I was impressed with the matter of fact way the club released information from the 15/16 Newcastle United accounts.  I had got used to hyperbole, spin and selective figures in previous years, but the club statement this time largely let the numbers do the talking, pointed to what was good but didn’t sugarcoat what was bad.

There were some exceptions though, some areas that deserve further examination, as reading between the lines provides more context than the surface sheen of their brief article.  But largely, my opinion was it was much improved in a PR sense.

Before I go into the details, I will say that following the last relegation in 08/09 Newcastle were restructured to be able to cope with relegation.  Ashley had to inject a £29m personal loan the following season in the championship and that was after cutting costs across the board.  These accounts show that the restructuring was successful.  You only have to look at Aston Villa and the financial debacle currently engulfing Sunderland to see that this prudent approach can pay dividends for a club that has been relegated.

Many will see this prudency and the resulting accounts as a ringing endorsement of the financial job that’s been done.  Others would ask if setting the club up to be able to effectively yo-yo is really something that supporters should celebrate?

With that in mind, here’s the few main points of interest to me which I’ve not seen covered elsewhere

Debt increased £15m to £144m

While debt was reported as £129m, that was the figure at the end of the accounting period, which was June 2016, almost a year ago.  The club statement added a further update that in December 2016 £33m more was loaned to the club.

The complexity is that £18m of it was used to pay off some of the £129m debt already on the books (the remainder of the £29m personal loan mentioned above) and the club only kept the remaining £15m.  To be clear, £18m of the £33m was paid by Ashley to Ashley, from his St James’ Holdings company and to himself personally and taken off the club debt.

The remaining £15m should be the headline cost of relegation.  Losses in the championship might also be covered by income from player sales or from an extended overdraft, but in terms of the growth in gross debt, it now sits at £144m.  A number not mentioned by the club or elsewhere.

newcastle united accounts

There was no requirement for the club to announce this.  The loan facility had already been publicised when it was submitted to companies house in December 2016.

My opinion is that the conscious decision to include this post accounting period information was to counter the announcement that the club turned a profit in the year it was relegated.

Relegating a club in profit doesn’t look good, so highlighting the personal cost to Ashley serves to make him look like the victim of the club he’s lumbered with, rather than the club and fans being the victim of the owner they’re lumbered with.  An owner who has more than doubled club debt since arriving.

The Wage Increase is vastly overstated

Three times the club statement pointed at increased wages to express dissatisfaction with the relegation that resulted.  This was disingenuous.

newcastle united accounts

Wages in 2015 were only £3.7m more than they had been seven years earlier.  To emphasise wage growth from such a low base gives a false impression.  Wages were actually down from 2014.  Here’s how Newcastle’s 2016 wage bill compares with other clubs that have released accounts so far.  They had the lowest I could find, and also the lowest percentage wage growth over the 10 years Ashley has been at Newcastle.

newcastle united accounts

The club has made almost £100m Profit in the last 6 years

The fact that the club has been profitable 6 years running was included in the release.  Exactly how profitable was not.  The £4.6m profit for 15/16 means that in the 6 years before being relegated the club turned a £99.8m profit.

newcastle united accounts

This should not be taken as Ashley pocketing large sums of money.  Every year that the club makes a profit it tends to then re-invest that money in new players.  This is exactly what we envisage a self sufficient club to be.  The alarming take away should not be that anyone is profiting from failure at the club, but that so much has been spent on achieving failure.

That’s not to say Ashley is not profiting. The Strawberry Place property development will personally profit Ashley rather than the club that owned the land, but that’s been well covered elsewhere and should outrage every supporter for it’s calculated shifting of wealth.

What’s revealed by this level of profit is the rank incompetence of the people empowered to reinvest that money and how singularly they have failed to build a squad with it.

You can follow the author on Twitter @bigchrisholt

(All contributions from Newcastle fans welcome, send articles (as well as ideas/suggestions) to [email protected])



  • bobbi fleckman

    Chris, the reason for noting the loan in December is not to appease football supporters, it’s to protect the directors. If the club is carrying on regardless with regard the lost income of the premier league, the directors can become personally liable (trading whilst insolvent). It’s necessary to address the elephant in the room that the club were relegated and income will dramatically fall, they are showing that this is addressed by an unsecured loan facility from initially Mike Ashley and latterly St James Holdings.

    It’s not entirely clear of that £18m repaid to MA was part of the £129m in the accounts or £18m personally lent to tide the club over in it’s post-relegation (and post accounts) period – I read it as the latter.

    • Chris Holt

      They covered themselves in regards to publicising the loan when they declared it publicly in December 2016,. I’m sure it will be noted in the full accounts too. There’s no requirement to include it on a website story about the previous season. Nor to complicate it with lack of clarity on what it was or wasn’t used for.

      If it was 18m put in immediately after relegation, why would the same requirement to announce it not exist then?

      Makes much more sense that Ashley loaned £29m in 09/10 and recovered £11m after we sold Carrol. So this was the remaining £18m of that.

      • bobbi fleckman

        I’m pretty sure, what you have on the website will be the text from the Director’s report which, as you say is part of the accounts. A look at Norwich’s figures show that the directors go to some lengths to show they have a viable non-premier league strategy including funding. Villa make a similar statement to NUFC that xia’s company will support the club financially.

        Any of the relegated clubs cannot announce they have filed their accounts, report some financial success and not address the thorny issue that some of the money that created that success was no longer going to be there.

        With regard MA’s loans, I thought the £129m was the figure from the re-financing of the H&S regime where he repaid the stadium mortgage, did a bit of a haircut on the balances payable to clubs for players, the casino loan and otehr creditors that had been unearthed. I understood the £29m from 09/10 was repaid in two tranches some time ago. Certainly the note from last year’s accounts shows a debt of £129m to MA

  • bobbi fleckman

    You mention the sale of the lease of Strawberry Place at a loss to the club, I’ve had a check on this, it’s said to have been “well covered elsewhere”, the accounts don’t mention a loss, in fact the only place I can find speculation of skulduggery are on fan forums and a once good fanzine that seems to have gone a bit downhill.

    • Chris Holt

      The Mag, True Faith and The NUST have all covered it.

      I didn’t mention any sale of the lease as there is no evidence of any sale.

      What we know is Mike Ashley is 100% beneficiary of the car park rental and any development on the land and there’s been no indication whatsoever that any part of the deal will realise any return to Newcastle United.

      If there were any benefit to NUFC in the development then you’d think it would be something that would get publicised as good administration of the club, rather than total silence on the matter.

      • bobbi fleckman

        The lease was bought in H&S days, it was bought as part of the mythological plan for a casino. Was this purchase in NUFC’s books? If it’s no longer there, there will be a note of disposal in the fixed assets of the balance sheet. I’m not sure that it was ever there but I’m aware that MA had to pay back the loan received on the back of the casino plan.

  • Leazes Ender

    So Charnley has… in effect….. given land owned by the club… away to Mr Ashley for nothing…

    Move away nothing to see…. no criminal activity here

    • bobbi fleckman

      Where, when did that happen?

  • Toon Army AZ

    The other day, I walked into a Puma outlet store on an Indian Reservation in the USA. On the racks were dozens of Arsenal and Borussia Dortmund jerseys, t-shirts, accessories – but no Newcastle. The NUFC management needs to find the vision and ambition (and yes, funds for players – we’ve already got the manager) to push this “big club” into football’s upper echelon. That’s where the money is! Champions League, not Championship. Spend the money… Do it wisely… Otherwise we’ll forever be in the purgatory of clawing for promotion one year and praying to avoid relegation the next. Bad for the fans, bad for the finances.

    The day I see black and white stripes on the store racks in the dusty desert of the West, I’ll know that we have arrived.

  • Guilttripjunkie

    If Ashley was running the club correctly he wouldn’t need to give ‘loans’ to keep it afloat. In an era of huge TV income the club should not be relying on Ashley for loans.