A survey of football finance directors has revealed Ladbrokes Premiership clubs face increasingly difficult financial situations.
One of the five Premiership directors who responded to BDO’s confidential survey stated their club’s finances were a cause for “grave concern/on the verge of administration”. Another said they were “in need of attention”.
The other three stated their finances were either very healthy or “could be better but not bad”. Every response in the previous year’s study had been in these two categories.
The findings contrast starkly to English league clubs, around half of whom responded. Three-quarters of Premier League clubs are in a very healthy financial position and 88 per cent expect to make a profit in 2016-17. Almost a quarter of Football League Clubs have finances in need of attention or causing grave concern.
Ian Clayden, head of professional sports at BDO, said: “The Scottish Premiership remains a mixed bag with widely varying results across most of our survey. Certainly, with incredibly low TV rights income compared with English football, SP clubs are facing many financial challenges.
“Clubs are largely dependent on their loyal fanbase and player trading activity, and are not attracting significant investor interest.”
Investors are increasingly targeting lower-league English clubs and the gap between the top-flight finances either side of the Border continues to grow. Clayden claims it is “incredibly unlikely” that there will be an imminent bursting of the Premier League broadcasting bubble, in which clubs earn £100-150 million each per season.
In Scotland, two of the five clubs were reliant on their principal shareholder to plug losses or cash shortfalls, and three had issued a fixed charge on their stadium as loan security.
The survey noted significant support for Scottish representation in the English Football League, including 63 per cent among Premier League clubs. Even two of the five Scottish clubs were in favour.
BDO is an accountancy and business advisory which is carrying out the liquidation of oldco Rangers.