West Ham’s last set of financial accounts show increases in all areas. The club is still very much on a big upward curve after over-taking both Everton and Newcastle in terms of financial might with the seventh highest turnover in the Premier League.
The Hammers turnover increased 17.7 per cent to £142.1m and within that figure, ticket sales for the last season at the Boleyn Ground rose to an impressive £26.9m TV rights income grew to £86.7m and Commercial and Sponsorship revenue was up by 31 per cent to £19m while Retail and Merchandising sales grew by 29 per cent to £9.3m.
The club managed to record an operating profit of £31.5m, excluding player trading, but this was reduced to a more modest profit of £1.2m before taxation.
The club recorded a £4.8m loss on the books when other factors were included after spending £53.3m on bringing in new players, which saw us take on a total wage bill of £84.7m and invest £4m in Rush Green training ground. A further £45.7m was spent on players during the 2016/2017 season.
The external bank loans were completely paid off in July 2016 following the sale of the Boleyn Ground with the accounts claiming an £8m profit in the sale.
The Boleyn Ground and land was sold to developers for £38m with £15m going to pay off bank debts that were mortgaged against it and a further £15m going to stadium owners LLDC to contribute to the £323m transition costs of the former Olympic Stadium. While it is great that the Hammers have jumped up to seventh spot they remain a long way behind the top six in terms of financial might.
Manchester United leads the pack with £515.3m followed by Manchester City on £392m, Arsenal are third on £350m and Chelsea fourth on £329m. Liverpool and Spurs have yet to announce their figures but Liverpool recorded figures of £298m in 2015 while Spurs had a £196m turnover in 2015 so we are unlikely to catch them up anytime soon.
West Ham owners also rewarded West Ham Vice Chairman Karren Brady with a 40 per cent pay increase. The highest paid West Ham director, employed by parent group WH Holding, Brady was paid £907,000 up from £646,000 in 2015. Her £261,000 increase came in the last season at the Boleyn Ground as the Hammers prepared to move the London Stadium. In 2011 after the Sullivan and Gold takeover, she earned £256,000 but that was increased to £427,000 in 2012.
In 2013 Karren Brady earned £1.63m which included a £1m bonus for winning the London Stadium tenancy deal although the bonus payments are thought to have been staggered over five years. In 2014 her salary returned to £636,000 with a modest £10,000 rise in 2015 to £646,000.
Her £907,000 yearly pay packet pales into insignificance given those earned by her London Premier League rivals. Spurs Chairman Daniel Levy and Arsenal’s CEO Ivan Gazidis for example both paid themselves £2.6m in 2016. And the average Premier League footballer earns £44,000 per week, or £2.2m per year.
Despite being bankdebt free, the club continued to loan money from private lenders tied to their TV money income. The Hammers repaid £30m of loans from JG Funding in May last year but took out a new credit facility with lenders Media and Rights Funding worth another £30m, which is payable by July this year through direct payments by the Premier League to the lenders.
Overall, the figures are moving in the right direction. Next year’s figures, which are unlikely to released until next February, are likely to smash the £200m barrier. In those accounts will be the £38m income for the sale of the Boleyn ground, the first year of the new bumper TV deal worth £128m for finishing in seventh spot, and ticket sales at the London Stadium are expected to rise by £13m to around £40m.
You would expect Commercial and Sponsorship to rise by another 30 per cent to around £25m and retail to double to £19m in an enlarged and expanded mega store. Not forgetting the £25m we received for the French man. Incredibly our turnover for the year ending May 31, 2017 could come in at a staggering £275 million. In 2012 our turnover was just £46m following relegation.