EIGHT clubs named that could follow Bury’s demise

We look back at a report from earlier this season where EIGHT clubs have been named that could follow Bury’s demise and Bolton’s financial struggles.

Liverpool University’s football finance expert Kieran Maguire highlighted five main clubs that could be at risk trouble and another three who have worryingly delayed wage payments.

It is said that out of all 92 clubs within the top four tiers of the English football pyramid, 61 made a net loss in their most recent accounts with total losses coming to £589million.

Find out below which eight club clubs have been named to potentially struggle just like Bury and Bolton have done recently.

CHARLTON ATHLETIC

Current league position: 22nd in the Championship table

Loss in 2017-18: £10.45m
Loss in 2018-19: £10.1m

Reason for concern: Owner threats

It is said in the Daily Mail eight months ago: “Charlton’s Belgian owner Roland Duchatelet has been trying to sell the club for some time, but no one has come near his asking price. Duchatelet has even demanded that the EFL buy them as his relationship with fans has deteriorated.

“Charlton lost money both before and since Duchatelet’s arrival in 2014, but the extent of the losses has been significant, with only the sales of Ademola Lookman, Johann Berg Gudmundsson and Nick Pope in 2016-17 allowing the club to break even. Under Lee Bowyer they have made an excellent start to the season and will be hoping for promotion to the Premier League, but with debts exceeding £60m there could be problems if the owner tries to recoup his investment.”

Since then, Charlton were acquired by East Street Investments from Abu Dhabi, subject to approval from the EFL. Approval was reportedly granted on on the 2nd of January 2020 but on in March 2020, the main investor was reported to be pulling out, a public disagreement between the new owners erupted, and the EFL said January’s takeover had not been approved.^[53] The Valley and Charlton’s training ground were still owned by Duchâtelet, and a transfer embargo was in place as the new owners had not provided evidence of funding through to June 2021. On 20 April 2020, the EFL announced a misconduct investigation relating to the club’s takeover by East Street Investments.

A report came out in April 2020, stating Charlton could face administration and, therefore, a points deduction as majority shareholder Tahnoon Nimer refuses to inject much needed cash, especially needed due to the coronavirus pandemic.

MACCLESFIELD TOWN

Current league position: 22nd in the League Two table

Loss for 2017-18: £250,000

Reason for concern: Winding-up order

It is said in the Daily Mail eight months ago: “Sol Campbell performed a minor miracle last season in helping Macclesfield avoid relegation, but the club’s financial problems are more pressing. They failed to pay wages more than once in 2018-19 and now face a winding-up order on September 11 due to former players suing for unpaid wages. Their losses might seem relatively low at an average of £4,000 a week in recent years, but the club are a classic case of any losses are too much if you can’t afford to cover them.”

Since then, the club Sol Campbell and Daryl McMahon resign, Campbell later backed the HMRC winding-up bid, claiming to be owed £180,000, seen players’ payments paid late, the squad boycott matches, points deductions and EFL charges.

In April 2020, it was reported that the club had failed to pay its players for a fifth time, failing to pay March 2020 wages, and later that the first team, backroom staff and most office staff had been put on furlough (temporary leave) due to the coronavirus pandemic.

COVENTRY CITY

Current league position: 1st in the League One table

Loss for 2017-18: £2.48m

Reason for concern: Homeless

It is said in the Daily Mail eight months ago: “Playing this season at Birmingham’s ground after a dispute between hedge fund owner Sisu Capital and stadium landlords Wasps. Sisu’s motives for buying Coventry are no clearer than when they acquired the club in 2007, since when it has lost £64m. Sisu and another mysterious organisation based in the Cayman Islands called the Arvo Master Fund have lent the club £37m but there seems to be little chance of repayment. If either Sisu or Arvo demand their loans back, then the club have no assets. Coventry have been successful in developing star players in recent years such as James Maddison and Callum Wilson, but this is a hit-and-miss way of making money.”

In March 2020, Sisu owner Joy Seppala insisting she was “hopeful” of being back at the stadium next season – and on-going plans for a new stadium, for which six possible sites have been short-listed, as well as details of the size and style of the facility. This is something that has been on the cards for years now, so how much are Sky Blues fans believing these new claims?

We continue to find out which five other clubs have been listed to potential go down the worrying of direction Bury and Bolton suffered recently…

SCUNTHORPE UNITED

Current league position: 20th in the League Two table

Loss for 2017-18: £3.6m

Reason for concern: Wages far exceeding income

It is said in the Daily Mail eight months ago: “Bottom of League Two, Scunthorpe’s finances are as concerning as their form.

“With wages exceeding income there is nothing left to pay for the day-to-day running costs and the club has incurred losses averaging £50,000 a week over the past six years. Owner Peter Swann has underwritten these but the club’s outstanding borrowings have ballooned. If relegated there would be a substantial fall in income as they would lose solidarity payments from the Premier League as well as seeing EFL broadcasting money halved once parachute payments dry up.”

Following the Daily Mail report, Peter Swann gave his response, claiming that Scunthorpe were not a club that were in danger financially.

On the Iron Bru podcast, a statement from Mr Swann was read out.

 “The author doesn’t know the club or how it is run.

“We have planning for a new stadium with ancillary usage to help income, planning to host accommodation with over 300 apartments is planned.

“We don’t owe anyone any money, we own our own stadium and have 15 acres of land.

“To be honest we are probably one of the best-run clubs in the Football League.

“Of course, relegation costs – but we are not relegated and we won’t be. We are not the only club whose wages exceed income.”

Scunthorpe United have released their financial statements for the past year.

Pre-tax loss was £3.1 million compared to £4.3million last year. Turnover fell from £4.2 million to £3.7 million. Net income on players was £1.4 million compared with only £270,000 the previous year and the wage bill also dropped from £3million to £2.6million.

MORECAMBE

Current league position: 23rd in the League Two table

Losses in 2017-18: £452,000

Reason for concern: Losing money despite lowest wage bill in English football.

It is said in the Daily Mail eight months ago: “Many fans would struggle to name any Morecambe player, the colour of their home shirt or the name of their stadium. They had the lowest wage bill in League Two in 2018 of those clubs who reported such details (many clubs use legal loopholes to reduce their transparency). Yet still they have failed to pay players on time at least four times, most recently November 2018. Their average wage paid is less than £1,000 a week, but with crowds averaging only 2,000 they still lose money. They are reliant on the goodwill of owners and with new owners in place and Jim Bentley being the longest-serving manager in all four divisions, hopefully they can put such issues behind them.”

In April 2020, Morecambe launched a fundraising campaign in response to the current coronavirus outbreak, saying in a statement that the pandemic has had an effect on its finances, but it is in a stronger position than others, however it is launching the initiative to ensure that the club, its suppliers, and its partners, can meet financial commitments, despite there being no football in the short-term.

Centenary celebrations in the summer are at risk but the co-chairmen are buoyant that the club will pull through the tough times.

According to Graham Howse, who is a local accountant who shares the chairmanship, despite having the lowest average attendances of around 2,200 and potentially the smallest operating budget at nearly £3m in the EFL, the club is no more endangered by a protracted shutdown than any other.

The report from earlier this season also stated that there are worrying signs for Swindon Town, Oxford United and Southend United who also have delayed wage payments last season.

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