Newcastle United 2014 full accounts statement

Newcastle United's treasure chest

NUFC’s coffers are overflowing, but the debt to Ashley remains

Before I begin, my apologies for not posting these earlier, as I usually do shortly after the accounts are made public. Better late than never though as I still can’t find any other copies of the statement itself elsewhere, though there is a very extensive analysis of the latest accounts on the very good Swiss Ramble site if you haven’t seen it already. The link to a PDF of the full statement submitted to Companies House is below, along with a few personal reflections from myself.

Some personal notes on the accounts

Turnover

The overall turnover figure of £129.7 million is the highest in the club’s history. This was also true of many other Premier League clubs though due to the commencement of the new blockbuster broadcasting deal. On the £129.7 million turnover, the club made a profit after tax of £18.7 million, and an operating profit of £4.7 million. However, Ashley is yet to pay any tax at Newcastle United as losses from previous years have been deferred once again.

The new three year TV contract which kicked in during the period for these accounts saw Newcastle United media revenue leap a huge 53.3% from £51 million to £78.3 million, meaning they are now a huge 60.4% of total turnover. The corollary of the above at most PL clubs is that local fans who actually go the the games are becoming more peripheral as their share in the club’s income becomes ever smaller. If this continues apace, they are almost in danger of becoming just a piece of colour and noise to make games more entertaining for TV viewers around the world.

Looking at the matchday figures, average attendances were negligibly down from 50,517 to 50,395. Matchday revenue is down from £27.8 million to £25.9 million, and is now only 20% of the club’s total turnover (down from 29%). This small decline has been blamed on the lack Europa League football which the club enjoyed in the previous season, which is certainly a very big part of it, alongside mediocrity and boring ‘route one’ football.

Commercial revenue has grown significantly, by almost 50% from £17.1 million to £25.6 million, which to be fair isn’t too bad. However it is still lower than it was when Ashley bought the club and there is still the Sports Direct issue. Despite the fact that Newcastle United have provided a level of free publicity to Sports Direct which has been worth £10s of millions of pounds every season, Newcastle United still had to pay Sports Direct £2.8 million (up from £841,000) for goods purchased on “normal commercial terms.”

Debt

Though the club’s net debt figure is now down to £94.9 million (from £133.5 million), the club still owes £129 million to Mike Ashley as it did in the previous year. However, this is counterbalanced by something which caused much controversy when the figures were released, the fact that the club has around £34 million in its coffers due to a cash inflow of over £38.5 million over the year, the fourth biggest cash balance in the Premier League, behind Arsenal, Manchester United and Tottenham according to the Swiss Ramble piece I mentioned above.

False economies?

Mike Ashley managed to cut the costs of Directors’ pay even further, from £261,745 to £189,771. To put this in perspective though, this is a fraction of the salary of ONE half decent first team player. Previous Managing Director Derek Llambias left in June 2013, and it seems that the club was rudderless for several months until Lee Charnley was announced as Managing Director in April 2014, along with John Irving as Finance Chief. Promoting from within has saved Ashley further £10,000s, with the aggregate renumeration for the highest paid Director falling from £176,894 to £106,793. However, Lee Charnley’s almost catastrophic decision to retain the similarly cut price John Carver as the club’s head coach after the depature of Alan Pardew might have cost the club tens, or even hundreds of millions of pounds if the club were relegated and coundn’t get promoted again. It shows once again that Ashley’s policy of appointing cheaper but sub-standard staff like Charnley, Carver and others to top positions, all to save relatively small amounts, is highly risky, with the club standing to lose far more than they could ever gain. The recent huge increases in Premier League broadcasting rights has left this policy looking even more misguided. This penny wise, pound foolishness has undoubtedly been one of the main reasons for Ashley’s failure at Newcastle United since he bought the club in 2007.

With the steep rise in broadcasting revenue and turnover, though the club’s wage bill has gone up from £61.7 million to £78.3 million, the wages to turnover ratio is down 4% to 60.3% (from 64.3%). On it’s own, this seems like a healthy figure, if the club is well run and doing well like Southampton (59.3%), Chelsea (60%) or Swansea (64%). However Newcastle have been performing more like Aston Villa (59%), Hull (64%) or Sunderland (67%) (all figures from the Telegraph). They need to up their quality, or risk losing the biggest prize of all, Premier League football and Premier League money.

Although depleted, Newcastle still have a decent mid table squad about the same as West Ham, as well as a similar turnover (West Ham’s was £114.8 million over the same period). One must ask again after yet another relegation struggle if it is being hobbled by the misguided economies in the coaching staff mentoned above, most notably the Manager / Head Coach. The idea of John Carver being the manager of a club like Newcastle United, with sacked Championship manager Steve McClaren being viewed as aspirational is clearly absurd. You have to pay dozens of players, but you only have to pay one manager and one Manging Director, so it’s usually worth getting really good ones.

Newcastle United Accounts 2014 (PDF)

avatar NUFCBlog Author: workyticket workyticket has written 1052 articles on this blog.

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22 Responses to “Newcastle United 2014 full accounts statement”

  1. 1
    avatar chuck says:

    Headlines has Patrick Viera as the favorite for the NUFC head coach job, that plus rumors of all kinds of money being spent on bringing in player reinforcements.

    Strange the timing seems to coincide with the more recent extension for season ticket purchases.

    Personally the two leading candidates just don’t thrill me, one never having managed anything, the other a mediocrity recently let go by Derby, where he failed at a promotion attempt, from the second tier.

    As for players, I say put your money where your mouth is Ashley, then some of us may believe some of what you say.

    I would advocate that the fans give up on Season Tickets altogether and only pay at the turn-style so to speak, putting more pressure on the club to perform, but I know few want to go in that direction, other than those with lousy seats.

    It will be business as usual and yeah there may be a few bucks spent on players, certainly not enough to field a side that’s really competitive, but enough for most fans to get their football fix at every home game.

    McClaren will show up, Carver will stay, along with the other coaches, who have failed to arrange a decent defense or score from a set piece during their brilliant coaching stay here, most their first coaching jobs ever.

    The old adage “you get what you pay for” fit’s this club
    perfectly, from the list of know nothings that have been hired because they came cheap, Mort, Wise, Llambias, Pardew, Carver, Stone etc., Charnley and NEXT! McClaren, forget Viera, he’s only a distraction.

    That’s your future Newcastle fans, whether you like it or not.

  2. 2
    avatar sickandtired says:

    If you look into it, Chris Mort was actually paid 1.26 million for his 1 years work. Hardly cheap, but he was the last to get that sort of money – well, other than Allardyce and KK.

  3. 3
    avatar chuck says:

    Sick & Tired

    Yes I don’t doubt he (Mort) was fairly well compensated for his brief stay, but just another waste of money, who knew next to nothing about football and scurried back to Threadneedle Street as fast as his chubby legs could carry him.

    I believe his function was to double-check the clubs financial situation only.

    That was followed by a series of f***ups with some of the shadiest figures in the game, until Ashley hired the shadiest of all Llambias, whom he found on the floor of some gambling casino.

    From what I can only conclude, there has been a continuous group of incompetents hired, most who are underpaid for the job titles they have, but are highly paid when compared to what they know, that goes from coaches to top level management, Ashley being too cheap to hire a team of top level management, being he wants the final say on everything, the polite term is micro-management, it’s also known by the term, control freak.

  4. 4
    avatar workyticket says:

    sickandtired, Mort is a legal expert on takeovers / IPOs etc. He was seconded for the period of Ashley’s takeover from the last lot of Bandits so it was a bot of a special case. To put things in a little perspective and without picking extreme examples like Manchester United, City, Chelsea etc, I remember that ex Southampton Chairman Nicola Cortese was paid a salary of around £2 million in his final year at Southampton.

  5. 5
    avatar chuck says:

    Seems Newcastle fans are the most optimistic in the league, with many actually believing there will be a chance of getting Patrick Viera as Heed Coach.

    I hate to burst their bubble but Viera is just another distraction like some of the big name players that have also been mentioned by various sources, sure the club will unload players and replace them and there’s a possibility that one or two may be decent.

    But don’t expect too much, there will be the usual suspects, youngsters like Cabella and Perez, future maybee’s, along with free agents and squad players, but nothing that will make the side a top six competitor.

    McClaren will be arriving anyday now (but not before the Season Ticket window closes) But what about Laudrup and Viera, yeah sure, in your dreams, it’s another season with a retread manager, the same Carver, Stone etc. bunch of coaches, who in the time they have been there, have yet to figure out how to either defend or score from a set piece.

    Ain’t life wonderful, as once again we go bravely into the future with another side desperately attempting to once again avoid relegation while playing boring football.

    Yeah it makes you want to rush out and grab that final season ticket , before they are all gone.

  6. 6
    avatar Nutmag says:

    A view from outside.
    You have to feel for poor old Lee Charnley trying to get a Head Coach “Over the Line” on a “Zero Hours” contract with a three strikes and your out clause.
    NUFC are a predictable “sit com.” How anyone can still believe in any of this guff amazes me.
    “Never give a sucker an even break” is Ashley’s motto.

  7. 7
    avatar chuck says:

    Gullible ! comes to mind when the term NUFC fans are mentioned.

    Each year, they live in hope, only to die in despair upon realizing nothing is going to change.

    We have seen Ashley’s act year after year, it doesn’t change, so why would it now ?

    As for Charnley, (NEXT!)who cares, he knew what he was getting into.

    Not only are we going to start the season with a worse side, we may lose Sissiko and Janmaat, not to mention being coached by the same losers and a manager that just got dumped by a second tier club.

    And the fans will flock to St. James’ (wearing their WONGA outfits) in the thousands.

    Sad !

  8. 8
    avatar DarthBroon says:

    Blatter’s resigned. What a fukkin’ waste of time THAT election was.

    So, it looks like his trip to the USA for the CONCACAF Gold Cup tourney is off.

    I wonder what changed his mind? :)

  9. 9
    avatar workyticket says:

    Some Geordies were wetting themselves over the prospect of Patrick Viera coming to Toon, even though he has never managed a club before and is still doing his coaching badges. When I raised this point on the Chronic, I was put down and informed that he was part of a grand Ashley masterplan to use Viera’s connections to bring all the best French players to St James’ Park, and that Ashley had seen the light at last in terms of ambition. WTF?

    In other news, Watford have brought in Quique Flores as their new manager for the Premier League, a multi-trophy winning ex-manager of teams like Atletico Madrid, Valencia and Benfica in the past. Besides domestic trophies, he has won the Europa League and the UEFA Super Cup with Atletico as well. Watford are one of Giampaolo Pozzo owned selling clubs I wrote about before too, where the players are always being bought and sold for profit and taken from under the managers nose so there isn’t even the Newcastle setup excuse.

  10. 10
    avatar DarthBroon says:

    I reckon ‘The Wally With the Brolly’ is the best we can hope for from Ashley, worky.

    If not, it could still be Johnny Charver; at least until we’re in a relegation spot after eight games or so next season. Then they’ll bring in a Bobby Gould, Harry Basset or Laurie Sanchez to ‘steady the ship’ – back into mid-table.

    It would be unthinkable for this kind of sh:t to happen anywhere else, but don’t forget – this is Ashley we’re talking about.

    “Until we win something”? :)

    What a fukkin’ joke.

  11. 11
    avatar DarthBroon says:

    I, personally, wouldn’t object to seeing Patrick Vieira appointed as Charver’s replacement.

    At least it would be an indication that there was a genuine move to break the lousy, chiseling, penny-pinching mold of the last eight years (as if).

    In any case, I’d welcome the appointment of anyone whose reaction to being stitched up by the board would likely be to break a few noses.

  12. 12
    avatar chuck says:

    As I stated, nowt has changed with this geezer and nowt will.

    Be sorry to see Sissoko go, but fatso will get a nice piece of change for him and invest it in more wanna coulda- maybees, either free agents or under twenty ones.

    Hey maybe we will sign some hidden gems, now that Ash. has stabilized the club and put it on a solid basis, befitting the nineteenth wealthiest club in the world,
    and McClaren will become a great coach and we will end up winning the Champions league and every big time player will want to sign for us ?

    Nah !

    The way things look, we may not be so lucky with relegation next season, unfortunately there’s only one answer, and that’s to force him out, it’s the only method
    (the Boycott) that will work, unfortunately the fans haven’t got the cojones for it.

  13. 13
    avatar workyticket says:

    I don’t know if there was anything to the Viera story. I couldn’t find any evidence for it whatsoever.

    How about Lee Clark as the next head coach? He’s been saying: “It would be my dream to manage the club,” and that “Mike Ashley presides over one of the best run clubs in the Premier League.”

    Any more of this stuff as the uncertainty goes on and McClaren’s going to seem like Pep Guardiola. Does anyone know how the season tickets are going?

    http://www.shieldsgazette.com/sport/football/newcastle-united/lee-clark-i-want-to-be-newcastle-manager-1-7289328

  14. 14
    avatar chuck says:

    Lee Clark ? another loser “gis a job man !”

    I would take Steve Clarke though.

    Problem is McClaren fit’s Ashley’s requirement’s to a “T”

    As he’s quite similar in his approach to Pardew, plays a mainly defensive game, the difference being he has a better tactical understanding of football and attempts to break down the other side.

    A cautious, but very boring style, which will not sit well with Newcastle fans, who enjoy a more open entertaining style of football.

    Especially if he is supplied with some flair players by Carr, which is a problem in itself as it was with Psrdew, being the don’t fit into the tactical approach.

    The group Ashley/Carsley, Carr and McClaren, have to be on the same page, which includes whatever the clubs goals for the season are, taking into consideration the style of football to be played under the new Coach.

    No sense in signing flair players unless you intend to use them, which I don’t see coming from McClaren, sorry folks if it’s entertaining football you want, find another team to watch.

    It seems that the problem between Ashley, who talks to Carr and get’s him to buy stepping stone players, who can be sold on, instead of building a side, that can compete, with input from the head coach as to who would best fit, would sound more logical, no?

    That was why Joe Kinnear was brought in, to sort out the situation with Pard’s and Carr but ended up only adding to the chaos.

    That’s a good reason to get rid of “Chubby Charnley” who obviously is totally lost and hire a DOF with a track record, someone with contacts and experience, who can finally sort out the mess that is NUFC.

    If Ashley want’s mid level mediocrity, ok, but winning sides earn more money, better a top eight side that plays entertaining football and is fairly competitive, than a predictable side playing boring football and the cost is not much different.

    However, with the hiring of McClaren, the writing is on the wall, it’s “Pardew inproved” but basically a non competitive side, who are only there to avoid relegation and to continue to buy players with a good sell on in mind, that and the TV revenues from the PL, plus fifty two thousand fans by now enured to boredom and being exploited every other week, that’s it folks.

    By the way they still have a few choice eight year deals on tickets, hurry up though they are going fast.

  15. 15
    avatar DarthBroon says:

    workyticket says:
    June 3, 2015 at 11:18 am

    ‘[Lee Clark]’s been saying: “It would be my dream to manage the club,” and that “Mike Ashley presides over one of the best run clubs in the Premier League.”’.

    Well, there’s the perfect cover letter right there, worky. He’s telling Ashley that he doesn’t give a sh|t what the fans think.

    That should be enough to get Chubs to consider his mediocre CV.

  16. 16
    avatar workyticket says:

    Darth, if Clark has a mediocre CV, McClaren’s Jose Mourinho. Have we all lost perspective now after years of Pardews, Carvers, Kinnears, Dowies etc?

  17. 17
    avatar DarthBroon says:

    I certainly haven’t lost perspective, worky.

    I’m saying Clark might now look a better (more malleable, less likely to rock the boat) prospect than McClaren in Chubs’ eyes.

    But, as I’ve said before, NOTHING would surprise me when it comes to Ashley’s running of the club.

    Charver being in charge at the start of next season would be unthinkable anywhere else. It’d be just one more baffling decision at the end of a very long line of them under Ashley.

  18. 18
    avatar DarthBroon says:

    I’d MUCH rather see McClaren get the job over Clark, if that’s what the choice comes down to.

    I just think it’s typical Ashley to go for a manager who’s just been sacked by a Championship club when everyone was hoping we’d really turned a corner and might be about to appoint someone with a bit of flair.

  19. 19
    avatar chuck says:

    I don’t even know why you guys are discussing Clark, his was just a shot in the dark, as Viera was no more than a distraction.

    Both those two and all the other couldbe/wouldbe’s mentioned from time to time.

    It was always going to be McClaren and I guess I don’t have to repeat my opinion on that loser.

    On the other hand I can see why Ashley wants him, he fits his purpose to perfection.

    Just don’t expect the ever gullible fans to host any love in, concerning his appointment as imo it’s an “in your face” move by Ashley.

    Plus if it’s entertainment you are looking for during the upcoming season, I suggest you find another club to watch.

  20. 20
    avatar workyticket says:

    DarthBroon says:
    June 4, 2015 at 5:06 pm

    “I’d MUCH rather see McClaren get the job over Clark”

    That’s what we’ve come down to. What if it ends up being Carver again?

  21. 21
    avatar DarthBroon says:

    workyticket says:
    June 5, 2015 at 12:25 am

    “What if it ends up being Carver again?”

    As I’ve said several times in the last few threads, worky. It wouldn’t surprise me at all if they did start next season with Carver. And, that would be awful.

    McClaren would certainly be be an improvement on Carver.

    But there are loads of better candidates out there, including Paul Clement: the guy Derby chose to replace the man who managed to steer a strong Derby side into a mid-Championship spot when they were odds-on for an automatic promotion place earlier in the year.

  22. 22
    avatar workyticket says:

    chuck says:
    June 4, 2015 at 8:12 pm

    “I don’t even know why you guys are discussing Clark, his was just a shot in the dark”

    That’s what they do at Newcastle now though, Chuck. They take shots in the dark, usually shooting themselves in the foot. As I’ve mentioned in my new blog, it wouldn’t surprise if it’s Newcastle United who follow the media rather than the other way round, looking for ideas on who to approach, if they actually want to approach anybody.

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