Forest’s wages hit 200% of income

WE’VE KNOWN for years that clubs in the EFL Championship have dangerously high wage-to-income ratios, but Nottingham Forest’s wage bill now consumes over 200% of their total revenues, the worst in the league. In their 2020-21 financials, Forest revealed that their wages totalled £ 37.2 million while their income amounted to £ 18.4 million. Such a figure, obviously influenced by the impact of the pandemic, should send alarm bells ringing among Forest’s loyal fans.

Forest’s ownership has already written off some £ 73 million in loans, otherwise the club’s net debt would be higher than the current level of £ 36.2 million, a figure that compares favourably to most of the Championship, notably fellow midlanders Stoke City and Birmingham City. They have also converted £ 52 million of debt to equity to ease the situation, including £ 12 million in the last financial year. 

Forest’s pre-tax loss for 2020-21 was £ 15.5 million, slightly less than the £ 15.9 million lost in 2019-20. They have only made a profit once since 2005 and have lost over £ 100 million in the past decade, including in excess of £ 60 million since Evangelos Marinakis took over. The operating loss for the season was more than £ 34 million. 

Forest’s overall revenues dropped by 27% on 2019-20. This was their lowest income since 2015-16 after four seasons when they generated £ 23 million per season. The current level equates to mid-table levels of earnings, but is way behind clubs like Norwich (£ 57 million) and Cardiff (£ 55 million). Over the past two seasons, covid-19 has cost the club some £ 16 million in lost revenues. 

The club has to cancel its shirt sponsorship with Football Index, who went into administration. Furthermore, the redevelopment of the 10,000-seater Peter Taylor stand has been put on hold, but Forest expect planning approval to be granted soon.

Matchday income totalled just £ 1.3 million in 2020-21 owing to empty stadiums for the vast majority of home fixtures. This was an 83% decline on 2019-20. Forest are not alone in virtually wiping out this revenue stream. This was partly compensated by a 12% rise in media income to £ 11 million. Commercial earnings went down by £ 2 million to £ 6.2 million.

Player trading have long been important to Forest and in 2020-21, profit from sales was £ 14.3 million, 27% more than the previous season. This was the second highest in the past 10 years, but way lower than clubs like Norwich City (£ 60 million) and Brentford (£ 44 million). The biggest sale was Matty Cash’s move to Aston Villa, which raised £ 14 million.

Forest spent modestly in a season that saw them finish a disappointing 17th. The signings of Harry Arter (Bournemouth) and Loïc Mbe Soh (Paris Saint-Germain) were all bought for undisclosed fees but Scott McKenna of Aberdeen cost around £ 3.5 million. Transfer income was approximately £ 15 million. Unfortunately, Arter fell out with the club and was sent on loan after just a few months and is currently at Notts County.

The club clearly has a very committed owner, but the wage-to-income ratio is still precarious and can only be unsustainable. Forest, in normal times, have a healthy support base – they have an impressively high percentage of season ticket holders and their average gate in 2021-22 is close to 27,000. This bodes well for the club’s 2021-22 accounts. Forest have made headlines this season in the FA Cup, beating Leicester City and Arsenal, and are not far off contending for promotion. Can they push on and return to the Premier League and transform their financial position?

The Football Alliance: The forgotten league from the Victorian age

WHEN the Football League was formed in 1888, there were already hundreds of clubs in existence across Great Britain. The game had been adopted by thousands of people from many walks of life: schools, colleges and universities; church groups; and industry. From these three strands of society, the majority of clubs owe their origins. The league would comprise 12 teams, so it was inevitable there would be a number of disappointed clubs that could not gain admission.

In 1889, another league was proposed, largely consisting of clubs who were either not invited or whose bid to join had been rejected or ignored. The Football Alliance was inaugurated and like its bigger brother, the teams were from the north and the midlands, emphasising where the growth of football was coming from. As James Walvin noted in his book, The People’s Game, “Football ideally fitted the nature and needs of urban industrial life”.

The Alliance was the brainchild of Crewe Alexandra’s secretary J.G. Hall who had been involved with another competition, The Combination, which floundered due to poor organisation and unfulfillment of fixtures.

The Alliance became a de facto second division of the Football League in all but name. Among the first 12 members were some well respected clubs, such as Crewe, who had reached the FA Cup semi-final in 1888, losing to the eventual winners, Preston North End who would then go on to win the Football League champions and FA Cup winners to clinch the first “double” and earn the nickname, “the Invincibles”.

Nottingham Forest, who had been overlooked in favour of Notts County by the Football League were also involved in the Alliance’s first campaign, along with Newton Heath (Manchester United’s forerunner), Grimsby Town and Walsall Town Swifts. There was also Long Eaton Rangers, who played one season before disappearing into local football.

Small Heath Alliance, founded in 1875 and would become Birmingham City, were also founder members. They played on Coventry Road at a ground that later became popularly known as Muntz Street. The club was based at this stadium for close on 30 years, despite having a very poor playing surface that earned the nickname, “the celery patch”. Muntz Street soon became impractical and the club moved to what became St. Andrews.

There was another team from Birmingham in that first Alliance season, Birmingham St. George’s, which was the result of a series of club mergers, notably Mitchell’s and St. George’s in 1881. The club had a relatively short life, disbanding in 1892 due to financial difficulties as Small Heath and Aston Villa started to dominate local football. 

The Alliance also included some names that fell away from prominence. Darwen FC folded as recently as 2009 (although a successor club was formed immediately), but had their moments in the FA Cup and played in the Football League between 1891 and 1899. Darwen finished sixth in 1890 and 1891 and were then elected to the League. Earlier in the club’s history, they included Fergus Suter in their ranks, reputed to be the first professional player and the subject of the recent TV dramatization The English Game.

Bootle was another northern club that folded before being reformed. The original Bootle club was founded in 1879 at a time when the Merseyside town was growing rapidly. It was a popular home for wealthy merchants who prospered from the rise of Liverpool as a port. Bootle’s main rivals were Everton and when the Football League was being set-up, the organisers only required one club from the Liverpool area. Bootle missed out but enjoyed a very successful year in 1889-90, finishing runners-up in the Alliance by four points and also reaching the quarter-finals of the FA Cup, losing 7-0 to Blackburn Rovers. Bootle later became founder members of the second division in 1892 but resigned after a solitary year.

The Alliance clubs fared well in the FA Cup in 1890 and The Wednesday reached the final after beating Football League members Accrington, Bolton Wanderers and Notts County on the way. Wednesday were a decent side and had England internationals in Teddy Brayshaw and Billy Betts in their line-up, as well as one of the early adopters of man-to-man marking, Jack Dungworth. Their star man was Albert Mumford, known as “Clinks”, who scored the vital goals against Bolton Wanderers in the semi-final.

Blackburn, their opponents in the cup final, easily won by 6-1, but reaching the final highlighted there was talent outside the League. Wednesday also won the Alliance, but the following season saw them, bizarrely, finish bottom, before recovering in 1891-92 and securing election to the Football League. 

The second champions of the Alliance, in 1891, were Stoke City, who had finished bottom of the Football League in 1889 and 1890 and were not re-elected. Stoke had retained players who appeared in the League and their squad included players like Tommy Clare and Bill Rowley, who had been capped by England. Their leading scorer was the extremely versatile Alfie Edge, who netted 12 goals in 22 games.

In 1891, the first hint of a southern entrant came in the form of Royal Arsenal, who had just turned professional. They expressed an interest in joining the Alliance, but they missed their chance. They did join the Football League in 1893 as Woolwich Arsenal. 

In 1892, the final year of the competition, Nottingham Forest were champions, a team that had stunned the football establishment by beating Preston North End in the FA Cup in front of 20,000 people. The overall standard of the Alliance was evident when a representative game with the Football League at Sheffield ended all-square. As the League sought to expand, the union of the two leagues took place in 1892, allowing the Football League to create an official second division. 

The Alliance was short-lived, perhaps, but it proved there was strength in depth within the football community and as the Football League grew in confidence, its merger was inevitable. Despite its important role in spreading organised football, the competition has been somewhat overlooked in the history of the game.