Arsenal guarded over financial figures
What is interesting about financial results is often not what they reveal but what they don't.
As widely expected, the club has done well. Last season may have been trophyless but the club earned £223m. Much of this was from the new television deal, bringing in nearly £69m, helped by the strength of the euro coming in from Uefa's money.
Significantly, the Emirates Stadium is not only a fortress in terms of results on the field - they have lost only one competitive match in 58 there - but something of a cash cow. Matchday revenue last year was just under £95m. But in constructing the Emirates, Arsenal now have the biggest debt in the club's history - £318m.
Peter Hill-Wood, the chairman, says all this is under control and was anticipated when the stadium was built.
With £250m in bonds repayable over 23 years and interest fixed at just over 5% it costs Arsenal £20m a year in interests and repayments, however it still leaves a profit before tax of just under £37m.
In addition to this there is the bank loan of £133m, almost all used to fund the development of Highbury Square and its 700-odd flats. Arsenal say it is ring-fenced and will not affect the football side.
As of 31 May 2008, Arsenal had £93m in the bank. £31.5m of this is held as security to service the debt over the bonds and cannot be touched.
But Hill-Wood insists club manager Arsene Wenger has funds to spend should he want to.
Hill-Wood also makes the shrewd point that "it is not about spending a specific amount of money, it is about investing in the right people".
This allows Arsenal to consistently make good profits from player sales. But even here there are pressures. Arsenal paid £101m in wages and wage pressure will surely grow.
The words of Hill-Wood are taken from the club's website, Arsenal.com, because the Arsenal PR machine, which looks capable of giving the old Kremlin lessons on media management, decided that Hill-Wood, who has long been the best chairman in English football, would not talk to anybody else.
So Hill-Wood is very circumspect about Arsenal's property development. In the past the club expected £350m: £270m from the Highbury development and a further £80m from regenerating Queensland Road.
On Queensland Road, planning permission is yet to be obtained and it is hard to see how in the current climate units there will sell.
As for Highbury there has been talk that some who put deposits on the flats have not completed, all the club will say is they are watching developments closely and are aware of the current housing crisis.
But it must mean the £100m property profits once expected are unlikely and the club accept this saying anything from the property speculation will be a bonus.
Hill-Wood confirms the American investor Stan Kroenke has joined the board. But does not explain why these negotiations took so long. Or why having said last year he was not the sort of man Arsenal wanted, Hill-Wood now says he brings "a wealth of experience".
Nor does Hill-Wood explain why if a 12% holder is welcome there is no place on the board for the man who owns more than twice that and is the largest shareholder, the Uzbek businessman Alisher Usmanov.
He remains the elephant in the room nobody at Arsenal seems to even acknowledge.
Yes the existing board, Kroenke apart, have a lockdown agreement not to sell outside "outside the family", but Usmanov is free to bid.
And should he bid say £10,000 a share is it still likely he will not get Arsenal, lockdown or no lockdown?
The current board may believe Arsenal is not for sale but that does not mean it cannot be bought.
Also, Hill-Wood has nothing to say as to why Keith Edelman, the managing director, who along with director Danny Fiszman, played such a major part in constructing the Emirates when others on the board such as David Dein wanted to move Arsenal to Wembley, has gone.
Edelman's sudden departure in May remains a modern-day Emirates mystery.
Arsenal are still looking for a successor, a process that was due to be completed this week but held up by the death of Arsene Wenger's father.
What is surprising is given how good a story Arsenal have to tell, both on and off the field, they behave as if they have much to hide.
Compared to last year when Edelman trumpeted the results Arsenal seem to have gone inwards as if content to rely on Wenger's undoubted brilliance.
I'm 
© MMIX~RS~q~RS~~RS~z~RS~31~RS~)
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Speaking of finances, take a look at what could be the new Manchester United shirt in the aftermath of the AIG turmoil. Too funny!
http://www.redstate.com/diaries/jeule/2008/sep/18/new-manchester-united-jersey/
Montiac
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Without wishing to denigrate your blog, from what I can see you have basically copied and pasted bits from the article on arsenal.com.
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ZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ
Massively boring blog. The second massively boring blog I've read today by this man.
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Mihir (or anybody reading this) - much looks good about the club financially, but I don't understand why the reported debt has gone up from £260m to £318m in a year. This doesn't sound so good! Is is something to do with Highbury Square - or a re-scheduling od debt? I just don't get it, I'm afraid.
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Arsenal like to keep things close to their chest, who knows maybe the trumpeting that Edelman did got him shoved out. Anyway there are obviously things they would rather not make the light of day, and will not tell, who doesnt?
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Well Mihir, you know about as much about the Arsenal finances as the rest of us and your speculation about "much to hide" seems like journalistic mischief making to me. Arsenal are a Public company and their accounts are there for all to see. Fully transparent to a trained eye.
As for Edelman, that is a slight mystery, but really of no consequence. The Stadium is built now. His job is done. He's not a football man and obviously not that great at Marketing as there is a lot that can be done in that direction. ( Look at how effective Chelsea's international marketing has been in so short a time). Arsenal's world didn't fall apart when Edelman left and no doubt a better person will take his place. Speculation about Edelman is just about as interesting as watching paint dry.
As for Hill Wood playing matters down, he's an experienced and old fashioned, old school, Chairman. No one would expect him trumpet the way Arsenal are run. It's there for all to see.
I forgive you though. You're a journalist and it's your job to try and spin something out of nothing.
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Word was that Usmanov is not seeking a takeover of Arsenal though and is just interested in making money on his shares when the time is right. I don't anticipate an Usmanov takeover but he would sell to a high bidder.
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Blimey - I thought Mihir had forgotten about Arsenal - but no, of course not. For, I don't know how many years, Mihir's been banging on about how Arsenal are about to fail, collapse, go bust etc. Not once has his "sources" proved accurate on this club - perhaps if he wants to know about "kremlin-like" PR machines, he should look at his own beloved Spurs and the way they treat bad news. Arsenal may not be perfect, but they're run as a business which doesn't rely on foreign money to survive, unlike any of the other top 4 clubs. But for Mihir to post this, he might have to swallow some pride.
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An interesting read Mihir, but at the same time you have to accept that the Arsenal "model" is almost precisely where the board projected that it would be 5 years ago.
I have it on very good authority that to this point only three people have walked away from deals that they had agreed to on Highbury flats, and indeed as is mentioned in the report, the first 65 purchases have been completed since the date of the financial figures, bringing in somewhere in the region of £18million.
Those that have walked away have left Arsenal with their 20% deposits which were non-refundable. It is, however, true that the housing market is experiencing tough times and that the original estimate that the sales would bring in around £110million may need to be "dowscaled" at this point next year when all but the sales of the final properties released should have been finalised (Again there are already buyers in place for these deals.)
On the subject of Usmanov - This is an all together murkier issue. He remains, as far as we know interested. Arsenal have clearly had to back track on their opinion on Kroenke to provide extra security to the club's position.
I have a strong feeling that he is waiting himself to see whether the debt (which should have peaked in these results at £318million) starts to come down signifcantly as the property money begins to roll in.
Then he may make his move. But ultimately do not underestimate the strength and resolution in the Arsenal boardroom. As somebody who has had dealings with Danny Fizman I can tell you that when he is not for a shifting it would take a crane to move him.
He is the leader of that boardroom now, having deposed his great rival Mr Dein. Whilst Fizman holds firm Arsenal will remain unsold. Should his resolution falter then Usmanov becomes a real possibility.
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Arsenal are one of the few clubs in the premiership who handle both footballing matters and buisness matters behind closed doors, ie: in house. This explains why Arsenal fans were caught so unaware when David Dein was fired from the club and it also explains why Arsene Wenger mostly gets players that no one has heard off, or even the redtops have speculated about. It isn't that Arsenal have something to hide, it is just that they prefer the run the club smoothly, not in the glare of the media unlike some other clubs (eg: Liverpool)
I would argue that since Dein was the face of the boardroom to the media and the fans for so many years, Arsenal havent managed to have someone who is able to act as the boards link to getting news out. It is true that Hill-Wood and Fiszman have done this job at various stages, but there isn't a set person who wants to talk on the mantle.
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Mihir,
I think you should get someone else to write blogs about Arsenal. This just shows that you are very biased against Arsenal you are being a Spurs supporter and it brings the integrity of the BBC into question.
SK coming on to the board makes total sense as he has a wealth knowledge to bring to the Arsenal group with all his businesses in media and communications. And as for you not understanding why it took so long for the negotiations to finalize is unbelievable and proves you do not understand how businesses and contracts work.
Why do you also keep going on about Arsenal going to Wembley. That has already been explained away. FA didn't want a club to be there full time so it was a non starter from the beginning. If you look at how that was financed by them with all the escalation of costs then you see how well the Arsenal board has done then you must accept that the way they run a business is way better.
I'm not surprised that Hill-Wood didn't talk to you as you would put in a Tottenham bias on it anyway. Also as they have a website and also TV station then why wouldn't they interview and post everything there.
Can't you understand that the Arsenal board and most of the shareholders are there for the club. They haven't taken any dividends and the profit is plowed back into the club. Why would they want to sell especially when most of them don't need the money. They are lifelong supporters of the club who want to continue to do things right.
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Well done Mihir. After a break of, oh - a few months, you have managed to get the phrase "planning permission is yet to be obtained" into an article about Arsenal Football Club. It must have been killing you to have gone that long without one.
And why drag Wembley into again? That's where Spurs will be going if they don't go to the 20,000 capacity post-2012 stadium!
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that man utd shirt link doesnt work
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http://www.freedomswatch.org/images/external/before_and_after_small.jpg
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Totally agree with Nick_Hove_Actually. I guessed the angle you would take as soon as I heard the story break on the club's website this morning. I think Arsenal guessed too, so you shouldn't whinge that you didn't get to speak to the chairman when he is probably just as suspicious of your methods as you are of his.
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"The Elephant in the room" - Brilliant! He does look like an elephant. Let's hope we (Arsenal family) continue to not acknowledge the United supporting Elephant.
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The big Arsenal Mystery about the £37 Million pound profit
The story likes Bose fails to deliver, as usual
If the BBC are going to insist on employing a clown why don't they seek one out at a circus, they may at least find some way of entertaining us for their hefty salary
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Come on Mihir after this beauty ( http://www.telegraph.co.uk/sport/football/2400726/Stadium-pushes-Arsenal-to-the-brink.html ) you should have learned to be careful with the doom and gloom prognostications and fudging of the numbers:
"But in constructing the Emirates, Arsenal now have the biggest debt in the club's history - £318m.
[...]
In addition to this there is the bank loan of £133m, almost all used to fund the development of Highbury Square and its 700-odd flats. Arsenal say it is ring-fenced and will not affect the football side."
That's not in ADDITION. The £318.1m net debt INCLUDES the £133.5m bank loan to finish the development of Highbury Square. So the construction of the Emirates is responsible for £184.6m of that debt and Highbury Square the remaining balance. Even if Arsenal don't make the £100m in profits they initially anticipated from Highbury Square and just broke even they would still clear the £133.5m bank loan and only the stadium debt would remain and that's easily paid off with the profits from the football business.
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Too funny. My team, Arsenal, reporting record revenues and profits - all built on a sound revenue and capital base. 3rd in the PL despite the annual prophesies of doom and gloom by those who think success is only made by spending.
Meanwhile, Mihir's team, Spurs languish at the bottom of the premiership having bought and sold like a Wall Street trader on speed with about as much thought.
Poor old Mihir - still desperate to file stories about doom and gloom for the Arsenal.
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So according to this article 'But in constructing the Emirates, Arsenal now have the biggest debts in the clubs history - £318m'.
Does this mean Mr Wenger is going to push for his own club, which has a massive debt, to be barred from competing in the champions league?
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Well, how wonderful is that(he said sarcastically) As someone who is a lifelong Gooner but now has to realise he will never be able to afford a season ticket or even take his grandson to a game on a regular basis because of the expense I can only say....drat and double drat. Football teams aren't JUST a business, they're built on the emotions and support of the fans. Ah me how times have changed
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Seems odd to go on about Arsenal's debt without putting it in context. I'm sure I'm right in saying its by far the lowest of the top 4?
I'm sure Man U's debt was most recently reported as about £764 million? Arsenal's debt is caused by a new stadium that is now bringing in record profits and has set the club up to compete financially into the new century. What's Man U's excuse?
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Mihir "frustrated spud" bose ... oh dear oh dear oh dear.
I couldn't even get to the end of this blog it was so dull and biased.
We're all aware bose is a stalwart Tottenham supporter. With such a promising season looking once more to be eclipsed by the Arse so early ... this blog just smacks of sour grapes.
Come on beeb, can we get some decent commentary and opinions on the game, even Lawro's better than this old bore.
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If you can't write articles professionally Mihir then don't bother. You can see the Spurs-fan bitterness coming a mile away in your writing.
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3. At 2:46pm on 19 Sep 2008, i_amlukechadwick wrote:
ZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ
Massively boring blog. The second massively boring blog I've read today by this man.
+++++++++++++++++++++
You have to admit he does boring very well though.
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You could set your clock to it. Arsenal release their annual figures and Mihir Bose writes a speculative 'article' on them. Is it really that easy to get a job writing for the BBC? You must be laughing all the way to the bank Mihir, assuming it's still operating.
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Its the usual thing, a journalist who is a Spurs supporter just likes to have a pop at the Arsenal, just plain old envey.
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Some interesting numbers. But Bose does not mention the important factor in club finances - players wages.
The Arsenal have a policy of not paying ridiculously high wages to superstars, in that way they can actually balance their books.( A policy that has influenced some players like Flamini to seek out better paying positions elsewhere.) With billionaire owners coming in and injecting unearned cash into a football club, financing has gone askew. No longer is it a closely controlled business with money in having to be balanced by expenses but as in the case of Chelsea the club has become a billionaires plaything, in Man City's case a moneypit and in the case of Liverpool a greedy investment gone wrong. Arsenal must be applauded for running their club realistically. It remains to be seen if they can keep up with the irresponsible big spenders- it seems that in the last 2 seasons they have not.
The threat to the business of football and thus to the game itself is the unrealistic amounts of cash being injected into the game. At some point the FA will have to step in and they will have to, somehow, restore club finances to responsible levels. It is time to do that now before the cuurent craze goes to far - and it's not too far fetched to say that Arsenal should be used as an example of such fiscal responsibilty
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Bose is well known for being a crushing bore.
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Thank you for informing us on the death of Arsene's father. He deserves our condolence.
Aside, from that, i don't see any news in your blog. As a financial analyst myself, i think, Arsenal's financial position is fantastic! Their debt is well if not over secured with the properties at Highbury square, which other football club can boast of such security aside from their stadium?
I perfectly agree with Mike Ashley of Newcastle that Arsenal remains the ideal model for a premership club in theUK.
Lets be realistic, this is about the only club in the prem that is doing self-sustaining football business others in the top 4 are engaged in bringing in extra footballing activity funds which cannot be sustained in the long-term. A good reference is the fall in Abramovich's big money signings in Chelsea.
A time comes when the investor wants to see returns on his investments. You can ask Mr Mike Ashley about this.
So please Mihir, put pride aside and give the Arsenal board, the thumbs up they deserve!!!
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Could you be any more biased? Tottenham fans shouldn't be allowed to write articles about their greatly superior rivals.
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Seriously, this is becoming a joke now.
Having been an avid BBC sport online reader for quite a few years now I feel I have got to the point now where I must say something.
I'm not one to bash the BBC, I think it is a fabulous institution but they are quite clearly wasting money on Mihir Bose!!!! There are some fantastic, passionate and energetic journalists on this site whether it be via reports on events or the hilarious "live texts". However not only does Mihir never seem to actually inform us of anything new, but he just literally copies and pastes from the sports news that is already on his own site with the occasional "i have been informed".
Not only is he boring and repetitive but also quite negative. If it isn't the Olympics, its the Euros in 2012 and now it seems to be Arsenal's club structure. He should be on here praising Arsenal's policy of not hanging their dirty clothes out out dry like some clubs and also our finace policies. The figures speak for themselves - sound financial footing with two billionaire stakeholders in the background. Oh and did I forget the highest match revenue in the country as well as the Arsenal housing development, which even in the current sales market is proving a fantastic success.
Mihir, don't let the BBC down with your negative and ill-informed nonsense. And stop copying and pasting!!!
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Mihir,
I've read a few of your blogs and always thought that the responses you've received were a little harsh.
But after reading the above, about a subject/team that I've followed all my life - I can fully understand why so many responded with such harsh words.
There is an Internet term "QQ" that is quite appropriate for this blog.
- btw, excellent response by aknightly, (Post 35)
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Well written article that points out some home truths although these seem to have wrankled with all the supporters from a certain football club....
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I'm increasingly suspicious that these 'blogs' were introduced in order to allow the respective 'bloggers' to eschew the normal journalistic process - you know, check facts, report facts, avoid rampant speculation - for the sake of filing articles in which their individual bias can be trumpeted, normally without any attempt by the author to back up the claims made in them or involve themselves in the debate which inevitably follows other than the occasional tiresome and somewhat cynical "Well, what do you think, readers?"
I'm no Arsenal fan, but to even suggest that Chez Wenger is in any way under financial pressure is quite simply ludicrous.
Perhaps it is time to do away with these self-serving 'blogs' and return to the time-honoured journalistic approach which served the BBC so well until it decided to chase ratings and target the lowest common denominator?
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I'm not an Arsenal supporter, but the club's financial numbers are a beacon of sanity in the football industry. Arsenal's net-of-cash debt is pretty small in relation to income, let alone in comparison with the debts of Man Utd, Liverpool and others.
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It's not the bias of this article which upset me (since I'm not an Arsenal fan) or the negativity (although I'm not a fan of that either). What concerns me is the part which may very well be entirely made up.
"Last season may have been trophyless but the club earned £223m. Much of this was from the new television deal, bringing in nearly £69m, helped by the strength of the euro coming in from Uefa's money."
By all means, please correct me if I'm wrong, but do Uefa not conduct all their finances with the Swiss Franc? Last time i checked, Switzerland was not part of the euro and all their fines against players and clubs are in francs.
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Hi, you know you said about Hill Wood saying Stan Kroenke was not the man Arsenal wanted, you put the wrong link. Heres the correct one:
http://news.bbc.co.uk/sport1/hi/football/teams/a/arsenal/6566789.stm
Thanks
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My last post was referred because I complained about a lack of clarity in the reporting.
My question was, did Arsenal earn £233m or £37m? The original article confuses these numbers.
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Mihir, really it must be time for you to hang up the typewriter and notebook - this really is tirseome stuff.
And I think you need a new cliche to describe Usmanov other than the elephant in the living room that you keep dragging up. It highlights just how unoriginal and regurgitated the rest of your piece is.
Why don't you tell us about the state of the finances of the other clubs in the league - starting perhaps with Tottenham?
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It may be the case that Arsenal's current board were less keen on going public than David Dein, hence although they comply with plc requirements, they do not feel any need to invite a media frenzy.
It may be that they heard all the rubbish about Arsenal being broke last summer and comprehensively demolished all the claims in detail. This year, they simply feel no need to waste their time doing the same?
It may be that most shareholders know perfectly well what the results are and that all other shareholders will have been sent the annual accounts prior to the AGM, hence given the absence of shares owned by the media, why do they need to do a roadshow?
Maybe Arsene just wants the club to focus on football (they seem to have done so today?)
Who knows?
And does it matter??
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Mihir, I hear you are a Spurs fan. You wouldn't be looking at all of this through those blue and white tinted glasses, would you?
The current housing market problems apply more to those who struggle to make ends meet, not those who would consider buying a Highbury penthouse. I'm not saying that some people might be dissuaded, I'm just saying that I think you are overstating the problems. Secondly, as PHW states, any profits from the Highbury redevelopment have not been taken into account in terms of our overall financial model. WE DON'T NEED THESE SALES TO REMAIN IN GOOD FINANCIAL SHAPE. Any and all money we receive will be considered a "one off bonus".
While obviously it would be ideal if Arsenal were debt-free, I much prefer our situation to any of Liverpool, Man Utd or Chelsea's positions, all for varying reasons. Liverpool are cash-dry and their stadium plans are stagnant; United have to spend £80M/season to service their £750M debt; Chelsea have a £580M loan with Abramovich, and haven't been close to breaking even in any season since he took over.
Reality check, please!!
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Am I the only Arsenal fan who doesn't spot the bias in the above article?
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Mihir,
You continue to criticize Arsenal, who have managed to go top of the league while continuing to be a well-run, profitable business. Perhaps you should write about your team, Spurs, for once, as despite continual spending they are bottom of the league with an unbalanced squad after terrible mismanagement during the transfer window.
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All public bodies - and this includes governments, political parties, football clubs and the like have somehow to negotiate the minefield of dealing with the media. Various approaches have been adopted - eg spin, trying to make friends with the media, ignoring the media completely. etc etc It seems to me that given the fact that the media is often both servant and master, and a very cruel one at that, the approach that the Arsenal board takes is about the only way one see that can handle this unforgiving "monster" that is the media - give them basic facts, rarely give them person to person interviews, and give out only essential information. So I applaud Mr Hill-Wood and the Arsenal board in adopting this approach of keeping information to a minimum.
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Mihir,
With all your journalistic talents why aren't you going on about the poor start to the season Spurs have again and should they sack their manager again!! I'm sure you got inside knowledge there! I can't believe everyone is saying they need time to gel!! Just look at what Sven did at Man city last year!!
Oh and you could also mention how well Arsenal are doing and how after over 10 years in charge you are starting to see their youth coming through stronger.
What have Spurs and a cocktail stick have in common?
They both only have 2 points!!
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"So according to this article 'But in constructing the Emirates, Arsenal now have the biggest debts in the clubs history - ?318m'.
Does this mean Mr Wenger is going to push for his own club, which has a massive debt, to be barred from competing in the champions league?"
I am guessing that the genious behind this retort is of Manc(or should that be West London), or South London(or should that be Moscow) origin. Two things, firstly Mr Wengers comments were regarding operating profits, meaning spending what you as a club earn not what your chairman/owners earn from other interests. Because of this as Arsenal are still making an operating profit and consistantly spend within that.
Secondly the Arsenal board are the only club owners(perhaps with the exception of Middlesborough) who would not sell the club to make money without ensuring the club is going to be well looked after, if they were they would not have gone so far to make sure the clubs future was sound, they will not make money in the short term from the stadium move but they knew for the club to have a long and successful future they needed a bigger stadium we could call our own. It was long known that the interest of a rich Russian was scanning the EPL for a cash cow before the stadium was finalised and the wealthy Russian in question was casting his greasy oil and blood soaked fingers towards the Red north end of London long before the Blue side of South London. Look no further than Liverpool where the agreement for a stadium is in place but owing to the people who own the club wanting some money for the club and in the knowledge rich investors are swarming the stadium design is conveniently being altered more often than their starting line-up. Call me stupid but i will take loyal honest hardworking owners over multi Billion pound foreign investment anyday, at least our owners and board have the clubs best interests at heart and not their own wallets and egos!!!!
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To answer No. 42. Consider yourself duly corrected. From the 2007-08 season UEFA deal in Euros not Swiss Francs.
And no 45. Arsenal's "total income" was £233M and their "profit" was £37M. I don't see any confusion.
As for the rest of the article. I would agree with the consensus that of the current "big four" Arsenal's financial position is the one I'd rather have.
The fact that they are probably the club who are the most "vulnerable" should Manchester City actually manage to challenge the status quo says a lot about what's wrong with how football in general is financed these days.
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I'm an Arsenal fan and I don't think this blog post is biased. It rightly says that Arsenal are trying to compete at the top level with much less capital than all the other top clubs.
Everyone says the board care only for the club; but they take mo9ney out while other owners put money in.
I don't know whether Arsene Wenger is afraid to sign big players or know he doesn't have the money. But since big money has flowed to our rivals, they have put a lock on the top two spots and Manchester City might be about to join them.
The rules of top flight football have changed and Arsenal has to change to.
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I thought this blog was reasonably good until it started implicit criticism of Arsenal. Yes whilst the propery market is not going brillianly at the moment prices are still inflated so they should make money, even if it is not the mega profits of two years ago. Also, many clubs in the English league would give their right arm to be run as prudently and as well as Arsenal and still get in the Champions League season after season; in fact, only Middlesbrough seem to be as well run in the whole top flight. Arsenal are going about life in the right way. Whilst their approach may only bring the odd trophy here and there, it means every one they do get will be a fantastic success. They also will be in the fine position of not having to worry about whether their billionaire owner will suddenly decide he's had enough and sell, leaving vast debts and players on vast wages. And anyway you could make a good argument for every club running their business this way seeing as there are only 4 trophies that can be won anyway in one season. Arsenal's prudent approch won them none, it is true, but they came close. But then how many trophies did Chelsea, Liverpool and Man City's spend, spend, spend approach win them?
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To Number 60. You are actually quite wrong. The board might take a salary for working at the club but that is it. From what I can remember the club and plc have not taken or given any dividends to shareholders for the last 20 years or so. All profits are ploughed back into the club and not into the pockets of the board.
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Mihir - sloppy journalism.
Nearly all of your blog you lifted from the Arsenal Website.
The debt rose because of the Highbury Square development - you really should read carefully. Once the property is sold off and debts onthe property repaid. The surplus will be made available to the football side of the group.
Ring fencing that new debt means that the football side will not be used to fund the development borrowing. Yes, the building industry and housing is not booming hence the comment that the board are aware of the situation and will monitor the situation.
That is the only down side.
Had you checked other sources you would also have noted that Edelman is involved in MetroBet. Knowing Arsenal's penchant for being above suspicion it is more likely that being a director of a betting company and director of a sporting organisation which is might be subject of betting do not sit comfortably.
Arsenal has thanked Keith Edelman and made it clear that Emirates Stadium along with the shrewd re-financing of the loan thus fixing of the interest rate prior tio credit crunch will be Keith Edelman's lasting monument. The fixed interest also means the club is in the ideal postion to strategically manage its finances.
Arsenal's debt for the most part is effectively a mortgage - admittedly the assets are not equal to the value of the club but that is nothing special in any business. Arsenal will have a new stadium as an asset for the money borrowed by contrast Man Utd have a debt - in which the money borrowed was used to finance a takeover. The nett gain in assets for Man U is new owners that's a lot for £600m of borrowing.
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Mihir,
My sources tell me (to pinch your favorite line) that Arsenal expect the Highbury Square and Queensland road portfolios, when sold, will free up approx £300 million. To be used to clear debt, or however the board see fit.
Plus, the debt as they stand, are all but fixed at a better rate of interest than most peoples Mortgages.
As much as you try, there isn't a bad news story for you in these Arsenal accounts.
How big a debt do you think your beloved spurs will be saddled with, were they to start a new stadium now? How much do you think Liverpool will rack up in the next few years? (if that is anyone will lend them the money at all?) plus, i dont think there will be much profit in an Anfield property scheme like the Highburty one.)
Why don't you write an article on Tottenham's start to the season instead? Much more interesting.
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I'm afraid that this article is just mischief making, and bad journalism.
What with the lack of quality of BBC TV footbal comment, and now their web site, I will be watching Sky 'Football First', and getting responsible journalism from the 'Times' and the other serious papers.
I encourage you all to join me !
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MikeNorthBank
agree 100% this guy has some cheek thats for sure.
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" I'm Mihir Bose,the BBC's sports editor. This blog is my regular take on the key sports stories and issues behind the headlines. "
1stly how did you manage to get the job in the 1st place?
The story about Arsenals Finances is not " news " anymore and in fact from your rant i would say its none of your buisness either.
headlines? well Arsenal have been at the Emirates for quite some time, the development of Highbury also. So thats not " news " anymore either.
I dont give a hoot about your blog to be frank and if you really want to start giving us some real news perhaps you would kindly explain why Spurs are bottom of the league having spent and wasted lots of money. in fact on second thoughts DONT BOTHER i think most of us are not interested in your opinions at all. go and get a real job.
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What a very badly written blog. Did you do any research at all over and above reading arsenal.com?
Information as to why Kroenke is welcome on the board but Usimov is not is readily available to anyone with the slightest knowledge of what's been happening at the club.
This is way below the minimum standard one would expect of the BBC.
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Interesting hearing all these Arsenal fans bleat on about a Conspiracy by a journo who supports Spurs. Considering that most of the London media seem to be wine and dine at the emirates, it seems a bit rich to moan about one Spurs fan. We have to put up with the Arsenal bias in the papers, so get on with it.
Anyway i really did not detect much bias, mainly facts about a very large debt and the problems with the property market.
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We are lucky that football is so well served by many excellent journalists right across the spectrum from the broadsheets to the tabloids and many online sites.
Unfortunately, Mihir Bose isn't one of them.
This blog could have been written by any GCSE student with a spare five minutes to peruse the arsenal.com website.
Woeful.
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poor little mihir bose, caught out again.
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I think it would have been erring on professional suicide for Mihir to write in depth about Usmanov and especially their reluctance to deal with him. He's a particularly litigious fellow, especially with respect to his past... and it's probably more than the bbc could afford in legal fees.
I don't blame you for taking a pop at The Gunners though, Mihir. We're top of the league and playing beautiful football so I think we're well insulated against a dig or two. I just wish you had done it from a Spurs fan's perspective and perhaps injected a little more resentment or venomous bile. This is a blog after all and I think readers expect a little more investment from the writer... no pun intended. (Oh, go on then... how about £70 million worth of investment.)
; )
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Whem Mr Bose was appointed by the BBC ,Iwrote to them protesting that his shockingly anti Arsenal bias made him unfit for the job. I was assured that his bosses would ensure unbiased reporting. I have yet to read one of his articles about Arsenal that praises anything they have planned or done... despite the fact that most Journo's think the Emirates move has been stunningly successful. Wake up Mr Bose's bosses and read what he is writing.
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Enjoying the sunshine on the southcoast, I can see the gloom in north london from here. Spurs for there part are in 'self destruct mode'. But interestingly the article (which does refer to 'Wenger's Brilliance') does highlight the depth of the potential for financial contraints.
No one would argue that to date the gunners have been run as a tight ship in recent years as they have been hampered by the cost of developing their prize assets. Even their manager has been quoted (and even mis-quoted) about the level of expediture. I am from the 'action over words' world, so the lack of spending to me show's an inability, rather than a lack of intent. The intent is clearly always there, but the cost of development (particularly with construction inflation costs going through the roof in recent years) is not to be under-rated.
However, the scenario they find themselves in is not of their own making but is a reality check on the market. Half a million for a 2 bed appartment in north london? maybe last year but the reality now is that they will be worth up to 40% less than was anticipated at the time of making the decision. To simply ignore this most important fact is to ignore the meltdown of the financial system as we know it. And any fan would be advised to take heed as to what is going on.
The fact that it effects the gunners is a byproduct not a cause. None of the board could have predicted two yers ago how much and how quickly things could change with regards to what at the time would have been perceived as 'a safe bet'.
What is more interesting is the myriad of gunners who have taken offence to the pointing out that whilst highlighting the double digit growth in both turnover and profit, the similar if not slightly greater increase in debt does mean that if the anticipated revenue comes in then it will have to rely on the fans to keep the primary source of revenue going.
A more general comment on this period in time would suggest that whilst we are all but a technicality away from a recesssion, leisure and retail will always be the first to notice as 'belt tightening' starts to prevail.
I have no doubt that the Emirates (an excellent stadium and built by the contractor who is currently delivering the Olympic Stadium) can bring in a significant amount of revenue, but this isn't fratton park, it's 60,000 people able to and willing to fork out an increasing amount of cash.
Can I just add that if some people read the article, it did state the biggest debt in 'the clubs history'. Not the premiership, Man U and Chelsea's state is well known by all, but the fact is that they DO have a billionaire investor to underpin their atronomical debt. Arsenal, at this point in time, don't have the same level of support. That is just a fact of life, nothing more.
Particularly in light of the rise of another sleeping giant. Man City has always been well supported, and as a neutral I have rated their manager doing well on a shoestring at blackburn, and we happened to be on the receiving end of an absolute smashing, that may not be the last as the giant awakes. Unfortunately I fear the EPL will become the domain of '20 billionaires' as their play thing (a quote from someone else in the past I can't remember who). As it is the only way the increases in costs and wages (all of which are completely out of kilter with the 'average man on the street') will allow anyone to compete in the future.
How clubs like Portmouth, Middlesborough, Sunderland and Everton will be able to compete for players without sending their clubs bust, only time will tell.
As an outsider I find the 'Yank / not our sort of person' move more curious as I know a lot of gunners rated David Dein as the driving force behind Arsenal and their academy teams for many years. And it is perhaps the lack of clarity as to where the russian and Dien sit that may provide the more interesting ongoing commentry.
But I am afraid to the majority of the posts above, who see that as a 'pop' at their club. Consider it a reality check, None of the red tops or indeed the middle ground will dare write anything against the gunners. And yet they are too willing to jump on those that are less in a position to defend themselves.
Just look at how the media reacted to Harry Redknapp's false arrest, and how little you heard about the counter prosecution and it's conclusion. See http://news.bbc.co.uk/1/hi/england/hampshire/7416117.stm for an indication as to how these things pass you by.
MIhir, I congratulate you on trying to open a few eyes, but the blinkers will always be there for the few.
Perhaps if you left the reporting to a non-spurs fan (if you are indeed as I have seen nothing to support this only supposition), then it may encourage more debate than the automatic gamesaying of 'oh well you're just a spurs fan'.
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It may be a grey and rainy day but my heart positively beams to see men of action and not words are here to inspire the masses.
And though a verbose dissertation might cast doubt in a few reader's minds, such men will always have my vote and we the innumerate are all the more enlightened for their muscularity and derring-do.
I would add that in my past dealings with the press I have found them to be nothing but thoroughly ethical and scrupulous pillars of humankind.
: )
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I see that my licence fee is being well spent on JK Bose's amazing fantasy writing.
If all is not well at Arsenal why do we regularly sell out most home and away games? Whereas moneybags Chelsea have a load of empty seats and regularly advertise on radio and in the local press about tickets still being on sale.
Your assertion that the Arsenal PR department is Kremlin-esque gave me a good chuckle. If a club chooses to operate on a need-to-know basis then so be it. If there is any dirty linen then why should it be washed in public á la Newcastle?
Matters on the pitch speak for themselves. I write this the morning after the kids demolished Sheffield United and the first team is on top of the Premier League. Your "sources" should be able to tell you that Mihir...
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I think the answer is that Mihir is supposedly a football analyst. His understanding of finance is pretty poor. Ever heard of a mortgage Mihir? Emirates didn't build itself?
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I'm an Everton supporter and whilst Arsenal aren't 'my team' per say', I actually respect them quite a great deal.
The comments in the article, "What is surprising is given how good a story Arsenal have to tell, both on and off the field, they behave as if they have much to hide", I feel is over the top.
A business has the right to declare and be as open / shut with its information release as it deem's fit and in line with the club's business practice to the satisfaction of the shareholders.
On face value, if the figures declared are true and accurate, one would have to assume the shareholders are satisified and performances on the pitch are good also, so the theory and belief Arsenal have always held of bringing on and developing young talent is working for them.
Whilst Arsenal can't win every year, when was the last time they seriously weren't considered a threat or a massive club which in my opinion they are cemented as oppossed to say Chelsea, who let's be frank, prior to RA were only a 'team'.
I wish Everton who are my club were on as sound a platform as Arsenal.
Thank you.
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The Envy just shines through with you Bose.
Shouldnt you worrying about your own shambles.
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A modern day mystery? What a load of rubbish yet again from the BBC’s chief sports editor. Are you trying to create a story out of nothing? Create a little scandal where there is none? How many businesses release the details of exactly why they are replacing their CEO? None. Edelman joined because he’s an excellent cost cutter and bookkeeper. When Arsenal needed the purse strings to be tightened during the construction of the Emirates stadium, Edelman was the man to do it. Edelman is not a football man, he doesn’t have a little black book of contacts in the football world. He was brought in to do a specific job and so now that the project is completed it was time for him to move on. It’s no big deal Mihr!
Also what’s wrong with a pre-planned statement? Every company (with a public profile) who make a public announcement has a pre planned statement – were you expecting Hill-Wood to make an off the cuff press conference (heaven forbid)? I have worked for a number of businesses who have a much lower public profile than Arsenal football club and they always had pre-planned statements for all its financial results. But if you know different please let me know.
And at a time when we desperately need football clubs to ensure that our great game doesn’t fall into the hands of undesirables, I think it’s pretty obvious why Usmanov doesn’t get a place on the Board at Arsenal and it should be applauded not questioned. Arsenal resisting his takeover is a good thing not something to query.
You say there’s talk of people giving up their deposits but you fail to mention what you mean by “talk” – who’s doing the talking? Is it the people who’ve put a deposit down? Is it people from Arsenal? And how many people are we talking about? 1? 2? 3? 655? How many? You fail to mention any of this and I have to wonder why.
Your bias against Arsenal is ridiculous – stop abusing your position to get your point across and attempt to convince others that there are more problems than there actually are. If you don’t like Arsenal then just come out and say it. But if I’ve got the wrong end of the stick then please let me know.
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Mr Bose
In your wittering about Arsenals finances over the years is there anything you have got right?
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This is really poor.
it's like tabloid atricle, trying to make a crisis when one doesn't exist.
I don't blame Hill-wood for only making comment on Arsenal.com when there's journos like you about in high positions.
Mihir, just admit you took a stab in the dark on this one, and you've been caught out.
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This is really poor.
it's like tabloid article, trying to make a crisis when one doesn't exist.
I don't blame Hill-wood for only making comment on Arsenal.com when there's journos like you about in high positions.
Mihir, just admit you took a stab in the dark on this one, and you've been caught out.
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money money money money money money money money money
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