The Newcastle United finances from the 2013/14 season have just been announced.

The headline figures that they have announced are;

Broadcasting revenue up to £78.3m from £51.0m

Matchday revenue has fallen from £27.8m to £25.9m

Commercial revenue is up to £25.6m from £17.1m (new deals with Wonga/Puma)

Club turnover has risen from £95.9m to £129.7m

After playing trading and tax, there is a profit of £18.7m which is up from £9.9m

The operating profit is £4.7m compared to a £0.6m operating loss the previous season

Mike Ashley has not reduced the club’s ‘debt’ of £129m to him.

The glaring thing that isn’t explained stands out like a sore thumb.

The revenue has gone up by £33.8m (from £95.9m to £129.7m)

The operating profit has improved by £5.3m (a loss of £0.6m becoming a profit of £4.7m)

So what the limited information released by the club doesn’t explain is how costs have gone up by a massive £28.5m!

The club have given us the broad picture of where the money has come from – in other words the TV deal, cash on matchdays and money from sponsors.

However, there is absolutely nothing to tell us where the money has been spent and to account for a near increase of £30m in costs, before player transfers in and out is added/taken away.

So the club are telling us that the normal costs of running the club have increased from £96.5m to £125m.

What is very telling, is that the club have not told us what the ratio of wages to turnover is, something that they have been very keen to tell us in the past as that amount has been reducing as wages have stayed relatively the same in recent seasons whilst the turnover has gone up.

If we had been told the wages to turnover ratio then we could have worked out what the wages had actually been and whether the wages had somehow gone up by a massive £28.5m in one season, or we’d be asking where else that money has gone….?

Of course there is no suggestion that anything illegal/untoward has happened, just that we are not being told where the extra £28.5m of costs have come from.



  • markattias

    NUFCTheMag TaylorandBesty MikeAshleyLies maoc This stuck out to me how it wasnt near the 50 million rather than 18, nothing untoward? ok

  • IamNufc

    NUFCTheMag TaylorandBesty MikeAshleyLies maoc With those figures, total outlay is £101.1m compared to last season turnover £95.9m…How?

  • j127430

    NUFCTheMag TaylorandBesty MikeAshleyLies maoc it will be interesting to see any related party notes in the accounts. Have we paid SD

  • j127430

    NUFCTheMag TaylorandBesty MikeAshleyLies maoc anything for the club shop supplies etc?

  • Toonbadger

    OUR costs have gone up to pay for the fiasco at Rangers, lawyers etc etc

  • IntravenusMP

    @j127430Why would we pay SD?

  • nnnnnmmmmm

    isn’t the £19m profit after tax? so actual pre tax profit would have been in the high £30 million bracket, which is what people were expecting? i’m not sticking up for them, more needs to be spent, we all know how neglectful the owner has been

  • Seventy2

    “The operating profit has improved by £5.3m (a loss of £0.6m becoming a profit of £4.7m)”

    I presume the Operating Costs are the difference between the cost of players coming in (including 1st years wage) and the outgoing transfer fees. If I am correct the £4.7M profit will be the figure included in the accounts not the amount of improvement shown here.

  • IntravenusMP

    @IamNufc At a guess, fuel costs were very high in the period, wages would have gone up and other variable costs. Very few companies can increase turnover 36% without an increase in costs and your figure suggests we’ve achieved that increase with a 5.5% increase in costs. Given that wage increases have been 5%, 5.5% is not unreasonable at all.

  • IntravenusMP

    “What is very telling, is that the club have not told us what the ratio of wages to turnover is, something that they have been very keen to tell us in the past as that amount has been reducing as wages have stayed relatively the same in recent seasons whilst the turnover has gone up.”

    That’s a bit of a naive comment, these accounts are the standard year-end accounts and under the companies act requirements and UK GAAP, there is no need to analyse wages ratios etc, this will be something the club will either report on separately or within the management accounts which are more analytical and used for strategic purposes.

  • No Brainer

    IntravenusMP Fuel costs lower in the period, fuel a very low impact on nufc any way.
    Major cost to a football club is talent nufc have only marginally improved the talent pool (injuries have curtailed our chance to see them). Those improved players are not superstars commanding £100K and upwards more likely £50K to £80K therefore with three players on £80K per week then the cost increase is maximum £12m.

  • IntravenusMP

    No Brainer 

    In the scheme of things, you are right, it’s not a big slice of the costs but electricity costs were increasing throughout 2013-14. SJP is a huge hospitality arena with artificial lights on all year. 

    All I’m saying is that on @IAMNUFC’s figs, I’d not be surprised for all the major costs to rise in the region of 5% so these figures are not exactly shocking.

  • Chemical Dave

    Haha, intravenous drip justifying this by saying they forgot to turn the lights off !

  • martynziegler

    dodo938 certainly interesting wages or wage/ revenue ratio not mentioned

  • Seventy2

    2012/13 – T.O. £95.9M profit £9.9M Operational costs £86M
    2013/14 – T.O. £129.7M profit £18.7M Operational costs  £111M
    Increased costs of £25M

  • dodo938

    martynziegler just checked and accounts not in Cos hse yet. will have a look when they’re in. (i think saints will report big profit soon)

  • Mal44

    Turnover up by £34 million and I think this was also a period where we made a significant profit on transfers (cabaye out and no one of significance in). This is also the after tax profit so, as someone mentioned below, actual profit would be higher. We need to see the actual accounts to get a better idea of what has actually happened but it is puzzling how the profit isn’t a lot higher. When the accounts are submitted to Companies House more will be revealed although even then we probably won’t see as much detail as we would like. A good chance for the Fans Forum to ask some detailed questions.

  • IntravenusMP

    @martynziegler dodo938  It’s not really an issue, these accounts are the standard year-end accounts and under the companies act requirements and UK GAAP, there is no need to analyse wages ratios etc, this will be something the club will either report on separately or within the management accounts which are more analytical and used for strategic purposes.

  • IntravenusMP

    Chemical Dave If that’s how you interpret my words, perhaps you need to work harder at school

  • Chemical Dave

    I don’t need to work hard at school to spot an Ashley apologist bonnylad. £5m+ on increased electricity bills, Haha, cheers for giving me a laugh drip.

  • v0ices

    IntravenusMP dodo938 how much is mike paying you?

  • Sickandtiredstill

    I saw something yesterday which suggested wages were now down to 48.6%.

  • Toon Terrier

    Smoke and mirrors. Match day revenue continues to decrease when most other clubs are rising. Regardless it’s Ashleys club and he will do as he will including using expert accounts and the same frugal policies will apply with the sale of our best players whatever the effect on the team. A great business, a shadow of a football club.

  • Sickandtiredstill

    No Brainer IntravenusMP 13/14. Well the fact is other than Kemen and the loan move for Remy, costing 2 million or so, no one else was signed. No three players on 80k per week etc nor 12 million.Players out, including Cabaye, amounted to 21.1 million leaving an approx player trading profit for that period of 19.1 million.Plain and simple, the numbers do not and cannot add up under a regime intent to continually cut costs and the wage bill.

  • IntravenusMP

    Chemical Dave I’ll just C&P the bit of my post to make it clear for the ill-educated. “fuel costs were very high in the period, wages would have gone up and other variable costs”

    I’m not saying that Light & heat costs went up £5m. Until we see the accounts, we’ll not know but it’s not inconceivable for costs to go up across the board.

  • IntravenusMP

    Sickandtiredstill No Brainer IntravenusMP Are you really claiming that KPMG and Newcastle united have wilfully misrepresented the financial position of the company? And you’ve come to that conclusion within 1/2 a day of financial investigation? Well done, I think HMRC may have a job for you and could well bring down one of the worlds biggest accountancy firms.

  • IntravenusMP

    v0ices IntravenusMP dodo938 Nothing sadly, just hope to educate a few people who are making silly comments.

  • Sickandtiredstill

    IntravenusMP  Clearly the Club may have a position for you on its PR team.
    Under what circumstances can you even contemplate that NUFC under Ashley suddenly became 25.8 million more expensive to operate?
    In one season??? get a grip of yourself.

  • IntravenusMP

    Sickandtiredstill IntravenusMP unlike you, I’ve not seen the accounts, nevermind analysing the figures to come to a conclusion. 

    Once I get to see them, I’ll let you know where i think the costs have gone up but a hunch would be wages.

  • Sickandtiredstill

    IntravenusMP Sickandtiredstill Wages for who? We only signed Kemen – Remy & Luk De Jong were loanees! 25.8 million in wages for them?
    Seriously, do you have any fookin clue what you are talking about or even which Club?

  • Chemical Dave

    A hunch would be wages ? I’ve heard water rates went up in that period, maybe that’s where the money went ?

  • Mal44

    Put simply operating profit is, broadly speaking, the difference between total income for the year (excluding player sales) and total expenditure for the year (excluding player purchases).

  • Deluded

    IntravenusMP You’re naive yourself pal, copy and pasting your responses. He didn’t say they HAD to tell us, he just passed comment that it’s strange it hasn’t been spoke about considering how obsessed we are with wages. Thanks for the education!

  • Deluded

    nnnnnmmmmm You think we’d declare we’d made that much and he’d paid that much tax?! Bless you.

  • Deluded

    IntravenusMP Chemical Dave Why would wages go up so much when we didn’t sign anyone of note? You think it was fuel prices?

  • Deluded

    IntravenusMP Sickandtiredstill No Brainer So you’re really claiming that companies like that can’t and don’t hide figures in accounting reporting? Bold statement for such an ‘educated’ man. What’s your expertise and job again?

  • IntravenusMP

    Deluded IntravenusMP That’s OK, I like to help. It’s simply not the time where the wages to turnover ratio would be reported as it’s not a requirement.

  • Deluded

    This ‘IntravenusMP’ has only turned up on this article and the Ashley MP grilling article defending Mike. I think it’s obvious which bridge this troll comes from. He even claims Remie Streete is only a year away from the first team!

  • Deluded

    IntravenusMP Deluded He didn’t say that though. And you know that. He was pointing out whilst we’re usually quick to say let’s get wages to turnover low, he thinks that the silence is deafening.

  • IntravenusMP

    Deluded Troll? just giving a bit of balance mate. Most of the comments on this have been seeking some sort of negative connotation or in the absence of this, simply making up stuff to get angry about. In reality, the figures are close to what would be expected. Any well managed company would be looking to offset all permissible costs against income as the company will not have many losses left to bring forward to minimise the tax burden.

    As for Remie Streete, how far off the first team should a 20 year old centre half be? I’d say 1 year would be very good going but if he’s not getting close in 2 years, it would be doubtful whether he makes it at all.

  • IntravenusMP

    Deluded IntravenusMP The wage / turnover ratio was mentioned IIRC at the fans forum after the accounts were published last year. The ratio in last years accounts had adversely increased because the figures included the purchase of players in the January window so wages were higher.

  • Sickandtiredstill

    IntravenusMP Deluded Oh really? Unless the full accounts show he’s offset a big chunk against his own ‘loans’ and thereby reduced the amount the Club owes him, you are again talking shyte. 
    The much lauded Ashley model of cutting costs and wages (while signing no one during that period) simply doesn’t stack up against INCREASED operating costs close to 30 million in one season. A period which just about every single article writer in the land has envisaged profits close to 50 million or more.

  • Demented_Man

    I don’t care what anyone says.  This huge leap in operating costs is highly suspicious, especially given the forecasted profits that would have attracted a hefty corporation tax bill.  I bet we won’t hear anything about it on Total Sport though.  For too near the knuckle for them.

  • Sickandtiredstill

    Demented_Man Maybe we’ll find he finally paid himself back the 18 million which he had deferred after relegation? If not – then heaven knows how he’s managed to swing these numbers.

  • toon tony

    What a bunch of CROOKS.

  • IntravenusMP

    Sickandtiredstill IntravenusMP Deluded Eh? If he’s done that, then the costs would have reduced wouldn’t they? The big loan of £129m remains on the balance sheet so no.

    The most likely increase is wages. There will be a general increase in costs as the main efficiency savings had already been made. 

    I’d say the other likely cost will be the writing down of players values, this will have the effect of reducing the tax bill and appear to make the business less profitable.

    Effectively, this is the opposite of the Shep & Hall era where the players were (in too many cases) valued way over there true market value and had the effect of creating the illusion of a fairly profitable club when the reality was it was close to falling apart.

  • Sickandtiredstill

    IntravenusMP Sickandtiredstill Deluded More bollix.
    Player amortisation was around when Shepherd/Hall were at the Club. Do you know or understand anything of football finance???
    You keep suggesting wages – yet you don’t say who for! One kid and two loan players, with 6 leaving the club at the same time?
    So, a close to 30 million increase, in one season, on ‘general costs’ as you suggest?
    What a complete numpty.

  • grahame49

    Please don’t let Ashley divide us. Newcastle united is our club,we love and hate them at times but its ours my dad and gran went before me. My son after me,like many who go or do not my colours will be black and white remain united in name and nature

  • stepaylor

    IntravenusMP Sickandtiredstill Deluded amortisation is not included in the operating profit and can not be used to explain the missing 30k

  • stepaylor

    Sickandtiredstill i think even lower maybe 45%. 65 million is my guess at the top end of estimates

  • stepaylor

    Look!!! to all your people out there that dont see this.

    The club revenue (reported by them) was 130 million.

    Wages are estimated at 65 million or so and at 50% is well below the premier league average 

    This income figure is before player trading which shows the Cabaye sale and loan fees for De Jong and Remy. Lets say plus 16 million. 

    So overall revenue including profit from player trading was 145 million.
    From that take 65 million in wages and the usual costs for running the club at around 30 million.

    145 minus 95 is 50 million.

    50 million minus amortisation of maybe 15 million (no new signings and players leaving and running down contracts another year) leaving 35 million before tax. Drop 5 million on the overdraft and your at 30 million. Now tax that at around 33% AND

    Bobs your Uncle 20 million profit

  • “Of course there is no suggestion that anything illegal/untoward has happened…”
    Unfortunately, ‘legal’ and ‘moral’ are two different concepts nowadays.

  • Toon Terrier It could be an even greater business if Mike Ashley had any balls.  Sadly, he’s a total coward who’s scared to risk aiming for the profits he could achieve if we were playing in the Champions League every season.

  • Out of curiosity, can any accountants suggest probable reasons as to why the accounts took so long to be published?

  • IntravenusMP

    NUFC Tips unlisted companies don’t like to publish too early for the simple reason, very little is to be gained by publishing early. Usually the main reason to publish early is down to performance, if a company has had some poor results in a previous year, they will be happy to go early to publish good news and improve their access to credit. 

    You’ll find most football clubs have a year end to May / June or July. Most have a June ye and are filing accounts today or tomorrow (the deadline for a June yr end is 31 March).

  • IntravenusMP

    Sickandtiredstill Demented_Man Paying back debt is a balance sheet adjustment and does not affect profit.

  • IntravenusMP

    stepaylor IntravenusMP Sickandtiredstill

    As far as the Mag’s interpretation of the press release goes, the operating profit is £4.7m compared to a £0.6m  operating loss for the previous season (sic)

  • partworntyres

    PIES!

  • LeazesEnder

    Out of curiosity, can any grammaticians out there spell intravenous for drippy?

  • magpiefifer

    As always with Ashley,it is not what we are being told,it is what we are not being told – the figures just do not ring true.Having watched Hellawell try and palm off the Westminster committee to keep his paymaster happy anything is possible with Ashley in terms of how he does business.
    Football is a results business – on the pitch mainly – but Ashley is only interested in balance sheet results,and tax avoidance!!
    Stop feeding the fatman.

  • DownUnderMag

    I’m sure there would have been some creative accounting going on behind the scenes to make sure that money was made but to reduce the “profit” to as little as possible and waive some of the inevitable tax query that would be raised.  

    For me the biggest concern is where this money is going, given the debt is not moving an inch.   Record profits and yet we are struggling to field a side for the thing that actually drives all this…the FOOTBALL! 

    Worrying and I would love to see the media circus if this was happening to any of the media darlings like Liverpool, Villa or Man Utd…and yet for us there is a passing mention and not much else, even from the local press!

  • amacdee

    DownUnderMag

    “Record
    profits and yet we are struggling to field a side for the thing that
    actually drives all this…the FOOTBALL!”
    Ah there you go D U M making the assumption this is all about football.Whereas it’s all about MONEY pure and simple. Oh and developing the Brand. Not ours but Fatman’s.

  • amacdee

    IntravenusMP NUFC Tips Er have you seen the list of clubs that have already published ? 
     http://www.dailymail.co.uk/sport/football/article-3016432/Club-club-guide-Premier-League-s-financial-health.html

  • newcastle7

    Until the accounts are published please stop speculating.No one has taken the corporation tax bill into accounts or the amortisation of players transfers so it is totally wrong to assume that costs have gone up.
    Our friends down the road have lost approx sixty million over the last three seasons and are in dire straights
    financially and had a £40m overdraft last year.You should be glad our club is in safe hands as Leeds,Coventry and Portsmouth fans will tell you life is not good now.

  • IntravenusMP

    amacdee IntravenusMP NUFC Tips  the June year enders (spurs, saints & ourselves) have not filed accounts yet so spurs ands saints figs may be estimates. The others have May yearends or listed so have disclosure requirements,

  • Gaffa201

    stepaylor Drop 5 million on the overdraft? thats balance sheet not P&L and the club has unused tax losses of £40m so they will not have paid a £ in tax in those accounts. you obviously have no idea about accountancy!

  • Gaffa201

    newcastle7 no tax to pay £40 tax losses brought forward from June 2013 accounts

  • IntravenusMP

    LeazesEnder  Right, here’s a clue : Your comments on this thread are a good indication of the lack of understanding within. Your intellectual growth rate cannot even be charted.

  • IntravenusMP

    newcastle7 That is very true, the article shows a lack of understanding in the way it questions the figures without reading them. The accounts were filed yesterday and no doubt available to download in the next few days. 

    There are plenty reasons why overheads would have increased, these may well be paper adjustments to shelter profits from tax which is the kind of thing that would be done in any well managed company.

  • IntravenusMP

    Gaffa201 I’m not saying you are wrong but do you have a link to the note on tax losses bought forward. If so, that’s great stuff.

  • Gaffa201

    IntravenusMP I downloaded the 2013 accounts last year and its in the tax note.  The account will be interesting because the club really has very little reason to have had such a dramatic increase in costs. My hunch is a large transaction in the RP note to an associate of Ashleys.

  • IntravenusMP

    Gaffa201 IntravenusMP there can only be hunches at the mo but I don’t think it will be a related party payment, more likely to be player value write-downs and salaries will go up a decent amount. If Ashley wants to take money out for himself, he’s got a £129m tax-free pool to dip into, it doesn’t appear tha he’s touched that. 

    The fact there is still £40m of lasses to use up, given we’ve seen a £30m, £1.2m and £9m+ profit in the last 4 years, it rather shows what losses had been accumulated in the Shep & Hall era (on top of the relegation season)

  • Sickandtiredstill

    IntravenusMP newcastle7 profits = players in (a real net spend not just recycling money), at any other football club.
    That’s a point you seem to avoid when banging on about a well managed ‘company’. This is a football club, not a branch of SD.
    As for increased overheads, you’ve mentioned electricity (hilarious) and wages. You still haven’t suggested who such wages would be for. Would you care to now?
    Of course, no doubt some of that will be for paying off Kinnear and Llambias – real good examples of a ‘well run company’ eh?
    One thing is for sure – plenty of people are now eagerly awaiting a further explanation as to why operating expenses increased by almost 30 million in one season. 
    You two Muppets are nothing more than pure Ashley apologists.

  • Gaffa201

    IntravenusMP Gaffa201 why would salaries go up they all have perfectly good contracts over several years which Ashley wont change. Remy was prob paid about £5m so thats all I’d expect to see. I also have no reason to suspect they have written down players the registations are w/off over the life of the contract and will be circa 12m again in 2014.  

    Given my reasoning above I’m looking outside the box for answers for what I suspect to be about a £20m cost which wasnt around in 2013

  • Sickandtiredstill

    IntravenusMP Gaffa201 You moron.
    Losses from Shepherd/Hall – are you fookin joking?
    Why the hell do you think Ashley still holds 129 million of ‘debt’ over the Club?
    The further losses, from 10/11, are purely and wholely down to Ashley getting the club relegated.

  • IntravenusMP

    Gaffa201 IntravenusMP As the OP says, we’ll see in a few days. 

    With wages, it’s fairly normal, especially in the younger players to have an increase in salary with each year. Cabaye was paid for most of the year, Remy & Sissoko were both on big wages the latter only impacted for 5 months in the previous year. 

    We had to pay & pay off the director of football & I suspect Lambias needed paying off as his departure could have been argued as constructive. 

    We will see if you are right but there would be no reason for Ashley to pay himself anything via any vehicle given his loan.

  • IntravenusMP

    Sickandtiredstill Sir, is it possible for you to be civil. I actually can’t be sure of the point you are attempting to make due to the unnecessarily abusive tone.

  • stepaylor

    Gaffa201 newcastle7 Tax losses are accrued and credited only in the year they are noted. You can not carry forward a loss (from operating a business from one year to the next). All you can do is write down the loss of capital expenditure which is often referred to as depreciation (of an asset). This also however removes equity from the P&L. 

    There is a difference between an operating loss and a loss of equity value. They are not the same thing

  • stepaylor

    lots of comments on this and some poor understanding in places.

    In brief it is going to come down to the actual numbers as its tough understanding what they are referring too in the release. One thing is for sure though. The operating costs of the club have certainly not increased during the time of the accounts. There is no way the operating profit before EBITDA was 4.7 million. maybe they got the decimal point in the wrong place and it was 47 million.

  • Gaffa201

    stepaylor Gaffa201 newcastle7 Tax losses are carried forward in a trade and can offset a future Corporation tax liabilty. given the losses that NUFC have made over the years the June 2013 accounts state that £40 of such losses are available to offset against future profits hence the fact they will not have a liability in June 2014 accounts.  The directors may choose not to create a deferred tax asset if the future profits are not certain at the date of the accounts(which NUFC choose to do)

    I have no idea where equity and depreciation come in, depreciation is a disallowed expense for corporation tax anyway.

    Do you work in accounts?

  • Gaffa201

    stepaylor at no point has he said EBITDA was 4.7m, the operating profit includes the deduction for player registration amortisation per the 2013 accounts.