03 December 2008


posts a loss:


Southampton have announced a loss of £4.9m in the last financial year even after making £12.7m through player sales. Saints PLC chairman Rupert Lowe revealed that at one stage the player and coach wage bill was a huge 81 per cent of the club's turnover. Also in the Southampton Leisure Holdings plc figures for the year ending 30 June 2008 was the revelation that the Championship club's overdraft peaked at £6.3m during the summer. In a statement released to the Stock Exchange, Lowe, who along with football board chairman Michael Wilde didn't return to the club until May, laid the blame for the figures at the door of the previous board. He commented, 'Since returning in May, the current Board has worked tirelessly to bring our costs more into line with our dwindling revenues. We have done this throughout the Company where possible, but the nature of player contracts means that the process cannot be completed instantly. This work will continue, in discussion with both our loan note holder and Barclays Bank, on whose support we remain reliant.

Southampton is a classic example of what happens to a relegated Premiership club when the parachute payments run out, compunded by the need to service a long-term debt on the new St.Mary's Stadium. The club is reliant largely on young players, many produced through its Academy. Although recent results have been encouraging, relegation still remains a possibility. Not all fans welcomed the return of Rupert Lowe to the club and he noted, 'We are not currently strong enough to indulge the small, but vocal, negative elements of our support base and need everybody to pull together which we recover our financial strength. This is not a good time to be exposed to too much debt, particularly if revenues are likely to be adversely affected by an economic downturn.'