OK, before we start in detail, it was a rounded figure for a cheap - or should that be, expensive? - headline. The net loss declared by Yeovil Football and Athletic Club Limited, before tax, for the year ended 30th June 2009, is actually £976,402.
As usual with our club, this was no Annual Report To Supporters, which is good practice followed by many Football League (and some smaller) clubs. It wasn't even a full set of accounts. It is contained in what we understand to be the legal minimum that can be submitted under section 449 of the Companies Act 2006 as 'abbreviated' accounts. This means that such information as the company wage bill, any financial payments due to directors, and any outside directors interests, amongst other things, are no longer revealed. This may come as little surprise to those who have spent many years listening to the oft stated mantra of "Transparency, transparency, transparency" whilst seeing a regime that in practice issues as little information as possible on any matters financial: the great unwashed should pay their gate money and mind their own business.
Anyway, on to what we can glean. The club's 'liquid' assets, in the form of stock, debt owed it, and cash in the bank and hand, fell hugely between the accounts lodged for June 2008 and those for June 2009, from £1,331,258 to £543,805. Being abbreviated accounts nothing is itemised, but the most obvious large cause of this could be Nottingham Forest having met their final instalment(s) on Chris Cohen and Arron Davies, which thus disappeared from the asset side of the balance sheet.
The auditors state that:
"The company has reported a net loss before tax of £976,402. Income was significantly down on the previous year, the result of reduced football and stadium related income and the fact that there were no player sales in the year. Although playing staff costs were reduced to some extent, these remained relatively high compared to income.
In cash terms, the effects of these losses were partially mitigated by cash receipts from player sales in 2007/08. However, cash flow has become tight and the company's shareholders have introduced loans to the company both during the year and subsequent to the year end in order to ensure the company remains within its facilities.
The directors have taken active steps to reduce the costs in the current year, and the company has reported profits in the year to date since 30 June 2009. The shareholders have also confirmed their intention to continue supporting the company for the forseeable future. On this basis, the directors believe it is appropriate to prepare the financial statements on the going concern basis."
The share capital remains at £1,700,301, of which £1,575,379 is controlled by the ultimate holding company of Yeovil Football and Athletic Club, Huish Park Stadium Partnership Limited (as of their last published accounts of year ended 28th February 2009). The only listed directors of HPSPL are John Fry and Norman Hayward. The auditors' note that "shareholders have introduced loans to the company" (Yeovil Town), is most likely to mean that the club is now in debt to major shareholder Mr Hayward, who is the only shareholder likely to have provided such an injection.
When CEO Martyn Starnes started to prepare the ground by using the phrase "significant loss" (25 March 2010 : Glovers Finances Heading For 'A Significant Loss'), one suspects few supporters immediately started thinking close to seven figures.
It would not be surprising to see an aggrieved rant in the local press shortly: with mention of 'hoodies', negative comment from the sidelines, the difficulties of running a football club in the current climate, prudence, and how critics should put their money where their mouths are. On the other hand, we might see a rational exposition of how and why the current regime has just posted the biggest annual loss in the club's history, with a proper breakdown of the whys and wherefores, and what the club's short and long term plans and goals are. On past performance we know where we'd place our bet.
Link: Glovers Finances Heading For 'A Significant Loss'
Link: Club Record Small Profit In Latest Accounts (year ended 30th June 2008)
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