Season review
Barnsley rebounded straight back to the Championship following one season in League One.
It was a tough 2019/20 for the club with Barnsley rock bottom of the league when the outbreak of COVID-19 caused the suspension of the season.
Fortunately for Barnsley, a superb run of form once the season resumed saw the club dramatically retain its Championship status with a 91st minute winner against Brentford.
Off the pitch, Barnsley is intriguingly owned by Pacific Media Group who have continued its strategic investments into various clubs across Europe which may benefit Barnsley with a wider and more knowledgeable network to acquire talent through.
Due to promotion, Barnsley was a rare occurrence of substantial revenue growth with revenue nearly doubling to £14m, while the club recorded a modest loss of £0.3m.
Revenue
Overview
Barnsley increased its revenue from £7.8m to £14m (83%) in the 2019/20 season following its promotion back to the Championship and by narrowly surviving will be thankful for no significant drop in its 2021 revenue.
Matchday
Matchday revenue rose from £3.1m to £3.4m (9%) as the impact of promotion and bigger crowds outweighed the loss of four home games were played without fans.
There will however be a hole of £3m in its 2020/21 financial results due to a full season with no fans in attendance.
Broadcast
Broadcast revenue more than tripled from £2.7m to £8.5m following promotion and progressing a stage further in the FA Cup (fourth round).
Barnsley were a surprise package in the 2020/21 Championship season and its fifth placed finish will likely see the club increase its broadcast revenue.
Commercial
Commercial revenue benefitted from promotion, rising from £2.0m to £2.3m (15%) following The Investment Room becoming its new shirt front sponsor.
Barnsley will be hoping that there is further commercial growth following its successful 2020/21 campaign, but this may be impacted by COVID-19.
Summary
Barnsley narrowly survived in the Championship in 2019/20 which given the added financial pressure from COVID-19 was a lucky escape. The club improved its form in 2021 and despite revenue likely to fall due to the loss of matchday will be hoping to see growth in the 2021/22 season.
Operating costs
Overview
Operating costs were on the rise following promotion, increasing from £13m to £18m (39%) as the club prepared for its Championship return.
Wages
Wages rose from £8.1m to £11m (37%) due to the activation of promotion related wage bonuses/increases and new signings.
The utilisation of the furlough scheme saved the club some wage costs.
Due to promotion and the associated revenue growth, Barnsley managed to reduce its wages to revenue ratio from 105% to a relatively healthy 78%, which given the ratio of its peers, is one of the lower figures in the league.
Other costs
Barnsley’s other operating costs rose from £4.4m to £6.4m (45%) due to the higher costs associated with competing in the Championship.
Summary
Barnsley appear to be a club focussed on financial sustainability and did well to reduce its wages to revenue ratio following promotion and not overexerting itself financially.
With COVID-19 damaging revenue levels, the club will have to keep a close eye on its costs base while staying competitive in the league.
Transfers
Overview
Barnsley were busy in the transfer market following its promotion as it prepared for a relegation battle.
In came Luke Thomas (£1.2m), Scmidt (£1.1m), Wilks (£1.0m), Juel Andersen (£0.9m), Ritzmaier (£0.5m), Sollbauer (£0.5m), Sibbick (£0.2m), Halme (£0.2m) and Bahre (£0.1m) for a total of £5.6m.
Departing Oakwell were Pinnock (£3.0m), Moore (£2.4m) and Lindsay (£2.0m) for a total of £7.5m, resulting in net transfer income of £1.8m.
Barnsley saw some of its key players sold for significant fees and replaced with players that needed time to gel which nearly cost the club via relegation. Since then, the club and some of these players really kicked on.
Amortisation
Player amortisation charges rose from £2.4m to £3.0m (26%) as a result of the increased level of transfer purchases.
Barnsley spent significantly less in 2021 and therefore it is likely this figure will stay at a similar level or fall.
Profit on player sales
Barnsley recorded a profit on player sales of £5.8m which helped the club break-even.
There was significantly less value in player sales in 2021 which is likely to result in a much lower profit on player sales.
Transfer debtors / creditors
The Tykes are owed £5.3m in transfer fees and only owe £1.7m, a net debtor position of £3.6m.
Profitability
Overview
Barnsley rely on its player trading to achieve profitability and in years where sales are not forthcoming in large enough quantities a loss is very likely to occur.
Operating profit / loss before player trading
Before player trading, Barnsley recorded a loss of £3.1m, albeit an improvement on its loss of £4.8m in 2019.
While promotion may appear good to its pockets, the majority of the rise in revenue is swallowed up by rising wages to remain competitive in the division, an issue facing many in the football leagues.
Operating profit / loss after player trading
Barnsley recorded a loss of only £0.3m after player trading due to the profit recorded on player sales of £5.8m being far greater than the player amortisation of £3.0m.
A relatively lean year for player sales in 2021 means that the club are likely to record a much larger loss, especially when combined with impact of COVID-19.
The club is reported to have received £2m in compensation from West Brom for manager Ismael, which may help soften the financial blow (if not the emotional one).
Profit / loss before tax
Barnsley recorded a similar pre-tax result due to no finance costs.
Barnsley’s reliance on player trading is a common model across Europe and fits with the goals of the owner who owns a number of clubs across Europe. The scouting network this provides is valuable and is likely to be utilised to help Barnsley remain competitive on and off the pitch.
Assets / Liabilities
Overview
Barnsley is a well-run club which appears to prioritise financial sustainability. The club is, even after the outbreak of COVID-19, debt-free.
Cash flow
Cash levels fell from £2.6m to £0.8m (69%) as cash outflows from operations of £2.9m were partly offset by cash inflows from transfers of £1.1m.
Barnsley spent little on capital expenditure in the year and received no owner or third-party funding.
Final Remarks
Barnsley ended the 2019/20 season on a high following survival and a superb 2020/21 season meant there was plenty to be excited for. However, the departure of its manager to West Brom highlighted that while financial sustainability and spending within your means is sensible, it can place limits on the club when not seen as ambitious enough for some fans, players and in this case, managers.
Despite this, the club will admirably stick to its plans and will hope that they can continue to build and sustain another promotion challenge in the near future.
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