Aberdeen wary of the Glasgow gap
Posted on December 4, 2019
ABERDEEN may be Scotland’s third club at the moment but their financial figures for 2018-19 highlight the chasm between the Dons and the Old Firm, Celtic and Rangers. Derek McInnes’ team plays host to Rangers this week with nine points separating the Gers from Aberdeen.
This is only one aspect of the difference between the two clubs – Aberdeen’s turnover may be close to £ 16 million, but Celtic and Rangers generated revenues of £ 83 million and £ 53 million respectively in 2018-19. Furthermore, Aberdeen’s wage bill of £ 9.2 million is dwarfed by Celtic’s £ 56 million and Rangers’ £ 34 million.
Aberdeen finished fourth in the Scottish Premiership in 2018-19, their lowest position since 2013. Since Derek McInnes took over in the summer of that year, Aberdeen had not finished outside the top three and had been Premiership runners-up for four consecutive seasons. In 2017-18, they had reduced Celtic’s margin at the top from 30 to nine points.
Despite a marginally less successful season, Aberdeen’s turnover increased by 3% to £ 15.9 million, with gate receipts up by 13% to £ 5.4 million. Aberdeen’s average attendance at Pittodrie was 14,113 which was 5% lower than the 2017-18 campaign. The Dons lost Adam Rooney to Salford City at the start of the season, who were then in the National League in England. The transfer was something of an eyebrow-raiser in Scotland for Salford, the non-league club backed by the so-called “Class of 92”, paid £ 375,000 for Rooney and were reputed to be paying him £ 4,000 per week.
Despite higher gate receipts and commercial income, Aberdeen made an operating loss of more than £ 1,000,000 and an overall loss of £ 5 million. Aberdeen have only made an overall profit once in the past 10 years. Broadcasting income totalled £ 3.1 million, some 17% lower than 2017-18. The club also suffered an impairment charge of £ 4.25 million in connection with the Pittodrie Stadium.
Aberdeen have been looking to move for the best part of a decade after realising that further development of Pittodrie was not possible given the age of the ground and restrictions from the land surrounding the stadium. The club has found a site at Kingsford and the judicial review was favourable. Aberdeen admitted that the funding for a new £ 45 million stadium is still in its early stages, but the sale of Pittodrie, which has been valued at £ 11 million, should help. In the meantime, the club continues on a path of cost efficiency and increasing turnover, despite local economic challenges.
The Aberdeen coffers should be swollen a little if they sell leading scorer Sam Cosgrove, the 22 year-old who joined from Carlisle United in 2017-18 and has scored 37 goals in 51 games, including eight in the Scottish Premiership this season. Championship clubs in England, Stoke City and Middlesbrough, have shown an interest in the former Everton youngster. Manager McInnes has said that it is a possibility that Beverley-born Cosgrove will be sold. Another player that could be on his way is highly-rated Scotland defender Scott McKenna, who handed in a transfer request earlier this season.
Aberdeen have lost just three times this season in the league, but two of those defeats were demoralisingly heavy, 4-0 at home to Celtic and 5-0 away at Rangers, two results that underlined the relative strength of the Glasgow sides. Aberdeen went out of the Europa League to Rijeka in the qualifying rounds after winning through two rounds.
New chairman Dave Cormack, a US-based software entrepreneur, recently took over after Stewart Milne stepped down after 22 years. Cormack has promised £ 5 million in fresh investment to add to the £ 11 million he has already pumped into the club. Furthermore, AMB Sports & Entertainment have taken a 10% stake. Aberdeen have also announced a partnership with the dynamic MLS club Atlanta United, which is part-owned by AMB. Atlanta president Darren Eales has joined the Aberdeen board.
Cormack has one eye on closing the gulf between his club and the likes of Celtic and Rangers: “The new investment and partnership with Atlanta will allow us to punch above our weight and try to level the playing field against significantly higher income generated by Celtic and Rangers.”
While this sounds exciting, it also represents part of a growing trend with US investors and clubs looking to Scotland and other European countries. While Eales says this is not part of a multi-club strategy akin to the approach of Red Bull or City Football Group, if the Atlanta partnership is successful, it could just whet their appetite for further investments in other countries. It’s early days, but with a new stadium somewhere in the future and a broadening of relationships, the future could be very exciting for Aberdeen.