DUNDEE UNITED REDUCE LOSSES DESPITE SUBSTANTIAL INCOME DROP

Published: 9th March 2018

Reporting the Annual Accounts for the year ended 30 June 2017, Chairman Mike Martin reinforced the implications of playing in the Ladbrokes Championship. The main take-aways include:

• £2.2 million of cost savings across the Club
• Total losses reduced by a third from £1.5 million to £1 million
• Operating losses narrowed by 42%
• Revenue, due to operating in the Championship, dropped by 24%
• Debt reduced to £1.8m from £7.3m ten years ago

Dundee United continues to battle the effects of Championship football and the severe financial disparity when compared to participation in the Premiership. Promotion to the Premiership therefore remains the priority for the Club and the Board remains committed to financing the infrastructure and resource required to provide the best opportunity possible for that outcome.

The Board remains confident that a combination of new revenue streams, including investment in new and improved match day hospitality facilities, balanced with further selective loan finance and carefully targeted cost-cutting will enhance the Club’s Premiership ambitions while addressing the company’s current financial challenges.

The company’s revenue dropped by 24% to £3,499,612 (2016: £4,613,609) due, in the main, to reduced prize money connected to finishing 3rd in the Championship (2016: 12th in Premiership) and the associated drop in match attendances. The continued loyalty of Dundee United supporters attending games at Tannadice was not enough in itself to offset the loss of income from the larger travelling supports of Premiership teams including the loss of two derby games.

Income was also down due to the failure of the team to progress beyond its introduction at Round 4 of the Scottish Cup compared to a semi-final appearance the season before. While the Club enjoyed trophy success in the Irn-Bru Cup and progressed to the Premiership Play-Off Final, both events had a neutral net financial effect due to the related costs and SPFL levies.

Reduction in income was however offset by cost savings of £2.2 million across the Club. Expenses were cut by 30% as the Board took decisive action to deal with the change of footballing circumstances.

The Board feels that this year’s accounts demonstrate its commitment and ability to address the aforementioned challenges. The Board would also like to extend its thanks for the support of all its shareholders, staff, corporate partners and supporters.

Chairman Mike Martin said, “The Club continues to address the financial challenges of life out with the top league. While we remain in the Championship we will continue to incur losses. The support of our corporate partners and fans continues to be impressive and we are very grateful for this.

“Promotion to the Premiership remains the priority for the Club and the Board are committed to financing the infrastructure and resource required to achieve this.”

CCX2 2010 wrote:

Does anyone know if the Andy Robertson money is included in these figures ?

Another set of shocking finiancial results for us to think about whilst we are in division 1, we must be running out of sticking plasters and chewing gum.

What are we going to do about it, any ideas? The foundation is our only way of getting ourselves organised IMO, get some cash behind us and try and play a part when or if a new investor comes along.

115 people have viewed this in the 12 hours it's been up compared to 220 looking at people's predictions for a game against Brechin. Are we shutting our eyes and hoping it will go away.

 

I dont believe it includes the robbo cash.

Absolutely bizarre that only a couple of folk have commented on this.

Think many in the support has been worn down and become apathetic about United's affairs.

A fair bit of spin coming out of Tannadice, but the figures clearly aren't good. Cutting expenses (this from the club's official statement): assuming that includes football staff costs, it's a 'rock and a hard place' scenario. On the surface, paying lower wages should mean a lower league place, but in reality that also depends on the manager spending budgets effectively. The last four managers have failed to do so.

Dreadful to see that 'success' in reaching the play-offs and winning the Challenge Cup had a neutral net financial effect.

Although we all know it was a cynical move at the time, the fact that we all want the club to succeed, the change in leadership/ ownership will have had an effect on everyone’s reaction.

If baldermort was still in charge I imagine the reaction would have been more ‘West Ham -esque’

Btw, what a tremendous effort from them - literally forcing the maggots fucking their club out the director box today, would’ve loved to have seen that at Tannadice

DUSF take on Thursday's meeting (from their FB page)
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"SLG meeting 08/03/18. 19:00-20:00

Directors, Mike Martin (MM) Jimmy Fyffe (JF) and David Dorward (DD)

Attendance - Dundee United Supporters’ Foundation (DUSF), The Federation of Supporters Clubs (Fed), Fans United (FU), Arabtrust (AT) The Business Club (BC), United Ladies of Tannadice (ULT) and a number of independent fans.

Notes – Colin Stewart

MM opened the meeting thanking everyone for attending then spoke for the next 25 minutes.

Key points –
➢ MM is undertaking a root and branch review of all aspects of the club (something we had called for in previous correspondence with the club)
➢ MM clearly stated the recruitment has not been good enough, it has been unfocused and the physical well being of some players recruited is questionable.
➢ MM want to put in a structure that sets out “how we operate”, a Dundee United way regardless of the board or who was the manager or coaches.
➢ Focus would be on the Scotland player market with England and Ireland following, the Continent whilst still there would less to the fore but still considered.
➢ Appointment of Paul Sturrock was the first change.
➢ MM said change would happen, today, tomorrow, the day after and so on not next week, next month sometime in the future.
➢ MM has met all the players, {senior & development squads) and all the non playing staff. Spoke of a Club spirit rather than a Team spirit; indicated some players seemed to grasp that idea whilst others did not.
➢ MM outlined again the drop in revenue since relegation and the cost cutting that has been undertaken.
➢ MM was keen to look forward not backwards, although he accepted lessons had to be learned.

Questions were then invited and the main thrust of the questions came from DUSF and FU with some from the individual members.

Sale of the GE Arena

MM admitted the GE Arena was to clear the loans and provide working capital to the end of the year. Said again same price for the club to buy back with him bearing the fees and costs. He then admitted that his SSIP has entered into (his words) a very generous deal for United via a lease agreement. Why did he not explain this at the time?
(Interestingly in the following day’s evening telegraph MM admitted the sale could have been better explained to the fans). MM said other options had been considered but this one was the best for the club.
At this point JF and DD commended MM for doing what he did.

Influence of Stephen Thomson (ST)

All the directors confirmed ST had no influence or input to decisions now being made all said there had been a lift in atmosphere at the club.
The indication was whilst advice was being offered it was not taken by the ex-chairman. The inference from MM that he offered advice but was ignored raised the question from DUSF “Why did he not resign rather than operate in such an environment, he did not answer. Influence only came when he purchased Justine Mitchell’s shares in the club; MM confirmed he paid money for the shares.
On the question of the sale of the bulk of ST’s shares MM considered this would be most if not all.
MM was confident a sale would happen, negotiations continued with people in the UK and 0verseas.

Newcastle Jets
FU asked MM to explain the Newcastle Jets deal, no answer or explanation was given. It was a lost opportunity for MM to say something like, the deal looked good at the start but as we moved forward it became evident it was not such a good opportunity for DUFC to extend its reach; mistake on our part.

Looking forward the budget was set with 4000 season tickets in season 2018/19 e 10% reduction from 2017/18. The new season ticket package will be shared at meetings on the 17th and 24th March with the SLG and will include a teenage pricing package.

MM said the letter (sent registered post) from DUSF, Fed and FU had not been received, he then said he would not have responded to the questions in writing as he prefers face to face like this meeting. He was then asked if he would answer them face to face with the groups and he said no.

With the sale of ST’s shares MM accepted he may not be there long term but he was not going to stand still. Change will happen whilst he is chairman.

MM thanked all for attending and asked for the fans to give him a chance."

No answer or explanation to the Jets question? Did he just sit there in silence?

thanks for the info. I think budgetting on a 10% drop in season tickets is optomistic

If Mike Martin is confident that ST will sell most of all of his shares and possibly to overseas buyers you'd have to wonder why he bought Justine's shares as he potentially gets left with a bunch of effectively worthless shares if someone else buys ST's.
Did he need them to have a majority in an ST less boardroom?

At any rate I assume that he must have an agreement in place with ST that his shares have to be bought at the same price as ST's when ST sells and being a cynic I can't help but wonder if he's paid a nominal sum to Justine and agreed to kick back the profits to her once the shares are sold?

To me he just looks like ST's  placeman  and therefore his actions will be for ST's benefit and not the club's. That doesn't mean that he won't do things that benefit the club but when push comes to shove if it's a choice between what's good for ST and what's good for the club I think ST will win every time.

The sale to people overseas just looks like an attempt to ramp up the sale price (didn't wee jum pull a similar stint with Eddie T back in the day?) - buying United is not a commercial proposition - loss making and no assets - the only people interested IMO will have an emotional stake in the club.