Wednesday, 30 April 2014

Controlling debt will be AFCB's biggest battle

You'll all of read by now that AFCB's accounts up to the financial year ending in July 2013 had a whopping £15m club debt after the last season in League One. That is before the signings of players like Tokelo Rantie, Lee Camp, Yann Kermorgant, Adam Smith and other Development squad signings in January this year. It is a different world that football clubs are living in and the £8m financial fair play edict is something that clubs are going to find hard to stay within in the first few years. 
There's been a lot of spending at Dean Court.
For AFCB it is of course a big worry that the club is spending far more than its income and a massive amount of work will still need to be done to bring spending under control. The need to be competitive also comes with a huge expense and the players' wages and signings are said to be the main reason for spiralling costs - see full figures on the Bournemouth Echo report. It will be very important to hear what Jeff Mostyn says on the financial state of the club and how they are going to try and put the club on a firmer financial footing.

The £7.5m loan to Wintel Petrochemicals is said to be due to expire on 5 October and I do wonder what that means for the summer months and transfer business. If sales do need to be made then AFCB has the players now to recoup much of the debt but if team strengthening is the plan this summer then new funds will need to come from some source. The rumoured £3m interest of Crystal Palace in Lewis Grabban may well see something happen if the Cherries need to sell, but if you compare Lewis to Jordan Rhodes scoring power then an asking figure of £8m is surely nearer the mark. We can expect players like Matt Tubbs, Miles Addisson, Josh McQuoid and Shwan Jalal to leave the club while Stephen Purches and Richard Hughes will probably hand up their boots. But large sums of money will be needed to bring the balance back to something more reasonable and I suspect that further loans are a possibility. 

When you consider what the losses were in 2013 at Bolton £50.7m, QPR £65m, while Leicester City had Vichai Srivaddhanaprabha to bail them out of £103m in debts, you may not think that AFCB's losses are not so large, but for a club that has not been operating long in the the higher eschelons of the football league it is important that the finances quickly come into order for the future safety of the club. Even Nottingham Forest who the Cherries beat at the weekend only has losses of £12m in 2013.


  1. An additional factor is that the owner is a national of a country which is currently subject to sanctions. Given the (weaker) EU sanctions and the (stronger) US sanctions, the UK tends to behave a bit like Airstrip One and follow the US line.
    This could blow up in our faces.

    btw, are you suggesting that Lewis Grabban is worth £8m or did you mean Jordan Rhodes? I see Lewis as the better all-round player but Rhodes as the better finisher.

    Looking at Bayern v Real Madrid last night, it was just like watching AFCB!

  2. AFCB are certainly reliant on Maxim Demin and his comrades at board level, but I don't expect the sanctions to go as far as stopping foreign investors from Russia supporting sporting institutions in the UK. As for Real Madrid, I hope that we can welcome them again soon.

  3. I don't see sanctions being a problem either. But one thing these figures do prove, and that's how close to going down the pan we were under Mitchell, as it's basically his tenure where all this expenditure has originated from. Car park, training pitches and the like, not to mention a vast squad, I suppose Groves thinking, was buy loads, some would work out to be good, which in the case of a few, that was correct. Shed a further 8+ players, bringing in a minimum of 3 Premier quality in. Add to the fact attendances under Groves fell dramatically, monies spent at the club fell, as people refused to put money in Mitchell's pocket (as they saw it), and it's hardly surprising we were making vast losses. I don't see us making profits, but Maxim has a plan which we're all getting our heads around now, and he will know more than most, that this will mean a large injection of cash from him, in the short term at least. Interesting times, and a fascinating summer ahead!!! UTCIAD