Blues’ losses jump from £5 million to nearly £25m
BIRMINGHAM City have announced a huge pre-tax loss of £24.8 million in their latest accounts.
Blues lost almost £25 million from July 1, 2021 to June 30, 2022 – a £19.3 million increase on the previous year, when the club lost £5.5 million.
The sale of star player Jude Bellingham to Borussia Dortmund skewed the club’s accounts for the previous year, which is alluded to in the directors’ report this time around.
“The loss for the year before tax increased to £24.8 million (2021 - £5.5 milion restated) primarily as a result of profits from player trading in the prior year,” the official document said.
Blues’ revenue increased last year to £17.5 million, compared to £13.1 million in the previous year. However, the club’s wage bill also increased slightly to £31.1 million, as opposed to £30.95 million in the financial year ending June 2021.
Forecasts show that the club will require additional funding of £23 million from the period July 2022, to December 2023, from Birmingham City plc (BCP), Birmingham Sports Holdings Ltd (BSHL) and Oriental Investments Rainbow ltd (ORIL).
The document added: “The directors of the ultimate parent/parent have indicated that they expect that the group will have sufficient working capital to be able to advance funds for BCFC to meet its financial obligations as and when they fall due for the next 12 months.”
BSHL incurred losses of HK$40,661,000 (approx £4.2 million) for the financial year ending June 30, 2022. As of that date, BSHL had net liabilities of HK$88,004,000 (approx £9.1million).
The report said: “These conditions indicate the existence of a material uncertainty which may cast significant doubt on the group’s ability to continue as a going concern. Therefore the group may be unable to realise its assets and discharge its liabilities in the normal course of business.”
The report added that the directors were of the opinion that the group would be able to meet its financial obligations in the next 12 months due to various loan facilities.
Companies House notes that £7.97 million of working capital was provided to the club by Maxco Capital from June through to December last year, as part of their Master and Sale Purchase Agreement.
Local businessman Paul Richardson and former Barcelona footballer Maxi Lopez attempted to buy Vong Pech’s 21.64 per cent stake in Blues, which would have led to a phased takeover, but it was announced on December 7, that a deal had fallen through. Blues and a number of individuals have been charged by the EFL for allegedly breaching rules in relation to Maxco’s proposed takeover. The EFL alleges that people acted as relevant persons without gaining their approval.