Boro Swimming Against The Tide On Spending

BORO were the third biggest net spenders in a busy summer as Aitor Karanka completely rebuilt his first team.  That came as a bit of a surprise.

Keeping a mental tally of the ins and outs (Boro shelled out for Kike, Husband, Clayton and Wildschutt but flogged Emnes, Jutkiewicz, Butterfield and Smallwood), it seemed the overall outlay was relatively modest on fees while the perception is always that a host of other ambitious sides are throwing cash about like a sailor on shore leave.

The Spanish supremo overhauled his Conquistadors by bringing in a dozen new signings and selling or releasing 13 players. Boro spent £4.9m but recouped £3.7m in a summer of frantic churn and finished with a net outlay of £1.2m. That is not a massive sum.

For instance, after very few cash departures,  Boro spent more than that on deadline day last August when Kei Kamara and Jacob Butterfield came in. And that wasn’t long after Tony Mowbray had invested £1m on Albert Adomah.

This summer felt like for Boro it was more about moving the Football Manager style sliders from transfer fees towards wages, with most of the resources going into enhanced spending wages for players arriving on frees and on loan.

So it was a bit of an eyebrow-raiser to see Boro so high in the net spend table. That is a stark reflection of the changing economy in the Championship as Financial Fair Play starts to bite and clubs – even the relatively well-wadded ones, starting to cut back.

Boro’s total spend of It was far from the biggest spending spree in the division. The relegated sides all used their muscle to reshuffle their squads with Fulham spending £15m and both Cardiff and Norwich a fraction behind on £14.9 – but all three also flogged off a host of well rewarded relegation veterans in a desperate bid to lighten the top flight wage bill millstone and the trio all ended with a hefty net profit from the shake-up.

That will be needed to deal with a seismic shock of turn-over being slashed from £80m to £18m. They will need those savings AND the parachute money – big football’s mink-lined reward for failure – to meet their eye-watering wage costs close to the £30m mark.

Of the rest, the sides that fancy themselves as play-off contenders have made the biggest commitment overall: Wigan (with their season of adjustment behind them they look to be going for it this time under Uwe Rosler) spent a whopping £10m, Forest are funding a third successive promotion push to the tune of £8m,  Brighton (ditto) shelled out £4m while Derby and Bournemouth both invested £2.5m each. But most of those sides also off-loaded a clutch of players to bring their net balance right down – or even turn a little profit.

In terms of net spend Wigan top the table with an overall outlay of £3m; Derby are second with £2.5m; then come Boro with a relatively modest £1.2m; then, surprisingly newly promoted Brentford who have spent £1m in a bid to consolidate.

What is perhaps more interesting is that, looking at the net spending table as a whole, Financial Fair Play regulations are clearly starting to bite.

Wigan, Derby and Boro have invested in a bid to challenge for promotion and Brentford to stay up.  You can see their strategic aims clearly because they stand out against the trend. For most other sides in the division the name of the game is consciously clawing back cash to meet the lowered FFP ceilings.

The permitted over-spend this season has been reduced by £2m with another turn of the screw.  Last season clubs shareholders were allowed to put in a total of £8m over the total revenue figure.  This season that has been reduced and most clubs have tried to fund tighter target through selling players (which is easier than tackling wages directly as players are on fixed contracts and can be very hard to move on.)

Only seven of the 24 teams have clocked up a net spend and two more have broken even. The rest – 15 teams – have finished the transfer window in credit, which is an impressive feat in a difficult landscape.

And, noticeably, that includes sides that were among the promotion challengers last season. Not everyone has opted to gamble on spending as they fine-tune their squads.  For most it was a summer of wheeler-dealing and trading down.

Brighton, who have lost in the play-offs two years running and have a new boss finished the window £6m in credit. That will come in handy as they are £120m in debt (mainly due to their new stadium) and have among the biggest wage bill in the division – although, it must be said, also the highest average attendances.

Reading too, who finished strongly last term, have retrenched.  They also finished £6m in credit after a summer of sales and only very limited recruitment – five in, 15 out.

Ipswich, who hope to squeeze into the play-off frame this time after two years of belt-tightening, never spent a penny in fees but brought in eight players on frees and finished £3.75m to the good after sales;  and Watford, who have ambitions of their own, also never paid out a fee but signed 10 players and finished slightly ahead overall.

For Boro – for Steve Gibson – the net investment in fees AND wages represents a significant gamble.  Boro have done some severe pruning since relegation. Then they had a wage bill well over £25m. It was reduced slightly under Gordon Strachan but he was allowed to go on a significant ill-fated spending spree leaving Tony Mowbray with one hand – and one foot – tied behind his back as he tried to reshape the team AND cut the costs. Boro trimmed the squad, the wage bill, the behind the scenes set-up and non-football staff.

But the club remain ambitious. They have maintained an infrastructure and  squad that is at a higher level than their current income with the annual deficit – of between £12-14m a year – paid by Steve Gibson. Under the FFP rules that can’t continue without some form of sanction. That means the club need to either get promoted quickly or sharply cut costs. Or dramatically  increase revenue. And there’s the rub: the reality is that Boro are among the division’s financially restricted outfits.

The club has overall revenue and matchday take that is safely in the bottom half of the Championship financial tables.  In the last period that figures are available for – 2012-13 – Boro came 14th in matchday revenues with just £4.6m: Crowds are relatively low against their rivals with ambitions, season ticket prices are exceptionally low for the division (yes, yes they are) and there are an unusually high number of concessions meaning the average take per head per ticket is under a tenner.

matchdaycash

On the other hand Leeds’ matchday take was top with £9.9m while most of Boro’s main rivals take over £7m through the gate. Most – Forest, Derby, Brighton, Reading etc – not only have higher crowds by several thousand but also charge more, have a higher proportion of adults paying full whack and take per head is far higher.

And in this league there are few other sources of income. TV cash is negligible, sponsorships are much reduced and merchandising is down – the town centre club shop is closed and count the empty boxes and restaurant tables.

So in terms over overall revenue Boro were 10th on £4.9m. Again Leeds were top on £15m with Brighton on £10m and Wolves, Derby and Forest not far behind.

income

Meanwhile Boro have among the highest wage bills. In the last tables they came in at seventh at a fraction above £16m but chairman Steve Gibson has told the Gazette this summer’s recruitment has increased that and pushed it back towards the £20m mark.

Despite the financials being weighted against Boro, the chairman has funded a promotion push.  He’s backed his manager and brought in the player   he wants. And that’s a risk.

The sensible and prudent course would probably be to swim with the tide and try to reduce transfer spend (or even sell players) and reduce the wage bill. Boro could have sold several players this summer – they had formal bids for Adomah and enquiries for George Friend and Grant Leadbitter that were emphatically brushed aside. The sensible and prudent  course would have been to accept those bids, bring in cheaper alternatives and write it down against the FFP target. That’s what the bean-counters would do.

But Steve Gibson isn’t a bean-counter. He is a businessman but at heart he is a fan. And he is desperate to  see Boro get promoted. And he knows that  the financial tide is turning against him and that time is of the essence.

Next year will bring another turn of the FFP screw and another £2m reduction in permitted spending.  And three more teams will be bolstered by parachute payments. And the gap in revenue will grow. And it will be another year further away from the sale pitch profile that comes with being a Premier League club and having played in Europe. Memories fade.

For Boro to compete it is probably now or never.  The chairman has backed his boss to build a team that can compete. But if they don’t go up…

It is a gamble for Boro mainly because of the timing and the lowering ceiling but I don’t think it is a financial risk with the long term financial security of the club.

If this season’s big push doesn’t quite  succeed but is close then there is the possibility that Steve Gibson will bite the bullet, accept any embargo or sanction on the chin and opt to keep the squad together and have another crack. That will run an increased risk of exceeding the next year’s FFP targets by a far wider margin.

But if the tilt at glory falls well short then it may be time to sell to balance the books. And some shrewd recruitment in the past two years means Boro have a clutch of players they could easily sell at a profit… although that will  mean downsized ambitions.

If the gamble fails you could see Boro at the other end of that net spending table next year.

CHAMPIONSHIP NET SPEND

Wigan £3,000,000

Derby £2,000,000

Boro £1,200,000

Brentford £1,000,000

Blackpool £500,000**

N Forest £500,000

Millwall £250,000

Blackburn £0

Fulham £0

(TOTAL £7,450,000)

Rotherham -£250,000

Wolves -£300,000

Bournemouth -£500,000

Watford -£575,000

Huddersfield -£700,000

Bolton – £755,000

Sheff Wed -£820,000

Birmingham -£850,000

Ipswich -£3,750,000

Norwich -£4,700,000

Charlton -£5,400,000

Brighton -£6,000,000

Reading -£6,000,000

Leeds -£7,200,000

Cardiff -£10,000,000

TOTAL -£53,805,000

**Blackpool figures can’t be finalised as they await a tribunal decision to put a price on Tom Ince after his move to Hull. That could put them well into the black.

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114 thoughts on “Boro Swimming Against The Tide On Spending

  1. OK AV, accept that this is the Boro blog and cricket is not your thing but, as I said, for many of us Ancient Boro fans, Yorkshire is still our county. Neither Cleveland nor Teesside are counties. I’m a Teeessider and Yorkshire man. I love Boro but I also love Yorkshire where Cricket is concerned. BTW: is tomorrow’s game a Yorkshire derby because MMP billed the Sheff Wed match as such? I’ll shut up now! UTB.

    **AV writes: Sheffield a derby? It’s practically in the Midlands!

  2. Yeh, just to concur and before AV bans the word Yorrkshire county champions!

    As for tomorrow’s score, I’m not going to make a prediction as I’m always wildly optimistic…

  3. My thoughts on which formation and selection for tomorrows game, is that being away from home he will start with his preferred 4-2-3-1, after all wasn’t the scouting criteria to find players that could play his system. He now has the option during the match to switch to 4-4-2 or 4-3-1-2.

    Selection: I would select the back 4 of Friend Omeruo Gibson Abella, holding 2 of Clayton Leadbitter, midfield 3 Wildschut Vossen Adomah, front Kike (Clayton having license to push forward when we attack)

    On the bench: Bamford (who could replace Kike, Vossen, Wildschut or Adomah) Tomlin (Clayton, Vossen) Whitehead (Clayton, Leadbitter) Ayala (Omeruo, Gibson) Woodgate (Omeruo, Gibson) Reach (Wildschut, Friend, Adomah) if Nsue is fit I would replace Woodgate with Nsue (Kike, Vossen, Adomah, Abella)

    Goalkeeper: I think he will start with Mejias (less abuse away from home) with Dimi on the bench.

    This still leaves players in the stand such as Ledesma, Halliday, Fewster, L Williams, Morris, Bennett, Atkinson plus injured R Williams, Carayol and the other 2 loans Blackman and Fredericks, apologies to anyone I have missed out.

    Hard times at the Riverside.

    Come on BORO

  4. I see that Allam is planning ‘give away’ Hull City if his name change is rejected. I am so thankful we have Gibson.

    When you put the Hull owner’s dummy spitting alongside the rank stupidity and instability of Cellino at Leeds, the complete lack of emotional intelligence of Tan at Cardiff, the destructive interference of the Venky’s at Blackburn, the suicidal lunacy of Oysten at Blackpool and with Man City’s and Reading’s old owners on the run from the police, thank god for SG.

    He doesn’t get everything right but long may he reign.

    1. Hear, hear.

      I may disagree with some of his decisions from time to time but I never doubt that they are taken with the very best of intentions. We are incredibly fortunate.

      I suspect that if asked many current generation fans would cite Juninho as the greatest modern Boro legend. As much as I enjoyed watching The Little Fella, he is a log way behind the big fella. And Mustoe of course.

  5. AV

    Did you not notice I mentioned hordes north of Teesside, people I knew from north of the Tees supported Yorkshire cricket team.

    I have no problem with those same people now supporting Durham, not even Mackems and Skunks can deny Yorks v Durham as a derby match.

    What is more, they are all welcome to support Boro.

    What would you say if your lad was offered the chance to compete in some sport for Yorkshire?

    Chris Old played cricket for Middlesbrough, Yorkshire and England. Alan Old played rugby for Middlesbrough, Yorkshire and England. We have every right to be as proud of them as the likes of Downing.

    Local government reorganisation in 1996, recommended by the Banham Review, saw the county of Cleveland broken up into the four independent unitary authority boroughs of Hartlepool, Stockton, Middlesbrough and Redcar and Cleveland (a renamed Langbaurgh). At this time they were returned to the counties of North Yorkshire and County Durham for ceremonial purposes, with Stockton-on-Tees becoming the only district in England split between two ceremonial counties.

    Historically, Thornaby was always in Yorkshire but part of Stockton.

    Anyway, we will agree to differ.

    On to footie, we need a good result tomorrow to get a run going.

    COB

    1. Alan Old, or AGBO as we knew him, was my maths teacher. Apropos of nowt really! I was born in North Yorksire, that’s what it is. And it’s still Middleton St George to me, not any fancy Dan Durham land grabbing airport name.

      Now to tomorrow, and the man I have an eye on is Wells, I fancied him last term and was amazed that Huddersfield snapped him up. They all have something to prove, but then so do Boro, regardless of the team on the pitch.

      I’m going for 1-2 to us, I think Gibson back will give the defence it’s steel next to Kenny but without the crystal goalkeeping ball that Mrs Smog is currently using to divine tomorrow’s weather I am going to hedge my bets.

      Up the Boro

  6. Smoggypaul

    I went to school with Agbo and his brother. They were older than me but were fearsome bowlers as well as good batsmen. I would go to school on a Saturday morning to watch the first team.

    The only time the match lasted any time was if we won the toss and batted.

    1. AV, you are too young to be bitter and twisted about “North Yorkshire” as my mother insisted in putting on her address all her life. However, as you get older there will be a “boundary” change in your life and you will get your chance.

      In the mean time, please indulge us old uns.

  7. I got all excited about the first game of the season, more than I have for ages. After two good wins I became super-heated only for it predictably to end in tears.

    I’m feeling that tingle again about tomorrow. How will it pan out this time?

    1. Boro through and through then!! Elation followed by disappointment then hope and excitement only to be repeated for the next 10 years or so. Better than supporting England though!!

  8. Pitch warning

    There was a rugby league game played tonight, the pitch looks good but the groundstaff will have little time to work on it.

  9. Agreed, Slaggy! I don’t care where Boro fans come from.

    But I’m still a Yorkshireman, even if both Cleveland and Teesside did their best to eradicate our birthright! So Yorkshire’s winning of the County Championship today is truly a day for celebration. I cracked open a bottle of champagne. My wife, who sadly is a Lancastrian, and hates cricket (well, coming from the wrong side of the Pennines, you can understand that…….) gladly drank to Yorkshire’s victory, because, as she says, “I’ll drink to anything!” Typical.

    No doubt some morons at Huddersfield tomorrow will chant ‘Yorkshire’ at us to provoke us, cos that’s what the Leeds idiots do. I just feel like chanting ‘Yorkshire’ back at them! We’re Yorkies, too, numbskulls!

    And so to some real football. I hate the international breaks. Really looking forward to tomorrow’s game, and like others above I hope AK goes for it with an attacking formation. I really want to see Vossen and Kike in partnership, and Dimi in goal. Not too fussed about the rest, but I think it would be a shame if Reachy misses out, as I think he’s played well so far and deserves his place.

    A winnable game in front of 3000 of our own. Come on Boro – don’t disappoint!

  10. . . . . . although I think it is a credit to the blog and its new format that we are getting such participation. ( I think the spell checker helps.)

  11. Well done Andy R

    I wouldnt be surprised if Aitor played those who have trained well and fully fit. I also think he will go with his trusted formation.

    Yanic, Bamford, Vossen on the bench. All may come on at some point.

    We need points from both our away games and with 7 games in three weeks all will get a game.

  12. Thanks Ian. Having an almost 2 year old to get me up early paid off!

    I think you might be right with the team. Damia aside, AK has rarely thrown players in without at least a fortnight’s training with the club.

    That said, this a game we could do with winning and Bamford has been with us a little longer than Wildschut and Vossen. Perhaps he will start either in place of Tomlin or as part of a different shape.

  13. Ian,

    Don’t think Chris Old ever played for Middlesbrough. As I recall Yorkshire signed him up as soon as he left school. He was a terrific young batsman, but Yorks. were looking for a successor to Truman and so they concentrated almost entirely on his bowling and rather neglected his batting potential. I played against him a couple of times (Staff v Pupils), and we had a pretty good Staff team with a couple of NYSD players (John Narey and Alan Slater), as well as some ex- University players. It was my privilege to open the batting, and as I saw this scrawny kid measuring out his run, and disappearing somewhere towards the sight screen, I wondered where he was going. He tore in, but I played his first three balls solidly in the middle of the bat. I played the fourth in exactly the same way, but the ball whipped between bat and pad, and I heard the old death rattle. A beauty.

    In both games Chris won the game for the school, but mainly by taking a ton in each game. He was a great lad and he used to come and watch us play sometimes at Acklam Steelworks, where many years earlier his dad ,known as Old Chris, used to play in goal for the football team. They attracted a fair crowd, only about half a mile from Ayresome Park.

    Alan Old left Acklam Hall at the end of my first term there. He was already an outstanding rugby player and cricketer, but I had seen him play football many times as a small boy at Beechwood Primary. He was brilliant even then, as was his older brother Malcolm, and had he continued with his football he would have walked into any Boro team, and could just as easily have attained international status in football as he did in rugby. He also played Minor Counties cricket for Durham, but had he wished to turn professional he could easily have played at county and international levels. He was one of the really great all-round Boro sportsmen from an exceptionally talented sporting family. And they lived only a stone’s throw from the Cloughs.

    One of the sadnesses for me, as a lifelong Boro fan, was the way that our grammar schools set their faces against football. As kids it was the only game we played in the yard, but any talent for the game amongst the pupils was allowed to wither on the vine by the school, purely for reasons of snobbery. (Snobbery with Violence was how I used to characterise the game). When I taught at Acklam Hall one of the things I managed to achieve was to break the monopoly of rugby and to give the sixth form lads a regular game of football if they so desired. We even managed to get a staff football team organised.

    AV:

    As you are seeing the Boro – Yorkshire ties are long and deep. One of Middlesbrough’s great sporting occasions was the annual Yorkshire game at Acklam Park, a wonderful occasion which played to packed houses. I also remember with great affection Yorkshire’s annual pre-season game at Redcar.. it was there that, as a small boy, I was able to watch the great Len Hutton, the Yorkshire and England captain Norman Yardley, and best of all get my first glimpse of the great Freddy Truman,every young lad’s cricketing hero.

    And don’t get me started on Harry Bell’s and Lindy Delapena’s contribution to both Boro FC and CC.

    Cricket not allowed on a Boro blog? I don’t cocoa.

    1. Len, I know exactly what you mean about the grammar school antipathy towards football. I well remember my first PE lesson at the old Grangefield Grammar when, introducing us to rugby, the teacher was adamant that it was the best sport in the world.

      When I innocently stuck up for footer, I was put on detention – it was my first day at senior school! Hardly the way to win hearts & minds. Although I went on to enjoy the game, and still do, it was not a good start. It also meant I went into a black hole in terms of playing football.

      It was 6 years before I played 11-a-side in a team again. I played at various levels over the next 25 years, gaining 4 promotions. I made up for my lack of skill with running power, teamplay and determination but still wonder how much better I could have been if my skills had been allowed to develop between the ages of 11 and 17.

      Along with the Marie Celeste, it’s just one of those unknowns …

    2. Very ditto, went to SWT in Redcar and footy was played EVERY break, before and after school, endlessly, but we weren’t allowed it officially. We were a decent rugby school mind, (AGBO AND Mike Wright both being decent players themselves of course) but totally ridiculous to have the sport police in that way……..all it did was make me a Wales supporter for Rugby, the era of JPR etc was magical and England couldn’t hold a candle to that artistry, and leave me with a feeling of total injustice that lives with me to this day. The 1950s didn’t end until 1975 for some (the long 50’s anyone?)

    3. Len, Your post brought back some memories for me, the Old family lived at the other end of Parkfield Avenue to me, Alan was the same age as me and in the same classes at Beechwood and Green Lane. He went to Acklam Hall and I went to Stainsby. I think Malcolm went to Stainsby too but was three or four years in front of me. The other thing was their nicknames; Ratty, Mousey and Kipper as I remember.

      2 -2 today for me.

      Thanks for that,

      UTB,

      John R

  14. Just hope AK wants to win this match more than he and Leo want to prove to us all that we are wrong about his goalkeeping selections.

    On paper we should be optimistic about 3 points providing we don’t burst any optimistic balloons on and off the pitch before kick off with the wrong Keeper between the sticks. I predict a win by two clear goals but if we are lumbered with a project in goal then I fear the worse!

  15. Being from Stockton pre-Teesside, let alone pre-Cleveland, all this Yorks stuff leaves me cold. And don’t get me started on cricket. It’s odd that Co Durham means next to nothing to me and, I suspect, meant little to most Stocktonians – there seems to be much less of a bond than the tykes have.

    Consequently I don’t begrudge anybody sharing their affilitions and biases. Reminisce away!

  16. Len

    I am sure Chris Old played a few games for Middlesbough, he opened the bowling along with, I think, an Indian professional.

    I faced both Olds in the nets, I cant remember seeing any balls but heard plenty of timber rattling.

    I remember us having a rugby match with a rare afternoon kick off. We asked Mr Pickersgill if we could swap it to a morning start. He got the rugby team together in the old gym and gave us a tirade about the evils of football,rotten, rotten through and through we were told in his accent as broad as himself.

  17. Listened to Ronald Koeman interview and he sounded just like Schteve McClaren.

    Great result, no surprise that we lined up as we did.

  18. Thank you for your reminiscences, Len. I went to Beechwood and Acklam Hall! I remember most of the teaching staff from Acklam, but sadly have no recollection of yourself. I joined the school in 1964. Were you still there then? Chris Old was already in the Sixth Form by then, I recall, but I do remember seeing him bowl very fast for the school team.

    Great win today at Huddersfield, in front of the magnificent Parmo army. We very nearly blew it, of course, after totally dominating the second half, and I don’t think we would have got the winner without a remarkably generous and very foolish piece of defending that gave us a stonewall penalty. I do think we played very well in the second half after an error-strewn first period. Some of our interlink play after the interval was very fluid and creative. Vossen looked confident and impressed on debut, and I think he and Kike will gel well together in time. Credit to all who played, and especially to Damia, Reachy and Mr Perpetual Motion, Grant Leadbitter.

  19. Clive, Taught English at Acklam ’63-5, my first post, in a very funny and friendly dept.(Clem Heath, Ken Midgley and Peter Illingworth). Only have good memories of the lads and staff.

    Agree with your summary of the game today.

    1. Thanks Len. Pete Illingworth taught me, and had a very dry, sarcastic streak. I seem to remember that Clem was a regular at all Boro home games. He used to stand near me in the Chicken Run!

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