The challenges of being competitive in the Championship have been laid bare by analysis of Nottingham Forest’s most recent set of accounts.
The Reds recorded a pre-tax operating loss of £25.1m for the period from April 2018 to May 2019, in figures which were released earlier this month.
That was up from the previous year, when the club made a loss before tax of £5.6m.
And, according to football finance blogger Swiss Ramble, their 2018/19 deficit is the third biggest among Championship clubs who have so far posted their accounts for that period, behind promoted sides Aston Villa (£69m) and Norwich City (£39m).
Player sales have been a significant factor in keeping Forest within the Football League’s Profitability and Sustainability rules.
A statement from the club’s board as a prefix to the latest accounts said, “it has the discipline to take tough decisions regarding player sales in order to ensure compliance”.
In 2018/19, the Reds made about £11m from player sales, most notably thanks to Ben Brereton’s £7m switch to Blackburn Rovers.
Swiss Ramble has Forest some way below the likes of the £38m Bristol City made on player sales, along with Middlesbrough’s £33m and Swansea City’s £30m.
The Reds did record an 11 percent increase in turnover in 2018-19, going from £22.7m to £25.3m
Revenue from sponsorship and advertising was up considerably, to £1.7m from £637,000; catering went from £962,000 to £1.2m and income from TV and radio from £597,000 to £805,000.
Ticketing also saw a rise from £6.9m in 2018 to £7.2m in the latest set of accounts, as Forest enjoyed bumper attendances, while income from retail went from £2.4m to £2.6m.
However, Swiss Ramble points out how it is tough to compete against teams benefitting from parachute payments after being relegated from the Premier League, with Stoke City’s revenue posted at £71m, Swansea City’s £68m, Boro’s £56m, Villa’s £54m and Hull City’s £48m.
They say: “If parachute payments were excluded, #NFFC £25m would have been the 8th highest revenue in the Championship. They would still be a fair way below the leading clubs, e.g. Aston Villa £43m and Leeds United £41m, though the gap would be reduced to “only” £16-18m.”
Meanwhile, the figures have the Reds down as spending the third-most in the division on players in 2018/19.
Their £23m outlay - on the likes of club record signing Joao Carvalho and Lewis Grabban - is behind only Stoke (£67m) and Villa (£31m) out of those teams to have posted accounts so far.
Forest identified “increased player wages” as a key contributor to their £25m loss.
And Swiss Ramble lists their £36m wage bill as 10th highest in the Championship - almost in line with their ninth-placed finish last season.
According to the figures, Villa had by far the biggest wage bill, at £83m, Stoke’s is listed as £56m, Norwich’s as £51m and Swansea’s £48m.
