Wednesday, 23 January 2013

Gillingham FC (2) - part 2 of their finances

Following on from this blog last year, Gillingham FC held its AGM in December 2012, and has also published its accounts to May 2012, helpfully including the detailed profit and loss account. The Chairman's statement in the accounts says "Off the field, the year also concluded an internal financial restructuring that had been ongoing for almost five years, resulting in the ownership of Priestfield Stadium returning to Gillingham Football Club and all liabilities to the Clubs bankers being satisfied in full, leaving the Club with a far healthier platform on which to build"

The club bought the stadium back for £1,050,000 in August 2011, just three years after selling it to Priestfield Developments for £10,100,000, backed by loans from Bank Of Scotland.  At the end of May 2012, the ground was revalued at £3,000,000. 

The Profit and Loss account shows restructuring costs of £858,796 and also Other Operating Income of £3,250,000, described in the trading profit and loss account as "debt release". 
The Related Party Note tells us that Larchpoint Ltd, a company owned and controlled by Paul Scally, acquired the bank debt of Gillingham FC and released the company from its liabilities.  Larchpoint's Accounts to May 2012 are abbreviated, so there is very little to see, apart from a £1 debtor and £1 of share capital.  It doesn't show any bank debt outstanding as at 31 May 2012, nor any profit or loss on this debt, but it is possible that all of the transactions have been and gone with zero profit or loss.  So either the restructuring of the bank overdraft debt was within Gillingham FC, and the "other operating income" of £3,250,000 relates to the bank writing off this debt, or Larchpoint have somehow taken on and had written off exactly £3,250,000 so there is no profit or loss or balance at year-end.

Three Directors Limited are also now owed £1,800,000. 

In a rough calculation, Overdraft at May 2011 = £(3,683,424).  less: Purchase of stadium £(1,050,000) = £(4,733,424).  add: loan from Three Directors of £1,800,000 = £(2,933,424).  Restructuring costs of £(858,796) = £(3,799,220).  Debt release of £3,250,000 = £542,220, and this has been repaid. 

Larchpoint's Accounts to May 2012 are abbreviated, so there is very little to see, apart from a £1 debtor and £1 of share capital.  It doesn't show any bank debt outstanding as at 31 May 2012, nor any profit or loss on this debt, but it is possible that all of the transactions have been and gone with xero profit or loss.  My guess is that the restructuring of the bank overdraft debt was within Gillingham FC, and the "other operating income" of £3,250,000 relates to writing off this debt. 

Priestfield Developments 2012 accounts also show the sale of the ground to the football club for £1,050,000, however still show £9,050,000 as a long term creditor "for which security has been given". However, in August 2011, the company filed statements of Satisfaction in Full of both of the mortgages and charges held by Bank of Scotland.

Monday, 9 July 2012

Malcolm Crosby

Maclom Crosby signed a new three year deal at Northampton in May 2010
He had initially joined the club in September 2009 as assistant manager to Ian Sampson.  In March 2011, Crosby was appointed caretaker manager, following the sacking of Sampson.  Gary Johnson was appinted as manager, and it appears Crosby was allowed to leave Northampton at the end of the season.

From there, he was appointed as head of football development at Oxford United on 31 May 2011.  
The club site reported his role as 
"His main responsibilities will be for the scouting and recruitment of all areas of the Football Club. He will work closely with Chris Wilder evaluating upcoming opposition, and assisting with the first team squad recruitment.

Malcolm will also work closely with the Youth Development department and will oversee the scouting and recruitment pathway for U9s through to the U18s. Additionally Malcolm will work with Chris Allen and the youth team squad to aid both coaching and player development.

Chairman Kelvin Thomas said: "Bringing in Malcolm shows the club's intent to improve and develop our scouting and recruitment. We have already made some improvements to the process, but bringing Malcolm in to oversee this process is a major step forward."

"It is going to possibly take a few years to see the fruits of this appointment, but we want to get back to finding, developing and bringing players through that impact both our first team and beyond."
"It is an area of the club we have wanted to develop for a while, but we had to focus on the first team and ensure we got back and stayed in the Football League, and now we feel it is the right time especially with Malcolm becoming available to take on this role."

Manager Chris Wilder said: "Malcolm brings a tremendous amount of football experience to the set up and I think it is very important that we have a focus in this area.It has been very tough coming through the non-league years, being able to attract and keep players, but hopefully this is a step in the right direction.

"Malcolm will also be able to assist me in watching our opponents to ensure that our preparation is spot on.To have someone with Malcolm's experience and knowledge can only be beneficial." 

However, just one year later,on  19 June 2012, Crosby was to leave United, the report saying .
"Oxford United can confirm that Malcolm Crosby will be leaving his role as head of recruitment at the end of his contract period.

Malcolm returned to the club in a scouting capacity in May 2011 after previously working as first team coach and then caretaker manager in the 1990's. he leaves with the club's thanks and blessing as Chairman Kelvin Thomas said:
"We thank Malcolm for his hard work over the past year. He has a wealth of experience in the game and we know that he will be pursuing other options. We wish him every success in that.
"Malcolm has been a good servant to the club during his time here and will always be welcome at Oxford United."

Crosby was subsequently appointed as head scout at Birmingham City.  

Physios and coaches

The role of physios, coaches, and strength and conditioning seems to change fairly regularly at Oxford United in recent years.

Neil Sullivan left his role as physio in August 2008 to join Derby County, after seven years at Oxford.  
Charlie Grieg replaced him in a caretaker capacity, with Jon Brown taking charge in December 2008.
Jon Brown left in August 2011, with youth team physio Max Martini taking temporary charge. 
Andy Lord joined in September 2011 from Derby, where he had been working with Neil Sullivan. 

Strenth and conditioning 
Jordan Milsom had this role in 2006/07, left for Swindon for a year, and then rejoined in June 2008 under manager Darren Patterson, with Lindsay Davis (sports massage and kitman), John Williams (nutrition)
Milsom left in December 2008 for Leicester City.  At the time, it was decided not to replace him, a BBC interview in January 2009 reporting "Boss Chris Wilder wants to use every available penny for team building and it is a decision backed by chairman Kelvin Thomas.  I think we are going to do things differently.  We are lucky to have some great universities and sport science departments to lean on.  Wilder has said he would rather have the money towards a player and Thomas agrees that in non-league football they cannot justify the expense.  Chris feels, and I agree, that a fitness coach at this level is probably an extravagance and Chris is very confident that the medical staff and Mickey Lewis can deal with the fitness."
Andrew Dubowski joined in November 2010 with ten years experiece in the navy.  He left in December 2011.   
Dan Bond arrived in Jan 2012.

United finished 2011/12 outside of the play-offs, having been comfortably in seventh place before the last seven games saw them pick up just two points.

On 10 May 2012, just five days after the end of the season saw United it was announced to BBC Radio Oxford that the club would be taking advice from Wigan Warriors.  The rugby league side are also owned by Ian Lenagan, and it appears that the owner has decided to take more decisive action on the backroom staff, and reasons for failure in the past season.  Wilder said "We have fantastic connections with Wigan who place a massive importance on fitness.   It's part of the club that we need to study and improve because obviously from my point of view as manager I need players on the training ground and available for selection."

In a 14 May 2012 Oxford Mail interview , chairman Kelvin Thomas said:- “We have to look at the reasons why we didn’t get into the play-offs, I’ve said I think overall our strength and conditioning was decent, but not at a level that was going to push us into the play-offs.  We have to look at the whole area and I think it’s potentially one area we need to invest in and get more quality in there in terms of personnel on the sports science side.  I think we’re going to look to get a bit more experience in that department to help (manager) Chris (Wilder) on that side of things to help really kick it on and hopefully change the structure so we’re doing things the right way. Hopefully that will improve the injury situation, but we have to look at it over a four-year period as well – in the time Chris has been in we haven’t had that many injuries and then one year when it’s really hit us.  Some of that’s luck, some is conditioning. We’re going to improve the conditioning and hopefully the luck will turn around.”

Alasdair Lane is set to be unveiled in July 2012 as head of this department, after a year at Rotherham and a number of years at Brentford, following time in the army.  
In August 2012, Ian Lenagan wrote "Additions to staff include Strength & Conditioning Manager, Sports Psychologist, Nutritionist Consultant and Video Analyst with Oxford United now using the same software technology as announced recently by Premier League Champions, Manchester City. "
At the end of 2009/10, the club had
Manager - Chris Wilder
First team coach - Mickey Lewis
Goalkeeping coach - Alan Hodgkinson
Physios - Jon Brown, Charlie Grieg
Sports massage therapist - Lindsay Davis
Youth development - Les Taylor
At the end of 2010/11,
Manager - Chris Wilder
Assistant Manager - Mickey Lewis
First team coach - Andy Melville
Goalkeeping coach - Alan Hodgkinson
Youth team manager - Chris Allen (appointed July 2010)
Physios - Jon Brown, Charlie Grieg
Strength & Conditioning - Andrew Dubowski
Sports massage therapist -
Youth development - Les Taylor
At end of 2011/12
Manager - Chris Wilder
Assistant manager - Mickey Lewis
First team coach - Andy Melville
Goalkeeping coach - Alan Hodgkinson
Youth team manager - Chris Allen
(appointed July 2010) 
Physio - Andy Lord
Sports massage therapist -
Strength & Conditioning - Dan Bond (appointed Jan 2012)
Head of football development - Malcolm Crosby
Youth development - Les Taylor

(not listed in the programme
Sports Therapist - John 'Spike' Elliott 
Manager - Chris Wilder
Assistant manager - Mickey Lewis
First team coach - Andy Melville
Goalkeeping coach - Alan Hodgkinson MBE
[not mentioned - Wayne Brown]
Youth team manager - Chris Allen
(appointed July 2010) Physio - Andy Lord
Head of sports science - Alasdair Lane
Sports Therapist - John 'Spike' Elliott
Strength & Conditioning - Dan Bond
Head of football development - 
Youth development - Les Taylor
Nutrition - Ed Tooley

Sunday, 10 June 2012

Woodstock Partners and Oxford United

Woodstock Partners Limited
On 21 March 2006, Woodstock Partners Limited ("WPL") acquired Oxford United Football Club Limited ("OUFC") from Firoka (London Park) Limited, a company ultimately owned and controlled by Firoz Kassam, a successful hotelier and businessman.
The Woodstock connection could have been dreamed up in a local pub, as all of the key people were all based in the village.

Nick Merry
Merry fronted the takeover as Chairman.  He had once been in the United youth team, and was now living back in the UK, having apparently made his fortune in America with a dental products business, and also claimed to have mining interests in Africa.

Jim Smith
Fondly known as "The Bald Eagle", Smith managed back-to-back promotions with United to the top tier in the 1980s, before leaving for QPR.  He had last been working with Harry Redknapp at Southampton nearly a year before, and was now in semi-retirement between Spain and Woodstock.  Smith took over as manager from caretaker Darren Patterson once the takeover was completed.

Kelvin Thomas
Kelvin Thomas, another Woodstock resident, was also appointed a Director.  Thomas had football and other interests in the USA, as well as a home in Florida.

Merry, Smith and Thomas were all appointed Directors of United.  

Ian Lenagan
Lenagan is again a Woodstock resident, who made his fortune floating his IT business at the height of the boom in 2000.  Although rugby league is his key sporting interest, Lenagan supports all kinds of arts and sporting, including Old Woodstock Town Football club, and he also invested in the London Broncos rugby league team.

Lenagan was very much the quiet man behind the takeover, not publically making his involvement know until nearly a year afterwards, nor being one of the new board of Directors of OUFC.  

The WPL 'plan' was for an initial investment of £2MM, with a further £750,000 to cover the next three seasons.   It was never entirely clear whether this was supposed to be a 50:50 sharing of costs between Merry and Lenagan, however the WPL shareholding was 1 share each, which suggests an equal partnership. 

Smith signed several players, however United were relegated to the Conference on the last day of the season. 

The cost of the takeover was approximately £2MM - this was the amount required to pay back everything owed to Kassam's companies as at the take-over date, plus legal fees.   At 30 June 2006, the amount due from OUFC to WPL was £2,099,045.

OUFC had a storming start to their non-league campaign, undefeated in something like 18 games and top of the league.  However, results fell away, and the club finished second in the league to Dagenham and Redbridge, and with only one automatic promotion place, it was down to the play-offs.  United were defeated to Exeter in the play-off semi-final, who went on to win promotion, followed by a second consecutive promotion to League One the following year.

The club made a net loss for the year of £653,830.  At 30 June 2007, the amount shown as due from OUFC to WPL was £2,912,000, an increase of £812,995.   The bank overdraft had also increased from £17,579 to £136,759 during the year. 

A poor start to the season saw Jim Smith replaced as manager by Darren Patterson.  However, the club saw their worst finish in recent years, finishing mid-table.  

The club made a net loss for the year of £870,582.  At 30 June 2008, the amount shown as due from OUFC to WPL was £3,282,759, an increase of another £370,759.   The bank overdraft had increased by £292,208, and taxes due had also increased to £128,226, from £57,192 the year before. 


Patterson was unable to get results on the pitch, and it soon became apparent that financially the club were struggling.  The stadium apparently refused to provide the usual executive box catering one match because the quarterly rent payment had been missed.  Matters came to a head in October 2008.  Nick Merry resigned as Chairman, and Darren Patterson was sacked as manager, the last straw being a defeat to Torquay in the FA Cup.  Kelvin Thomas was appointed as Chairman, flying in from the USA.  Jim Smith took temporary charge as manager for a few games, and after a detailed interview and screening process, Chris Wilder was appointed manager, his first game being boxing day 2008.  OUFC suffered a five point deduction for fielding an ineligible player, and despite a race for the play-offs, the team finished just short. 
The amount due to WPL from the year before was £3,282,579, however WPL stopped charging interest on its loans with effect from April 2008, and had written back £29,000 relating to the previous year.  Effectively the opening amount due was now £3,253,579.  

The club made a net loss for the year of £887,870.  At 30 June 2009, the amount shown as due from OUFC to WPL was £3,361,059, an increase of £107,480, and this amount would be unchanged for the next few years. The bank overdraft had been reduced to £92,000, however taxes due had also increased to £444,000, from £128,000 the year before.  Accruals and deferred income had also rocketed to £923,880 from £306,446.

Chris Wilder's team had an excellent start to the season, clear at the top by Christmas.  Another crucial matter was the transfer of Dean Whitehead from Sunderland to Stoke for £3MM.  OUFC had sold Whitehad back in June 2004 for £150,000, and Kassam had sensibly insisted on a sell on clause, which resulted in a total profit on player transfers of £531,232 in the season.   

Back on the pitch, loan players were brought in to try and strengthen in one or two positions, results fell away, and Stevenage romped to the title.  In the last few games, Wilder returned to the players of the first half of the season, United were into the play-offs, defeating Rushden and Diamonds in the semi-finals, and eventually winning 3-1 against York City to return back into the football league.  The play-off final at Wembley was unfortunately not the big money-spinner that had been expected after all costs were taken into account.

The WPL loan remained unchanged at £3,361,059.


From the last published accounts for OUFC (June 2011):
The WPL loan was £3,361,059 at June 2011. From the WPL accounts, £2,801,552 was due to Directors, and £392,941 to Other loans. [These loans used to be described as all Directors loans until Nick Merry resigned, leaving Ian Lenagan as sole director, and after this the loans have been disclosed separately. So it may be that Merry did invest £392K into WPL. During the Harry Redknap fraud trial, HR said that he had put money into OUFC, and so this may be in here somewhere. I think the club denied any direct connection with Redknap, so it may have been routed via Merry and WPL.]
From the fans forum on 15 March 2012, £440K was put in by WPL in November 2011, £350K in Feb 2012, and after expected repayments, the loan will have increased by £250-£300K.
Hence total WPL investment will now be around £3.611MM to £3.661MM. Note that no interest has been charged on this loan/investments from April 2008. 

Other loans
From the last published accounts for OUFC (June 2011):
Other loans were :
 - due within one year £180,000 (2010 : £355,000)
 - due after one year £100,000 (2010 : £100,000).
From the forum, there had been loans of £355K from three fans in October 2008 [and presumably 100K from somewhere else in long term creditors].
£200K was repaid last year [calendar year 2011], £255K still outstanding, of which £25K will be repaid this year [CY2012]. The club is not anticipating more external loans.
Tieing back to the numbers in the accounts, it seems total loans were £355K+£100K=£455K.
Repaid by June 2011 was £175,000, leaving £280,000.
Repaid after June 2011 was £25,000, leaving £255K as at the 15 March 2012, and with another £25K to be repaid in 2012.
This then leaves £230K, split I presume as £130K from the three fans, and another £100K in long term creditors.