NUFC Announce 9.9M Profit & Increase In Match Day Turnover

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The latest financial figures have been released today by Newcastle United and while the club are claiming the 2012/13 figures are a great success, the reality is somewhat different.

The club made a small operational loss of £616,000 but the figure the club are leading with, is making a profit after tax of £9.9m.

However, this profit figure only shows up after the accountancy practice of ‘Amortisation’.

newcastle united financial figuresWith sums received for players showing in relation to what the club originally paid for them – the outgoing players’ values having increased during their time at Newcastle United.

So because of this accountancy practice of ‘Amortisation’, a £10.6m trading profit on players appears, even though Newcastle spent more (£28.7m) on incoming transfers than they received (£11.1m)

So a £616,000 operating loss, then has a £10.6m player trading profit added, to give the £9.9m profit. However, in purely money in and out, Newcastle spent more (£616,000) than they got in, but once the accountancy magic was worked, they can present that £9.9m profit.

On top of the above loss/profit, the club also announced that it had slashed the wage bill from £64.1m to £61.7m.

They then made the following statement as part of their report;

“Matchday and commercial revenue is a key driver because that is where the club can compete with – and outperform – its competitors to enhance its spending capabilities.�

This is where things really fall apart, the turnover and the split as follows;

The 2012/13 turnover is £95.9m, with the split being £17.1m Commercial, £27.8m Matchday and TV/Broadcasting £51.0m.

However, if we go back to six years before and the last season before Ashley arrived, the income was as follows;

In 2006/07 the turnover was £87.1m, with £27.6m Commercial, £33.6m Matchday, £25.9m Broadcasting.

In other words, if you added the TV windfall to the 2006/07 figures, Newcastle United would now have a turnover of £112.2m, instead of the £95.9m figure released today

Even ignoring inflation, the club’s latest revenue figures are shockingly low for a club of Newcastle’s potential. To be claiming the Commercial and Matchday figures as great successes when Newcastle are bringing in £44.9m for those two areas compared to £61.2m six years before is unbelievable.

Even taking into account certain things the club have contracted out, these figures are disastrous, and for Mike Ashley to claim that Matchday and Commercial income is where Newcastle can gain an advantage year after year over other clubs is laughable.

In terms of Matchday revenues – the long-term fixed price deals for fans, combined with low interest in buying Corporate seats and the ever expanding cheap family section (numbering 8,000 at the minute already) make it almost impossible for this area to increase in any significant way. That is before you even come to thousands of fans who have cancelled their season tickets in recent weeks.

As for Commercial turnover, free advertising for Mike Ashley’s family of brands (Sports Direct, Karrimor, Sondico, Dunlop etc etc) at St.James’ Park, on the training kit, at the training ground, at press conferences and so on, helps leave a massive gap in the financial turnover/profit, plus of course the fact that there is no significant management team in place at Newcastle United to go and chase all the worldwide commercial deals that every Premier League club is chasing on the back of the ever more penetrative TV deals.

Companies around the world falling over themselves to be associated with Premier League clubs. Of course the more companies paying in money to Newcastle United would equate to a dilution of promotion for Ashley’s brands, with obviously those other companies wanting to see their company names promoted….instead of the free advertising hoardings etc that promote Sports Direct etc.

These latest figures show yet again that Newcastle United are going nowhere under Mike Ashley, the room for growth is almost non-existent unless the club make profits by selling players.

The extra tens of millions that could and should be there from Commercial and Matchday revenues could have seen Newcastle clear of everybody else and chasing the top six revenue earners. Instead we are becalmed without a puff of wind – no ambition other than to remain in the Premier League and promote Mike Ashley’s business empire.

Depressing times with no light at the end of the tunnel.

And don't forget we're 8th in the league (and finished 5th in 2011-12). Not exactly what was expected when the whole of England was guffawing at us after our relegation in 2009, and the whole of Geordieland was despairing - truly amazing - we are an exemplary club in a time when clubs are being demoted, or having their names/colours changed and paying players 300,000 a week in dismal seasons.

We are a truly model club, and I cannot believe how lucky I think myself to have Mike Ashley owning the club I support.

Good piece dave,

Dont have time to go into it all but I read something similar last year. It was then that my views changed on Ashley. Most on here know I have supported him, or at least give him time. Not anymore. Not because of the usual sh17 being spouted......because he is fleecing the club.

We all know figures can be easily twisted. What I read last year was that shirt sales and the NUFC club shops are now part of Sports Direct, so any profit from them goes into those coffers. This makes it look as though we are not that profitable and means he can spout the crack about needing to cut our cloth accordingly.

I wouldnt mind if he was paying himself back the money we owed him and that was a reason for not spending much, but he certainly doesnt appear to be doing that. It will be interesting to see what the figures are for next season with the extra 60 mill and Cabaye money.

Real shame, as the model of self sufficiency is one that I agree with. Trouble is, money seems to be being taken out.

Bit coincidental the timing of the release of this information isn't it ?
The clubs usually announce this kind of stuff around April or in the close season
Wouldn't have anything to do with trying to stem the flow of record ticket cancelations would it and the fact many are still on the fence and don't know what to do next season !
I especially like the part where they claim our only hope is to outperform our competitors on match day revenue practically begging for ticket renewals and implying to all that it's the only hope for our club is to keep paying up and hope it doesn't all disappear into the black hole that is fat ash's bank -like stripping his free advertising for his companies and getting paying customers wouldn't boost our club considerably
This kind of release just proves to me what a bunch of crooks this regime are , there as bad as cowboy builders who empty pensioners life savings
Let's face it most of us toon fans are so besotted with the club that we don't have all of our wits about us and will always try and live in hope this time will be different and a lot will fall for this latest ploy to keep the crowds up and the cameras coming to st James
Well not me this time , I will continue to dare to believe but without my money being gambled on it
I guess we will find out when the next window ends just how ambitious they are with how many players we lose and how many come in .that is of course if there isn't another dof put in place coincedently with little time to negotiate all the necessary deals in or perhaps even a managerial change with no time to fully asses his squad and identify where reinforcements are necessary (god these crooks are so predictable you can almost see there next trick coming)

Newcastle are using Financial Fair Play (FFP) rules as an excuse for no investment in the football team. The real problem at the club is the drain of revenue from the clubs turnover, which has remained static over the last 5 years. If you keep the turnover down, the FFP restriction becomes more dificult to overcpme.

Other clubs have more than doubled there turnover in the last 5 years, because the tv money and prise money has had huge increases, by at least £30m per season. That figure will icrease again this season to about £50m extra. So the puzzle is what has happend to the revenue at the club.

The matchday money and commercial money has gone right down over that period by at least £36m per season. Adding the cost of inflation to that sum and you get a loss of 5 x £40m which = £200m. Where has that money gone. The picture gets even worse when you consider that we have made a huge profit on transfers over the last 5 years. With the Cabaye money that profit comes to £65m.

The missing money and the transfer profit is hidden somewhere. They say that we made a profit of £9m, well that is a poor comparison with Swansea, who made a profit of £15m last season and £15m the season before. They only get 20,000 at there home games. They also spent £30m in last summers transfer window. We spent zero remember.

Which everway you look at these details, you must wonder what is going on up there at SJP. The word cooking comes to mind and did somebody say books.

This does indeed make depressing reading, I do believe going over board, spending money excessively is not the way forward. However we do need investment and cannot move forward without it.

Yes, very sad.

Most people on here know how I did support Ashley's way, due to the excessive nature of the previous regime. But this last year it has been wearing thin.

The fact that he is blatantly cooking the books makes me so annoyed. I dont mind one bit if he doesnt spend any money, so he can pay back all the money he has put in. But to hide money and try and play hard up is just taking the p155.

Ive said before, it will be interesting to see the figures for this season. F00k all spent, cabaye money in and sh17 loads extra from the premier league. He would need Ken Dodd's accountant to cook that lot so lets see. If its the case and another p155 poor summer on the transfer front then i think I am going to wrap my ticket. Its a shame, but an empty stadium is the only thing that will effect him, as it will drop the value of the club.