Phil SumblerYou can throw many criticisms at Swansea City owners – both past and present – but the one thing that has been consistent over the past twenty years has been the desire for the club not to spiral into debt.
The club has largely lived within its means for many years now and even on the face of relegation from the Premier League in 2018 we have strived to maintain that even keel with sales, cutbacks and just a general prudence with our finances that stands us in good stead.
As a fan that can be frustrating to watch especially as other clubs go about spending money like it is seemingly going out of fashion but the long term financial sustainability for the club should always come above a fruitless spend to achieve a goal that has not guarantees of succeeding.
Back in December we learned that Bristol City posted a £38m loss in their financial accounts and yesterday there was reports much closer to home – from our friends up the M4 – of a debt of £109m and an operating loss of more than £12m during the year
It is a stark reality though of life in the Championship and a result of any club continually needing prop ups from an owner to survive. Cardiff’s two singular seasons in the Premier League have left the legacy of that debt which, whilst not immediately payable, remains a burden over any club let alone a club at this level of football.
The accounts showed some key points to note
- Average weekly wage of £15,500
- Highest paid director at £413k
- A small profit on player transfers (£2.2m)
- Broadcast revenue was up year on year leading towards an increase of turnover of £9m
- Owed to the club was more than £6.5m in transfer installments with commitments to other clubs on the same of up to £5.9m
- Loans from directors/shareholders were up more than £30m to over £81m with total new loans for the year in excess of £40m
The accounts also made reference to the Emilio Sala case that is currently at the Court of Arbitration for Sport where they reference “a good chance of success” but have included adequate provision in the accounts if it should prove to be unsuccessful.
The final key point though is that since the year end the club have borrowed a further £22.1m at rates of up to 9% with loans of £3.1m being repaid thus increasing the overall debt of the football club.
These figures are at a time where parachute payments have been received by the club and with this being their third season outside of the top flight we know the impact of that fourth season and the reduction of these, something that the financial team at Cardiff City will have been working on for several seasons now.
These figures should serve as a stark reality to the financial balance that all football clubs to balance at all levels. There is a real fine line that clubs have to tread between success and failure and whilst some succeed in the top echelons of the Premier League it can go so dramatically wrong with just one poor season that can see that financial blanket given to you by your broadcast income in the Premier League cut to a shoestring on which it is impossible to manage.
Credit there from our perspective should go to the likes of Trevor Birch and Julian Winter who were handed that task in the immediate years following our relegation and whilst it has not been pleasant to watch the likes of James, Rodon, McBurnie and Roberts moving on elsewhere it has been a necessary pain to pay to avoid figures such as those posted out of Leckwith.
There is a danger out of accounts such as these – and Cardiff are certainly not the exception fully at Championship level – that fans see this as the norm within clubs and become incredible blasé about the figures posted but this is a position that can rarely end well at any club and there are many examples that can be pointed at where it has indeed not ended well.
For our sake as Swans fans we have to take the lessons that can be gleaned from football accounts and remember that ours may lead to accusations of “penny pinching” or “no ambition” but the long term sustainability of Swansea City means much more than spending money that we do not have.
Anything else can be the price of modern day football and the consequences are not something I would necessarily want to think about.
For a more in depth view of football finances you can follow the excellent “Price of Football” on Twitter here
A sobering and very timely article. It takes me back to a rainy December Saturday afternoon in 1985. I stood outside a miserable and empty Vetch Field. We should have been playing Walsall at that very moment, but the day before, the Swans had been wound up in the High Court. I honestly thought I’d never watch my beloved Swans again.
Against the odds, we were reprieved and revived, albeit with a thin and make-shift squad. I was so happy that I didn’t care if we lost every game after that – I just wanted the Swans back. Our first game after coming back to life was a 0-1 defeat by Cardiff City. We finished the season bottom of the third tier, but I was thrilled – the Swans were back in my life.
I never want to be in that position again – like Bury FC, we might not get a second chance.
People who don’t remember that pain are blasé about finance – “someone will come from somewhere to pay off debts.” Look at the real world now! The crisis in Ukraine is a world crisis. Financial markets are in turmoil. People might throw money at Chelsea, but I fear for lesser clubs, including our blue neighbours.
Talk of ‘no ambition’ is utter nonsense. Our owners are operating in the real world. Business sustainability is everything at a time, post pandemic, European crises, when many businesses are folding. We must make sure that we are not one of them.
Professional Football clubs in this day and age need to take a reality check. Gambling on promotion is dangerous. Clubs need to press the reset button and start again – build from the bottom – utilise youth development and grow your own talent. Yes, it might be painful in the shorter term, but if it consolidates sustainability, a competitive team and club will grow, especially with the occasional sale of a home-grown talent.
The Premier League will always be the aim, but the reality of the current PL is depressing: Six big money clubs, two clubs trying to gate-crash that elite, and twelve teams fighting relegation. Money takes true competition out of sport.
Some fans who only remember the Swans from Brendan and then the Premier League see our current position as low.
After supporting the Swans for decades in the lower divisions – the old division four and three, and more recently fighting relegation to non-league, I see our position in the Championship as an awesome achievement for a club run on a low budget and financial common-sense.
I have read comments recently stating the preference for grinding out results in order to get to the PL (and probable relegation the season after) Personally, I would prefer the whole club, age-grades as well, to try to play football in a more pleasing way and see where that takes us. If we were to establish ourself as a strong Championship club playing eye-catching football (which will come with patience) and running on a financial even keel, then I’d be a happy man. The true Swansea Way is more than just the style of football – developing home grown players to become stars has always been part of the Swansea Way – I won’t reel off all the names; it would take too long.
I don’t ever again want to stand outside an empty stadium mourning the demise of my beloved Swans.