There is no other publication covering Newcastle United that has any comparable record to the financial analysis of our club than true faith. We are proud to have a number of finance professionals on our writing team who can provide the kind of business expertise in assessing what is going on at the club that others, even the proper media can’t come anywhere to matching what we do.

Chief amongst our analysts over the last few years has been Andrew Trobe whose grasp of a set of accounts and what they mean is matched only by his ability to convey what they mean to the likes of you and me who go snowblind at the sight of a spreadsheet.

Not only does Andy possess the professional expertise to conduct this analysis, our man is also a passionate Newcastle United supporter who wants the same things for our club as you and I.

Earlier this year United released their accounts which in the blood and snots of a relegation battle probably didn’t receive the analysis they deserved.

Before the end of the season Andy penned the enclosed piece for us which we criminally couldn’t squeeze into the last issue but which we would like to bring to your attention now.

I don’t apologise for this article and others like them being difficult reads. Clearly, these pieces aren’t something you can skim read in 2 minutes sitting on the Metro on your phone.

If you want to understand where the club is at now with its finances then you are going to have ton take time to read this piece and probably take yourself to a quiet space and read it actually paying close attention. If you are anything like me, you’ll have to read it a few times before getting the gist of it.

But if you really do want to have a proper understanding of the key features of life at Newcastle United and one that underpins everything the club can do in the short, medium and longer terms then this piece and others like it have to command you attention. Over to Andy … 

When you read this, our fate will likely be known. At the time of writing (post Crystal Palace, pre Aston Villa), there’s a slim chance we’ll still be in the top flight. The likelihood however is we’ll already be relegated. But worry ye not. You can take solace in our recently published financial results for the 14/15 season.  They’re spiffing!

What’s the headlines? Record profits (second highest in the Premier). Debt slashed. Loadsa money in the bank. Highest profits of any premier club over the last 5 years. Leicester fans, eat your heart out.

You want more? Ok, let’s get beneath the headlines. Firstly, let’s have a look at the Profit & Loss. This shows the club’s activities over the year.


The headlines are record profits for the club but I reckon the key point to be drawn from the P&L is that the club’s financial growth has come to a shuddering halt. The only marginal growth came from match-day income (remarkable, in view of the utterly shite season it relates to).

The increase in profit was achieved on the back of reduced costs.  Or more specifically, we paid out less in bonuses as a result of our 5th bottom finish. Presumably, the club’s financial strategy is to reduce their bonus payments even further this season!

A common theme in my TF musings on NUFC’s finances over the last few years has been Ashley’s failure to grow the club’s income.

During his tenure, the club’s income has increased from £87.1m (2007) to £128.9m last season. At first glance that would seem a pretty impressive increase of £42m (48%) so what am I whining about?

Well, I’m whining because none of this increase is down to Ashley or his board of directors. It’s all down to a centrally negotiated increase in TV money which we would have received if Forrest Gump had been in charge.

When Ashley bought the club, he did so with the promise of expanding the club’s commercial operations particularly in the Far East which he saw as an untapped market.  Sounds great but let’s have a look at the reality.



Although Commercial revenue has improved in recent years, it still has not recovered to pre-Ashley levels. This is a damning indictment on Ashley’s business acumen. To put this in context, over the same period Tottenham Hotspur have grown their commercial income by 56% and both Aston Villa and Everton have overtaken Newcastle.

In 2013/14, our Commercial Income rose slightly on the back of the Kings of Leon concert. Hosting pop concerts is hardly innovative or ground-breaking stuff but highly lucrative. Newcastle, with it’s infrastructure and location, has all the inherent benefits that other stadiums do not enjoy. And yet we haven’t even managed to exploit this income source.

This failure to grow our commercial and match day income has left the club in a precarious position. Why? Because we have become so reliant on broadcasting income. Not a problem whilst Premier League status is maintained but without it, the club’s income will collapse.

income_mixWhilst this reliance on broadcasting income is not unique to NUFC (and indeed we’re not the worst in the Premier), it’s still is a huge risk for the club. Look how the position in terms of our income mix has changed since 2007.

In a previous article, I estimated that the total cost of relegation will be £100m in the first year (due to the forthcoming TV deal) and will get gradually worse after that if a return is not secured immediately. That’s the cliff edge facing the club. I bet you’re glad you started reading this cheery article eh?!

But that’s all in the future. Back to our 14/15 accounts and our record profits. How do they compare with other clubs?


Newcastle would in fact be top of the profitability league if player sales were excluded (Liverpool making £56m on player sales largely due to Luis Suarez’s move to Barcelona).

This isn’t just a one off. Newcastle have now reported profits for the last 5 years.



I’m going to give you my tuppence worth on these profits. My views are pretty straightforward and I’d like to think have remained pretty consistent over the years.

I think the club should spend what it earns. Simple as that. Football clubs are not like ‘normal’ businesses which are set up to make profits for shareholders. If football club owners are in it to make profits then they’re in the wrong business.

Any money that is generated by the club should be ploughed back into the playing staff.

The flipside of this is that I also think that the club should avoid making huge losses by spending money that it doesn’t earn. Towards the end of the Shepherd era, that’s exactly what we did. It took 5 years to get the costs back under control.

Any loss is added to the club’s debt. When those cumulative losses (and subsequent debt) become unsustainable the club is in risk of going into administration. This isn’t rare. Dozens of football clubs have gone into administration over the last 30 years by spending money they didn’t have chasing success (Leeds and Rangers being Exhibits A and B).

Over the last 5 years, no club in the Premier has made more profit than NUFC. If that profit, or a slice of it, had been ploughed into the club’s playing staff, it’s difficult to argue that we’d have a better side (although with Carver and McLaren in charge, who knows?).


As I highlighted earlier, these profits have not been generated as a result of growing the clubs commercial operations or any success on the pitch, it’s purely on the back of cutting costs. Here Ashley has either been successful or brutal depending on your point of view.

Wages were cut by £13m from £78m (13/14) to £65m (14/15). As a % of turnover, wages are now at 51%. This reduction, as previously indicated, was due to the absence of bonus payments for finishing in the top ten of the Premier League plus, according to the accounts, “the cost and timing in the prior year of some significant changes to the playing and development squad”.



Based on their revenue level, we would expect us to have the 7th highest wage bill in the Premier League, but it was in fact the 17th highest, only ahead of Leicester, Hull City and Burnley.

To be fair, Charnley has observed that “our wage bill for the year to 30 June 2016 will increase by a minimum of just under £9 million as a result of our activity during this transfer window”. That’s as maybe but we’d still be a long way shy of 7th highest payers.

One exception to the wages decrease was the highest paid director, presumably Lee Charnley, who saw his remuneration jump 40% from £107k to £150k. Worth every penny eh?

The final point in my headlines at the top of the article was in relation to the club’s debt. The net debt has dropped by £14.2m and now stands at £80.7m.




The good news was that these accounts left the club in the best position for over a decade to build a side last summer. Money in the bank. A low wage bill. Manageable debt. Record operating profits. It allowed the club to spend on a scale we hadn’t seen for years. It was the opportunity to compete we’d dreamed of since Robson last graced the club.

The bad news is that Ashley entrusted this windfall to a managerial and backroom team which have proven to be criminally incompetent. From the purchase of players who would struggle in the Northern League to tactics which would embarrass Mike Bassett.

The buck stops with Ashley. He chose this team of incompetence that has presided over this abject failure.

And now we’ll pay the price.