Saints have just announced their accounts for the year up to June 2013 and they deliver a clear message to the supporters about how we have failed to utilise the potential for income now we are in the Premier League.
Saints financial results have been announced and they make interesting reading, they tell a story that perhaps the supporters aren't interested in, one of where plenty of income has gone out but little has been recouped in terms of commercial revenue and perhaps point towards the real reason as to why Katharina Liebherr felt it neccessary to step in and re organise the club.
To be fair most of the accounts are fairly bog standard, wages and transfer fees have increased as you would expect for a promoted club, but the worrying factors are how little commercial income has increased and how much has been spent on upgrading the training ground.
Staring with commercial income, in the year to June 2012 it was £4.8 million and in our first year back in the top flight it has only risen to £6.7 million, this highlights how we have let this area of the club go, if we compare clubs of a similar size in the Premier League, in 2012 Fulham earned £12 million and Norwich £14 million from their commercial revenue streams, supporters might not care too much about advertising hoardings and corporate hospitality but it is a big area and one in which we drastically underperformed for a club of our size, given that we took out a loan of £5.6 million this could have been avoided if we had put into place affordable and realistic sponsorship opportunities.
The issue of the training ground is a significant one, the accounts summary confirmed that this project is now expected to exceed £30 million, this is an extraordinary figure given this is an upgrade not a new project, in comparison Stoke City spent £7 million on building their training ground from scratch, they are now upgrading it further at a cost of £6 million to include a full size indoor training pitch as well as other facilities.
The much publicised training ground rebuild problems can now be seen to be a major financial issue that will have lead to the reason why alarm bells rang in Katharina Liebherr's office, especially given that the exisiting facilities only built 8 years ago where as good as most in the Premier League to start with, to see so much money wasted, money that could have been used to improve the squad is quite frankly shocking especially when aligned with the poor commericlal performance mentioned, results of this nature would have made a CEO's position in any company untenable.
Overall the message is that the income and outgoings of the club have not been managed as they should have been, this is not a question of fraud, but one of poor management, it has been glossed over due to quickfire promotions, but as the report confirms if these issues had not been addressed it could have seen problems going forward, however as director Han Hofstetter states
"Whilst I perceive that we have inherited a difficult situation financially, there are now clear and structured plans in place to progress the Club and avoid a similar situation from occurring again.
"The continued support of the Ultimate Shareholder cannot be underestimated, and we are grateful to be able to rely on their dedication to helping us flourish as a Club.
"In the short time I have been at Southampton it has become abundantly clear that we are blessed with a staff that has all the necessary skills with which to progress, and now that we can supplement that with a strong Board I am sure we will enjoy a successful future together.”
That message is clear, the club has lacked direction off the pitch and has needed the Liebherr's to step in and bankroll the situation, if she had declined to do so then there could have been a major financial problem.
This being the case the management of the club had to change and it has now done so and they now have the people in place to take things forward in a prudent fashion and with people who know how to run a football club.
Nicola Cortese had many strong points, but these reports show that although he could deal with the on field side of things, off the field it was different and that we were spending money that as a club we did not have without going cap in hand to the Liebherr's it really could have and should have been avoided by good financial governance and strategies.
So going forward Katharina Liebherr has put into place a management structure that can take the club forward both on and off the field, I have read on message boards about the fact that the Club will not be able to take steps forward as quickly as they were seemingly going to six months ago, this is actually not true, on the surface we had a Chairman who told us that the Club was aiming to take steps forward, although these steps were indeterminable, but underneath that surface there were no foundations for us to be able to take them, the then CEO was overspending and reliant on Katharina Liebherr to write the cheques, something that she was not willing to do unless proper Corporate Governance was in place.
This being the case we are actually now better prepared to be able to continue our progress forward and establish ourselves back in the Premier League, we now know who owns the club, who is running it and the parameters they are working too, Ok we perhaps know that we arent going to challenge the top 4 in the near future as we dont have te resources, but we didnt have those resources six months ago so werent honestly going to challenge them back then either.
Five years ago Markus Liebherr bought Southampton Football Club with a five year plan of getting us back into the Premier and making us self sufficient, we werent a rich mans plaything in the manner of Roman Abramovich back then and we arent now, nothing has changed apart from the fact that we have nearly achieved both of the original aims, now we can concentrate on moving forward again.