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Begbies Traynor Football Distress SurveyScottish Football League – May 2014
Football Distress Survey
Scottish football stuck in ‘financial doldrums’ as one in ten clubs face financial distressThe latest report into the financial health of Scotland’s football clubs shows a picture of financial stagnation and declining match attendances, with gloomy economic prospects for one in ten of the clubs in the top three Scottish divisions.
“The figure represents a decrease from the four clubs in serious financial trouble last time Begbies Traynor carried out the survey...”
The Begbies Traynor Red Flag Alert Football Distress Report provides six-monthly snapshots of financial distress among Scottish football clubs. The report’s latest figures reveal that three clubs in the top three Scottish divisions are suffering from critical financial distress. The figure represents a decrease from the four clubs in serious financial trouble last time Begbies Traynor carried out the survey in October 2013.
A further 16 clubs, half of the 32 clubs included in the report, are showing early, less serious signs of financial distress.
The survey also highlights the depleted attendance figures and subsequent ticket revenues, which have continued to decline since the economic downturn.
“Overall attendances across all four top Scottish Leagues were down by 6%.”
League One, which has been boosted by the inclusion of Rangers and its relatively super-sized fan base, has seen a drop of 16% in average attendances since October 2013, while Championship games are also attracting 8% fewer supporters than they were six months ago. Overall attendances across all four top Scottish Leagues were down by 6%.
“It’s good news that one of the top level clubs, at least, has managed to clamber back from the financial precipice since the start of the season, and Hearts’ future also appears brighter, with the club recently sold out of administration in a fan-based buyout backed by a local benefactor,” said Ken Pattullo of Begbies Traynor in Scotland.
He added: “However it is worrying that three clubs are facing grave financial pressure and that the early symptoms of financial distress are affecting 50% of the clubs in Scotland’s top three divisions. The wettest winter in decades has also done its bit to dampen fans’ enthusiasm and declining attendance figures may prove to be the final nail in the coffin for some clubs already locked into a cycle of distress.”
Pattullo believes that as cash continues to seep out of Scottish football and club benefactors struggle to make the increasingly heavy investments required, a step change towards community and fan-based ownership of Scottish clubs is emerging as a positive new trend.
“Annan Athletic, Ayr United and Motherwell are the latest clubs to take steps towards an ownership model based on the fans who have tirelessly supported them through thick and thin and who offer a sounder prospect for building a secure future than the whim of the mythical wealthy benefactor.
“...community and fan-based ownership of Scottish clubs is emerging as a positive new trend.”
“We can expect to see this movement towards an alternative business model gather momentum in the coming months as the community interest company (CIC) proves its merit and offers a real prospect of salvation for financially weaker clubs.”
02Scottish Football League – May 2014
Average English League Attendances – 2012/2014 Seasons
Average Scottish League Attendances – 2012/2014 Seasons
2011/2012
2011/2012
2012/2013 (Mar)
2012/2013 (Mar)
2013/2014 (April)
2013/2014 (April)
2012/2013 (Oct)
2012/2013 (Oct)
40,000
15,000
35,000
12,000
30,000
9,000
25,000
6,000
20,000
3,000
15,000
10,000
5,000
0
0
Source: The Football League
Source: ESPN
PREMIER LEAGUE
PREMIER LEAGUE
CHAMPIONSHIP
CHAMPIONSHIP
DIVISION 1
LEAGUE 1
DIVISION 2
LEAGUE 2
0% VARIANCE SINCE LAST SURVEY
+3% VARIANCE SINCE LAST SURVEY
+3% VARIANCE SINCE LAST SURVEY
-8% VARIANCE SINCE LAST SURVEY
+1% VARIANCE SINCE LAST SURVEY
-16% VARIANCE SINCE LAST SURVEY
-2% VARIANCE SINCE LAST SURVEY
+1% VARIANCE SINCE LAST SURVEY
34,601
13,861
35,714
9,901
36,489
10,182
36,657
10,228
17,746
2,208
17,227
1,950
16,091
1,750
16,608
1,613
7,379
594
6,173
684
7,416
5,577
7,475
4,667
4,406
475
4,204
5,457
4,456
467
4,353
470
03
Football Distress Survey
Scottish Football League – May 2014
Football Club Distress – 2012/2014 Scottish Football League
Football Club Distress – 2012/2014 English Football League
14
4
13
46
8
64
3
6
2
12
10
8
8
6
64
42
2
0 0
Mar
12
Mar
12
Oct
12
Oct
12
Mar
13
Mar
13
Oct
13
Mar
14
Oct
13
Mar
14
Number of clubs in distress Number of clubs in distress
Source: Red Flag Alert Source: Red Flag Alert
Ref: BTG 1130(2)/05.14
Offices across the UK. www.begbies-traynor.comBegbies Traynor (Central) LLP, a limited liability partnership, registered in England and Wales No: OC306540. Registered Office: 340 Deansgate, Manchester M3 4LYA member of the Begbies Traynor Group: Specialist Professional Services. www.begbies-traynorgroup.com
Football Distress Survey
For Further InformationIf you would like to discuss any of the issues raised in this survey or would like further details about the services we provide to help underperforming businesses please contact:
Ken Pattullo Partner
T: 0141 222 2230M: 07786 951511E: [email protected]