As the Blues Announce a Loss – We Ask, is it Bad News?
(This is a re-publish due to a technical problem!)
Andy has given me permission to re-produce his latest article. I have made some comments after it.
Kev
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Birmingham City record pre-tax losses of £20.5million
By Andy Walker
BIRMINGHAM City’s successful promotion push last season came at a hefty cost, after it emerged that the club recorded a pre-tax loss of £20.5 million.
The astonishing figure has been revealed in the club’s audited financial statement for the year ending August 31 2009, therefore a debt amassed under the former owners.
The directors’ report blames the huge loss on ‘the decision taken by the previous members of the board to retain most of their playing staff from the previous Premier League season’.
That decision to arm Alex McLeish with a squad on top flight wages in the Championship saw Blues fork out staff costs of £27.1 million in 2009, compared to £26.6 million the previous year.
That was further hit by a fall of over £22 million (44.8 per cent) in turnover, including match receipts, broadcasting and commercial income.
The accounts will further infuriate Blues’ new owners, who already strongly feel that they were misled during last year’s takeover.
The Carson Yeung camp were fuming when they discovered that the previous owners had paid themselves advanced 2010 management fees worth £420,000, after which an offer from David Sullivan to pay back half was turned down, not to mention ex-MD Karren Brady’s controversial £1 million severance package.
While Yeung paid £1-a-share to buy Blues in October, the Chinese now believe that 30p-a-share would have been a fairer price.
A Blues source told the Birmingham Mail that the current board weren’t yet willing to comment publicly on the hefty pre-tax loss, largely as they feel that the figures speak for themselves.
The recent report also warns that, when it comes to McLeish’s future transfer kitty, the purse strings may have to be tightened in order to address last year’s loss.
It reads: “The acquisition of players and their related payroll costs are deemed the core activity risk and, whilst assisting the manager in improving the playing squad, the board is mindful of the pitfalls that are inherent in this area of the business.
“The aim is therefore to manage these costs whilst being as competitive as possible within the club’s financial constraints.”
However, former co-owner Sullivan defended the previous Blues board. Sullivan insists that they made no secret of a financial problem at St Andrew’s during the final months of their tenure and pointed out that automatic promotion back to the Premier League proved that they were right to stick with an expensively-assembled squad in the Championship.
“We are surprised the figures are quite as high as this,” admitted Sullivan. “We had a policy of retaining the squad to get back up which we thought was the correct policy and was vindicated because the club got promotion at the first opportunity automatically.
“Last summer we knew the club had a financial problem as we publicly stated we loaned it £5 million to pay the deposits on two new players because there was no money to do that.
“Some of the losses are the way accounting practices write players off over the period of their contracts although the money is paid over an early period.
“But I am sure the club will make £10-15 million in the Premier League this year.”
Originally found on Birmingham Mail dot Net.
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Firstly, it is very disappointing to have a loss announced. I’m sure there a number of fans who maybe are feeling concerned about the ability of the board – but as Andy has said, this last year and therefore the last board. But is it REALLY that bad?
When a club gets relegated, the reduction of television money – despite parachute payments – always goes down. I have read the reduction can be anything from 25-40%. Also there are other knock on effects. Lower attendances, less merchandise sold etc.
Obviously for a club like ours, the goal was to gain promotion immediately. As a result we were run as a Premier League side in the Championship, I suppose living the dream on a smaller scale.
It was inevitable that we were going to make a loss. Like it says in the article we could wipe that out this season, and we already know we will be in the league again next season, financially a real positive.
Reading the article, it appears that the new board didn’t have a clue that this loss was there. I’m a bit confused about this. Maybe I’m thick, but before Carson took over – we were a public company weren’t we? Which meant that if we were going to be taken over the accounts had to be revealed. Meaning that either the previous board hid key information or the new board didn’t read it properly. I doubt we’ll know for sure.
I’m concerned that this will re-start the spat between the present board and the former board. I hope not.
Over all I don’t think this is particularly bad news, as I have said we have every chance of breaking even this season.
I’m sure there will be some who will look at this and see it as a negative, but I’d encourage you to keep your chin up and give the board a couple of seasons to prove themselves.
Martin Taylor Speaks to Joys and Sorrows
One of our forum regulars, “Cliffmann,” is a friend of Martin Taylor. He offered to speak to Martin to gain an interview for Joys and Sorrows.
So over to Cliff:
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Joe Hart, Blues, Match Attacks. That’s probably my 7 year old sons current loves in life in the right order. Match Attacks for those unfamiliar with them are cards of the current premier league teams which give stars based on attack and defence ability.
Alex (my son not Eck!) has changed favourite players like most people change socks, Cameron Jerome, Frank Queudrue and Martin Taylor have all been one time preferences. So this year he was a bit surprised Tiny was not in the match attack pack, so we found a card on the internet of Martin from a previous season. When he saw it he was aghast at the fact Martin only had one star, not the maximum of 5 for either attack or defence.
The reason for telling the story is that we know Martin quite well as a family, so next time Alex saw him he decided he would not call him Martin any more and he would be affectionately known as “one star”. One of the funniest things I have ever seen is seeing this massively tall man struggling to come up with a suitable put down for a 3ft 7 year old.
So when he left the club for Watford in January without the chance to say goodbye to the fans I thought it would be nice for him to say goodbye and also maybe think of a response to his new nickname.
“Love the questions mate, something a bit different to usual. I think whoever decided on my one star status must have been watching one of my poorer performances. I always feel it’s better to be underestimated than overestimated, it gives you the chance to surprise an opponent who may have thought they were gonna get an easy game. That aside it was great banter from Alex!
Just a quick note to the fans to say thank you for all the support I received when I was at the club. It’s probably a standard thing to say for a player who leaves a club but I think I can sincerely say that I received fantastic support especially during a certain difficult period of my career and that loyalty from the blues fans helped my family and I enormously.
I’ve always enjoyed speaking to fans that I bump into around and about, they’ve always got good footballing opinions of what’s happening at the club. All in all it’s been a pleasure to play for Birmingham City. Thank you”
1. How did the move to the club originally come about?
It was a few years ago now, Jan 2004 to be precise but Blackburn were going through a bit of a transition. We’d had a good season the year before but some new faces were brought in and I found it more difficult to hold down a place. Sometimes as a professional you get the feeling that your time at a club has passed and you need to move on to further your career. Birmingham showed a lot of interest and were doing very well at that time. I spoke to a couple of lads who were at the club already and it sounded like an excellent opportunity to come to a club that was on the up. It took a couple of weeks to sort out but just before the window closed I found myself 100 miles down the M6 playing at the blues.
2. What was Bruce like as a manager?
I enjoyed my time working with Steve Bruce as a manager, he had wealth of knowledge of the game that he liked to pass on to his players. There were periods when I was at the club that I would have preferred to play more games under him but I always felt that he believed in me as a player who could do a job for him. He had a good team working with him, I thought Erik Black in particular was a very good coach
3. When the new owners came in did you as a player notice a changed atmosphere or is it a press myth?
There was actually a change in atmosphere around the place when the new owners came in. I would agree that sometimes a football club could have a change of ownership and the players would see no differences, however Carson Yeung’s arrival did bring a new feeling. The owners were very direct in their contact to the players showing us what they were planning for the club and the positive changes that they would bring. The previous owners did a great job when you compare the club from when they bought it to when they sold it but the new owners have their own ideas of how to make Birmingham City competitive further up the premier league. They know that for it to be successfully marketable the club and its facilities need to be comparable with the top premier league clubs and these are the differences that the players are now experiencing.
4. So in terms of Blues teams, were the Robbie Savage era better than the current team do you think?
I’ll sit on the fence on this one and say that it’s difficult to compare teams from different eras as they had different styles with their own positives. Both the team when I first joined and the team this season have done exceptionally well to stay in the top half of the premier league. If the current squad can maintain that position for a few seasons then that consistency would be the only separating factor of the two eras.
Martin "Tiny" Taylor
5. When you signed for the club, Steve Bruce said you were versatile and could play left back, right and centre, was he serious? Surely you are 100% centre half?
I actually played all over the pitch at Blackburn and was quite versatile when I was a younger player, if you can imagine! I actually made my debut as an emergency centre forward and played there a few times after that. I also found myself in midfield a few times. It’s often the case that centre half’s play full back when they first progress to the first team and that was what happened to me being used at both right and left. I quite enjoyed it being able to attack for a change and had probably my most successful season at Blackburn when we finished sixth playing a good portion of it at full back, mind, it helped having Damien Duff in his prime helping out in front. My body shape has changed as a player as I have got older into more of a centre half’s, gone are the days of overlapping the winger to get a cross in, I’m happy to just hold fort now.
6. Highlight of being at the club and your best performance?
Highlights would have to be getting promoted twice, especially the first time when we beat Sheffield Wednesday at home to put ourselves on the brink of an immediate return to the premier league. Even though we hadn’t quite made it yet, there was a great feeling following that game.
My best performance would have to be Newcastle away in the FA Cup replay (5-1). Not surprisingly I enjoyed every minute of that game.
7. If you search youtube you can be spotted sat on the bench during a blues-villa game. Two questions… See http://www.youtube.com/watch?v=ugcutAxYD7I around the 1.39 mark!
a) What is the Blues-Villa derby like for a player in terms of pressure/preparation?
The game is prepared for like any other, but the big difference is the pressure and tension that you feel when you get out onto the pitch.
As a player you can sense from the crowd that its not just another game and that the result is the only thing that matters. That’s why the best things about derby games tend to be the tackles as everyone is wired up and doesn’t want to be the one to miss a tackle or make a mistake that could lose the game. Skill and flare tends to be forgotten for an afternoon.
b) What happened to that awful “curtains” hairstyle?
I was very proud of my ‘curtains’ hairstyle thank you very much and I would love to be able to grow it back if a. I could, and b. it came back into fashion.
8. How do you cope with not being in the team, do you get all moody or are you quite relaxed about it?
I would love to tell you that I accept it really well and it doesn’t bother me but in reality I probably get a bit moody.
It’s very frustrating as a player when you work hard all week with the rest of the players but end up not involved in the game on the Saturday. It’s vital to maintain a good condition when not playing as you could be called on at short notice but its a much more enjoyable job when you are playing regularly and experiencing the highs and lows in the team.
9. What career would you have done if football had not worked out?
I think about this occasionally but still don’t know. I think a lot of people don’t really work out their vocation until a few years after leaving school, when they’ve tried a few things or realised they’ve chosen the wrong subject at university.
I would probably have been like this, my favourite subjects at school were maths and geography but I probably would have ended up doing something completely unrelated to these.
10. You won a league cup medal with Blackburn, is it a treasured possession or lost somewhere in the loft?
It’s actually quite treasured with my other medals, three championship runners up gongs.
When I played the final at Cardiff, one of the older lads in the squad said I should treasure playing in a final because not many professionals get the chance in their career.
I’ve been fortunate to have had that chance and would love it again. It’s also a great thing to hold onto to show the grand kids in a few years who won’t believe that granddad was able to run never mind play football.
11. Who were the biggest jokers at the club and were there any stand out pranks played?
In the time that I was there a few jokers have passed through the changing rooms. Dunny was always one for a prank, as well as Sav. I can’t think of a particular one but there was always some good banter flying around. Ian Bennett was great fun to have around the training ground, he had the lads in stitches on a daily basis.
Martin "Tiny" Taylor
12. What’s it like being so tall?
I often don’t think of myself as being particularly tall, I suppose I’ve got used to it now. The only time it is ever a problem is when I hit my head on doorways or low hanging signs, or have cramped legs on transport. I think I’m still above the anthropometric/economic trade off of seating as many people comfortably in a specific area.
There are however advantages to being tall, such as at concerts or in highly stacked supermarkets, oh and not forgetting jumping for headers with Duncan Ferguson!
13. How is Watford different in terms of set-up, ambition and treatment of you as a player?
The set up at Watford is excellent from the facilities to the staff at the training ground to the help I received when I first joined. I found the transition between clubs quite comfortable as many of the training methods were very similar to the ones I was used to at Birmingham. They are a very community friendly club and I have been welcomed very well by everyone at Watford. Like any team in the championship they have ambition of getting promoted to the premier league and being as successful as possible.
14. Have you met Elton John yet, and did he have those great star shaped glasses on?
Unfortunately I haven’t had the pleasure of meeting Elton John yet. Hopefully one day in the future.
15. You have already scored for your new club, are you settled in already?
I am pleased with how the first month has gone. To get on the score sheet is a bonus, but I am happy with how I’ve settled in and we’ve had some decent results in that time. As a team we’ve been dominant in all the games I’ve been here which is not easy in the championship as all teams are very competitive.
16. What are your personal ambitions now and do you have plans in place for life after football?
My ambitions are now to play as many games as possible with Watford and to try and get promoted. I think we have as good a chance as most of being in and around the top positions in the championship and if it didn’t happen this season then we would just try for next.
I don’t have any concrete plans for what to do after football. It’s difficult to plan as I don’t know when that will be, hopefully not for another few years. Unfortunately there will be time when I come to retire, something as a young professional looks a lifetime off but creeps up on you all too quickly. The best thing is to prepare that it could happen at any time and not be surprised or disappointed when it does, just be ready to move on to the next chapter.
17. Pressure time now! With a chance to annoy your friends and colleagues what would be your best 11 during your time at the club?
1. Goalkeeper – Maik Taylor
2. Right Back – Stephen Kelly
3. Left Back – Jamie Clapham
4. Central Midfield – Damien Johnson
5. Centre Half – Kenny Cunningham
6. Centre Half – Raidi Jaidi
7. Right Midfield – Sebastian Larsson
8. Centre Midfield – Stephen Clemence
9. Centre Forward – Mikael Forssell
10 Centre Forward – Nicklas Bendtner
11 Left Midfield – Gary McSheffrey
Martin, I think I speak for everyone who supports the blues in saying we hope you do really well at Watford and things go well…
Good luck One Star!
Cliff
Images used with kind permission from Birmingham City FC
Disrepute?
Picture the scene. Two managers stand nose to nose on the touchline having a disagreement about a decision the ref has given. Things get personal, the voices raised, the TV cameras zoom in to capture the facial expressions – eventually the referee comes across and sends them both to the stands.
Over the coming weeks they are charged for bringing the game into disrepute as the pictures of their argument is played on sports channels and certain internet video sites!
They will probably get fined, maybe even banned from the dugout for a number of matches. Why? Well it’s obvious, they have bought the game into disrepute.
So why is it, that two certain Directors of a London side, are allowed to accuse our new owners of things and get away with it? They are also publicising players deals of a club they have nothing to do with any more, surely that in itself is against some rule or law?
Some of the things that have been said by them have been completely out of order, and the FA should investigate them. Yes I believe a disrepute charge should be considered.
I am getting fed up of David Gold and David Sullivan whining and moaning about how our new board treated them. Well you sold the club to them! Both of you had voiced your desire to leave, OK David Gold retracted that statement and offered his help to the new board. However the new board clearly decided a complete break from the old board would be the best, and you couldn’t blame them for that.
I have a number of times said that I have appreciated what the previous board did at the club, but you are even beginning to lose those fans who could see the positive contributions you bought to the club.
Why don’t you just leave the Blues alone and concentrate on your new club? I feel sorry for the West Ham fans, because at the moment DS and DG seem to be talking more about our club than theirs.
I would like to add that I think our new board have handled themselves very well in all of this, and have tried to keep their heads down. Mr Pannu’s announcement of possible legal action against Mr Gold I believe is the action of a man who is exasperated with a situation that he thought would just settle down. In one way I hope it doesn’t come to it – because the all that will happen is the Lawyers will gain a fortune and the arguments will get worse.
SO, will either DG and DS be quiet about us and get on with their new job, or will the FA investigate a disrepute charge? No I don’t think they will either – either of those.
Does the “Respect Campaign” apply to the money men in the board rooms too? Apparently not.
I expect there will be more blogs on the subject.
The Best Yet to Come
This is an article by Jay one of our forum regulars. It is an expansion on a post he made commentating on the recent positive comments we’ve been receiving from the national press.
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It’s been a very weird season for me as a Bluenose, for the first time in my lifetime anyway, we’re challenging on both major domestic fronts. In a season when ‘them’ from down the road have booked a trip to Wembley, it’s becoming a reality that the we might be booking our tickets too in a couple of months.
It seems this season, based on the league table anyway, that the gap in power is closing in the Midlands, 21 games into the season, Aston Villa sit 3 points above Birmingham City in the Premier League, and with Birmingham being the form side in England, that gap could soon be all gone.
It moves me onto the next 2 month’s at this football club, ever since Carson Yeung and his army came into St. Andrews, they changed the feel of the club, and since they officially took over the club, they’ve not witnessed a defeat, 15 games it’s spanned, but it seems the easy work is now done.
The games coming up are huge, Chelsea & Spurs, as we look to battle into the top seven of the Premier League, something McLeish will secretly have his eye on, although he won’t tell us and it’s something many Bluenoses are starting to look at, whispers of; “Clear your schedule mate.” “Renewed your passport?” Are all starting to creep into the minds of us Blues fans and it’s Febuary and March that are going to for me, define this incredible season.
Not only have we made amazing strides within the Premier League, causes some shocks, shut out the un-stoppable Chelsea, been robbed at Anfield, but quietly, carefully, we’ve came through two of the toughest FA Cup draws you could imagine. Away at Nottingham Forest, another one of the country’s form sides, poor performance in both ties, we come away with a win. Everton away, a team in form, a very classy performance = 5th Round. Next up on the road to Wembley, Derby County, the easiest draw on paper so far, it’s down to the character of this amazing squad to show their ambition, their belief in themselves and the sheer cheek to continue marching towards Wembley, can it be done? I think so, and I think they do too.
It just shows the change in perspective since the start of the season, a lot of grumbling fans, a board that wasn’t wanted, a lack of investment, the only bright light being the manager and even he was under-pressure due to a lack of good football. Now, January 2010, he’s a hero, a tactical mastermind, he’s moulded the best outfit I’ve ever possibly seen at St. Andrews and all that’s missing is Lé God scoring blinding free-kicks and back-heels.
It’s been an amazing season so far, and the next two games will show everybody what we’re made of, if we come out of those beaten, bruised, confidence down, I think we’ll yet again see that the spirit within this club, 8th, 10th, 12th, 17th is amazing and I think we should all be proud of every single person associated with this football club, including the fans.
KRO, here’s to Wembley!
Jay
The New Blues, How Has that Happened?
I was chatting with a friend on Facebook chat yesterday, both of us are still amazed at what has happened this season. The Blues I am used to, is supposed to lose a game like yesterday, just fail on getting record runs, get rolled over after scoring first. It is all very strange, enjoyable – but still strange!
Take yesterday, I was convinced we were going to lose. The last time we played Everton, we WERE fortunate to get a point. They had a good goal disallowed that would have put them 2-0 up. Since then they have improved and our run will end at some point – this game seemed the likely one. However, the team stuck to their task and got the result, and despite what some Everton forums have said – we deserved to win. Now it is 15 without defeat.
We have people all over the press giving us credit for our run, including the London press. MOTD have praised us and I have seen plenty of positive comments by fans on other sites.
So what is it, that has made this happen?
Well, without doubt, the takeover gave the club a bounce. From Sammy Yu’s appearance on the Tom Ross radio show where he answered fans questions – the club seem in touch with the fans. We have talked about the fans forum, there is a good feel. Surely that can’t be it can it? Yes, definitely.
We have a team who have taken the step up from last season, where to be honest we weren’t that good although better than most of the rest. Everyone fights for each other. We have a number of players that could be captain, but are willing to follow a captain. Yes we are lacking a bit up front, but the fact we are conceding a few, it gives us the chance of getting something out of the game even if we only have 1 or 2 chances. But surely that can’t be it can it? Yes, definitely.
What about the manager? When the previous board went after him, there was some concern. Rangers fans talked about McLeish as someone who bottles it in a difficult situation, not willing to change things. Well we got relegated, and if I’m honest I could see their point. Even last season where we finished 2nd, I genuinely thought that we played poorly beside a handful of games.
At the start of this season, we had the 451 formation and we struggled with it. Bolton was a turning point. The crowd called for 442, and to be fair to the manager he did change it. We did end up losing, but we did look better after the formation changed.
Since then, we have gone on from strength to strength. We have played all the top 8 and the only 2 to beat us is Arsenal and Villa, (which was early in the season).
So what is it of McLeish? Well he has definitely NOT bottled it as far as I’m concerned. He has kept faith in a side that is getting results, but he has made good decisions as far as substitutes are concerned. He has clearly got a match plan, that is different depending on the side we are playing. Whatever he is saying, the team are clearly following those plans.
The other thing about Eck, is his manner in interviews after the game. No moaning, you believe he just thinks this has gone – no to the next game.
I post on Small Heath Alliance from time to time, and one of the users on there, (tarantini), posted something which sums my comments up well, this was in the light of the Everton game – but rings true IMO:
We have a manager who:
1. Backs an Academy player in a high-tempo game
2. Could buy Billy Bigboots but gets players off the scrapheap instead
3. Acknowledges a clubs history but challenges the team to beat it
4. Goes back for the player he wants
5. Respects his opponent but is not cowed by him
So is it down to the manager? Yes, definitely.
Actually it is all 3 of these things, a bit like the fire triangle. If you lose fuel, heat or oxygen – the other 2 aren’t sufficient to produce fire. Obviously we will lose at some point, quite possibly on Wednesday – however I believe we can get back up and win the following game because of these 3 things.
It’s fun being a Blues fan at the moment! 
Kev
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