Wolves publish accounts
Wednesday 19th March, 2008
Wolverhampton Wanderers Football Club has released 'headline' financial information for the year which ended 31st May 2007. This covers the Championship season 2006/07 when the team, after finishing 5th in the table, was beaten at the semi final stage of the Play-Offs. These results do not include the purchase, and subsequent investment into the club, by new owner, Steve Morgan in August 2007.
This was the first season since relegation from the FA Premier League that the club had not received a 'parachute payment'. Despite this, the club managed to achieve an operating profit, after player trading but before the charging of interest costs, of just over £1.1m on a turnover of £15.9m. With net interest charges running at £0.3m the club finished with a bottom line profit of £0.8m. This compares to a loss of £1.2m on a turnover of £23.8m the previous season when the club had received a Premiership 'parachute payment' of around £7 million and the average attendance was 23,600 compared to 21,000 in the season under review.
However, the final figures for 2006/07 are better than forecast at this time last year due to the financial benefits of the team's excellent run of results in the second half of the season.
Out of necessity, combined player and football management costs decreased as the club re-adjusted to life without a parachute payment. A number of high value players were sold for significant fees, including Joleon Lescott, Ki Hyeon Seol and Lee Naylor.
However, the club continued its commitment to invest as much money as it could into the playing squad and acquired 12 new players including Andy Keogh, Michael Kightly, Stephen Ward and Karl Henry.
The club continued to have borrowings from its bankers to provide working capital and a term loan in respect of the building of the Sir Jack Hayward Training Ground at Compton, incurring net interest charges for the year of £0.3m.
At the year end the club had a very strong balance sheet with net assets totalling £35.2m. This figure includes the value of its property assets of Molineux Stadium, Aldersley (indoor) Arena and the Sir Jack Hayward Training Ground. However, transfer market valuations of players are not included. In accordance with accounting guidelines the cost of players acquired is amortised over the life of their contract. Home grown players do not appear as assets even though many of them have a significant value in the transfer market.
Jez Moxey, Chief Executive, said: "We are pleased to present the club's annual financial results to 31st May 2007. In keeping with our promise to supporters and as we did last year, we shared this important information with our fans first at a meeting of the Fans' Parliament.
"At the beginning of the 2006/2007 season the club embarked on a new strategic plan of buying and developing mainly young, hungry players. Mick McCarthy, the backroom staff and the entire playing squad did a great job in finishing fifth in the Championship, thereby securing a Play-Off place and exceeding all expectations. This is a young, relatively inexperienced squad which has a bright and exciting future given time to develop.
"In August 2007, Sir Jack Hayward passed over ownership of Wolves to Steve Morgan. Sir Jack worked tirelessly to find the right owner for the club and to secure its long term future, with no financial benefit for himself or his family. The club would like to place on record its immense gratitude to Sir Jack for all he did for Wolves. In recognition of his unique commitment he was asked, and he happily agreed, to remain as Life President.
"The results announced today, which cover the period June 2006 to May 2007, do not include the acquisition of the club, and subsequent investment, by Steve. Under Steve's leadership, the club continues to be in a very stable position; it has a clear strategy and the necessary resources to support its football and business development plans that we hope will bring lasting success.
Therefore, we remain extremely optimistic about the club's future prospects. The club would, once again, like to thank all of their fans for their tremendous support."