Huddersfield Town reports profit in new financial accounts as income and wages fall by millions


Huddersfield Town’s financial accounts for the 2020/21 season have been released via Companies’ House, giving an overview of where the club stands heading into the current season.

The club’s financial year runs from July 1 to June 30 each year, which means that each set of accounts covers approximately one season each. And despite a significant drop in club revenue, largely thanks to the effects of playing the whole season behind closed doors due to covid, the club have actually recorded a profit of £2.6million over the course of the year. last financial year.

There’s more than that to digest, so join us as we bring you Town’s account headlines for July 2020 through June 2021.

Read more: Huddersfield Town’s summer transfer needs assessed and prioritized

Huddersfield Town earnings 2020/21

Relegation from the Premier League in 2019 saw revenues drop from £119.1m in 2018/19 to less than half that of 2019/20 (£52.7m) – and Town have again faced a drop in revenue last season, largely thanks to parachute payments being cut and games played behind closed doors all season. This meant an 8% drop in revenue from £52.7m to £44.5m. This was composed as follows:

  • Earnings on the day fell from £4m to £1.7m. We suspect this includes revenue from season ticket sales that fans opted to redeem via iFollow once it became clear that attending matches would not be possible.

  • TV and league revenue (including parachute payments) fell from £44.7m to £40.4m

  • Trading revenue fell from £2.4m to £0.9m

  • Communications revenue rose from £115,000 to £484,000 – we believe this may include match streaming pass sales via iFollow.

  • Retail revenue fell from £1m to £0.6m

  • Lottery revenue fell from £414,000 to £282,000

  • Restoration income fell from £77,000 to £103,000

Huddersfield Town’s overall debt position 2020/21

The city had bank loan debts of £27m in June 2020, and these had fallen to £12.6m in June 2021, a drop of £14.4m. The City therefore also paid £1m in bank loan interest and £1.6m in other loan interest in 2020/21, for a total of £2.6m in interest on loans. That’s down from the £3.6million in interest payments they paid in 2019/20.

The majority of their debt remains the £34million owed to Dean Hoyle in the form of loans he made to the club during his ten years as chairman before Hodgkinson bought a 75% share of the club in 2019. Hoyle did not receive any refunds. on his £34m loans from the club in the 2020/21 season. Hoyle is of course currently in the process of regaining full control of the club.

Town received a £500,000 loan from a ‘related party’ in the 2020/21 financial year – this appears to be an investment made in the club by Hodgkinson through one of his other companies, most of which are since joining the administration. As of June 2021, this figure appears to be the entire investment Hodgkinson has made in the club in the form of loans, although he may also have invested money in other ways – in the form of loan money. sponsorship, for example.

The club’s cash balance has fallen from £10.6m in June 2020 to £1.3m in June 2021. The overall effect is that Town’s net debt in June 2021 stood at 48 £.9million – just slightly less than the previous year’s net debt figure of £. 50.4m.

Huddersfield Town 2020/21 wage bill

Huddersfield Town’s wage bill fell by £5.7m (or 19%) from £30.3m in 2019/20 to £24.6m last season. This was helped by the departures of a number of well-paid players acquired during the club’s time in the Premier League. That puts Town’s wage-to-turnover ratio at 55%, one of the lowest in the division and 2% lower than last season.

However, that is still around £3m more than Town spent on wages during their promotion season in 2016/17, when the figure came in at £21.7m – a figure that was greatly inflated by a substantial series of promotion bonuses. The figure for the previous year (2015/16) was £11million.

When the current season’s accounts come out next year, we can expect to see the wage bill again drop significantly, with Jonathan Hogg now the only senior player left from the club’s move to the Premier League following player departures. (relatively) well paid. like Christopher Schindler and Alex Pritchard last summer.

Huddersfield Town transfer activity 2020/21

There has been a significant decrease in the amount of money the club have received in exchange for loaning players, from £5.7m in 2019/20 to £0.6m last season. Players on loan in 2019/20 included Aaron Mooy, Ramadan Sobhi, Ben Hamer, Isaac Mbenza, Florent Hadergjonaj, Adama Diakhaby and Terence Kongolo.

(No official details were provided on which of these players drew a loan fee, but we do know that Mooy’s move to Brighton included a hefty initial loan fee before it became permanent, and former managing director Mark Devlin indicated in August 2020 that Sobhi’s loan deal with the Egyptian side of Al-Ahly included substantial loan fees.)

Last season, however, Reece Brown was the only first-team player on loan, joining Peterborough United, then in League One. A number of youngsters also came out, including Scott High at Shrewsbury Town for the first half of the season.

Sobhi’s permanent transfer to another Egyptian team, Pyramids, was one of many player sales made in the last financial year (as a reminder, it’s from July 2020 to June 2021). In addition to Sobhi, the account narrative also specifically notes the sales of Karlan Grant to West Brom and Terence Kongolo to Fulham as “key sales” to help them record a profit on the sale of player registrations totaling 10, £1 million.

It’s important not to take this figure at face value, however, as it’s based on a complicated accounting calculation that gradually writes off the value of a player’s purchase price over time – a process called depreciation. In reality, the accounts seem to suggest Town spent £2m on new players in 2020/21 while making player sales worth £21m. These figures would not include any future additions.

The supporting narrative also shows that “since the end of the year” (i.e. between June 30, 2021 and March 2022), the club “has acquired and disposed of a number of registrations from players”. The net income from these transactions is £0.1 million.

In other words, the net effect of the club’s activities during the summer 2021 and January 2022 transfer windows results in a net profit of around £100,000. It is unclear at this stage whether this includes payments to agents on the club’s various free transfers or the deal reached when Isaac Mbenza was released, but it would appear that the only player to have attracted a transfer fee this season is Juninho Bacuna, who left for Rangers. (Bacuna has since moved again, to Birmingham City.)

Huddersfield Town profit 2020/21 and conclusions

Before taking advantage of it, it is worth remembering (as we do every year) that much of that number comes from how player sales are recorded. Put simply, it can be very misleading: if you sign a player for £5m and sell him for £15m five years later, the profit in accounting terms would likely be recognized as £15m (and not £10m as you might expect), because that initial outlay of £5m turns the player into an asset which (as far as accountants are concerned) devalues ​​over time, even if in reality its value has tripled.

We also have to acknowledge the football side of things for a moment saying that while the club’s tight financial management in 2020/21 has set them up to have a much better run of things in the current campaign through a series of cautious summer loans signings and free transfers, if Town had finally been relegated to Ligue 1 last season their situation would obviously not be so good. They cut things well, that’s for sure; but eventually they got away with it.

In the end, therefore, the bet paid off, and it is good news for Town that they are back to a pre-tax profit of £2.6m after suffering an equivalent loss of 8.5 million the previous year, and an operating loss of just £5 million compared to £22.7 million the previous year. All of this while making a slight dent in their net debt figure – despite coming through the season with seemingly minimal investment from the owner and playing the entire campaign behind closed doors.

This has been helped considerably not only by their work in the transfer market, but also by the fact that Hoyle has restructured his loan repayments during the 2020/21 season (as revealed in last year’s accounts), in principle pushing back his next reimbursement to February 2022 – although the club have effectively resumed (or will resume) these reimbursements in light of Hoyle’s return to a position of direct day-to-day operational and financial responsibility remains to be confirmed.


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