Writer: The Tuckster
Date:Thursday October 10 2013
Norwich City have released the annual accounts for the club and with it, the news that the club are effectively debt free.
Two seasons in the Premier League have allowed The Canaries to wipe out a debt that was crippling in the lower leagues.
In October 2009, City had loans of over £24m that were putting so much pressure on the club's finances that we were famously 'days away from going out of business'.
A smart restructuring of the loans allowed for some breathing space and a promise to the creditors that all loans would be paid back within two years of Premier League promotion.
Looking back on it, that time seems an awful long time ago and at that moment, the prospect of Premier League football seemed fanciful. Roll on four years though and following succesive promotions, Norwich City are Premier League residents.
We all know that the club has been put back on a level financial footing by the Chief Exec, David McNally and board of directors and clearly lessons of the past were well learned.
Those massive loans are now gone and the only monies owed are interest feee loans of around £2m to Delia and Michael. City finished the 2012-13 financial year with £900,000 of external debt, £700,000 of which was tied up in preferred shares, while the remaining £200,000 was paid off weeks after the accounting period.
Chairman Alan Bowkett has been a major player behind the scenes and has spoken about the club being in control of it's own destiny.
'I'd postulate there are few clubs in the Premier League who can say that,' Bowkett told BBC Sport.
'We're on a sound financial footing. In my view we have our best team for 20 years. The future is looking rosy.'
He added: 'In terms of the football club going forward it gives us complete freedom to manage our own destiny.'
As everyone knows, another major reason for our success are the decisions taken along the way by Chief Executive, David McNally who arrived after relegation from The Championship in 2009.
'Four years ago when we were looking at lots of debt and League One football, we put in a plan to turn the business around and I'm happy to report we're on track,' said McNally.
'To do it in four years, some would have perhaps seen as far-fetched back in 2009.
'They were difficult days. We are now institutionally debt free. We can now generate as much cash as possible and put that into the football team. Comparing then and now is like night and day.'
Norwich's after-tax profit for 2012-13 was just £500,000, down from £13.5m in the previous 12 months, but the club has moved its financial year from May to June, meaning the newest accounts cover a 13-month period.
Meanwhile, there was £19.7m of player investment in the last financial year, up from £10.4m, and increase in spending made possible by successfully retaining their Premier League place for a third successive season, and the £49.03m received for television rights.
The latter figure will rise to somewhere between £62m and £64m for this season, with an extra £1.25m for every position above 20th the club finishes.
McNally though is under no illusions though as to what the future must hold for City.
'As long as we're alive, we have to stay in the Premier League,' he said.
'It's a message I need to get across to all of my colleagues here at the football club. The board knows it, but everybody who works here needs to be focused on that.
'It's why the finances have improved so quickly and it's integral to our future plans.'
What all this emphasises is the importance of Premier League football to our club. I know some people that would, unbelievably, rather that we be playing Championship football and being more competitive each week. To me, this is crazy talk. How can you ever improve if you don't test yourself?
Whilst we aren't going to rip up any trees and challenge to win the league anytime soon, maybe we never will, but you have to want to be at the top table. Part of the great thing about watching Premier League football is to see some of the world's best players come to Norwich and perform in front of us while our team give them what for.
Sometimes the opposition do wonderful things, like Willian's goal last Sunday but how brilliant was it to see our lads push Chelsea all the way? It was only becuase they were able to bring on £75m worth of talent from the bench that they won the game. Clearly we are a long way from those sort of options sitting on the bench but we were a match for Chelsea for most of the game.
I'll take that over beating Barnsley four nil, any day of the week.
It also seems that plans to raise the capacity of the stadium have been put on hold in the short term as well.
City regularly sell out Carrow Road, which has a 27,000-capacity and have considered rebuilding the City Stand to increase that to 32,000.
However, that would require a 20-year, £30m mortgage and losing up to 6,000 seats for an entire season, so the project has now become a long-term idea.
'It's on the agenda, but the first thing we want to invest in is the software - staff and academy - to secure our position in the Premier League,' Bowkett added.
Everyone would love to see a raise in capacity but I can only imagine the uproar from those seated in the City stand upon hearing that they couldn't watch their club for an entire season.
Date:Thursday October 10 2013
City To Face Fulham in FA Cup (Sunday December 8 2013)
Stats: West Brom v Norwich City (Sunday December 8 2013)
City's Raid On The Hawthorns (Sunday December 8 2013)
Savvy's Stats - West Brom (Saturday December 7 2013)
The West Brom Preview (Saturday December 7 2013)
The View From The Hawthorns Q&A (Saturday December 7 2013)
Drubbing Still Fresh In Clarke's Mind (Friday December 6 2013)
Hughton Demanding A Reaction (Friday December 6 2013)
RvW On The Comeback Trail (Thursday December 5 2013)
Yet Another Away Day Horror Show (Thursday December 5 2013)
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