By David Owen
January 14 – West Ham United, whose star striker Marko Arnautovic is being linked with a big-money move to China, have reported a halving of profits after a “difficult” year.
The East London club, who ultimately secured their Premier League place after replacing manager Slaven Bilic with David Moyes, posted a pre-tax profit of £18.3 million for the year to end-May 2018, down from a hefty £43.5 million the previous year.
Turnover dipped from £183.3 million to £175.3 million, with all components, from match receipts to broadcasting, edging down. The group operating loss at the corporate entity WH Holding Limited weighed in at £7.9 million, but a near £30 million profit on the sale of players, such as André Ayew and Ashley Fletcher, carried the Hammers into the black at the pre-tax level.
Staff costs rose from £95 million to £106.6 million, while emoluments of the highest-paid director advanced from £868,000 to £898,000.
Cash held steady at £30.5 million, while debt was cut from £75.6 million to £65.1 million. Exactly £45 million of this has been advanced by David Sullivan, the majority shareholder, and David Gold, his fellow director. Interest on these loans is said to be accruing at 4-4.25% a year. Just under £4.6 million had accrued at the balance-sheet date. This balance was paid post year-end on August 29.
In a further related party disclosure, the club said it had paid £438,000 to BKB Media Limited in respect of consultancy work in relation to a sale of shares. Vice-chairman Karren Brady is said to be a BKB Media director.
The club said an HMRC investigation “in relation to agent’s fees”, which began in April 2017, was ongoing. However, the “outcome and potential quantum” of any liability were still unknown.
It continued to encounter “operational issues” with the owner of the former London 2012 Olympic stadium where home matches are now played. The club was “seeking judicial redress as our only means of resolution in the absence of any willingness to negotiate on these matters without court action”. Since the year-end, the club had “won four Expert Determinations on operational issues experienced during the first two seasons at the stadium”.
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