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8:00am Monday 24th November 2008
Saints finance director David Jones has warned that further player sales and budget cuts will have to follow as the board try to ensure the club remains “sustainable.”
The warning came in Jones' Financial Review as Southampton Leisure Holdings released their annual accounts for the financial year ending June 30 2008.
Among the headline figures was confirmation, following a trading statement by the club at the start of the season, that the club made a loss of £4.9m even after making £12.7m through player sales.
While the net profit Saints made from player trading was up £4.4m from the previous year - from £5m to £9.4m - the club's pre-tax loss figure increased, by £4m from £0.9m.
The accounts also reveal how Saints’ suffered a drastic 36 per cent drop in turnover, from £23.3m to 14.9m.
Jones attributed this loss to the board making money available to spend on players in an ultimately unsuccessful bid to secure promotion.
As a result the club's wage bill also leapt from £10.5m - 45 per cent of the club's turnover - to a huge £12.1m, which was 81 per cent of the turnover in the 2007/08 financial year.
The impact of that failed promotion bid was compounded by the loss of the parachute payments Jones said.
In a statement to the Stock Exchange Jones said: “The financial statements have been prepared for the 12 months ended 30 June 2008 and for the first time the Group accounts have been prepared in accordance with the principles of first time adoption of International Financial Reporting Standards (IFRS).
“The 2007/08 football season was a major disappointment with the Club finishing 20th in the Coca Cola Championship, only surviving relegation on the final day of the season.
“Having been so close to promotion in the 2006/07 season, and losing in a penalty shoot out in the play off semi-final, the Board backed its football manager George Burley, to strengthen the squad with transfer fees and increased player wages to make a further challenge for promotion to the lucrative Premier League.
“This challenge did not materialise and the poor football performances had an impact on attendances and all other commercial revenue streams.
“The cost of this player expenditure, together with the loss of the parachute payment from the Premier League, has had a materially adverse impact on the financial results, which show a 36% reduction in revenue from £23.3m to £14.9m and an increase in the loss before taxation from £0.9m to £4.9m, despite a £12.7m profit on disposal of players' registrations.
“The net decrease in cash and cash equivalents for the period was £9.2m, with a net overdraft of £4.4m at the period end.
“The Board is working hard to bring costs back into line with revenue and is working closely with the bank and loan note holder, to ensure the Group is sustainable in the long term.
“This is involving major costs reductions and asset disposals, in particular player sales, a process which is not yet over.
"Until that is the case, the Group remains reliant on the continued support of the bank and loan note holder.”
halftime orange, chandler's ford says...
11:56am Mon 24 Nov 08
Bigrich1980, ERIMI says...
12:01pm Mon 24 Nov 08
Satellite, Erpingham. Norfolk says...
12:51pm Mon 24 Nov 08
homegrown, southampton says...
1:24pm Mon 24 Nov 08
couzzy, southampton says...
1:49pm Mon 24 Nov 08
NewforestSaint, new forest says...
1:55pm Mon 24 Nov 08
jezza, Stanstead Abbotts says...
2:06pm Mon 24 Nov 08
UTS, says...
3:01pm Mon 24 Nov 08
Satellite wrote:Ahh as i have pointed out many times Mr Crouch had nothing to do with anything until late December 2007. So you should be looking at Wildes executives for that issue.
UTS, if you really believed that the Bank was far happier having Crouch in charge, with wages at 81% of turnover and an overdraft at £6.3M then you will believe anything.
Derek of Holbury, Holbury says...
4:11pm Mon 24 Nov 08
Solent Saint, Lee on the Solent says...
5:34pm Mon 24 Nov 08
UTS wrote:UTS. It's snowing in Dubai, keep it a secret though.
Well i think Dave Jones should be sacked for incompetence on a huge scale. I mean what the hell does he do for his paid role ? Has he ever said 'NO' to more spending ? Can someone also explain why the bank where happier with leon Crouch running the club !!! Whats that i hear because he was going to put money into the coffers with others..........
miltonarchers, Winchester says...
5:37pm Mon 24 Nov 08
UTS wrote:Poor old UTS. So Barclays also hate RL, funny that, they did agree to extend the overdraft (according to UTS)so they cant hate him that much.
Satellite wrote: UTS, if you really believed that the Bank was far happier having Crouch in charge, with wages at 81% of turnover and an overdraft at £6.3M then you will believe anything.Ahh as i have pointed out many times Mr Crouch had nothing to do with anything until late December 2007. So you should be looking at Wildes executives for that issue. I think a good talking point is also why the bank allowed further spending ? They would of only allowed it from guaranteed future income. So going back to your point the bank was indeed happier with the previous Dec-May board. Mainly because there was going to be investment if Lowe/Wilde sold their shares. Barclays btw have now reeled in the slack due to Lowes arrogance. Talking about overdrafts im sure you will be delighted to know that Lowe actually extended the overdraft in May of this year.
simonkench, southampton says...
8:10pm Mon 24 Nov 08
Traceyf, Southampton says...
10:16pm Mon 24 Nov 08
UTS wrote:Dave Jones may well have said no to spending more but has it not occured to you that the CEO over ruled him?
Well i think Dave Jones should be sacked for incompetence on a huge scale. I mean what the hell does he do for his paid role ? Has he ever said 'NO' to more spending ? Can someone also explain why the bank where happier with leon Crouch running the club !!! Whats that i hear because he was going to put money into the coffers with others..........
Traceyf, Southampton says...
10:25pm Mon 24 Nov 08
UTS wrote:Of course Crouch had nothing to do with anything untill December 2007, he was only a member of a company board that made decissions...hmm...m
Satellite wrote: UTS, if you really believed that the Bank was far happier having Crouch in charge, with wages at 81% of turnover and an overdraft at £6.3M then you will believe anything.Ahh as i have pointed out many times Mr Crouch had nothing to do with anything until late December 2007. So you should be looking at Wildes executives for that issue. I think a good talking point is also why the bank allowed further spending ? They would of only allowed it from guaranteed future income. So going back to your point the bank was indeed happier with the previous Dec-May board. Mainly because there was going to be investment if Lowe/Wilde sold their shares. Barclays btw have now reeled in the slack due to Lowes arrogance. Talking about overdrafts im sure you will be delighted to know that Lowe actually extended the overdraft in May of this year.
Captain Kirk, Alpha Quadrant says...
10:43pm Mon 24 Nov 08
UTS, says...
11:07pm Mon 24 Nov 08
Traceyf wrote:Sorry Tracey you obviously do not know how executive status works in a company. Michael Wilde handed the keys over to a load of strangers and gave them exec status. Namely Dulieu, Hone, Hoos, Oldknow. They dictated what went on for most of last year and before. They basically hijacked the club and no other board member had any say.
UTS wrote:Of course Crouch had nothing to do with anything untill December 2007, he was only a member of a company board that made decissions...hmm...m aybe Crouch stepped out of the room when the decissions had to be made? Barclays gave support for one more year, what would happen after that? Which investment are you talking about exactly? Fulthorpe failed to demonstrate he and his consortium had the funds and how many people here shouted down SISUs interest?Satellite wrote: UTS, if you really believed that the Bank was far happier having Crouch in charge, with wages at 81% of turnover and an overdraft at £6.3M then you will believe anything.Ahh as i have pointed out many times Mr Crouch had nothing to do with anything until late December 2007. So you should be looking at Wildes executives for that issue. I think a good talking point is also why the bank allowed further spending ? They would of only allowed it from guaranteed future income. So going back to your point the bank was indeed happier with the previous Dec-May board. Mainly because there was going to be investment if Lowe/Wilde sold their shares. Barclays btw have now reeled in the slack due to Lowes arrogance. Talking about overdrafts im sure you will be delighted to know that Lowe actually extended the overdraft in May of this year.
UTS, says...
11:10pm Mon 24 Nov 08
Traceyf wrote:Well if he was over ruled then why did he not saying anything about it ? Any other person would make it known. Especially when their mate is Lowe loving load of gossip being fed to him.
UTS wrote: Well i think Dave Jones should be sacked for incompetence on a huge scale. I mean what the hell does he do for his paid role ? Has he ever said 'NO' to more spending ? Can someone also explain why the bank where happier with leon Crouch running the club !!! Whats that i hear because he was going to put money into the coffers with others..........Dave Jones may well have said no to spending more but has it not occured to you that the CEO over ruled him? When did the bank say its was happier when Crouch was chairman?
UTS, says...
11:18pm Mon 24 Nov 08
miltonarchers wrote:Where have i said barclays 'hate' Lowe LOL !! doh
UTS wrote:Poor old UTS. So Barclays also hate RL, funny that, they did agree to extend the overdraft (according to UTS)so they cant hate him that much.Satellite wrote: UTS, if you really believed that the Bank was far happier having Crouch in charge, with wages at 81% of turnover and an overdraft at £6.3M then you will believe anything.Ahh as i have pointed out many times Mr Crouch had nothing to do with anything until late December 2007. So you should be looking at Wildes executives for that issue. I think a good talking point is also why the bank allowed further spending ? They would of only allowed it from guaranteed future income. So going back to your point the bank was indeed happier with the previous Dec-May board. Mainly because there was going to be investment if Lowe/Wilde sold their shares. Barclays btw have now reeled in the slack due to Lowes arrogance. Talking about overdrafts im sure you will be delighted to know that Lowe actually extended the overdraft in May of this year.
derek fo holbury, holbury says...
1:01am Tue 25 Nov 08
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UTS, says...
11:43am Mon 24 Nov 08
Can someone also explain why the bank where happier with leon Crouch running the club !!!
Whats that i hear because he was going to put money into the coffers with others..........