Business

Football clubs 'in poor financial health'

  • 3 April 2012
  • From the section Business
Portsmouth v Middlesbrough - npower Championship
Image caption Portsmouth, here facing Middlesbrough, are trying to find a buyer and avoid relegation

One in five clubs in the English Football League is in "poor financial health", according to a survey by administrators Begbies Traynor.

The company is overseeing the administration of Port Vale, the latest in a list of clubs including Portsmouth who are in trouble.

"Many clubs are continuing to spend too much, principally on players' wages, as they always have done," it said.

The survey did not include any teams in the Premier League.

The Football League refers to the three divisions below the top flight - the Championship, League One and League Two.

Of 68 teams surveyed in those divisions, 13 have signs of distress such as serious court actions against them, including winding-up petitions, late filing of accounts and "serious" negative balances on their balance sheets.

That 19% compares to just 1% in the wider economy, the firm said.

'Underlying problems'

"While Premier League clubs are guaranteed huge television money every year and some have extremely wealthy backers, there are signs of genuine financial distress among a significant number of football league clubs," said Gerald Krasner, a partner at Begbies Traynor.

"The sales of season tickets for next season, many of which are paid for during April and May, could provide some short-term relief for struggling clubs, but it won't solve the underlying problems."

The financially distressed clubs include three in the Championship, six in League One and four in League Two.

The survey was anonymous and Begbies Traynor said the clubs surveyed could not be named.

The deadline for potential bidders for Port Vale was Monday. Begbies Traynor have said they were expecting five bids.

Portsmouth's administrators Trevor Birch have welcomed initial interest by the Portsmouth Supporters' Trust to buy the club through a share scheme.

Rangers' administrators Duff and Phelps have set a deadline of 4 April for "best and final offers".

Interest has come from the Blue Knights, a US group fronted by Club 9 Sports and a consortium from the Far East.

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