Season review
Bristol Rovers competed in its fourth consecutive season in EFL League One. The club started the season strongly with fans dreaming of a promotion challenge. However, this all changed following the unexpected resignation of manager Graham Coughlan.
The club season didn’t continue at this pace under new management, ending the season in 14th place.
The season proved even more eventful with new ownership amidst the managerial changes and the global pandemic. Mr Wael Al Qadi took control and financially, saw the club record a loss of £2.4m in his first season.
This article analyses the 2020 finances of Bristol Rovers.
Revenue
Bristol Rovers saw its revenue decrease from £6.5m to £5.9m (9%) as the club felt the impact of the pandemic. The club does not provide a breakdown of revenue; however, the main driver of this reduction was the early end to the season.
Matchday
Bristol Rovers would have seen matchday revenue decline as four home games were not played and this would have been the main reason for the overall revenue reduction.
Matchday revenue will be even lower in 2021 as the season was played behind closed doors.
Broadcast
Broadcast revenue will likely have increased as the club reached the FA Cup third round compared to a first round exit in 2019. This would have offset some of the matchday revenue lost.
Broadcast revenue will be similar in 2021 but will unfortunately fall in the 2021/22 season following relegation to EFL League Two.
Commercial
Bristol Rovers’ commercial revenue may have been boosted by a new deal with Utilita who replaced the now bankrupt Football Index.
Bristol Rovers is likely to see revenue fall further in 2021 as a result of a full season behind closed doors. Looking ahead, 2021/22 will see an even further decline due to relegation to League Two, but at least fans (and matchday revenue) will return.
Operating costs
Bristol Rovers’ operating costs fell from £9.9m to £8.8m (11%) as it managed to cut some costs as the financial impact of COVID-19 on revenue was felt. This reduction exceeded that of revenue and improved profitability.
The club provides limited information on its operating costs and therefore we are unable to analyse wages and other operating costs.
Bristol Rovers will have to reduce costs substantially following relegation to League Two. This will need to be managed carefully to remain competitive and also avoid financial issues.
Transfers
There was limited transfer activity by Bristol Rovers in 2020 with no major outgoings or signings for transfer fees.
Amortisation
Player amortisation charges fell from £0.5m to £0.3m (34%) due to the lack of transfer activity. It is likely to fall to zero in the coming years due to no transfer purchases.
Profit on player sales
Bristol Rovers recorded a minimal profit on player sales of £0.1m (2019: £0.6m). This was likely due to a sell-on clause in respect of a former player.
The sale of Clarke-Harris will see a much greater profit on player sales achieved in 2021.
Bristol Rovers is a club with limited resources and therefore often rely on free transfers and loans in the transfer market. The occasional significant sale (such as Clarke-Harris) can be a big boost to its finances.
Profitability
Bristol Rovers is a loss-making club and has been so for over 10 years. This did not change as a £2.4m loss was recorded.
Operating profit / loss before player trading
Before player trading, Bristol Rovers recorded a loss of £2.2m, an improvement on £3.3m loss in 2019. This was as a result of its cost cutting in the year.
With revenue likely to decline further in 2021, losses will likely increase.
Operating profit / loss after player trading
Due to limited player trading, losses rose to £2.4m. The sale of Clarke-Harris will improve this situation and may offset the anticipated revenue decline.
Profit / loss before tax
With Bristol Rovers incurring minimal finance costs, losses before tax were also £2.4m (2019: £3.3m).
Summary
Bristol Rovers will be hoping that a combination of the Clarke-Harris sale and cost cutting measures can see a reduction in losses in 2021. 2022 losses will likely increase following the club’s relegation to League Two.
Assets / Liabilities
A new owner saw a significant reduction in ownership debt as former owner debt was settled.
Cash flow
Cash levels increased from £0.2m to £1.1m as the new owner injected cash into the club’s reserves.
Debt
Debt levels fell from £15.1m to £1.9m as former owner debt was written off and Mr Wael Al Qadi injected £1.9m of his own cash as he showed early commitment.
Net debt
Net debt hence now stands at £0.8m. This figure is likely to increase following relegation as more funding is required to keep the club afloat.
Final Remarks
Bristol Rovers is now a League Two club having finished bottom of League One in 2020/21. This will have significant ramifications on its finances as it has to cut costs as revenue falls. This wouldn’t have been the story envisaged by its new owners who will now be tasked with funding the club’s return to League One. It will be interesting to see how this ownership tenure goes…
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