Arsenal’s latest accounts, are you pleased or confused?

Written by kelsey

Some out there may not like this, but I’ve had a look at Arsenal’s accounts and they’re not as rosy as everyone is making out. The fortunate thing for Arsenal is that the property portfolio is finally being sold off and is providing additional profit and we continue to be able to sell players.

If you strip out the property portfolio, which is fair as it won’t always be there and it isn’t football related, then you strip out the profit from the sale of players, the club actually made about £6m before tax.

Footballing turnover decreased by £3m on 2009 (5 fewer Home games) and costs increased by approx £7m, meaning their operating profit before interest and Tax dropped from £30m (2009) to £20m (2010).

The interesting thing is the chairman noted that player wages and wage expectations have increased dramatically and Arsène Wenger is aware of Arsenal’s financial model!

Hats off to the club, the overall figures are good, but the underlying footballing business continues to rely on selling players for the majority of its profit.

However, according to the Arsenal financial report: Operating profit before player trading and depreciation, which is a key measure of our financial performance, also rose to £72.0 million (2009 – £70.5 million). The profit reported of £56m is AFTER player trading has been taken into account along with net finance charges etc…. so it’s trading performance does not rely on player sales for the majority of its profits

Players’ wages have probably increased due to signing new contracts, etc. On the whole, the profits are very good, and so is the fact that we have made a massive profit whilst being able to knock £162m of the debt.

But they reduced the debt in what is effectively a retail business – they bought stock (the property) with debt, and then repaid it when they sold that stock.

Arsenal’s original plan was for the Highbury development to help pay for the  building of the Emirates,or at least ,make a sizeable contribution, that won’t happen, but anything else they now sell, will provide a surplus which, looking at previous sales and costs, should be circa £15m next year.

All a bit confusing, but open to discussion.

45 Responses to Arsenal’s latest accounts, are you pleased or confused?

  1. Big Raddy says:

    Kelsey. Some fine research but as you say confusing. If I understand correctly, taking out the property and the player sales we made €6m, which is a paltry return on turnover. But I am hopeless with finance, as witnessed by my bank balance!

  2. redandwhiteviews says:

    Did you also strip out the money spent on paying off the debt?

  3. Big Raddy says:

    SS. I must reply to your comment this morning.

    My point was that Mike was suggesting there was a racist/nationalist agenda concerning the fans promotion of Gibbs and Walcott. I find that attitude insulting. Arsenal have the most multi-racial, international fanbase of any club. Having fought (verbally not physically) at grounds all around the country when players have been racially abused, I will not allow a suggestion of bigotry to go unquestioned.

    You are right when you say that Mike’s comments were an amalgamation of his perceptions from all over the blogosphere, and it would be naive to suggest that there are not Arsenal fans with “agendas”, but they do not write on AA.

    In a team where the vast majority of players are non-Brits it is senseless to say there is a pro-Brit undercurrent. Who comes top of every Best Arsenal player poll? TH or DB – are they English?

    That said, Mike did make some good points about the players, but as an Arsenal fan who comes from a “minority” background I object to anyone making accusations of bigotry.

  4. charybdis1966 says:

    Oh no – the long awaited financial analysis I was dreading, because it’s just like work !
    Without getting embroiled in the detail I don’t think you can strip out the profit on player sales completely in the way you have with the property sales – the latter is definitely a non-recurring item and it is fair to strip it out, whereas player sales will always happen and unless we start to “buy high, sell low” when it comes to player sales/acquisitions it would be prudent to assume we will see a similar – if not exact – level of profit.
    If we want to add back a recurring player sales profit figure, rather than stripping it out completely, we could take an average from the last 5 years of player trading. This would no doubt increase this years “adjusted recurring items” profit to more than £6m I’m sure.
    However I don’t disagree with the premise that the profits are not quite as rosy as they appear at face value – a good deal of the recurring income is down to season ticket sales and match day related income – and I suspect that sustained lack of silverware will hit attendances and the recurring income streams adversely.
    Heck – I have got embroiled in some of the detail, dam you Kelsey! 🙂

  5. SharkeySure says:

    No worries Radders.

    “but they do not write on AA” – I don’t think Mike intentionally suggests that they do.

    “nationalist agenda concerning the fans promotion of Gibbs and Walcott” – I think there’s an element of truth in that, less so with Gibbs, but I really do believe that Walcott’s Englishness has given him an easier ride whilst we’ve waited for him to deliver.

    “Who comes top of every Best Arsenal player poll? TH or DB – are they English?”
    No offence intended, but I find that way too simplistic, mainly because those two (plus Paddy V and Cesc for me) are an absolute class above any other player we’ve seen in the last 20-30 years. Ask Arsenal fans if they want more Englishmen in the team, and see how many say yes. I’d hazard a guess that on blogs the answer would be in the 50% region, but outside the ground it would be more like 80%. The difference being that the blogs carry an international audience, who are less aligned to any notion of Arsenal’s supposed Englishness.
    Lastly we all know that fans are stuck with a club for life, and if over a certain period the mix of players nationalities goes agioanst what they would prefer, what they can do about it. So the fact that we have few Brits/English* at the club shouldn’t prevent anyone from being pro- Brit.

    * I’ve often wondered why British/English is interchangeable in this context.

  6. SharkeySure says:

    *what CAN THEY do about it.*

  7. SharkeySure says:

    Radders perhaps we continue this offline..??

    I’ve a fair bit more to say/ask on the topic, but don’t think its appropriate here.

    Kelsey, apologies, I will get to your post in a mo.

  8. SharkeySure says:

    Kelsey, very informative piece, as per usual.

    I’m with Chary re player sales they’ll be ongoing, but hopefully not Cesc next summer*.

    At the lower end I can only see increased demand for uor quality youngsters who are classified as ‘home grown’, but not quite good enough for our needs.

    I dare say we’ll make a lot more money from selling off our ‘didn’t quite make it’s than before !!

    Some see that as a done deal, whereas I still think Barca will be broke next year. Topic for your next piece Kels.. Barca Finances 2011-2012..??

  9. London says:

    An interesting read Kelsey.

  10. Rasp says:


    Interesting post kelsey, thanks for spelling it out for someone who’s not very sharp when it comes to the finances 🙂

    Apparently we have not yet started on the Queensland Road Project which was part of the orginal permission to build the Emirates.

    I believe (although no expert) that we will be building affordable housing and a community sports centre. Does anyone know how much this will cost and where the money will be coming from? – and more importantly will it lead to a few more years of financial austerity?

  11. charybdis1966 says:

    Raspers, I believe the original planning permission for Ashburton Grove was given on the basis that a portion of new developments would be for affordable housing; having worked in that sector in the past(and in the Borough of Islington as it happens) there are Housing Corporation grants available for affordable housing, especially key worker housing and one would assume these would be used to offset our building costs.
    Of course there won’t the be the same degree of profit in the construction and sale of affordable housing as there was for the private apartments/flats at Highbury Square, but my gut feeling is that we shouldn’t be financially hampered by the Queensland Road project.

    Good grief – I might as well be working at the day job now!

  12. Morning all

    Well done kelsey, you’ve managed to get chary to make a comment regarding finances!!!!!!

    If one of the ways we are to generate income is by player sales then we already have lots of experience of that.

    Rasp – I would assume that as Arsenal nearly got their fingers burnt by financing the Highbury Development they would be putting the Queensland Rd project out to tender but don’t quote me.

  13. London says:

    Morning Peaches

    Out to tender this time….makes a lot of sense.

  14. 26may1989 says:

    Sorry Kelsey, I don’t really agree with your take on Arsenal’s finances – taken in context (ie, compared to the lunacy that prevails at the vast majority of other PL clubs and our main rivals in other European leagues, and bearing in mind that we are coming out of a stage of major infrastructure investment) the club’s finances are excellent.

    Yes, the commercial revenues need to be developed, which is now doable given that the club can reform its position on shirt and stadium sponsorship, retailing etc, all of which have been deliberately managed on a very conservative basis since 2004 or so. But it’s worth bearing in mind that Arsenal’s wages bill in 2010 has been almost entirely covered by match day income – meaning TV money, commercial revenues, transfer profits and residential development profits are under much less pressure in covering the remaining expenses.

    Compare that with Man City: they announced today that their player wage bill on its own exceeds the club’s entire revenue, from all sources, and before taking into account the need to pay any other expenses and before accounting for the enormous trading losses they incur on transfer fees. An extreme comparison, but it helps underline how far Arsenal are from the madhouse.

    Can Arsenal generate more money and be more profitable? Yes, and one area (in addition to sponsorship and retailing) I would criticise the club is the ongoing failure to sort out Arsenal TV, which frankly is an embarrassment. Can they reduce costs? Yes, while the logic of securing a stable squad is laudable, it is fair to say we’ve been over generous with some of the younger and squad players. But taken in the round, the club’s finances are, in the words of one commentator, “simply stunning”.

    It goes into a lot of detail, but I found this blog a really interesting source on Arsenal’s current financial position:

  15. London says:

    I have just got myself up to speed on the “MikeSA” comment and what a good comment it was, certainly worthy of a head line post.

    I agreed with most, sympathised with the rest but absolutely disagreed with the accusation of bigotry, it was a shame, I felt it marred a fine comment with that lazy choice of word.

    There is a tendency amongst English Arsenal fans to want English Arsenal players to do well and why not? Watching the world cup is bitter enough but every Arsenal player in the team is like a spoonful of sugar; it never changes the out come but it does some how sweeten the final blow.

    Separately but still loosly connected I certainly agree with this.

    “It’s not good to say ‘this blog said, that blog said’ etc, but if there’s a growing train of thought in the blogosphere, then I think it’s fair to comment on it here.”

    Any attempt to stifle this view is censorship!

  16. SharkeySure says:

    Great poist that 26m

    How stoopid are Man City….?? Its a very good pouint you make about ‘losses on player trading’.

    Their losses would cripple most clubs. We tend to focus only the diff in buying and selling fees. We also need to throw in agents fees, and worst of all, contract settlements and pay offs when they force players out.

  17. Red Arse says:

    Hi Kelsey, enjoyed your take on the financial performance of AFC.

    I haven’t actually seen the figures other than the headline “profit” of £56 million, therefore i will defer to my learned co-bloggers.

    What I can say tho’, is that all businesses need to pay attention to not just the before/after tax profits/losses, but also their cashflow.

    The biggest profits imagineable are not much use if they haven’t resulted in better liquidity. Big profits resulting in big(ger) creditors is often a precursor to financial instability. (Not suggesting this is the case with AFC, but has anyone looked).

    Accountants specialising in credit management are more interested in the critical ratio analysis of a company’s balance sheet in arriving at a “good” or “bad” financial prognosis.

    All that, and I haven’t even seen the figures! Balance sheet analysis, boring? Not to an accountant, but to 99% of non accountants? Yes! 🙂

    Anyway, I’m back to footie. 🙂

  18. Red Arse says:


    Where can I read the MikeSA comment. I haven’t a clue what you are all talking about.

    One positive that seems to stand out for me, from reading your comments, is that “British” or “English” have now become all inclusive so that the point appears to be about bigotry and not racism with its disgraceful colour prejudice.

    A bigot, as I understand it, is someone who is intolerant of the opinion of others, or is interested only in his/her group, race or community to the detriment of others.

    Does supporting your countrymen fall into this category? I wonder.

  19. SharkeySure says:

    “certainly worthy of a head line post. ”

    That was my view too London, it really was a cracking effort on his part.

    I felt like he’d just unloaded everything that has been on on his mind for some time, ie a ‘very well constructed ramble’…if thats not an oxymoron.

  20. Red Arse says:

    Arsene has said Gibbs, Cesc and Big Al are all out of the Sunday clash.

  21. SharkeySure says:

    About 8.30 am on yesterdays post Red

  22. SharkeySure says:

    Not the worst news in the world re those 3…but whats up with Gibbs. Injured, back, now injured again.

    Tripped over his cat..?? Fell out the bath..?? Groin strain after a night with a WAG..??

  23. Rasp says:

    Hi London,

    I agree with your 12:22 re English players. Of course it is fine for English supporters of Arsenal to want English players in the side (if they’re good enough) and it is equally fine for French Arsenal supporters to want French players in the side. It’s a shame we don’t see so many orange shirts in the crowd as we used to when we had Overmars and Bergie in the side, I was always impressed that they’d come over for the day just to watch their heroes play for Arsenal.

  24. Red Arse says:

    Thanks Sharkey, I’ll go and look.

  25. Red Arse says:

    I have now read MikeSA’s belated comment, this morning, on yesterday’s post.

    It was a non controversial, perfectly valid viewpoint, until the “headless chickens” comment. From there on in I found it difficult to put into context.

    If the alleged comments were made on another site then that’s where his response should have been made.

    I have never seen any of the alleged bigotry on AA, and because the complaint, and it was a complaint, was not aimed specifically at any particular target, the scatter gun approach implicated us all.

    It therefore lost credibility for me and fell into the “truism” school of dabate, such as;

    Racism is wrong.

  26. Neamman says:

    Hi Guys
    There was an interesting article on BBC Sport yesterday. Apparently to help with financing the stadium 10 years ago we outsourced the management of the shops around the world. Consequently we only make a very small % of all shirt sales, even from the Armoury. This deal ends in 18 months and they say that the impact on our revenue will be major.

  27. SharkeySure says:

    We could be in Liverpool’s position, banking on futurer revenues to change our recent fortunes. I’m pretty happy that we really didn’t fall too far and still have the future benefits to look forward to….let shope they bear fruit sooner rather than later.

    Odd thing is that the two major pluses so far this season have been Little Jack and Big Chamakh, who’ve cost us nowt !!!

  28. rockylives says:

    Hello all. I’ve read Mike SA’s post and thought most of what he said was fine. I don’t think he was suggesting racism – just pointing out that some people seem to have more affection for our British players. Clearly there are some who hold that view but I suspect they’re a minority. Me, I”d love a player even if he came from Mars provided he did great stuff for the Arse.
    However… Mike SA was clearly an articulate poster and I wonder whether we were a bit harsh on him given that it was his first foray onto AA. And let’s face it, if he has posted on other sites before he’s probably used to everything descending to name-calling and abuse. I feel we could have handled him a bit more gently and nursed him round to the AA way of doing things.

  29. Rasp says:

    Hi rocky,

    I’m sure if Mike SA, reads through the messages of support he’ll keep coming on AA. You will have read that I have tried to recruit him as an author, because, as you say, he is an excellent writer.

    Reactions to comments and the sensitivity of the reader is always subjective and related to personal experience.

  30. Rasp says:

    My own ‘sensitivity’ is towards those who attack the writer instead of putting up a coherent argument as to why they disagree – well at least on this site. Maybe on other sites it is an understandable reaction prompted by the tone of the article – but then again, no-one is forced to read a blog.

  31. charybdis1966 says:

    Raspers, I have to confess to being a bit confrontational when it comes to certain other teams fans – at the moment I only have to see a Stoke fan’s comment and I see red. It’ll take a long time for me to forgive them their reaction to Rambo’s injury and Pulis/Coates constant moaning(like a drain) since then.
    Let’s hope they(with their dumb piped crowd noise at the Shit-tania), like Hull(another team who constantly disrespected us) go back to the Championship where they belong,
    Having said that Wolves look like they could be next seasons Stoke. Crude playing tactics, oafish manager and knuckle scraping, mouth-breathing fans.

  32. SharkeySure says:

    Fair do’s Rasp…..

    I love this site !!!

  33. Rasp says:

    I love your confrontational approach and acerbic wit – and luckily I have had the pleasure of meeting you in person so I know you really are that bitter 😕

    Its amazing how we often appear to be arguing when we’re actually agreeing don’t you think 😆

  34. rockylives says:

    I should have added a thanks to you Rasp (and to BR) for sticking up for me (and my post) when Mike SA commented.
    I spend most of my blog time on here, where the discussion is almost always informed and courteous (not to mention brilliantly funny a lot of the time) so when I occasionally dip into the comments on some other sites it can come as a quite a shock.

  35. rockylives says:

    But back to today’s post: Kelsey’s right to advocate a bit of caution about the figures. In the Swiss Ramble article there’s an assumption that a major area of potential revenue growth for us is in commercial activities. But to tap into that opportunity we will have to start doing Far East and US trips like the Chavs and Mancs do – and up to now AW has been totally opposed to this.

  36. charybdis1966 says:

    Yeah Raspers, I don’t have a blog persona – I’m exactly the same in most ways in real life, except for not looking like a 34 year old Dirk Benedict. Mores the pity on that count.
    Moving onto Sunday, does anyone get the feeling that Drogba is lubing himself up with KY gel at the prospect of ravishing our backline from behind(again)?

    Am I being unduly negative?

    Apologies if my metaphor is a bit graphic for those of a gentler disposition.

  37. Rasp says:

    I’m more worried about Essien and Malouda than Drogba – he’s not in great form and they’ve always got Anelka.

  38. charybdis1966 says:

    That dam Drogbreath always raises his game against us though – but surely he must be getting on a bit by now and is past his best?
    I’ve thought that for the past 2 seasons and been proved emphatically wrong.

  39. SharkeySure says:

    “appear to be arguing ”

    Rasp – I prefer to think of it as clarifying our perceptions !!

  40. SharkeySure says:

    Rocky I know what you mean about most other sites…

    I hardly ever bnother although ‘one in particular’ is always good for a chuckle, evn though schadenfreude is not the nicest of emotions. C’est la vie….

  41. Morning all

    We have a post from a new contributor today.

    Rasp if you’re around can you check in with me please

  42. Theres a NEW POST ………..

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