Newcastle Suffer Staggering £90M Loss During Promotion Season


Newcastle United have filed their annual accounts for the last financial year – 1st July 2016 through June 30, 2017, when we were in the Championship.

The figures should be available in full next week.

During that financial year, Newcastle made an operating loss of £90.9M and in the previous year, we made a profit of £0.9M.

Managing Director Lee Charnley

That’s a huge loss – the biggest ever for the club and it’s due to the dramatic decrease in revenue we got while in the Championship.

That’s mostly made up of TV revenue – which is massive in the Premier League – we got  £123M for last season.

And for this particular financial year, it was about £47M.

The total Newcastle revenue dropped by about a third.

The Newcastle wage bill was monumental at £112.2M – a £37.5M increase on the previous season.

That’s unbelievable.

Revenue came in at £85.7M from the previous £125. and that’s a drop of 32.0%.

The loss after tax was £41.3M, down from a £4.6M profit the previous year.

It’s good (lucky?) we were immediately promoted because we could have collapsed financially if Newcastle had to have another year down below.

Well done to Rafa and the players.

Mike Ashley loaned the club £15M as a lump sum last season, and the total amount the club now owes Ashley is £144M.

Here’s the club statement from Lee Charnley that was released:

“Even taking into consideration the fantastic levels of support during our Championship season, such is the disparity in central broadcasting and commercial revenues between the Premier League and EFL, we are reporting a drop in annual income of almost one third.”

“An immediate return to the Premier League was vital to restore the financial stability and future prospects of the club.”

“With the support and backing of the owner we took what was, in essence, a financial gamble on securing immediate promotion.”

“Statistics show how difficult this has been to achieve in recent times, with only five of the 18 teams relegated over the previous six seasons having come straight back up (one via automatic promotion and four via the play-offs).”

“We were the only relegated club to achieve an immediate return to the Premier League.”

“We were therefore under no illusion as to the scale of the challenge we were facing,” 

“Retention of the manager and key members of his coaching team, together with a significant spend to reshape the squad for Championship football, gave us what we felt was the best possible chance of success.”

“They were some high-profile departures including Moussa Sissoko, Gini Wijnaldum, Daryl Janmaat and Florian Thauvin.”

“In addition to Dwight Gayle , Matt Ritchie and Matz Sels, who joined us in June 2016, a further nine players followed in the financial years 2016/17: Christian Atsu, Ciaran Clark, Mo Diame, Jesus Gamez, Isaac Hayden, Grant Hanley, Achraf Lazaar, Daryl Murphy and DeAndre Yedlin.”

“Whilst sizeable transfer fees were earned for the players who left, the cash profile of these deals results in the fees being receivable over periods of up to four years.”

“Our ability to withstand the financial impact of relegation, and adopt the approach that we did, was therefore only made possible by the continued financial support of our owner, who injected a further £15M interest-free loan into the club in 2017.”

“Gaining promotion was the first priority and retaining our Premier League status was the second, both of which were achieved through considerable hard work, at all levels of the club, across every department, and thanks in no small measure to the magnificent support of our fans.”

That’s a lot to take in in one go – but basically, the financials for the one year down below were a lot worse than we had thought.

It was basically due to the enormous wage bill and the drop in revenue of about one third.

It gives some credence to why Mike Ashley wants to make sure the club is financially stable this year.

But there should still be ample money to give Rafa for new players.

Newcastle took a huge risk and by everybody pulling together, we were promoted.

Fortune favors the brave.

And last season everybody pulled together to finish in 10th place and we get a massive  £123M payout from the PL which will help the club financially.

People will write books about the Rafa-led Newcastle team over the last two seasons and how brilliantly the club did under his inspired leadership.

There’s no way Rafa can be allowed to leave the club!

Comments welcome.


15 comments so far

  • Lindisfarne

    May 18, 2018 at 4:58 PM

    Comment #1

    Still does not compare to the lost revenue from in stadium advertising over the last eleven years.

    12
  • toonluvva

    May 18, 2018 at 5:01 PM

    Comment #2

    So, Mr Ashley, there you have it. Your pig-headed attitude to investment in NUFC has cost you a LOT of money.

    Are you going to risk a repeat at the end of next season, or has it finally filtered through your thick skull that you cannot continue to play fast and lose with this club.

    I’m not just writing this as a season ticket holder and fan, I also believe that owners who take such a cavalier attitude to any football club are a menace to the game.

    In your case there seems to be no real excuse. You have plenty of funds to hand. your ownership has been one of wanton mis-management through the incompetency of those you have appointed. I’ll bet that you vet those hired by SportsDirect a lot more closely.

    Here’s a free tip. Trust Rafa. Give him a generous budget to attract decent players. I’m sure that Rafa knows the ins and outs of transfer fees, wages and bonuses. Let him set his targets within a budget, and then just set Charnley the task of just signing the players. That will work. NUFC wil prosper, and you might just become more appreciated.

    If you can’t stomach the above, set a realistic price for the club and sell up.

    There, easy isn’t it!

    20
  • lochinvar

    May 18, 2018 at 5:04 PM

    Comment #3

    Perhaps if the indecision and poor manager appointments of previous years and weak management from the Borad, Rafa excluded hadn’t been allowed then we wouldn’t have had this scenario.

    52,000 plus told you so

    2
  • toonluvva

    May 18, 2018 at 5:06 PM

    Comment #4

    Just another thing. The cynic in me is thinking the delays in settling a new deal with Rafa is designed to shorten the period that he can wheel and deal in the transfer market now that the window is open.

    Does anyone else have the same uneasy feeling?

    4
  • toonluvva

    May 18, 2018 at 5:12 PM

    Comment #5

    Lochinvar.

    I suspect that Mr Ashley appoints only those people who will do anything that they are told to do.

    He uses the board as a figleaf of respectability claiming that they’re running the club when in reality they probably have to get permission to buy a different brand of custard cream biscuits.

    What really annoys me is that had Mr Ashley actually used a little bit of common sense in his appointments, NUFC would in all likelihood have progressed along with NO relegations and have been making steady returns.

    The finger points at you, Mr Ashley.

    5
  • Phil K

    May 18, 2018 at 6:05 PM

    Comment #6

    HOW ????????????????
    Spent the least in the division on players, pay about a quarter Man City/Man U/Chelsea/Liverpool etc pay their players have a big attendance……..it’s like a scalper selling FA Cup Final tickets at three times the price claiming he’d LOST money

    3
  • catchy in norway

    May 18, 2018 at 6:08 PM

    Comment #7

    CREATIVE ACCOUNTING

    2
  • mindcompressor

    May 18, 2018 at 6:46 PM

    Comment #8

    When I read that club still owe something to fatso, my knife is opening in pocket 🙂 even if he put 15M it is beacuse all of him and his dumb decisions. So he paid just small amount of his grand stupidness.

    2
  • John Tudor

    May 18, 2018 at 6:50 PM

    Comment #9

    Bullshit

    0
  • dig-n-dig22

    May 18, 2018 at 7:07 PM

    Comment #10

    I think most bloggers on here know we don’t have to look at the above figures to realise we took a massive financial hit when relegated to the Championship 2015/16. what really alarms me is, looking at the inactivity in the window just gone Ashley didn’t seem too bothered if we got relegated or stayed in the Prem, in fact if Ashley had one of his “yes man specials” in place, we would have been relegated. What is most alarming of all is the fact that Ashley obviously doesn’t appreciate the benefit of a manager that can take the club forward with a good financial foundation instead of a manager that could sink us and take us to financial ruin, because if Ashley could figure out the benefit of the club being run by a good manager, Rafa would have been signed up a month ago with Ashleys full backing.

    2
  • Moonraker15

    May 18, 2018 at 7:15 PM

    Comment #11

    Wage bill £112 million! How come? We lost the biggest earners surely and I thought our wages were about £65 million in the prem! This can’t be right surely!

    4
  • JohnJ

    May 18, 2018 at 11:22 PM

    Comment #12

    “They were some high-profile departures including Moussa Sissoko, Gini Wijnaldum, Daryl Janmaat and Florian Thauvin.”

    So Ok we may be getting the cash for the above in instalments but what ever way you lookm at it we we are still getting “Big Money” back for those players – perhaps not in that finacial year but it’s still coming back!

    “In addition to Dwight Gayle , Matt Ritchie and Matz Sels, who joined us in June 2016, a further nine players followed in the financial years 2016/17: Christian Atsu, Ciaran Clark, Mo Diame, Jesus Gamez, Isaac Hayden, Grant Hanley, Achraf Lazaar, Daryl Murphy and DeAndre Yedlin.”

    0
  • JohnJ

    May 18, 2018 at 11:26 PM

    Comment #13

    Sorry hit submit by mistake!

    “They were some high-profile departures including Moussa Sissoko, Gini Wijnaldum, Daryl Janmaat and Florian Thauvin.”

    So Ok we may be getting the cash for the above in instalments but what ever way you lookm at it we we are still getting “Big Money” back for those players – perhaps not in that finacial year but it’s still coming back!

    “In addition to Dwight Gayle , Matt Ritchie and Matz Sels, who joined us in June 2016, a further nine players followed in the financial years 2016/17: Christian Atsu, Ciaran Clark, Mo Diame, Jesus Gamez, Isaac Hayden, Grant Hanley, Achraf Lazaar, Daryl Murphy and DeAndre Yedlin.”

    With regard to the above with the exception of Dwight Gale and Matt Richie I believe the rest were “Bargin Basement” signings.

    I think next years accounts will have a completely different feel about them in a positive way!

    1
  • county down magpie

    May 19, 2018 at 5:52 AM

    Comment #14

    Does this bring last summers lack of spending into context? We lost 90m dropping but were still able to hold onto ALL the players we wanted on their same wage (minus Townsend) and added more to it. Gayle at 10m plus wages, Ritchie at 10m plus wages, Murphy at 10m plus wages, Atsu at 6.5m plus wages.

    Ashley, cu n’t of a man that he is, did the same for hoots that he did for Rafa, bankrolled the biggest wage in the history of the championship to make sure we got promoted. And it worked. He spent too much with McClaren, we went down, Rafa took the brunt of it summer past due to lack of funds maybe set aside for team after April 2016 HOPEFULLY,16th placed prem team MINIMUM after the outlay of (summer 2015 the year we got relegated) that had to then be put into a championship to make sure we get promoted. IF WE HAD’VE STAYED UP, WE’D BE A DIFFERENT ANIMAL.

    0
  • Nostradamus the Geordie

    May 19, 2018 at 1:39 PM

    Comment #15

    I find it funny that the club, well Ashley and Penfold are not happy with the loss we made in the championship. Sorry gents but we where in the championship because you waited to long to fire a manager that was useless. If Rafa would have had more time I’m sure he would have kept us in the league and this would not have been an issue. M/A you need to understand, if we have a good team we make more money, once the players are in the squad like Arsenal that didn’t have to spend money on players as they had a team that could compete with the top four/six, this meant more money from TV, league position and cups, being home cups or euro, you see M/A if you tighten the purse strings you got backwards, if you let a world class manager pick his players and give him enough you will make money by not having to purchase players every window. Mind blowing I know.

    0

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