RELEGATION looms and tetchy Teesside is gripped with dark fears of impending administration. Bulkhaul is bust! The banks are coming with a big truck to repossess Mido! They will padlock the gates again! The ÃÂ£200 a time gold plated taps in the seven star hotel are dragging us down to oblivion! Oh no, we are all going to die!
The persistent cash crisis rumours are ill-founded but after two years of the cutting cloth mantra from the club as a soundtrack to decline perhaps it is no surprise that they are grasped as an article of dark faith by the Slavenista millinarian tendency and the conspiracists who insist that relegation has been the sinister aim all along .
But we are fans. Our number-crunching skills are based on mental calculations of points and goal difference and miles to Plymouth. We are not, generally, able to read Boro’s accounts sheet from Companies House. I’ve seen them but I can’t make head nor tail.
But this bloke can. David Conn is the dogs. A specialist in football finance who has chronicled the transformation of the game into an industry and who has revealed the tricks of the trade from the failed 90s flotations to the chase-the-lady structure of asset stripping holding companies and last year’s vigue for leveraged buy-outs, Conn knows when a rabbit is off.
So it reassuring that after looking carefully over the figures and the corporate structure he has concluded that the club and the company will not be left on life support when/if we are relegated on Sunday. And he has done his homework too, which is not always the case when the broadsheet big hitters get on the case. He was on the phone here last week, has spoken to some key figures behind the scenes and was asking some probing questions amid the gossip in the pressroom before the Villa match on Saturday.
Conn issues a mild rebuke for Gareth Southgate for over egging the pudding when it comes to pleading poverty – given the parlous state of the team you can’t blame the guilty gaffer grasping for some kind of mitigation – and finds some reason for optimism in the strategy the club have adopted. In short, the mounting debt has been faced head on and the crisis is over, even if the good times are not back quite yet.
In the report on the Guardian’s excellent sports blog, Conn says:
The club’s most recent accounts, for the year to 31 December 2007, showed that Middlesbrough lost ÃÂ£8.3m, following ÃÂ£13.3m in 2006, and had total creditors of ÃÂ£131m. The club’s bank borrowings, ÃÂ£93m, were the fourth highest in the Premier League
Steve Gibson, had not, contrary to some reports, loaned the club ÃÂ£69m of that ÃÂ£93m, but his company, Gibson O’Neill, does own and stands behind the club, and guaranteed ÃÂ£83m of the borrowings.
Transfer payment instalments from player sales brought the debt down to around ÃÂ£72m by July last year. Gibson, via his holding company, then injected ÃÂ£40m into the club to bring borrowings to ÃÂ£25m-ÃÂ£30m, which they believe will be manageable if Boro go down.
The calamitous fall into the ÃÂ£40m gap between the Premier and Football Leagues will be eased by ÃÂ£11.2m parachute payments, giving Boro a huge financial advantage over Championship clubs who will all receive just ÃÂ£2.5m from the league’s improved TV deal.
The ÃÂ£25m shortfall was expected to be met by the sales of Stewart Downing, Tuncay and probably JÃÂ©rÃÂ©mie AliadiÃÅ¡re, Mido and probably O’Neil too. Otherwise, Boro plan to keep the squad together, give the graduates and English signings more prominence, and push for promotion. Gibson is again expected to put around ÃÂ£5m into the club.
Gibson O’Neill, the holding company, in the year to 31 December 2007, the most recent accounts showed a turnover of almost ÃÂ£200m and a profit of ÃÂ£24.5m and given the specialist niche of his business is not expected to be severely affected by the recession.
The Rockliffe Hall development – the most expensive golf course in Europe, a 61-bedroom luxury hotel and spa, and 24 executive houses – is projected to bring ÃÂ£5-6m a year into the club eventually, approaching a season’s gate receipts.
Knowing you are not going bust but are merely borrassic is not exactly a silver lining but certainly we can have a softer landing than we dared hope for when/if we plunge ethrough the trapdoor.
Next season will not be easy. The squad needs a major overhaul and injection of steel and nouse and there are pressing questions to be asked about transfer targets and the tactical shape of the team… but we are NOT heading for oblivion.
What is crucial is that Boro must be up there and challenging for promotion. If we are not in the top three or four come the Autumn there will be bigger questions to be asked.
Boro to sue Manchester United if they field a weakened side at Hull? Yeah right. As if anyone would try and sue a club the football authorities cower meekly before.
Besides, if players are given a squad number in August then they are accepted by the Premier League as members of the first team squad. Of course, you’d get suspicious if Fergie got his boots out and lined up alongside Bobby Charlton with the Glazer brothers and Robbo in midfield and Eamonn Holmes and Pally at the back plus the tea lady in goal but short of that a motivated United second string should batter Hull. They battered Boro without breaking sweat.
Every team picks a side that meets their short term needs. Boro have played weakened sides. Some would argue they do it every weekend. Here’s one…..
May 7th, 2006
Fulham 1 Boro 0
Turnbull, Davies, Wheater, Bates, Taylor, Morrison, Cattermole, Kennedy (Cooper 85), Johnson, Graham (Craddock 82), Christie (Walker 62)
The average age at kick-off was 20 years old exactly, dropping to 19.1 briefly when Josh Walker came on for golden oldie Malcolm Christie and then shooting back up to 42 or something when Coops came on.