2020/1 - Accounts

A change of direction

City's 2020/1 accounts were filed on 4th May 2022 at Companies House and cover the 12 months up to 30th June 2021. The headline was that nett assets exceeded nett liabilities by £3,582,036, an "improvement" of £11.674m on a year earlier. Nett assets give a point in time valuation of the club, essentially the value of all the club if everything was liquidated and might suggest a value any prospective buyer might have to pay to acquire the club. Most nett assets are owned tangible goods and may include an amount of cash. Whilst City's Wiggington Road training will be considered an asset, it has historically been classed (and valued) as agricultural land (and not suitable for building) and therefore wiil have only a nominal value.

The turnaround can be attributed to various items, which may or may not include:

  • proceeds from the sale of Ben Godfrey to Everton in October 2020 (£2m+ as a 10% sell on clause)
  • writing off part / all of the interest owed to JMP (stated as £9.22m in last year's accounts)
  • increase in the declared value of Bootham Crescent (previously valued at £4m and sold at £7m)

Another striking difference was the manner of the announcement, a statement on the club website, the first time I can remember this happening for a a number of years, rather than having to search Companies House. In full, the statement read, "The Directors are delighted to advise supporters of the Club that Audited Financial Statements in respect of the year ended 30 June 2021 have been filed recently with Companies House which reflect an overall surplus of Assets over Liabilities (Net Equity) amounting to £3.(sic, point!)582,036 (presumably £3,(comma)582,036). In addition, following recent payments made to Ex-Directors and Shareholder of £285,470, being their final legal entitlement following a transfer by themselves of the former ground to Bootham Crescent Holdings Limited, the Net Equity of the Football Club has increased further to £4,169,149. Without doubt it has been an incredibly lengthy and arduous journey from those dark days of 2003, when the Football Club came within 30 minutes of failing to exist, although the vision, tenacity and financial support of the Chairman, Jason McGill, has enabled the Club to create remarkably solid foundations for the current and future generations of supporters. In addition to successfully resolving a previously dire financial situation the Chairman’s determination and endeavours have been instrumental in enabling a successful transition from the former ground at Bootham Crescent that reflected its age to a new purpose-built Community Stadium with security of tenure guaranteed for a minimum period of 99 years. This culmination of events enables the Club to adopt a progressive policy of successful forward planning which will hopefully lead to success on the field and ultimately a return to the Football League".

Note, the statement states nett assets had subsequently increased to £4,169,149. Significant events that I can imagine might have given a uplift of £587,113 in about 10 months include the:

  • difference between sale value and book value of Bootham Crescent
  • "true up" with former directors (see below)
  • write off of interest / loans owed to JMP.

The statement gave no indication of the profit and loss / trading position over the last 12 months, something which large companies have to provide, but smaller companies, like City, have no obligation to do so.

Across much of the early part of the 2021/2 season, there was much ill will concerning City's debt and whether JMP / Jason McGill would honour the commitment to forego interest due. Given the financial year had closed nearly 4 months earlier, it was disappointing that the directors didn't confirm the JMP / Jason McGill pledge had been honoured but were able to confirm that the club was running as a profitable business when they spoke on Radio York in October 2021.

The "full" accounts were available on the Companies House website shortly after they were filed.

The accounts included:

  • Debt provision of £3.425m (up from £325k a year earlier) and is assumed to be largely performance related payments due to City from Ben Godfrey's transfer
  • once again did not include a profit and loss sheet. It is not a statutory requirement but can be useful to better understand income and expenditure in year. About the only numbers relating to the 2020/1 accounts are the number of employees, net liabilities and JMP loans
  • City’s investment in Bootham Crescent Holdings Limited (BCH) was revalued at £6,344,715 during the 2020/1 financial year (up from £3,764,715 in 2012) and had originally cost £2,011.115
  • A payment of £285,470 was made to the previous directors on the sale of Bootham Crescent as a part of the original purchase agreement, this increased YCFC’s holding in BCH to 93.95%, effectively increasing City’s interest in BCH from £6,344,115 to £6,931,228
  • On March 31, 2021, City’s nett assets were £3.58m, Subsequently these increased by about £700,000 on the share of Bootham Crescent and monies due, believed to be from the BCH directors. In April 2023, Alastair Smith noted, "The assets (bear in mind that the 10 years rent and 99 year lease need to be depreciated in the P&L, it doesn’t affect cash flow but will show up as a cost in the P&L each year) in the balance sheet mainly consist of :-
    • The remainder of the 99 year lease
    • Remainder of the first10 years rent
    • Some fixed assets including Bumper Castle, the Training Ground, and plant and machinery
    • Normal debtors and creditors.
  • In April 2022, City reported an increase in assets of about £700,000 since the 2020/1 financial accounts, this may be related to the BC sale value and increased BCH holding
  • JMP accounts state they held 75% of the shares in YCFC and the York Stadium Management Company. They also state turnover for YCFC was £2,802,465 (up from £1,267,080 a year earlier, presumably driven by income from the Ben Godfrey sale) and turnover for York Stadium Management Company was £425,703 (up from £148,771 a year earlier). Given JMP own 75% of each of these 2 entities, it is unclear whether turnover stated represents 75% (JMP holding) or 100% (full entity) of turnover
  • Interest payments due to JM Packaging Limited during the 2020/1 financial year were waived and the overall amount outstanding to JMP was reduced to £5,473,564 (down from £9,220,180). This is presumably as part of the pledge not to take the interest that was contractually due and the write off of some historic interest as a part of that pledge. There was no other mention of any JMP interest payments
  • For the first time in many years, no mention is made of any commitment by JMP to provide funding; presumably such a commitment is not required given the nett assets and the club’s commitment to “wash its own face” at LNER
  • The accounts show an “operating lease commitment” of £14,610,090 over the next 99 years. Up from just £14,664 a year earlier, presumably this relates to the rent due an LNER, approximately £140,000 per year
  • In the financial year, YCFC accounts show City's playing and management staff numbers decreased by one to 32 (maybe due to covid ending the season early) and overall staff numbers increased by 2 to 47 (potentially related to additional effort involved in the sale and move to LNER). SMC employees remained constant at 2. Staff numbers are taken from JMP, YCFC and SMC accounts.

York Press article: 2019/20 accounts, maybe they'll post more about 2020/1.

Further information can be gleamed from accounts filed at Companies House for YCFC, Bootham Crescent Holdings, JM Packaging and York Stadium Management Company.

Health Warning: This analysis is provided by a layman with no accountancy training / experience but with an eye for numbers.

20+ Years Of City Accounts