Date: 1st April 2014 at 6:25pm
Written by:

The financial results for the DMWSL 613 Group Limited for the year ending June 30th 2013 have been released.

The group is the holding company for Southampton Football Club Limited and our other subsidiary companies, in short these results encompass every facet of the club in financial terms even though ‘the principal activities of the group are that of operating a football club and its ancillary activities.’

The full announcement can be read on saintsfc.

The financial highlights are however:

Total revenue increased 213% to £71.8m (2012: £22.9m) with average league attendances up from 26,427 to 30,807.

Broadcasting income grew from £5.6m in 2011/12 to £46.9m in 2012/13.

Matchday income of £11.8m in 2011/12 has risen to £16.9m in 2012/13.

Commercial income increased from £4.8m in 2011/12 to £6.7m in 2012/13.

Profit before player trading increased to £8.7m but with an overall net loss of £7.1m. Player trading included a one-off exceptional cost of a £2.1m impairment charge to write off the carrying value of certain players.

The loss before interest and tax has reduced to £6.6m (2012: £11.9m loss).

Club wage to turnover ratio reduced to 65% (2012:102% after the removal of exceptional bonuses).

Total group wages, including player wages, increased to £47.1m in 2013 from £28.7m in 2012.

At 30 June 2013 (balance sheet date) there were £21m of committed transfer fees still to be paid and since this date a further £27m of player transfers were negotiated (in the 2013/14 season). Whilst £21m has been paid in this current season, £27m will still be owed from 30 June 2014, with £22m of this being due in 2014/15 alone.

A £5.6m loan was taken out with Vibrac in September 2012 to enable the Club to take advantage of a lower transfer instalment payment by paying earlier, and so reduce overall cash outflows and liabilities.

Expenditure on the total training ground project now anticipated to exceed £30m. The first phase of the build is expected to open this summer.

Further investment from the shareholder in the year was £12.5m, with another £2.2m in September 2013 bringing the total investment since acquisition to achieve promotion to the Barclays Premier League to £52.7m. £37.9m of this has been converted into equity shares in the year bringing net liabilities down to £1.6m from £32.4m in 2012.

Gareth Rogers, our chief executive officer explained the results of our first full season in the Premier League in the following way.

‘The results clearly show the impact of promotion two years ago. The club has risen quickly in a short period and committed itself to high levels of expenditure both on the development of Staplewood as well as significant future transfer fees. This high level of expenditure has required strong support from the Ultimate Shareholder and once again this has been shown.’

Rogers goes on to say that with the first phase of the training ground due to open this summer, the continuation of talented Academy graduates moving into the first team fold and the gains the club has made in off pitch activities along with strong ownership and a ‘balanced board’ Southampton has an ‘excellent foundation from which the club as a whole can continue to grow’ over the coming years.

Board director Hans Hofstetter gave the quote that most of the press have picked up on.

‘Whilst I perceive that we have inherited a difficult situation financially, there are now clear and structured plans in place to progress the club and avoid a similar situation from occurring again. The continued support of the Ultimate Shareholder cannot be underestimated and we are grateful to be able to rely on her dedication to helping us flourish as a club.’

Hofstetter added that in his time with the club he feels we are blessed with staff that have all the available skills to help the club progress and move forward, and ‘now that we can supplement that with a strong Board I am sure we will enjoy a successful future.’

In short, despite some press speculation following the announcement, the growth we have made in other areas of the business mean in effect we have no immediate ‘firesale’ worries as some seem to believe.

Therefore cashing in on talent at the club is something that cannot be forced, it remains in our discretion and the line from the club continues to be we don’t have to sell, and we aren’t selling.

That goes for Luke Shaw as much as it does more recent rumours linking Dejan Lovren with a move to Liverpool.

Hofstetter said elsewhere in the media.

‘The most important point is that we are in a position where we do not need to sell any player Mauricio wants to keep.’

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