Newspaper article The Journal (Newcastle, England)

TV Cash Set to Double Profits at Newcastle

Newspaper article The Journal (Newcastle, England)

TV Cash Set to Double Profits at Newcastle

Article excerpt

Byline: By Graeme King

The billionaire bidding to take over Newcastle United may be able to double the club's profits in his first season in charge ( just through television money.

Newcastle stayed fifth in the revenue league of Premierships clubs for the 2005/06 season, with total turnover of pounds 83m, said the new report on Premiership finances from accountants Deloitte.

And now with a big rise in television money for the 2007/08 season, billionaire Mike Ashley could see operating profits soar from pounds 6m in 2005/06 to pounds 12m inside two years.

The report also revealed that Sunderland Football Club produced an amazing pounds 9m operating profit in the season they were relegated from the Premier League ( 50% more than their black and white neighbours and on revenues of just pounds 39m.

This appears to provide some evidence to back ex-manager Mick McCarthy's remarks of February 2006 that Sunderland had pursued a strategy of financial prudence, building a squad to operate in the Championship if required, not necessarily one for the Premiership. However the club denied this yesterday.

There was also a warning to Newcastle United that rapid progress will be needed on Mr Ashley's reported desire for Champions League football, as the 'big four' Premiership teams have now opened up a pounds 38m gap between their revenues and those of the chasing pack.

While Newcastle, Sunderland and their North-East neighbour Middlesbrough will all benefit from around pounds 15m extra income this coming season, there is still a big leap up to the revenues of Champions League participants Manchester United, Chelsea, Arsenal and Liverpool.

Exact figures for Middlesbrough are not available but Deloitte estimates the club's revenue for 2005/06 was around pounds 55m. Alex Byars, (correct) a member of the Sports Business Group at Deloitte, said: "Newcastle and Middlesbrough both finished mid-table this year, so will have earned TV revenue of around pounds 20m.

"Next year, assuming they finish in a similar position, they could get pounds 35m. For Sunderland, compared to their Championship revenue and Premiership parachute payment, their TV income is likely to go up by pounds 20m. …

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