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£53.9m Loss For 2010/2011

Villa have announced a record £53.9m loss for the last financial year, although revenues have grown to equally record levels.

Now I haven't seen the figures myself and there are better placed on the forum to give their thoughts, I'm going off the figures published by the Official Site earlier today.

Whilst the group loss rose from £37.6m in 2009-10 to £53.9m, revenues rose to a record £92m after the club saw a 1.3% increase overall, which included a 15.9% year on year increase in commercial income.

Matchday income dropped following early exits from Cup competitions.

The club also reduced bank borrowings by £8.3m and Randy invested a further £25m in the club.

What will take the headlines is 'exceptional charges' of £12m in relation to changes in management personal.

Please don't get too excited, that wouldn't be just O'Neill alone it would also have been all the backroom staff. I also think given the dates it includes Gerard Houllier and his staff, but it wouldn't include the compensation paid for Alex McLeish's staff.

Chief Financial Officer Robin Russell said of the results:

'Given the challenging economic environment that we have been experiencing in the West Midlands and indeed globally, we are pleased with the positive trends in our financial performance. The Board are confident that the actions taken since the end of the 2010-11 financial year have galvanised the long term stability of the club and have also given us a better financial platform on which to build for future success. Our objectives are to compete strongly on the pitch and to achieve sustainability as well as compliance with UEFA's Financial Fair Play requirements.'

Overall I'm surprised the losses are that big still, but without the smaller details it's hard to judge.

The positives are the increasing revenues, and with more high earning under performers having either departed or set to depart hopefully the figures should look better in the next accounts.

It again shows how far beyond our means we were living, but with that in hand given the write offs we need to be looking to rebuild on the pitch in the summer and get some positivity back amongst the fans.

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Writer: Mike Field

Date:Tuesday February 28 2012

Time: 5:33PM

Your Comments

im afraid next year is going to be something like 100m loss? i can see 15k season ticket fall if we carry on how were going.

Tr1dent

considering your position and the decline of the squad over the last year or two, this should be really worrying for you. also it is all very well looking (hopefully) at turnover, but you could turn over 592m, but if you spend £593m, you have a problem, as you well know. Based on the supposed cost cutting in the last year or so, this perhaps justifies the need to sell the likes of Young and a few others big earners to see a much needed improvment in the books as you need that financial stability before you can improve, but you have to be very careful not to get too far behind

oxfordspur

I agree Trident. Keep this Idiot and keep servingup the crap we've generally seen this season and it will get worse. Shake you head Lerner, your brain seems to be in neutral........

Pride of Lions

i dont think the losses will get biggerm but the league position will get lower, if Lerner doesnt do something very soon.

oxfordspur

Conveniently timed spin from the club to deflect attention away from our shocking negative tactics and feckwit of a manager. Randy really is a tool. He shouldn't have spent so much on getting into the top 4 and then given up. He should've known that this was a possible outcome of his actions. He needs to speak to the fans soon.

Villan444

Yes 444 Companies House and HMRC allow us to spin our end of year date just to suit a conspiracy.

Anyway, date wise this doesn't include the Young/Downing transfers either but does include Bent.

mike_field

The loss isn't anything to spin 444. The timing is same time each year as well. No one can hide or spin the dissatisfaction in mcleish.

The fear

I don't believe some on here. The facts are clear - Villa have been living beyond their means and cuts HAD to be made, 15,000 fewer fans at an average of £400 after deduction of VAT would be circa £6m, so no armageddon based on thsese simple figures. Interesting that if an article is posted on McLeish then there are 30+ messages. But show the reason for the decisions and there are a hand ful and 2 of them from a Spurs fan! Says it all to me. Interesting also to see that Villan444 still his head in the sand and blames spin! Results have to be published in line with company accounting practices but such issues clearly pass some people by. Why is when typing messages a portion of the message is hidden to the writer? Mr Fear - any ideas why?

Gordonsleftboot

What's your current stance Fear? Do you agree McLeish should go and Lerner needs to restructure? Do you think he should try and sell up? OxfordSpur has offered realistic comments, and I feel the Spurs model is the way to go but Lerner lost his nerve. It's not nice when fans of other clubs pity you...

ljkal

In fairness most supporters are not interested in the financial aspects of a club which is obviously paramount to the sustainability like any business but unless you have mega rich owners you have to cut your cloth as they say. Having said that with fevers running high with the current plight and fervour to remove the manager then potentially the next accounts could be even worse due to reduced ST sales, merchandise etc. and sponsors will expect return on investment so Mr Lerner faces a very difficult close season.

cynicalone

Why isn't everyone's financial year details given out on the same day gents??? They seem to be suggesting that they're doing everything as planned and they're doing well by losing money and that is what I was getting at although didn't explain. They took their eyes off the simple financial structure 2years ago and now they're taking their eyes of the footballing standard. Gordon, you're very similar to Eck. Both seem like nice guys but haven't got a clue about football and love making up ridiculous excuses to fit your argument. I'm not denying the obvious need to cutback on spending and never said so. The negative football is no way of cutting spending though.

Villan444

The numbers don't look as bad as they appear. With the sales of Young and Downing our net loss would be around 17M. Without the crazy manager situation over the past 12 months its around 5M Loss. With the wage bill now being dealt with, and the large number of players who left in the summer and are expected to leave, I expect next years numbers to look better.

VILLA 4 LIFE

Alas the accounts of a football club (or it's parent) are very complicated things and nothing will become clear until we can download the full results from Companies House (for the princely sum of £1!). Unfortunately it's never as simple as saying well we lost £54m but £24m of that was Bent and there's another £34m that came in the next year. Any transfer fees are spread over the life of the contract and they add in signing on fees etc as well. It means if you sign a player for £20m on a 5 year contract, that hits your P&L for £4m every year of that contract. That also means that the previous signings of Martin O'Neil will probably be still hitting the P&L hard well after he's gone and undoubtedly hitting this set of accounts. The real key again is the wages being paid out and the ratio of that to turnover. Have they got that under control ? Not sure yet and again that's something that needs to be viewed when the accounts are published. I am worried though that the club made no comment over this point.

Matt B

Got to say though, it just shows why we had to change tack and I'm afraid Martin would have had to go anyway if he wasn't prepared to help sort the situation out. The thing that gets me though is Randy, the fans aren't stupid. We get this point. We'd have bought into the restructuring and supported the club but why oh why did you pick McLeish???!!! You're only going to end up shelling out another few million to move him on when the fans are in full revolt! Lot of time for Randy Lerner but he's got the appointment badly badly wrong.

Matt B

If we're not in the green next year il be shocked... new kit sponsor, FINALLY breaking into the east asia market and one would assume no big expenses as far as wages and transfer fees go!

CDX_EIRE

With Eck as manager we will always be in the red..........the red mist ffs!

holte ender 1969

444 each club/company has a different year end so therefore different deadlines. Villas year end is may and accounts are due at companies house 9 months after the year end, which makes villas deadline the last day in feb. around this sorta time?

Lion Heart

I should rephrase that and say each club chooses its year end so I'm guessing many are different although it would make sense for football clubs to be may. A I'm guessing villa announced them quickly so that companies house didn't publicise the a/cs as they do with every company and give the media a field day. Villa will have wanted release a statement to stop fans from panicking at 50m losses.

Lion Heart

Thanks lion heart. Didn't know. Does sound like they've spun it to a degree then…

Villan444

The only spin you can put on it is really that they are saying we cant afford to sack McLeish ! As an FD myself I know only too well how easily you can spin these things. The players are all in the books as assets, when we have gotten rid of the rubbish players they would have had a book value that would have had to be written off when they left. I am rubbish at naming names but assume Carew (not rubbish), NRC, Salifou, Osbourne, Freidel may qall have had book values. I also imagine if they are anything like me they would have been prudent and written off the books players like Beye, Heskey, Cuellar as they could all leave for free at the end of the season. Better to get your bad news all out in one hit, also they may have put the compensation figure to Bham for McLeish as I am sure they could have justified sticking it in to the previous year. Without specifics its hard to know whether or not we should be worried, the club seem fairly happy but when you look at our thin squad and the players are mainly kids around the fringes. If you do the maths and 20 players all earning 50k a week is only £52m expenditure and I would imagine we have less than 15 earning that kind of cash so there is some towards the managers / backroom staff. Therefore we should be well covered if we can earn around £90m a year.

Chelt Villan

As you rightly say Chelt accounts can be made to look poor without knowing all the facts impossible to make a rational judgement e.g. board salaries, interest rates charged on loans to the club but with wages representing 88% of turnover during Houlliers reign and announcing a 37 mill loss for the previous year think every fan agreed that a certain amount of financial tighting was called for. But like Villan 444 I agree it doesnt excuse poor tactics, poor performances, and an obsesion with Heskey that at wigan reached the heights of the ridiculous, for some reason he cannot seem to get through more than 45 mins without playing the guy.

Merlin128777

It seems baffling that bank loans could be reduced by £8m and yet another year of heavy losses even accounting for £25m input from Randy. This all (is meant to) point towards how Randy is doing his best for the club despite his unpopular decision choosing AM. I think it could be another 2-3 financial result years before we really see the fruition of fiscal austerity RL has demanded.

thekentvillan

oh, i see Faulker has got a cheeky little pay rise!

thekentvillan

kentvillan, these results are for the year ending last april. The picture has changed markedly since then and as chelt villan said writing down assets, ammortising costs and being somewhat flexible with attribution to reporting years means that this is probably all of the bad news out of the way. It's a pity that the Villa don't report half year results as we would then have a far better undrstanding of where we are on the austerity journey.

AVbornandbred

Kent - The £25m Randy put in would not affect the loss, it will no doubt have been put in as a loan to Villa, possibly as capital but that wouldnt make much sense for Randy. Both would show on the balance sheet and not touch the P&L, my guess is he put the money in to pay for Bent as we were probably at our limits in terms of borrowing. Hence I guess why the club say Randy is still giving it his backing! Its a little misleading as the accounting for the £25m doesnt touch the loss either increasing it or decreasing it.

Chelt Villan

I think every fan can understand the need for financial stability, no true Villa fan would want to see us go the way of Leeds or end up like rangers just for the sake of being higher up the table, the problem is that it could have been done better i.e not bringing in McClueless!! It was a BAD decision the worst Randy has made since he took over the club and the problem is if he sticks with him for another year then the season ticket and im sure matchday tickets will seriously drop and all this cutting back will have been for notihng, if they had appointed a decent manager then cut back they would have kept good attendences and maybe even turn a profit LOL I am not unrealistic I know Villa are not the team of 3 or 4 years ago but we ARE good enough for top 8, 12 mil is a lot to spend on managers and back room staff but Lerner has to cut his losses with McIdiot and get some good advice on who to bring in to bring up the football standards.

KerryVillian

Yep Chelt. I had to laugh when I see the Evening Mail is reporting the loss would have been even bigger if it wasn't for RL's £25m.......nice to see they've got their top financial journo's on the case with this story!

Matt B

I seem to remember some study that shows that the final standings in the PL are unerringly pretty much the same as the amount each club spends on wages but occassionally you get a freak occurance like Newcastle dropping due to mis management. I am very fearful that we are this year's freaks. I hope I'm wring!

Matt B

Or possibly wrong as well :-)

Matt B

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