Sunderland plc today issued its preliminary results for the year to 31st July 2003, with chairman Bryan Sanderson including a damning review of the player acquisitions of Peter Reid, and confessing the “mistake” of appointing Howard Wilkinson and Steve Cotterill.
The results reveal a pre-tax loss of over £20m for the year – compared with just under £3m loss for the same period last year – taking the club’s net debt to just over £36m.
In his statement to shareholders, Sanderson said “The management of the team and of the acquisitions in the transfer market was unacceptable, and has cost your company dearly. In particular, a large part of the £18m squad purchases to try and ave our Premiership status added little or no value.
“After a poor start to the season and following on from a 17th place finish the season before, a management change was effected…..however results proved that the dual appointment of Howard Wilkinson and Steve Cotterill was a mistake.
But tonight, Wilkinson hit back at Sanderson’s comments and questioned his effectiveness as PLC chairman.
“If he (Sanderson) has said what he is supposed to have said then it is a joke. If he thinks five months is long enough to turn the football club around then I’d have to question his right to be chairman.
“He has been in charge during the whole of the sorry demise. A football club is not run by a manager alone. The plc now has a massive say in policy and how the money is spent.
“It (the appointments) must have been a mistake because they got rid of us after five months. Question – who made the mistake?”
Other highlights from the results and chairman’s statement included:
– Relegation not a surprise following a “thoroughly inadequate performance on the field”
– Sanderson apologised to shareholders and supporters for failing to deliver success on the field
– Chairman believes the club has the financial support, playing management and squad needed to return quickly to Premiership football.
– Chairman believes the club is now in a stable financial position with debts at a “manageable level”.
– Regret at having to release 70 non-playing staff but chairman sent those staff thanks and good wishes for the future. “The human cost has been very sad because we lost some very talented and professional individuals.”
– No senior players received contract extensions this summer
– Wage bill reduced by half, from £34m to £17m, focusing on “high cost” players – some of whom the club would have preferred to keep but could not afford.
– All players, directors and senior managers agreed to accept a deferral on part of their salaries until August 2004.
– Club’s final league position resulted in the minimum merit award of only £0.5m, out of a potential £10m.
– Total wage costs, as a percentage of turnover, was an “unacceptable” 80% – compared to only 59% for the same period in 2002.
– “We have taken all possible actions to retain the support of our bank, Barclays, from whom we have had support to carry out the actions necessary to deal with relegation”
– Club will be looing to “refinance a large part of our debt to longer-term and this is something we are working on with our banks and advisors.”
– Reserve team deserves mention for winning the Premier League reserve league. “This was one small bright spot in an awful year and gives promise for the future.”
– Club remains committed to its “football for us all” policy, having implemented a season ticket price freeze for the fourth consecutive season.
– League TV appearance fees are limited to £10,000 for an away game and £60,000 for a home game, compared with £600,000 per appearance for Premiership clubs.
– Club is looking to implement performance-related contracts as a key factor towards achieving future profitability.