Coaches
Wages – Players (Colo one of the better paid is £3,247,000 p.a. the kids are on £260,000 p.a.))
Electricity (floodlights cost a fortune)
Water
Normal office expenses – phones etc.
Transport and Hotels
Training ground
Tax
Good job you posted those Jeff, because it’s not like we have to pay those every year is it. Or are you saying all of those have increased ten fold?
LGFUAD21
Mar 30, 2015 at 2:44 PM
Comment #68Jeff from Benwell
It’s not quite that simple.
You can burn a serious hole in your pocket if the players fail to make the grade.
Amortisation is great at making our accounts look nice it says nothing for our cash flow.
If you want to sign £30m in players and we pay up front then you need £30m in the bank regardless of what your accounts say.
Now I’m not saying whether we do or dont have £30m stashed away and I’m not going to speculate based on a hunch, or emotion like most on here.
Ibizatoon
Mar 30, 2015 at 2:46 PM
Comment #69Jay…I don’t think I explained myself very well.
The only reason we now have these “accountants” is because the club have used it as a reason for why we can’t compete.
I don’t hold anything against these fans trying their hand at accountancy, someone has to try and decipher this crap.
Still, I agree with you on not caring about net spend…as long as we get in the right quality, for the right positions.
Sadly, this has been missing for some time and is a major issue.
swemag
Mar 30, 2015 at 2:47 PM
Comment #70Hard to know what to think about this. Obvious intial disbelief, then WTF? Then anger. Then ok, this is Mike Ashley we are talking about.
What ever, give me a good transfer window.
Sick of hearing about the 129 million debt and that we have a supportive owner.
Where the hell did that TV money go?
For anybody who thinks Ashley is walking away with the money…it is just really hard to believe. He is good for 3 Billion pounds, 20 million is like pocket change for him.
My thoughts are 2:
1. He is keeping Toon in the PL to use it as an advertizing board for SD.
2. Looking at how the PL is slowly becoming the completely dominant league world wide and how franchises in NA has exploded in value, he is waiting for the day when Toon can be sold for lets say 500 million. Then it will matter, then it is no pocket change even to him.
optimistic prime
Mar 30, 2015 at 2:48 PM
Comment #71Jay photo
I agree with your points there and honestly don’t care if we are in profit or not. The reason this whole saga gets my back up is because we are told no money to compete but we barley have or get the players required to have a decent season.
I don’t want ten £20million players, I just want a decent 11 with a decent bunch of back up players instead of cheap potential and free journey men and a squad with zero depth.
jayphoto
Mar 30, 2015 at 2:48 PM
Comment #72@Optimistic Prime – Glad Jeff put water up there. Many fans overlook the clubs crippling water bills.
I’m well informed of some other expenses the club have had this year. they are as follows.:
The changed the teabags to twinings breakfast tea. Was previously tesco own label.
They’ve had to get new coats/tracksuits with carvers initials on as head coach.
Pardew sneakily stole a bunch of office supplies when he left. they had to replace staplers, pens and a mouse ball.
The club also invested in a couple of space heaters because it was cold. This had put the electric bill up £3 a month.
Ibizatoon
Mar 30, 2015 at 2:50 PM
Comment #73LGFUAD…I think you’re being a little unfair on some of the posters to be honest.
Whilst your view point is sensible, what are fans, who do want answers, supposed to do?
We either speculate or simply accept – as the club don’t really tell us anything.
jayphoto
Mar 30, 2015 at 2:50 PM
Comment #74@ibiza i get you mate. yeah the club has hid behind finance for a long time. Think they do it as many people don’t really understand business and finance whereas Ashley is an absolute genius in how to maximise his intent through loopholes and poorly worded regulations.
I always imagine the side we’d have if we’d never sold players… then i realise we’d still have the worst centrebacks in the league and carver managing it so i don’t dwell too long 😉
jesperfuglsang - capt'n awesome of the lemon crew
Mar 30, 2015 at 2:50 PM
Comment #75So can we safely assume Fatty has bought Greggs or something seeing as we are short of £25 M or so? 😉
Jeff from Benwell
Mar 30, 2015 at 2:52 PM
Comment #76jay ha ha ha
Those sprinklers at half time man they cost an arm and a leg
Somebody asked where the money went so I told him.
John Tudor
Mar 30, 2015 at 2:52 PM
Comment #77the club just lies
Jeff from Benwell
Mar 30, 2015 at 2:53 PM
Comment #78Jesper for that money he could buy Denmark
Ibizatoon
Mar 30, 2015 at 2:58 PM
Comment #79Jay…It is all a mess.
Jeff…You know what they meant by “where has the money gone” – they meant the increased costs, not the costs which would be near enough the same as the last published accounts (which is basically what you listed).
Can I ask you a question? Why do you appear to take so much pleasure in winding up people with anti-Ashley views? It’s not even just the extreme posters, but any aspect that is anti-Ashley or questions the club in any way. It really is truly bizarre to me. Surely not everything is wonderful at NUFC?
Belfast
Mar 30, 2015 at 2:58 PM
Comment #80Just read that article Jail lmao hahaha
Pushy gate