CRYSTAL Palace have provided some insight into their 2019-20 financial results and they appear to be consistent with many of their peers, the pandemic making its mark on the club’s fiscal strength.
Palace lost £ 58 million pre-tax, a shift of some £ 63 million from the previous season when they recorded a £ 5 million profit. The club’s revenues totalled £ 142.3 million, a drop of around 8.5% on 2018-19. Interestingly, Palace’s income for 2019-20 is higher than West Ham United’s, although it has to be remembered that Palace extended their financial year to July 31.
The club calculated that the current crisis will cost them £ 30 million over two seasons, and they borrowed that same amount towards the end of the season to boost their cash flow. The club has zero net debt at the end of July 2020 with a cash position of £ 58.4 million, largely attributable to the borrowing.
The lower revenues were not matched by a drop in wages, which went up from £ 120 million to £ 132.4 million, taking the wage-to-income ratio to 93%.
Palace were relatively quiet in the transfer market, generating net income of £ 43 million thanks to the £ 50 million sale of Aaron Wan-Bissaka to Manchester United. Their purchases were fairly modest, including James McCarthy from Everton (£ 3 million) and Jordan Ayew from Swansea (£ 2.5 million).
Although Palace began 2019-20 reasonably well, they had a dire end to the campaign, losing seven consecutive games. Their star man, Wilfried Zaha, is now 28 years of age and clubs are queuing up to buy him, in which case, Palace will need to manage his departure well to maximise their income. Arsenal, Chelsea, Everton and Manchester United are reputed to be interested in the Ivory Coast international. He has two years remaining on his contract and is valued at between £ 30 and 40 million. The future is also uncertain for Palace’s popular manager, Roy Hodgson, whose contract ends this summer. Now 73, Hodgson may be replaced by a younger man.
Palace, who are in their longest-ever top flight run, are safe this season and are likely to finish in the places below mid-table. In the past two years, they have finished lower than the previous campaign and in 2020 they ended up in 14th. Such a trend can land a club in trouble, so in 2021-22 it will be important for Palace to move forward and attain some consistency. If Zaha does leave, that might provide the resources needed to add more quality to their squad.
Palace will always be overshadowed by the bigger London clubs, but South London is a huge catchment area and the potential is there for a successful challenger to emerge. Palace’s challenging is acquiring the necessary scale to become a bigger, more financially powerful club. Selhurst Park is one of the most atmospheric stadiums in London, but can Palace move from being a 25,000 to a 40,000 club? If they want to be contenders, it may be the only way they can step up a level.