Dundee United in profit amid gloomy season

IT HAS been a bad season so far for Dundee United – bottom of the Scottish Premiership, out of Europe early on, hammered 9-0 by Celtic and 7-0 by Alkmaar. It has certainly been a tough baptism for their coach, Liam Fox. While their home form has improved, their away results continue to be dire; there’s no doubt that Fox will have his work cut out to take the Tangerines away from relegation trouble.

But from a financial perspective, Dundee United saw their revenues rise from £ 3.8 million in 2020-21 to £ 8.3 million in 2021-22, the highest level of income over the past decade. Their pre-tax loss was £ 1 million, an improvement on the previous season which saw them lose £ 2.6 million. Post-tax, Dundee United made a profit of £ 280,000. The financials include a £ 600,000 covid insurance payout as well as a £ 100,000 Scottish government grant.

The club’s wage bill rose to a record £ 5.9 million, representing 71% of income, a vast improvement on 2020-21 when salaries were 132% of earnings. Since 2013, Dundee United’s wages have gone up by 80% and they have doubled since 2017.

Dundee United’s “football” revenues totalled £ 5.3 million (matchday and broadcasting combined) from an average home gate of 6,500 at Tannadice, contributing 64% of income. Commercial activity brought in £ 1.9 million, 23% of the overall total. A final placing of fourth meant they qualified for the Europa Conference League in 2022-23, but the run lasted two games in which they lost 7-1 on aggregate to Dutch side Alkmaar.

In 2021-22, the club enjoyed their best profit on player sales since 2018, about £ 1.3 million from the sales of Lawrence Shankland (£ 1 million to Beerschot) and Kerr Smith to Aston Villa (£ 2 million). They spent £ 435,000 on players, notably the £ 315,000 paid to Ingolstadt for Finnish winger Ilmari Niskanen. Ogren insists that as well as developing their own talent, player trading is an important part of the club’s business model. Over the past 10 years, their net spend is £ 9 million, suggesting the player development strategy is paying off. A total of 17 players from the academy played in the first team

In the summer of 2022, Dundee United were very active in the market and signed Dylan Levitt from Manchester United for a figure thought to be £ 300,000. Levitt is in the Wales squad for the World Cup in Qatar. They also acquired Australian goalkeeper Mark Birighitti from Central Coast Mariners and Rangers’ winger Glenn Middleton.

The pandemic had an impact on the club’s liquidity and although they have a healthy £ 2.7 million of cash, they do have borrowings of over £ 12 million, most of which is due to the club’s owner. Chairman and owner Mark Ogren said that finishing fourth exceeded the expectations they had in 2021-22. He also told fans the club is firmly behind Liam Fox and is confident of reaching the top six by the end of the season. Ogren’s aim is to make Dundee United self sufficient as he has stated that he is not willing to fund the club forever. According to media reports, he has already pumped in approximately £ 13 million.

Aberdeen stadium plan can move them a little closer to the Old Firm

ABERDEEN FOOTBALL CLUB may be in third place in the Scottish Premiership this season, but they are still way behind the Glasgow duo, Celtic and Rangers. After a disappointing campaign in 2021-22, in which Aberdeen finished 10th, their lowest position in a decade, the Dons have regained their place as Scotland’s third club, but their finances reveal just how far behind the big two they are.

Aberdeen’s turnover in 2021-22 totalled £ 13.9 million, a 25% increase on 2020-21. Their pre-tax loss was £ 2.2 million, marginally less than the previous season, largely because their wage bill was up by 10% to £ 10.3 million, representing 75% of income, and other costs climbed by almost £ 2 million to £ 7.6 million. In 2020-21, the wage-to-income ratio was 85%. While the wage bill was more than high enough for the club, it is a fraction of the amount Celtic and Rangers pay their players. Celtic’s salaries totalled £ 58.9 million while Rangers’ were just four million lower than their fierce rivals.

Aberdeen’s income showed a 35% increase in commercial activity, from £ 5.4 million to £ 7.3 million, the biggest contributor – 52.5% – to the club’s turnover. Matchday revenues totalled £ 3 million and were up from £ 2 million, while broadcasting amounted to £ 3.6 million, slightly down on the previous year.

The club has recognised the need to develop a smarter approach in the transfer market. In 2021-22, their profit from player sales was just £ 1 million, barely a third of the profit generated a year earlier. However, this did not include the summer sales of Calvin Ramsey to Liverpool (£ 4.2 million) and Lewis Ferguson to Bologna (£ 3.1 million), which will appear in the 2022-23 statement. Aberdeen also want to focus more on developing their own talent, creating a model similar to some of Europe’s top player traders.

Aberdeen chairman, Dave Cormack, believes the 2021-22 financials demonstrate the club is bouncing back after the pandemic. However, the operating loss totalled £ 5.29 million and net debt stands at £ 3.6 million. There is positive momentum, though, and the club sold record numbers of season tickets for 2022-23.

A new stadium is being planned, which could elevate Aberdeen to a new level. The scheme, which may be part of a significant shoreline regeneration, would cost around £ 80 million and have a capacity of between 16,000 and 20,000. This is not the first concept to be tabled, the club had previously received approval for a ground at Kingsford, but the beach stadium – promoted by the local authority – could have far more financial impact. Cormack said that the most successful regeneration projects always have a centrepiece and the new football arena will provide just that.

Research has suggested the project would provide 260 jobs and £ 6 million in salaries to the community as well as £ 14.3 million of gross value added. Over 50 years, the new stadium could add £ 1 billion into the local economy. Furthermore, Aberdeen envisage that visitors to the area will increase by some 300,000 from the current level of 450,000 per year. Planners have used the redevelopment of Perth that accompanied the construction of St. Johnstone’s McDiarmid Park as an example of what can be achieved.

Solar panels are expected to dominate Aberdeen’s stadium roof and the planners are hoping for a net zero outcome. The first minister of Scotland has aspirations for Aberdeen to become the first net zero city in Europe.

However, no major development comes without hurdles and already, the local council have ruled out public cash being used. This has changed the mood and some are now revisiting the idea of a move to Kingsford. Others believe the council has let the club down, especially as they made a proposal for Aberdeen to remain in the city in the first place.

Aberdeen will be hoping the club returns to European football in 2023-24 after missing out in 2022. They had eight consecutive campaigns in the Europa League between 2014-15 and 2021-22. At the moment, that looks very possible, but longer term, a new stadium can help the Dons close the gap on the Glasgow giants.