Report of NCFC AGM courtesy of Archant newspapersThe financial realities of life outside the Premier League have been re-emphasised by the Norwich City board of directors to shareholders at the club’s annual general meeting at Carrow Road this evening.
There were no bold declarations of ‘promotion, promotion, promotion’ as previous chief executive Jez Moxey had declared at the beginning of last year’s meeting.
That statement – one which was greeted by an uneasy grimace from most in the room – came with City sitting sixth in the Championship table after three losses on the bounce.
Both Moxey and Alex Neil didn’t see out the season, which finished in eighth place, 10 points adrift of the top six and a new regime arriving on and off the pitch.
This time around Daniel Farke’s team sit 15th in the table, eight points adrift of the play-off places and without a win in six matches – or in their last seven at Carrow Road – so the mood at the AGM always promised to be rather gloomy.
There was an early moment of note when a shareholder, Robin Wilson, challenged the re-election of Delia Smith and Michael Foulger to the board.
He said: “They have made so many of the same mistakes over the last few years, on what basis do they feel they should be re-elected, as I have absolutely no confidence in their ability and they should be here to stand down.”
The statement was greeted with surprised gasps by some but made little difference, with both directors re-elected by almost all in the room, bar a few voting against.
The club’s annual accounts were also discussed further, following their publication at the start of the month.
With City failing to bounce back to the Premier League, as they had done in 2015, the stark reality of a potential third successive season in the Championship had been made clear when the club’s annual accounts were released at the start of the month.
Managing director Steve Stone summarised the accounts, which had shown a loss after tax of £2.7million, dropping from a profit of £9.4m posted in 2015-16.
A drop in income of £25m to £75.9m, due largely to a decrease in broadcast revenue of £18.6m, has forced City to start cutting costs.
But it is the looming loss of Premier League parachute payments, worth around £43m last season and £32m during the current campaign, which will leave the real hole.
Forecasts for 2017-18’s accounts showed:
• Income to drop to £59.7m (from £75.9m in 2016-17)
• Broadcast revenue to drop 28pc to £38m (from £52.4m)
• Gate receipts to rise from £9.2m to £9.7m thanks to Carabao Cup run
• Commercial and media costs to drop £1.6m to £7.3m due to no concerts being held at Carrow Road next summer as the pitch must be relaid.
• Severance costs to be down from £4.4m to £0.3m, which includes payments to Jez Moxey and Alex Neil.
Stone also showed exactly how much business was carried out in the transfer market during the summer, generating £17.4m in sales and freeing up £293,000 per week in wages. Those were replaced by £8.1m in fees and £120,000 per week in wages.
As a result the club is set to make a profit of £2.1m for 2017-18, although Balls stressed that was on the assumption of no January trading.
“There are no financial pressures on the board to make any changes to the squad or requirements to sell any players, we can handle the financial situation,” Balls said.
“But of course if we want to bring in players then we will have to bring in resources to do so and if we are not promoted to the Premier League we will face a substantial financial challenge and therefore there will be some difficult decisions to be made.”
Balls also revealed other areas of focus are:
• Communication and transparency with fans and other stakeholders
• Match atmosphere at Carrow Road, including consideration of safe standing
• Community support via CSF
He explained further: “The matchday atmosphere Joe Ferrari and Tom Smith, and all the board, are very focused on, including safe standing.
“One of the realities is that will require a change in the law and parliament is so mired in Brexit legislation that that is unlikely to happen in the next few years.
“But we’re very keen, if we can do it, to move to safe standing.”
The board also confirmed they have committed to spending £2m over the next two years to turn temporary buildings at Colney into permanent structures, to comply with Category One Academy Status.
Sporting director Stuart Webber discussed the club’s academy system, stressing that patience with young players would be needed at times but insisting clear plans are being made.
“If you look at the team which won the FA Youth Cup (in 2013), Cameron McGeehan was the captain and is now playing regularly in the Championship for Barnsley without ever playing a game for us, which I don’t think is great,” Webber said.
“So with Harry Toffolo and Carlton Morris, what was the plan for them when they were 17 or 18?”
On a lighter note, the prompting of club anthem On The Ball City is set to return after Ann Johnson questioned why the traditional pre-match chant had been abandoned.
Backed in her view by Balls, a snap show of hands saw most people in the room vote for its return.
Head coach Daniel Farke also drew a few laughs when asked Balls pointed out that the German was a striker in his playing days, in response to a question about if City will be bringing in a striker in January.
Farke joked: “I’m not sure if there is enough money in the coffers.”
The former Borussia Dortmund U23s boss went on to emphasise his faith that his squad will improve on their current form but as far as investment goes, Balls had already answered the question – further investment will require funds to be generated through player sales.