The following communication has been issued by Chairman, Mehmet Dalman and Finance Director, Philip Jenkins.
Following Board correspondence to supporters in January, we’d like to take this opportunity to offer insight into the statutory accounts for the year ended 31st May 2024 that have recently been submitted to Companies House.
The group accounts for Cardiff City Football Club (Holdings) Limited can be viewed in full here, for those who wish to see them.
Below are several highlights, with some greater detail and clarification:
Trading Results
The filed accounts show:
Operating loss of £9,957,000 which is a reduction of £1,169,000 on the prior year.
Loss before tax of £11,661,000 which is a small marginal increase of £231,000 on the loss for the prior year.
Increase in the cost of sales and administrative expenses over the prior year that has been more than offset by the exceptional income realised in the year.
Increase in the cost of sales from 2023 to 2024 of £9,473,000 driven by:
Increase in player related costs at £5,712,000.
Increase in amortisation charge from investment in our playing squad of £840,000.
Increase in running costs following investment in Academy development of £1,136,000, including provision for the one-off costs on the termination of the lease on the old Academy site.
The above account for 81.2% of the increase in the cost of sales.
Exceptional items
The results for the year have benefitted from exceptional gains of £18.4m.
The main driver therein is the £12m receivable from the sale of a “percentage” share of the ultimate proceeds from a litigation claim made by the club.
The sum receivable is non-refundable and not dependant on the ultimate outcome of the litigation case itself.
While there is potential for additional amounts to be received, dependent upon the outcome of the litigation, such “contingent asset” has not been recognised in these accounts and further will not be included in future years accounts until any such sums are awarded and received.
Balance sheet
Investment in Intangible and Tangible Fixed Assets:
Investment in our playing squad of £7,460,000 in the year shows an increase of £1,934,000 over the previous year.
Investment in tangible fixed assets of £1,665,000 in the year, includes initial payments to secure the 150-year leasehold interest in the site for the development of the new First Team Training Ground and operational base.
Loans from shareholders and connected parties:
Loans from the majority shareholder, Tan Sri Vincent Tan, and connected parties has increased in the year from the injection of net additional funding of £11,832,000.
While the loans have increased in 2024, as in previous years, there is no interest burden on the Club as while the loans accrue interest at 7%, all interest on the loans from Tan Sri Vincent Tan has been waived by the Owner.
As our chairman has previously indicated when the time is right, such loans will be either written off or converted to equity. Therefore, there is no demand or pressure on the Club for such loans to be repaid.
Loans from directors and connected parties:
Such loans have increased by additional loans received of £11,000,000, taking the resultant balance to £40,300,000.
It is the intention of the Club to start repaying these loans as soon as cash flow allows, or additional funding is received.
Summary
While the reduction in the Operating Loss for the year is encouraging, there is still a great deal of hard work ahead to continue the downward trend in the Operating Loss.
We have, however, in 2024 been able to expand our investment in the First Team squad, complete the new Academy development and lay the ground for the construction of our new purpose-built First Team training ground.
Each of these advancements will put us on a more stable and stronger footing for the future.
Mehmet Dalman (Chairman) & Philip Jenkins (Finance Director)
3rd March 2025