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Trust on Club finances
Trust on Club finances

Our Club Board has announced some headline figures from the financial results for the year ended 30 June 2005.  Like last year, York City is amongst the first football clubs in the country to announce its financial results for the season ended and we will, in due course, make available the completed statutory financial statements.


Of course, football-wise, the 2004/05 season was a huge disappointment to supporters.  In some respects, that is reflected in the overall financial result of a trading loss for the year of 83,568.  As noted by the Club, over the two seasons 2003/04 and 2004/05, the Club has recorded an overall break even position in its profit & loss account.


Following relegation to the Conference, obviously there was a significant reduction in the Clubs revenue.  Despite the vitally important injection of monies from Nestle, the Clubs overall revenue was around 650,000 lower in 2004/05 compared to 2003/04.  A significant amount of financial restructuring was necessarily required in 2004/05 to help save costs and the overall level of costs incurred was around 500,000 lower than in 2003/04.


As is understood and appreciated by most City supporters, since rescuing York City from the brink of extinction, the Club has had to operate under tight financial constraints.  There were certain liabilities that the new York City Football Club Limited had to inherit from the old football club entity as part of the rescue package (e.g. amounts due to players, the tax authorities, the PFA).  That is, we inherited significant costs/liabilities incurred under previous regimes, but which the Trust-owned Club has had to pay for in cash terms.  Over the past couple of years, the vast majority of those liabilities have now been settled.  It is normal accounting practice that the settlement of those liabilities is not reflected in the profit & loss account, but it does mean an outflow of cash from the Clubs bank account. 


In addition, as reported at the time, there was a shortfall of around 100,000 to be funded in February 2005 as part of the deal for York City to gain ownership of Bootham Crescent.  That is, the loan of 2m from the FSIF was around 100,000 less than the amount to be paid out to complete the deal.  Around that time, following the negotiations by the Club Board, the significant sponsorship deal with Nestle reportedly brought in 100,000.  Hence, whilst the overall profit and loss account result is breakeven over the last two seasons, York City has had a cash shortfall that needed to be funded.


As results on-the-pitch fell below expectations and the deal for Bootham Crescent neared completion, it was apparent to the Trust and Club Boards that further funds would be needed in 2005.  Therefore, a 300,000 long term loan was put in place to help fund the Clubs commitments.  Fortunately, this was facilitated by one of the Clubs directors, Jason McGill.  Primarily due to commercial reasons, the Trust has not publicly commented on the funding arrangements until now.  Jason is a life-long City supporter, a Trust Life Member, in March 2003 partnered with the Trust to save York City from extinction, and was appointed as a Club Director by the Trust Board.


 


Going forward, the financial outlook for our Club continues to be challenging, but manageable.  For instance, ownership of the ground and training facilities brings with it additional costs.  There is an annual interest cost of around 100,000 on the 2m loan from the FSIF, and costs of repairs and renewals to maintain the facilities.  There is a shared responsibility amongst the Trust, Club and the wider supporter base to help fund this annual commitment.  It is a cost of gaining ownership of Bootham Crescent, which supporters have long strived for.


Fundraising donations received by the Club are just one of the Clubs revenue streams that are applied to settle its overall costs.  Fundraising donations by supporters are derived from a variety of sources all with the principal aim of benefiting York City - and several supporter groups have been actively fundraising for the benefit of York City over recent years.  Indeed, even following the initial fundraising of 1/2 million to Save City, in each of 2003/04 and 2004/05 fundraising donations have contributed around 70,000 to help the Club.  This is a credit to the fantastic fundraising efforts of many people and different groups.  Going forward, the Club, the Trust and other supporters will work together to strive to achieve stretching targets for fundraising to help build a better York City.  As the season gets underway, a schedule of fundraising activities will be co-ordinated and communicated.  As ever, York City relies on the commitment and voluntary efforts of many people working together for the club they love.


In addition, improvements have also been made in other areas to help sustain the Clubs finances.  For instance, improved financial controls, the Trusts appointment of a new Commercial Director (Peter Davis), the appointment of a new Commercial Manager (Elliott Stroud) to help generate additional commercial revenues, and changes to the youth development set-up.  Meanwhile, the Trust Board will continue to consider alternative methods to raise significant funds for the future benefit of York City.


As reiterated in the Clubs announcement this week, Billy McEwan has been given an appropriate budget for the forthcoming season whereby Billy is happy that he can assemble a squad of players to provide our loyal supporters with a considerably more successful season than last year.  On the pitch, under Billy McEwans leadership, supporters will be looking forward to seeing some improved performances and results in 2005/06.  As City supporters, we are all seeking some reward on-the-pitch for the efforts and contributions of so many over recent years.


If anyone has any further questions, please contact any Trust Board member and/or contact the Trust via enquiries@ycst.org.uk


 


Note: In due course, following completion, the financial statements for the year ended 30 June 2005 will be made available and those who wish to study the numbers in more detail will be able to do so.  The financial results for the year ended 30 June 2004 can still be downloaded from the Trusts website, as can the results of the first stub period (to 30 June 2003) after the formation of the new York City company via the following links.


http://www.ycst.org.uk/accounts_2004.pdf


http://ycst.org.uk/ycfc_accounts2003.pdf

 
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