Someone has to stop this
Astonishing
Now the figures have been announced, they are even more astonishing than I thought they would be. Surely this has to be stopped doesn’t it?
The club have announced losses of £121 million for the twelve months leading up to 31st May this year. This figure is up from £92.5m for the previous year. It is one of the biggest losses ever in the Premier League, but to be fair to City, it isn’t the biggest. That dubious honour goes to Chelsea who lost £141 million in 2004-2005, the first full year under the ownership of Roman Abramovic.
Disturbing
The reason these figures are so disturbing is that the wage costs incurred by City are higher than the club’s entire turnover. Wage costs were £133 million and the turnover was £125 million. Put simply, that is ridiculous. No other businesses could be run like that.
City are owned by wealthy Sheikh Mansour of Abu Dhabi, who wants to see the club competing at the very top. He has spent more than £300 million on players since buying City in 2008. In a statement on the official club website he said,
Warmth
“Two years ago I was fortunate enough to become part of the Manchester City story and I remain grateful for the warmth of the welcome that you have given me. The ownership of a club like Manchester City, with such a rich heritage and diverse community of stakeholders, carries a unique set of obligations to the fans, staff and broader Manchester community. This is something I do not take lightly.
“Therefore the challenge I set my board and executive leadership team is to develop City so that it is one of the most successful clubs both on and off the pitch, but to do so without losing any of the characteristics that make it so special.”
He seems to have forgotten to mention that he is prepared to buy that success, whatever it costs!
Sustainable
On the plus side, City have increased their earnings considerably and have seen a massive rise in sponsorship. They are at pains to stress that they intend for their business to eventually become far more financially sustainable.
From next year, UEFA is set to introduce new financial fair play rulings with sanctions being applied if they are not met. Clubs will have three years to get the affairs in order One of the sanctions will be exclusion from European competitions. One of the rules will be that wage costs are kept to a manageable percentage of the overall turnover.
Crucial
All of a sudden, it has become even more crucial that Manchester City finish in the top four this season because unless there is a substantial turnaround in their balance sheet, this could be the last chance they get to qualify for Champions League football for some time.
I have to say that when you see small professional clubs going out of business with debts of £1 million or less, it is very difficult not to be outraged by the figures released by Manchester City. I have nothing against them as a club and I am sure that there are others who will release similar figures, if on a smaller scale, but I really do believe that enough is enough and the Premier League has to re-join the real world.
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