Millwall Finances 2021 – Record Losses

This article analyses Millwall finances in respect of the 2020/21 season.

Season review

The 2020/21 season was a tame season for the Lions as the club finished mid-table in 11^th. This was three places lower than the prior year as they continue to aspire to a EFL Championship play-off place. The club reached the FA Cup fourth round and EFL Cup third round too.

Millwall finances took a hit from the loss of matchday revenue which saw the club record a loss of £14m. This was Millwall’s largest ever loss and The Lions have not recorded a profit since 2002.

Millwall Finances – Revenue

Revenue fell from £16.4m to £12.5m as the club saw its matchday revenue plummet. Millwall also recorded other income of £2.1m, an increase from £0.9m in 2020. The majority of this income relates to amounts received from the Government Furlough Scheme (£1.4m).

Matchday

Matchday revenue plummeted from £4.4m to £1.4m (67%) as fans were unable to attend most games. Only two games were played with fans which were capped at 2,000 fans (10% of capacity). With fans returning to The Den in 2021/22, most of matchday revenue should be recovered unless new restrictions are introduced.

Broadcast

Broadcast revenue fell from £9.4m to £8.4m (11%) as the club fell three places in the league and suffered the impact of COVID-19. A strong FA Cup run may help boost broadcast revenue.

Commercial

Commercial revenue remained stable at £2.7m. The club remain with the same shirt (Huski Chocolate) and kit (Macron) sponsors so likely much of the same in 2022.

Millwall Finances – Revenue summary

Millwall Finances – Operating costs 

Operating costs rose from £25.4m to £26.1m (3%) as Millwall steadied its cost base in light of falling revenue. Profitability was however damaged by slightly rising costs and a revenue reduction.

Wages

Millwall’s wage bill rose from £18.9m to £20.8m (10%) as the club failed to slow wage growth significantly. 

This and falling revenue led to a worrying wages to revenue ratio of 167%. This means that for every £1 generated in revenue, Millwall are paying out wages of £1.67. For comparison, UEFA recommend a maximum ratio of 70%, which Millwall are more than double of. The return of fans and rising revenue will push the ratio back towards the 115% of 2020. However, Millwall will be looking at how it can better manage its wage bill while remaining competitive to avoid large losses.

Other costs

Other operating costs fell from £6.5m to £5.3m due to matchday cost savings.

Millwall Finances – Operating costs summary

Millwall Finances – Transfers

The Lions do not often spend significant sums in the transfer market and 2020/21 was no different. While the chart above and Transfermrket.com suggest no transfer spend, the accounts of Millwall indicate a transfer spend of £1.5m and income of £1.6m. 

Millwall signed Kieftenbeld, Evans and Bennett during the season, while no major outgoings suggest this income came from sell-on clauses from previous sales.

Amortisation

Player amortisation charges fell slightly from £2.2m to £2.1m (2%) as playing squad investment remained stable. Limited spending to date in 2021/22 will likely see this fall slightly.

Profit on player sales

Profit on player sales rose from £0.1m to £0.7m as the club looked to have benefitted from a sell-on clause or two. It is unclear who this could have related to. 

No major outgoings in 2021/22 to date will likely see a small number here unless any sell-on clauses are triggered.

Transfer debtors / creditors

Millwall is owed a net £0.2m in transfer fees.

Millwall Finances – Transfers summary

Millwall Finances – Profitability

Millwall recorded its largest ever loss in 2021 and kept the streak of losses going since it started in 2003.

Operating profit / loss before player trading

Before player trading, Millwall recorded an operating loss of £11.6m, up from £8.0m in 2020 (45%). This was almost entirely driven by the loss of matchday revenue. The return of this revenue stream in 2022 should improve this picture, although the club will be losing its furlough income of £1.4m which will offset this.

Operating profit / loss after player trading

After player trading, operating losses were £13.1m, up from £10.1m (29%). As mentioned, player trading has a minimal impact on the Millwall finances, and this appears unlikely to change.

Profit / loss before tax

Net finances costs of £0.7m saw Millwall record a loss before tax of £13.8m, up from £10.9m in 2020.

Millwall Finances – Profitability summary

Millwall Finances – Assets / Liabilities

The losses incurred by Millwall saw the club require significant funding from both its owners and the EFL.

Cash flow 

Millwall’s cash reserves rose from £0.6m to £1.3m. This was driven by cash inflows from financing (from the EFL and its owner) of £15.8m which were used to offset cash outflows from its operations (£13.8m), player trading (£0.1m) and capital expenditure (£1.2m).

Of this financing cash inflows, £7.9m was received from both the EFL (loan) and its owners (capital injection – non-repayable).

Debt 

Therefore, debt levels rose significantly from £12.0m to £19.9m. Millwall received £8.3m in loans (£7.8m outstanding) from the EFL to pay off its HMRC debts. The repayment terms are unknown.

In addition, the club has a £20m credit facility with its owners and is currently using £10m of this facility. It is due to have a steep interest rate of 12%, however interest is currently being waived on this facility.

The club also has long-term lease liabilities of £2.3m.

Net debt

Millwall’s net debt hence stands at £18.5m, a significant increase on the £11.4m figure in 2020.

Millwall Finances – Final Remarks

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