Profits up but Champions League return is vital says Sir Chips

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Arsenal have reported an after-tax profit of £56.5 million for the financial year ended 31 May, up £21.2 million on the year before.

On the surface that sounds like a positive development on the finance front, but chairman Sir Chips Keswick has been quick to point out that player sales made the difference.

In a statement on Arsenal.com, he says: “Player trading has meant that overall Arsenal has had another profitable year, but we are very aware of the financial pressure which Europa League football places on the club.

He added: “A return to the Champions League is a clear priority which everyone at the club is committed to delivering.”

Arsenal financial results for year up to 31 May 2018 – via Arsenal.com

The exits of Theo Walcott, Olivier Giroud, Francis Coquelin, Alexis Sanchez and Alex Oxlade-Chamberlain, plus a couple of loan deals, saw us recoup £122.3 million from player deals, up from £13.7 million in 2017.

Gains on that front were offset by £17.2 million in payouts to Arsene Wenger and other backroom staff that were let go in the summer.

In simple terms, our football revenue was punched in the goolies by playing in the Europa League (down £34.6 million from 2017) and our operating costs went through the roof thanks to a £23.9 million increase in player wages and staff costs.

No pressure Unai, but you better get us back in the Champions League quickly otherwise you might be forced to sell off a few more players…

The full report can be read here

 

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Scott P
Scott P

I’m surprised we got any report at all. At least there was some profit, as I was also expecting a loss for last year given no CL and the purchases we made. Still, we can’t sustain 120m in player sales per year and pretend we are a big club. CL will ultimately be the difference over the long run.

Lucas Sam
Lucas Sam

aren’t all companies required to disclose at least some financial report? You know… for tax purposes. Not being cynical, genuinely curious what kind of reports we are allowed to see as fans now.

DGooner
DGooner

They will have a file under companies house. However, its KSE’s prerogative how detailed these reports are..

Santori
Santori

Dunno which universe you live in but we always got a report from Gazidis.

We are slightly better off this season bc of property sales.

Otherwise we have been taking a hit with lack of CL.

Scott P
Scott P

I’m not sure since I don’t live in the UK. In the US, these details are not required to be public for tax purposes. There may be different rules in place for football clubs, for FFP and FA requirements, for example.

Evang. Simon
Evang. Simon

Hmmmmmmmmmmmmmmmmmm…………..

Is it a good or bad news?

jim
jim

fair question

High gooner
High gooner

I dont know.. but I do know that if we dont spend that damn cash we wont get in to the champions league

SB Still
SB Still

We have slipped down the rich list and the Tots are closing the gap off the field too!

Replacing a long serving manager is challenging enough but on a very limited budget. Hopefully Emery and the team can get lucky in the league or Europa and we get back into the CL for the extra funds.

N10
N10

So spend some fookin $$$$$ like, pretty simple at this point.

Mpls
Mpls

And this, in a nutshell, illustrates the fallacy of believing our tumble out of the Champions League has a ‘silver lining’.

If we cannot get back in this season or next, we could very easily continue to tumble down and it might be a long, long while before we manage to climb back up.

A P
A P

Those people who clamoured for non-CL football to force a change represent a failure of the education system.

Burn Baby Burn
Burn Baby Burn

This fiscal year would also include purchase of Auba, Laca, Mhki, Mavrapanos, and Kola if I’m not mistaken.

TR7
TR7

Kola was a free, I think.

Burn Baby Burn
Burn Baby Burn

Good shout.

Santori
Santori

Kolasinac was a very good deal.

papa don't preach
papa don't preach

But he’s on 200k a week due to the Bosman

Laden Jnr
Laden Jnr

No, he’s not anywhere near that

Rich
Rich

So we had cash reserves of £231,000,000 at the end of May?
But we’re pleading poverty in January?
WTF is going on?

Abc
Abc

We spend 70m in the summer and we will not be selling anyone while having still quite big costs which will mean we will be losing these money quite quickly.
That’s why we do what we do, loan and then maybe sign permanantly. I think it’s a good idea given in what situation are we as long as we are able to get players.
Think now we finally see how our financial model fairs when we don’t sell players. This model is OK as long as we don’t overpay players and sell instead of letting them go on a free.

Red-Sky
Red-Sky

There will most likely be efforts to reduce the massive wage bill next summer, especially if we don’t make it to the CL next season. Which is a looming possibility I’m afraid. So we should expect a purge of high-wage players.

We seem to be stuck. We don’t have enough money to bring in decent players to help secure 4th place. And we can’t get the money otherwise if we don’t make it to the CL.
And of course the owner is happy to watch the club go down the drain. Since the infrastructure and the PL related revenues will always assure that the club is highly valuated.
2 billion on the shelf, ready to be dusted and sold.

Lucas Sam
Lucas Sam

well we had tendency (I assume that it’s over now) of grossly paying average players or fringe players to the point where we can’t move them afterwards. Regardless we have a couple of players leaving in the summer due to contract expiring: Licht, Cech, Monreal (unless we activate the extension clause), Ramsey, Welbeck and Jenkinson. All of those players represent 485,000pounds/week according to totalsportek. Considering we also have new sponsorship deals kicking and even more wage bill expension allowed. CL or not, I expect a busy summer. Granted CL can be an argument to sway top targets and prevent another PL team from getting it.

Scomodo
Scomodo

If we let Ozil go, thats another 350,000pounds/week

Santori
Santori

The big mistake is not the average player wages.

The issue is your amazing transfer team with Mslintat on helm over paid Ozil when Alexis left.

Everything went up exponentially thereafter.

Instead of playing Ramsey against the German, extend the Welshman, we kicked that can down the road as well.

Bringing in over the hill Lichsteiner for 90K this season when AMN could do his job did not help either.

Charles Charlie Charles
Charles Charlie Charles

Don’t think that £2bn valuation is fixed if the club descends down the league. Commercial revenues will fall, attendances will fall. Tv money is big but only goes so far. If he wants to realise that value he either needs to sell quick or invest in the team. Thing is, no is sure what he really does want out of the club.

Don’t Forget
Don’t Forget

We already extended Monreal

Richie

It’s besides the point but I do think it’s only a matter of time before UEFA give England a 5th or even 6th spot in the Champions League. UEFA like money, apparently.

Ya gooner
Ya gooner

I doubt it, it wasn’t long ago they were talking about taking a place away from us

Richie

That was 2 or 3 years ago when only the top 3 countries were given 4 CL spots each, and Italy came close to overtaking England (Spain and Germany are 1 & 2). Uefa have been talking about a Super League for a while now, allegedly Arsenal had secret meetings, so wouldn’t surprise me if they just expand the Champions League.

Rob67
Rob67

The unmentioned item here, is how these figures will / might be effected by Kronke paying off the Uzmanov share purchase, by dipping into the pot ?

In that sense, CL football might make him inclined to take more out ?

Challenging times.

Make Arsenal Great Again
Make Arsenal Great Again

The shares has nothing to do with this.

Rob67
Rob67

Errr…..No. It does if Stan has heard of the term ‘leveraged buyout’…..I fear he might have ….!

Make Arsenal Great Again
Make Arsenal Great Again

I’m a chartered accountant. This is what I do for a living

Make Arsenal Great Again
Make Arsenal Great Again

By the way, that’s not what leveraged buyouts means.

Let’s say you own 100% stakes in a club and I want to buy the club from you. If I either don’t have the funds or don’t want to use my personal funds to buy it, I go to a bank or a PE firm and ask for a loan to buy the club from you.

The back or the PE firm makes me pledge the underlying asset (the club) as a collateral. I buy your stake in the club, hence you get your money. The club gets 0 from that. If I default on the loan, the bank or the PE firm takes ownership of the club. That’s what a leveraged buyout is

Rob67
Rob67

But none of that prevents Stan from billing Arsenal for ‘services rendered’ – whatever that might be, to extract money out of the Club to pay off the Uzmanov debt – which was my original point.

Given that he took @ £3 million p/a for a short time, when he did not have complete control, he could now extract @£23 if he so chose.

And if Arsenal get back into the CL, the pot increases and the temptation to increase the take grows accordingly. So CL might not offer the cash salvation that we assume ?

Make Arsenal Great Again
Make Arsenal Great Again

Unfortunately, he owns the club and can choose to do as he pleases. I don’t support him but there is little to nothing we can do to prevent him from taking money from the club.

Teryima Adi
Teryima Adi

Thanks Bro. What an eye opener @ Make Arsenal Great Again

Lord Bendnter
Lord Bendnter

So we made profit, but don’t have money for transfers…..

Xanat
Xanat

That actually makes senes because profit in the balance and free cash usually are two different things.

lari03
lari03

It’s the combo of wages restrictions in the EPL and the squad purge ahead of the summer, which is responsible for the lack of serious signings.

In reality if we could get Õzil, Mhkitaryan, Welbeck, Ramsey and Elneny off the wage bill, with Cech inclusive, wipes circa 900k per week off our wage bill and if all mentioned players are sold, then the real rebuild and signings can happen.

We can probably sign 18 Torreira like players on this wagebill reduction, so it is the reason why it makes sense to wait until the summer to get the transfer balls rolling.

Santori
Santori

Cech -100K
Koscielny – 100K
Lichsteiner – 90K
Welbeck – 90K
Ramsey – 110K
Elneny – 55K

= 555K

Also Jenkinson, Ospnia, Lucas Perez

Ozil will be a tough ask. Depends if someone wants to pay him 350K. Possible -potentially Italy (Inter?)

KongoKim
KongoKim

lucas perez is sold?! jenkinson stays forever?!

Scott P
Scott P

You think Torreira is only making 50k/week after we paid over 20m for him?

Atom
Atom

Yes as he supposedly only made 25k a week at sampdoria.

GraeB
GraeB

Speculate to accumulate is a key saying. However that spending needs to be in the right areas.

I still believe that our defensive woes can be resolved without spending a fortune – 1 goal less every other game gets us into the mix – just better coaching.

Personally, I’d go for younger Championship players than “experienced” players who are past their best and struggle to meet Emery’s physical requirements.

Scott P
Scott P

It’s hard to say coaching will fix the problem when players like Mustafi will still go for sliding challenges at the most inopportune moments. Coaches can’t control basic errors like that.

Red-Sky
Red-Sky

Coaching can’t improve decision making. Liverpool defense didn’t improve overnight because the coach suddenly pulled up a defensive system.
The system must’ve been there all along to some degree, but lack of individual quality and leadership meant only limited improvement.
In our case we shouldn’t even be debating the need for better personnel.
I mean damn! haven’t you been watching Mustafi and co at all??

GraeB
GraeB

The point is that Mustafi should be coached into not diving in for tackles; full backs not pushing forward at same time; DMs covering when a full back does go forward; CBs challenging for all balls in the air; offside lines being straight etc, etc. Coaches can prevent basic errors or they have no purpose.

Santori
Santori

Wage bill is the main concern.

Transfer team should have played off Ramsey against Ozil last Jan, either got Ramsey extended early or Ozil for less. Instead we did not extend Ramsey, overpaid on Ozil and loaded up Mhkitaryan as well for 120K

The situation was slightly akin to Gnabry and the Ox earlier when instead of forcing either Ox to put pen to paper or promote Gnabry in, we ended up losing both.

On top of that we then sold Alexis (which is fair since he wanted to leave) but we neglected to bring someone in who could function on Right side to balance out Iwobi and could take on players one one one like Alexis.

That IMO was an opportunity loss with Mahrez.

Lack of CL for 2 seasons running also means we have to pay comparatively slightly higher for an equivalent player at the top end aside from lack of revenue from that competition.

Ironic of course many fans were so kin we drop out of CL not too long ago to win any cup (Yes even the league cup). Just goes to show how stuck up the arse some people’s thinking are.

Yet here we are without Wenger and prioritising Top 4 pot as our goal for the season.

As mentioned of course (the obvious) we will complicate things further if we should leave all our transfer dealings to the summer and should we not qualify for CL again.

Any opportunity now I feel is bird in hand. Come summer, these players that have motivation to move now may have other better options than us and there will be inherently far more competition as well in market for players.

Frankly struggling to see how the transfer team cannot make some wiggle room this window

Right now as it stands in Jan we could make room if Ramsey was allowed to go early to Juve. That’s 110K right there.

Elneny if he goes to Roma (or wherever) is another 55K which makes 165K. Surely enough to bring in one (or two)

There’s also possibly Mhkitraryan we should consider letting go (since we are stuck with Ozil anyway). He is well on the mend and can free up 120K.

Why we are pussy footing about Dennis and whether we want to commit to a loan followed by a buy in summer is beyond me.

He is a versatile player and brings us technical control in the midfield plus some wing play (not out and out but decent enough) and can cover Ozil in the attacking role between the strikers (if we should play diamond 4 or 4-2-3-1)

I want to say I’d be real piss if we panic loan and take in some young French midfielder instead who still needs polishing but I can’t since I won’t be terribly surprised if that happens.

Amazing since we are apparently better at transfers now than when Dick was in charge.

Fiers d'être Bleus
Fiers d'être Bleus

When will it end with your incessive love of Mahrez and wrongful accusations of Mislintat being in charge of the Ozil extension?
I am genuinely interested in a response from you.

Fatgooner
Fatgooner

Profits up? Great! Share price up? Fantastic! Who cares about actually winning anything?

We used to be a football club.

Red-Sky
Red-Sky

Monaco sacked Jardim for having a bad start to the season, replaced him with Henry who was also bad, so bad in fact they’re bringing Jardim back again 😂😂

Let'sGoArsenal
Let'sGoArsenal

Well, spend some money to get few needed players will definitely help.

Gooner Sam
Gooner Sam

Best way to have a chance of getting back in the UCL is investing wisely not failing to invest at all

Gooner Sam
Gooner Sam

Posted -1 year ago, does that mean I’m in the future?

Twatsloch
Twatsloch

Remember all the fans wishing for us to crash out of the CL? Well here we are. Better now?

Mizog
Mizog

And the way to get back into the champions league is by letting Ramsey go for free force ozil out the club and give the manager no money to spend !!