Evening Telegraph (First Edition)
Break-even season wrecked by pandemic
DEREK Bond says Covid-19 has robbed Dundee United of a breakeven season.
The Tannadice finance director’s task – attempting to balance the books during an unprecedented 12-month income drought – has proved extremely challenging.
The club’s new accounts, which will cover the 2019/20 promotion season, are in line to be published – and Bond admits they won’t make for good reading.
But he insists that is largely because a long-term strategy of investment into the academy has not yet been recouped.
That infrastructural spending, along with cash sunk into staff changes and readying the squad for a crack at promotion, resulted in United’s wage to turnover ratio soaring to 133% in 2018/19.
Bond knows that can’t continue. But he says the only thing that cost the club its first break-even campaign of Mark Ogren’s ownership – which this season’s budgets had projected – was the refusal to allow fans back into stadiums.
Plugging the shortfall has required help from the owner, players and staff to accept pay cuts and fans to dig deep.
But with the well-funded Tannadice academy project now kicking into high gear, Bond is hopeful the club will soon be rewarded for its commitment to youth development.
“It was never a long-term strategy (to run wages to turnover at a high level). That couldn’t be a strategy for anybody,” he said.
“It was a mixture of one-off costs coming into the club, a deliberate investment in the squad and also the academy.
“The academy was so badly run and under-invested.
“A big increase in the wage bill has been the academy – part-time and full-time coaches, medical people.
“We’ve very quickly got the academy up to elite status, which is almost unheard of. We’re up punching with Rangers and Celtic in terms of young players.
“Look at the players coming out of there now. If you sell one of those every year, the academy has paid for itself.
“We’ve had 10 academy graduates make debuts this season. That’s the fact a lot of people miss.
“The investment in the academy has probably been £500,000-£600,000. And that’s not a one-off cost, that’s an annual investment.
“When your turnover is down and you’re investing in the academy without getting an immediate return, it’s obviously going to be reflected in the accounts.”
The financial figures relating to the 2018/19 season have resulted in United coming in for criticism for overspending.
But Bond insists heavy investment was a deliberate strategy under the club’s then new ownership – and Covid-19 was the unforeseeable spoiler.
“The accounts for 2019/20 won’t make good reading either,” he said.
“But they’ve been influenced by Covid, they’ve also been influenced by further investment in the playing squad to try to get promoted, then be good enough to finish in the top six of the Premiership without further investment the following summer.
“If it wasn’t for Covid, our budget for this season was pretty much a break-even situation, based on us having already spent money to strengthen the squad and being in the Premiership with much more projected income from TV, gate receipts and hospitality.
“That was always the strategy. Covid has knocked it for six.
“When we were doing the budget for this financial year, which would have been around May of last year, things were looking positive around getting fans into games.
“There were positive noises, there were fans getting into games in England.
“So we set a budget this year based on fans starting to come back in in October, which we thought was realistic and achievable.
“If we’re budgeting for gate receipts to start coming in around October, November, a Celtic or Rangers game will generate a couple of hundred thousand pounds in gate receipts alone.
“That’s a huge part of our