Chairman says further 'drastic' cuts are neccessary as Scunthorpe United announce record loss
Outgoing chairman Steve Wharton has warned Scunthorpe United must make 'drastic' reductions to their current operating costs after seeing the club report a record loss for the last financial year.
Figures released today show the Iron recorded a deficit just shy of £2million for the year ending June 30, 2012, as the true cost of relegation from the Championship becomes clear.
-
Scunthorpe United chairman Steve Wharton is concerned at the record loss the club made during the financial year ending June 30, 2012.
The figures cover the whole of last season, when United were back in League One.
They show that the club's wage bill came down by £1.6 million - having topped the £5 million mark for the first-time ever during 2011 - but turnover dipped dramatically, by almost £4.5million, more than three quarters of which can be put down to the drop in Football League funding for being in the third tier rather than the second.
great ranges of all blinds and curtains. call 809887 for your free quote or visit our showroom 139-141 freeman street for our latest deals
Contact: 01472 809887
Valid until: Sunday, June 30 2013
In his annual report to shareholders, Wharton, who will step down and quit the club's board at the end of the current financial year, admitted the shortfall in income had been greater than he had predicted.
And he warned of the need to be more conservative with cash to preserve the Iron's long-term future.
"Adjusting to life in League One proved to be rather more difficult than was anticipated and we finished the season much too close to the drop zone," wrote the chairman.
"Inevitably the poor performances on the pitch, particularly at home, led to a decline in attendances and consequently, gate income was well below budget.
"The drop in total income which I predicted in my last year's report at £4 million in fact became £4.5 million and we were only able to reduce our costs by circa £2 million.
"It is stating the obvious when I say that further drastic reductions in our operating costs are essential to ensure our ultimate survival."
Speaking exlcusively to the Scunthorpe Telegraph, general manager David Beeby said while cost-cutting will continue, United will also look to do more to try to increase revenue, like they have done with the club restaurant, where turnover was up more than £30,000 on the previous year.
"Of course we're trying to increase revenue in all different areas," he explained.
"But a lot of that is affected by the division we're in.
"Most of the decreases (in turnover) are affected by the crowd, the reduced number of away fans we get and the reduced number of home fans we're currently experiencing due to results on the pitch.
"One area of the club where we did see an increase in turnover was the hospitality area on the back of extending the exec lounge which enabled us to open up a new market on non matchdays.
"We have to utilise that to try to generate extra revenue.
"Ultimately though it's about reducing costs to a level we can afford while trying to maximise revenues where possible."
In addition to his comments on finance and the decision to dispense with the services of manager Alan Knill just over a fortnight ago, Wharton welcomed the formation of the Iron Trust, who aim to give supporters a greater say in the way the club is run.
"A Supporters' Trust has recently been formed by a number of dedicated supporters and the club is doing all it can to assist the trust to develop, with the ultimate aim of a direct involvement in the running of the football club," he included in his report.
"I would urge all our fans to support the trust in any way they can.
"Whilst I think it would be an impossible task for the trust to have total control of the company, I do think it is important that our fans can have as close a relationship as possible with the Board of Directors.
"I have always said, and still believe, "The club belongs to the fans, the directors are merely custodians"."
The Iron's Annual General Meeting will take place on Monday, December 10, from 7pm, in the executive lounge at Glanford Park.
For an in-depth analysis and breakdown of the Iron's finances, including further comments from Steve Wharton and David Beeby, see this week's Scunthorpe Telegraph, out Thursday, November 15.
Comments
by Deereyme
Friday, November 16 2012, 8:43PM
“So, was your comment about red and green arrows being democratic a joke or not? Come on, the silence is deafening. Or is it simply too boring and above you now? I rest my case.”
by Deereyme
Friday, November 16 2012, 8:39PM
“Says who? You? Can't and wouldn't speak for DFlated but I certainly stand corrected and bow to you superiority and academic supremacy. Not actually any talking going on though is there Prof? Back to school me thinks. Oh, I get it, responding to inacurracies, myth spinning, accusations and defamation can be dismissed as 'boring' now I see. It just gets better and better.”
by ironite
Friday, November 16 2012, 5:22PM
“This is getting really boring now. It's just the two of you talking now.”
by oscarmoggy
Friday, November 16 2012, 5:05PM
“I think these last two posts (at 2.54pm & 3.38 pm) illustrate the point I was making in my last post.”
by DFlated
Friday, November 16 2012, 3:38PM
“Contrition - there's a big word. You have sussed how to work the arrows though haven't you, not bad for a poor professor.”
by Deereyme
Friday, November 16 2012, 2:54PM
“Sorry oscarmoggy, all I can see from you and ironite is misquotes, inaccuracies, demonising and patronising bile. Despite what ironite would wish all who read this to believe, I didn't state: "I have all the answers, but I'm not telling you because why should I, I'm not paid for it". Please, if you're going to try and win your argument don't make the golden mistake of trading in lies. Apart from that, I have some practical ideas yes, but since these have been offered numerous times through the appropriate channels with no reply and then, lo and behold, introduced with no credit or appreciation, I refuse to do this anymore. If you know so much about the way to run a business ironite, or how not to run a business, you should know how commerically insensitive that sort of thing is, though I suspect you know more about anlaysing than actually creating something yourself [hey, cue accusations of 'belittling']. On another note, personally I don't deny Wharton's insertion that he hasn't found anyone remotely interested in buying him out but, as I've said before and partly because of his 'cast the net further' quote, I wonder if enough has been done to lure a new owner? There is absolutely nothing wrong with that thinking because we don't actually know what has been done, though if the club's usual amateurish approach has been taken then it's fair to say, perhaps not enough? Lastly, you're supposed to be an academic ironite - do you really think red and green arrows are democratic or is this a joke? Go on, conveniently say it's a joke and stick your new job title after it. As for you oscarmoggy, have you come across 'hero worship' before? And I don't know why you keep falsely trying to tarnish me with this 'moaning, belittling, no solutions' tag when, though I'm not prepared to be bitten again by offering the club solutions, I very recently offered the macro-solution of sacking Knill, instilling Laws, followed by a root and branch examination of the the way the club operates. And hey, you know what ironite, that got lots and lots of yer 'democratic' green arrows! I think you'll find, if you can be bothered to look, that I've been offering Laws and co plenty of ideas and encouragement just lately but they're unlikey to read it and take it on board, lest you both forget this is a comments arena and not a solutions thinktank? I say all the above because, hand on heart, I believe the attitude and approach you display and promote are the reason the club has been stuck in this rut for so long and that your comments are dangerous and serve only to bring the club further and further down until we cease to exist. However, I will sign off with this observation: I don't have all the answers but I know some people who should have.”
by oscarmoggy
Friday, November 16 2012, 12:25PM
“You dont need to be an expert in commerce and marketing or to have read Alan Sugar's book to have an opinion on whats wrong with the club. However to many come on here (Deereyme and Dflated included) and moan, criticise and belittle every aspect of the club without offering anything substantial soloutions to what they percieve are the clubs problems. It's easy to point a finger and apportion blame like they do, but at least give us some alternatives.
As for reading books, there are lots of people who can write a book about how not to run a football club but how many can write one about how to run a football club.
I await to be corrected and belittled !”
by ironite
Friday, November 16 2012, 12:23PM
“You know what? I can't negotiate with anyone oblivious to the possibility of contrition or flexibility. How about we just let the red/green arrows settle this democratically?”
by DFlated
Friday, November 16 2012, 11:28AM
“Adversarial - big word. You like big words, makes you sound professorial. You seem to be in a state of denial. As Sickasaparrot has pointed out there are so may simple ways to make the matchday experience so much easier than it is or more pleasant than it is. All of them low on cost but high on return.
I know many people who won't go to GP because of the lack of ease to buy a ticket, the biggest being pay on the gate for the seated areas. The loo situation is basic hygiene, the outlet catering is abysmal and a joke, many other clubs are offering schemes and BOGOF offers. SUFC try things and then they suddenly disappear. What has happened to the Fans Forum? Not that it did anything apart from brown nose to the club with their sycophantic praise of the chairman (like when when Ajose came).
The best service it served was for the club to announce in the meeting minutes that they would not be building a new stand whilst choosing not to release the same news in the mass media.”
by ironite
Friday, November 16 2012, 10:47AM
“Sickasaparrot......Thanks for the input. As said before, I don't have the answers hence why I haven't made suggestions. You are the first to offer any kind of concerted argument for change that doesn't involve rattling-cages or scaremongering an old and frail man into riding off into the sunset. Instead or berating our hierarchy for incompetence, suggesting reading a book on how it should be run (a truly ridiculous suggestion) or proclaiming "I have all the answers, but I'm not telling you because why should I, I'm not paid for it" you've offered five legitimate solutions that can feasibly enhance the matchday experience and encourage a return journey.
This is what we want to see more of, instead of unconstructive mud-slinging that mirrors our adversarial parliamentary system.”