Please log in or register. Registered visitors get fewer ads.
Town Announce £3.2m Loss
Monday, 16th Dec 2019 19:45

Town have announced a loss before tax of £3.2 million in the year to the end of June 2019.

Ahead of this evening’s PLC AGM in Beattie’s, shareholders were given a sheet outlining the financial highlights of the overall club for the year to June 2019.

The PLC owns 12.5 per cent of Ipswich Town Football Club Co Limited and consists of the club's shareholding prior to the takeover 12 years ago with Marcus Evans owning the other 87.5 per cent.

The club made an operating loss of £10.41 million in the financial year 2018/19, while making £7.8 million profit on the disposal of players, the initial fees received from the summer of 2018 sales of Martyn Waghorn to Derby and Joe Garner to Wigan, as well as academy youngsters Ben Knight to Manchester City and Marcelo Flores to Arsenal, and Ellis Harrison’s switch to Portsmouth in June.

Top-ups from earlier deals and the initial sell-on for Matt Clarke - who joined Brighton from Portsmouth in June - are also likely to be included in that figure. Former Blues Tyrone Mings, Adam Webster and Kieffer Moore made their moves after the end of June so their sell-ons aren’t included in this year’s accounts.

Net player trading was £5.4 million - profit on sale of players less amortisation charge - up from £2.7 million the previous summer.

In the previous financial year Town made a loss before tax of £5.2 million and an operating loss of £8.4 million, having received £3.8 million from player trading.

The club’s overall debt has grown from £95.50 million to £96.26 million, owed almost entirely to owner Evans’s other companies - the increase an additional £751,000 in non-interest-bearing intra-group loans - with former MD Ian Milne having previously outlined the position.

“This is no third party debt," he told TWTD in November 2014. “The money that an owner has put into a club, he’s never going to see that back, unless maybe it goes up [to the Premier League]. But even then I doubt he’ll see that return.”

Town’s turnover in 2018/19 was up slightly from £17.13 million in the year to June 2018 to £17.72 million.

The wage bill, by far the club’s biggest outlay, was £18.95 million, 106.97 per cent of turnover, up from £18.53 million during the 2017/18 season. As in previous years, that's likely to have been around the 18th highest wage bill in the Championship.

Gate receipts were down from £4.7 million in 2017/18 to £4.6 million last season, while commercial income was up slightly on the year to June 2018 at £4.98 million from £4.35 million.

Despite the season seeing the Blues relegated from the Championship, the average attendance was up from 16,272 in 2017/18 to 17,767 last season, while season ticket sales were also up at 10,633 having been 10,144. In 2016/17 the total was 12,022.

“Gate receipts were down on last season despite an increase in average attendance due to i) season ticket price reduction of 10 per cent and ii) match ticket promotions in the second half of the season,” the highlights document explains.

“Cup receipts were also lower than last year, down from £90,000 in 2017/18 to £27,000 in 2018/19.

“Commercial revenue increased from £4.35 million to just under £5 million due to the new shirt sponsorship deal with Magical Vegas and the Rod Stewart concert in June.

“Catering and events remained similar to last year, however retail and corporate hospitality sales fell slightly short of 2017/18 levels.

“EFL income was higher than last year due to an increase in the solidarity payment offset by a decrease in the basic award distribution.

“Direct costs increased from £22 million in 2017/18 to £22.5 million this year due mainly to player wages, loan players and associated agent fees as further funds were invested in the first team squad and also our academy.

“Administrative expenses increased from £1.6 million to £2.4 million in the season 2018/19, a similar level to 2016/17 (£2.3 million).

“2017/18 included a one-off refund of historic policing costs following a legal settlement, partly offset by an increase in the club’s share of the EFL’s pension scheme deficit, hence the lower administration costs."

The financial highlights can be found in full on the club site here.

Photo: Action Images

Please report offensive, libellous or inappropriate posts by using the links provided.

TractorCam added 19:47 - Dec 16
But fans want a refund from losing the Bury game!

Saxonblue74 added 19:54 - Dec 16
Look at the figures from cup games! Therein lies many answers to why no domestic cup competition is taken seriously. It's going to take huge investment from one of the big media groups for the "magic" to return. Sad state of the modern game when only huge financial gain matters.

ITFCsince67 added 20:17 - Dec 16
Christ that’s a depressing read.

iaintaylorx added 20:26 - Dec 16
This is why ME won’t invest much. As much as he helps the club, he needs to put it up for sale!

jas0999 added 20:43 - Dec 16
The figures make grim reading, but a reminder that Evans bought the original debt for a fraction of its worth. But is charging the full amount in return and has already claimed (recouped) interest payments against that original debt, albeit not recently. So, he hasn’t invested £100M. It’s just what we owe him. He is however out of pocket, hence why a return to the championship is absolutely necessary.

bugledog123 added 20:47 - Dec 16
£100 million in debt! That's a serious figure for a Premiere league club let alone division 3.

Saxonblue74 added 20:57 - Dec 16
Football is heading for an almighty fall. Gate receipts 25% of the wage bill?! Lots more Bury Towns on the horizon I fear.

Saxonblue74 added 21:01 - Dec 16
Bluearmy81, this should help add to the long list of potential ME successors. Remind us of who you have on the shortlist?

cat added 21:24 - Dec 16
Thank feck the average attendances have increased. Sorry reading. Thanks to Evans the clubs finances are being managed. Thanks to Evans the clubs in free fall. Take your pick.

inghamspur added 21:36 - Dec 16
Back to reality.. ....

Edmundo added 21:36 - Dec 16
Why are any clubs, including ours, allowed to operate like this: wages 107% of turnover? Madness!
The EFL needs a massive overhaul - rules like the Bundesliga might help.

cornishblu added 21:47 - Dec 16
Referencing cup revenue probably cost more on time writing it than we earnt playing it ....could be a great source to f income of we took it seriously win on 10 years ....dreadful as a business model and as excitement for fans
Just don’t get why successive managers have not capitalised on this .....if we had beaten Coventry we would have been favourites for going to the fourth round ..,#justdontgetit

dirtydingusmagee added 21:48 - Dec 16
get your calculator out Bluearmy, its all a bit much for me to take in .

Bluearmy_81 added 22:01 - Dec 16
We are a handy tool to minimise his tax liabilities. He uses the club in that sense. Anyone that doesn't believe this is naive in the extreme, an accountant would be negligent not to. So we've gone from being on the verge of the prem with 25m debt to league 1 and nearly 100m debt, all in 10 years, wow that's some going. And still some of you sound like you'd do literally anything to please him!! You're embarrassing

Bluearmy_81 added 22:04 - Dec 16
Bryan plug you're naive in the extreme if you think he's plowed in 100m and got nothing out of it

Radlett_blue added 22:55 - Dec 16
A grim check on the reality of life in the 2nd tier. The 18th highest wage bill but still more than revenue, hence an operating loss of £10 f*****g million. I wonder if overseas billionaires are still queuing up for a tilt at the Championship.

rabbit added 23:12 - Dec 16
please explain that Bluearmy_81 us plelebs simply don't understand.
Your intuition and knowledge will be so welcome so we can achieve a balanced answer.

peaky69 added 03:21 - Dec 17
Not sure the comment field has enough space to provide full detail rabbit but...…….what Bluearmy is referencing I think is "The Club's Funding Position" and the reference to all the credit being in the form of some sort of loan note. Loan Notes are very popular for entrepreneur's such as ME.
In a nutshell a loan note contains the terms of your loan. And yes they are used for tax offsets.
There really is nothing sinister with them although their existence does suggest ME is expecting to recoup sum funds at some stage hopefully despite what we are told. It's not like he has just offered over some cash to pay off the debt.

I don't know for sure but guessing:
ME bought original debt for 38mill
Has input roughly 48mill - nothing to be sneezed at
Convertible loan notes are usually made into an actual debt
Not sure what the share preferences are sorry.

HappySnidge added 06:28 - Dec 17
This report says the £100m is owed almost entirely to the Marcus Evans Group (MEG), not the individual?

What I have not read is how MEG have treated the loan. Is there, for example, an accounting provision for a loan loss that is then set off against a tax liability for the profit made in other MEG companies? shows MEG estimated turnover at $203m per annum making ITFC a small part of total group income?

Like others I think ITFC fans should be grateful to MEG for rescuing ITFC from oblivion. However, from a journalist reporting perspective there is a distinction to be made between ITFC being a corporate tax efficiency device for MEG and the perception of a billionaire philanthropist bailing out ITFC

Saxonblue74 added 06:39 - Dec 17
Peaky69 and Happysnidge, as a small businessman myself I understand (most!) of your explanation but surely ITFC are still costing large sums of money just to stay afloat, however clever the accountant?

Saxonblue74 added 06:48 - Dec 17
There's also the minority shareholders to consider, 12.5% = around £12.2m debt!

Saxonblue74 added 06:54 - Dec 17
Perhaps we should try Dragons Den 81? I can just hear the pitch now, "we're looking for annual investment of £50m for an 87.5% share in our business. We currently have a debt of £96.6m and are making an annual loss of around £5.5m". I'll bet all 5 of them would be fighting for it!😂😂

tractorboy2421 added 07:30 - Dec 17
Shows the sorry state football has got into. I fear for our club, who would want to buy a 3rd tier club with this amount of debt ?? It's going to take a very brave person to buy our club ☹️

Cakeman added 07:42 - Dec 17
Not looking good is it? I am shocked that our wage bill is as high as it is. It will be interesting to see how much it has gone down following our relegation in next years report.

Fat_Boy_Tim added 08:26 - Dec 17
Bluearmy 81, I thought we'd all gone over this for several years now.

If you own a business (Call it business A) which makes a handsome profit of £20 million per annum (Lucky you) you will be asked to pay (Assuming it's UK based) about 20% tax on that profit. Profit here crudely being everything you turnover minus everything you spend.

So you tax bill is £4 Million pounds. (20% of £20 Million).

Your profit after tax is £16 Million (Keep that in mind).

If you also own Company B which makes a loss of £5 million you will pay no tax on this.

Now, if you employ a smart accountant he can offset company B's loss against company A's profit. £20 million minus £5 million = 15 million in profit reducing your tax to 20% of £15 million. IE: £3 million pounds.

Your profit after tax is therefore £15 million minus tax of £3 million = £12 million pounds.

Clearly, this is better than just losing £5 million on company B however overall you are still £3 Million pounds worse off than if you owned company A alone.

There is no way to make profit on losses.

You need to login in order to post your comments

Blogs 281 bloggers

Ipswich Town Polls

About Us Contact Us Terms & Conditions Privacy Cookies Advertising
© TWTD 1995-2021