Jackson: Challenging outlook' for Latics
Chief executive Jonathan Jackson admits Wigan Athletic face a '˜challenging outlook' after the club announced net losses of Â£2.3million for the 2015/16 season.
Despite winning the League One title in style, Latics once again suffered off the field as the fall-out from two relegations in the space of three seasons continues.
Operating losses - before any profits on player sales - were £4.3 million, while turnover decreased to £15.7 million compared to £28 million in 2015.
Net external debt at year end reduced to £5.2 million compared to £9.5 million at May 31, 2015 while overall net liabilities increased to £16 million.
“The financial results reflect that Wigan Athletic continue to adjust to operating at a different financial level than in recent years,” acknowledged Jackson.
“Turnover decreased by almost 50 per cent and costs - primarily player salary costs - had to be reduced by a similar amount to ensure the club were able to sustain this – something that is not always achievable for football clubs.
“Earnings before depreciation, amortisation and profit on sales of players – an indication of underlying financial performance - showed a loss of £900,000 compared to a £3.9 million loss in the previous year.
“Despite the playing squad restructure that was required to ensure the club reduced its operating costs, promotion back to the EFL Championship was achieved in a hugely-enjoyable season.
“It must also be acknowledged, however, the club continued to benefit from almost £12 million of Premier League parachute payments which meant we were able to spend considerably more on players than our competitors. “The future outlook after the current season is a challenging environment.
“The club is now receiving the final year of parachute payments which have significantly inflated turnover for the last four years.
“The EFL Championship is populated by clubs backed by extremely wealthy owners, who are prepared to lose enormous amounts of money in pursuit of promotion to the Premier League.
“Even clubs recently relegated from the Premier League are finding it difficult to compete in this expensive and ultimately unsustainable race for the ‘Promised Land’.
“The financial support of the Whelan family has allowed the club to enjoy incredible success in recent years, without incurring the large financial losses suffered by similar clubs, and that support allows us to continue to pursue long-term goals in the future.
“The club will always aim to compete at the highest level possible, but we must also be realistic in our ambitions and ultimately financial sustainability must continue to remain our priority.”
The figures in full:
* Operating losses, before any profits on player sales, reduced to £4.3 million compared to a loss of £11 million in the previous year.
* Profit from the sale of players was £2 million, primarily due to the sale of James McClean and contingency payments on players sold in previous years.
* Turnover decreased to £15.7 million compared to £28 million in 2015. The club received significantly lower Premier League parachute payments and also suffered a reduction in EFL central distributions and ticket sales as a result of competing in League One.
* During the season, the club invested over £4 million in transfer fees for new players, which ensured that the first-team squad was equipped to return to the EFL Championship at the first attempt.
* Total expenses, including salary costs and amortisation of player contracts, decreased to £20 million from £39 million in the previous year.
* Salary costs were again the most significant expenditure and these were reduced to £11.9 million compared to £26 million in 2014-15 when the club were relegated from the EFL Championship.
* Net external debt at year end reduced to £5.2 million compared to £9.5 million at May 31 2015 while overall net liabilities increased to £16 million.