CAPITAL GAINS
Hearts post tidy £500,000 profit despite pandemic
RELEGATED Hearts posted a profit of almost £ 500,000 during the Covid-19 pandemic — and despite taking costly legal action against the SPFL — thanks to the generosity of club benefactors.
After the 2019-20 Premiership season was curtailed early due to coronavirus, the Tynecastle club spent £646,000 in an unsuccessful bid challenging the l eague’s decision to send them down to the Championship.
But cash injections of more than £ 3.7million allowed the Edinburgh outfit to turn a £473,000 profit in the year up to June 2020. Those donations were made up of £3m from benefactors i ncluding James and Morag Anderson and £700,000 from the Foundation of Hearts.
Owner Ann Budge has now received all of the £2.5m she put up to gain control of the Gorgie club in 2014 and she will soon hand her majority shareholding to the fans’ group.
Turnover at Hearts during the period dropped £2.5m to £12m due to t he ef f ects of t he pandemic. However, despite difficult conditions with only eight months of trading due to the virus, Budge (below) insisted the club were duty-bound to take on the footballi ng authorities in court.
She said: ‘Financial year 2019-20 saw us cope not just with the direct impact of the pandemic, but also with the consequences of the “end the season” decisions taken by the SPFL board and its members, which e ndorsed t he r el egation of clubs, despite the season not having been completed.
‘This placed further financial burdens on all clubs so affected, including ourselves.
‘Faced with enforced expulsion from the Premiership and the consequential ongoing financial implications, the board sought, unsuccessfully, to challenge the decisions taken, on the grounds of unfair and pre judicial treatment.
‘The board raised this action, knowing it would come at a cost and knowing that the chance of success was slim.
‘However, in the interests of openness, fairness and integrity, simply to accept this decision was never an option.’
Hearts helped protect club finances by agreeing wage cuts with players in May.
They also recorded player sales of £340,000, largely made up from Jake Mulraney’s switch to MLS side Atlanta United in February.
However, the accounts did not include the £1.5m transfer of Aaron Hickey to Serie A side Bologna in September.
But Budge warned that the impact of Covid will be felt in next year’s accounts, with fans still locked out of stadia.
She added: ‘The club took swift and decisive action at the onset of the virus to manage our cost base, taking full advantage of all government aid schemes available. ‘ This, coupled with the unwavering support of our staff and players, fans and sponsors and, of course, our benefactors, enabled us to cope well during one of our most difficult periods in recent times. ‘Despite losing nearly f our months of income, we still managed to return a small profit, t hanks in large part to donations received.’ Hearts’ AGM on December 17 will be a closed event due to the pandemic.