#CardiffCity financial results for 2018/19 covered a season in the Premier League following promotion, but their stay in the top flight was brief, as it culminated in relegation to the Championship after they finished in 18th place. Some thoughts in the following thread.
Unfortunately, the 2018/19 season will also be remembered for the tragic death of striker Emiliano Sala in a plane crash following his transfer from French club Nantes. #CardiffCity are disputing the payment of a transfer fee, but have “prudently” booked a £19.5m provision.
#CardiffCity swung from £39m loss before tax in the Championship to £3m profit, thanks to revenue surging £90m from £35m to £125m, though competing in the Premier League increased expenses by £31m. Still reported £0.8m loss after tax, due to £3m tax charge. 
Main driver of #Cardiff City £90m revenue increase was broadcasting, up £85m to £107m due to significantly more lucrative Premier League TV deal, though match day also grew £3m (63%) to £7.9m, while commercial was up £1.9m (22%) to £10.4m. Profit on player sales flat at £2.2m.
#Cardiff City wage bill rose modest £5m (11%) to £54m, though 2018 included promotion bonus. Player amortisation grew £10m to £15m & other expenses up £3m to £20m. Also £12m player impairment and impact of 2018 stadium impairment reversal, but £6m reduction in interest payable.
As a technical aside, #CardiffCity prior year £36m post-tax loss was reduced to a £9m net loss (“Total Comprehensive Expense”) after an external revaluation increased the value of the stadium by £29m (£27m net of tax). No repeat in this year’s accounts.
#CardiffCity £3m profit was not huge, though would have been £22m if £19.5m Sala provision excluded. In any case, this is still better than 7 of the 13 Premier League clubs that have reported to date in 2018/19, as they have all made losses, including #EFC & #CFC both over £100m.
#CardiffCity profit on player sales fell slightly from £2.4m to £2.2m, mainly for sell-on fees of prior year sales. This is the lowest profit from this activity reported in the 2018/19 Premier League to date, miles below the likes of #CFC £60m, #LCFC £58m and #LFC £45m.
Since Vincent Tan bought #CardiffCity in May 2010, the club has accumulated £130m of losses, averaging £14m a season. Last season was only the second time they made a (small) profit in this period, though better than £12m loss in their last season in the Premier League in 2014.
Furthermore, #CardiffCity 2015 £4m profit was entirely due to once-off factors (£13m debt-write-off and £13m interest adjustment). If the club is correct that they will not need to pay a transfer fee for Sala, then future financials will be boosted by reversal of £20m provision.
#CardiffCity have made very little money from player sales, only £22m in total in the last decade, almost half or which (£10m) came in a single year (2015). This season should be better after the sales of Booby Reid to Fulham, Kenneth Zohore to WBA and Bruno Manga to Dijon.
#CardiffCity EBITDA (Earnings Before Interest, Depreciation and Amortisation), considered a proxy for cash operating profit, as it strips out player sales and exceptional items, improved from £(9)m to £51m, much better than £22m last time they were in the Premier League in 2014.
#CardiffCity £51m EBITDA is currently the 7th best in the Premier League, which is an impressive achievement, though many clubs are yet to publish 2018/19 accounts. Around the same level as #WWFC £50m, but miles better than the likes of #EFC £(15)m and #LCFC £(6)m.
#CardiffCity revenue obviously grew significantly after promotion (by £90m to £125m), but it was also around 50% (£42m) more than last time they were in the Premier League (£83m), due to higher TV deal. Will dramatically fall in 2019/20 to around £63m, despite parachute payment.
Despite the significant growth, #CardiffCity £125m revenue is by far the lowest reported to date in the 2018/19 Premier League (though Burnley, Bournemouth and Huddersfield are still to publish). For some perspective, around a fifth of Manchester United’s £627m.
#CardiffCity TV money included £103m from the Premier League. Received £83m equal payment (50% domestic deal, 100% overseas & commercial) plus £6m merit payment (25% domestic, based on league position) and £14m facility fee (25% domestic, based on number of times shown live).
As a result, an amazing 85% of #CardiffCity revenue came from broadcasting, though to be fair this is far from unusual in the top flight. In fact, 13 of the clubs in the Premier League earn more than 70% of their total income from TV.
#CardiffCity TV income will significantly fall in 2019/20, though will be cushioned by £43m parachute payment, which is much higher than £4.6m solidarity payment that most Championship clubs receive. Will only get 2 years of parachutes, as they were relegated in first PL season.
#CardiffCity match day income rose by £3.0m (63%) to £7.9m, even though they staged 7 fewer home games, as average attendance increased by 56% from 20,164 to 31,409. Nevertheless, this revenue was still one of the lowest in the Premier League, though is club’s highest since 2014.
#CardiffCity attendances have risen three years in a row from 16,427 in 2016 to 31,409 in 2019, though the number is very dependent on whether they are participating in the Premier League or Championship.
#CardiffCity 31,409 attendance was actually mid-table in the Premier League, sandwiched between #LCFC and #WWFC. This was around 4,000 (15%) higher than the last time the Bluebirds were in the top fight in 2013/14.
#CardiffCity commercial income rose 22% (£1.9m) from £8.5m to £10.4m, “leveraging the benefits associated with increased exposure and global profile of the Premier League”. However, still one of the lowest in the division. In comparison, Big Six earned between £275m and £111m.
Since 2011 the #CardiffCity shirt sponsor has been Visit Malaysia, reportedly worth £3m a year, while Adidas have had a long-term kit deal since 2015. The 2018/19 season saw the club sign JD Sports as its first sleeve sponsor.
#CardiffCity wages only rose £5m (11%) to £54m, though prior year was inflated by hefty promotion bonuses. The modest increase meant that the wage bill was about the same level as when Cardiff were last in the Premier League in 2014. Player wages were up £11m, so others fell £6m.
#CardiffCity £54m wage bill was by far the lowest in the Premier League, so it is unsurprising that they struggled. To give some perspective, it was £9m below Huddersfield’s 2017/18 wages. Will fall in Championship following departure of some high earners and relegation clauses.
#CardiffCity wages to turnover ratio dropped (improved) from 139% to 43%, which is one of the lowest in the Premier League, only above #THFC 39%. Again, as a meaningful comparison, Huddersfield’s metric was higher in 2017/18 at 50% (though included bonuses for staying up).
#CardiffCity highest paid director’s remuneration fell two-thirds from £1.4m to £485k, as no repeat of Championship promotion bonuses. This was around the same as #WWFC £470k, though much less than the likes of #MUFC Ed Woodward and #THFC Daniel Levy, who both got more than £3m.
#CardiffCity player amortisation, the annual charge to expense transfer fees over the length of a player’s contract, tripled from £5m to £15m (same as last season in Premier League). Also booked £12m impairment after termination of player contracts, e.g. Madine, Peltier.
Despite the increase, #CardiffCity player amortisation of £15m was the lowest in the Premier League. For some perspective, this was at least £100m below big-spending clubs like #CFC £168m, #MCFC £127m and #MUFC £126m.
#CardiffCity £12m impairment charge is common practice for clubs relegated to the Championship, e.g. in 2017/18 Stoke City £29m, Swansea City £15m. This charge reduces the value of a player in the books to an amount based on directors’ assessment of a player’s value.
#CardiffCity spent £38m on players, including Sala, Murphy, Reid, Cunningham, Smithies and Bacuna. This is around the same as the previous 4 years combined (£43m) and second highest in the club’s history, but was the second lowest in the Premier League, only above Watford.
That said, #CardiffCity £24m average annual net spend over the last 2 years was a reversal of the preceding 3 seasons, which averaged annual net sales of £4m. Since the accounts were published, the club has spent £23m on acquiring players.
#CardiffCity gross debt rose by £7m from £74m to £81m, split between £40m owed to owner Vincent Tan (£32m repaid in 2019) and £41m other loans (up £39m). Debt would be much higher without Tan converting £95m into capital and writing-off £23m in the last decade.
#CardiffCity £81m debt is mid-table in the Premier League, much lower than some other clubs, though many of these have taken on debt for new stadiums or training grounds, e.g. #THFC £466m, #BHAFC £280m, #AFC £217m and #LFC £129m. Club also owes £10m in transfer fees.
#CardiffCity paid £1.9m interest in 2018/19, up from £1.3m, all for other (external) loans. Around £15m of Tan’s loan is at 7%, but the interest to date has been waived. The remaining £25m of the owner’s debt is interest-free.
Interestingly, in 2018/19 #CardiffCity repaid £32m of Tan’s debt, which was then replaced by £39m of external funding. The club generated £32m cash from operating activities, but spent £36m (net) on players, £2m on infrastructure and £2m interest.
As a result, #CardiffCity cash balance fell £1m from £3m to £2m. This was one of the lowest in the Premier League, only above #BHAFC £1m, but far below the likes of #MUFC £308m, #AFC £167m and #MCFC £130m.
Tan and his friends have put a huge amount of money into #CardiffCity, around £173m (£159m loans & £15m new share capital). This has funded £96m of player purchases (net) and £24m of infrastructure investment, while covering £58m of operating losses.
Accounts note Tan “will continue to support the club in the foreseeable future”, but adds “long-term funding is not guaranteed”. However, he has sold half his stake in MLS club Los Angeles FC (for $70m) and is set to sell the rest, apparently so he can concentrate on #CardiffCity
#CardiffCity executive chairman Mehmet Dalman summarised the club’s current position, “We will undoubtedly face challenges following our return to the Championship in balancing the change in our revenue, albeit softened by the receipt of parachute payments.”
