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Carrick sale helps Spurs post record profits
1 May 2007
Leisure Report


Reporting interim results for the six months to 31 December 2006, Tottenham Hotspur Football Club said it had recorded a a record pre-tax profit of £20m, thanks largely to the sale of midfielder Michael Carrick to Manchester United, for an initial £14m.

Turnover from key operational areas was higher than in the corresponding period last year, while total turnover for the period was higher than the club's annual turnover, prior to the current management team joining the business six years ago.

The 32% increase in turnover was driven primarily from the uplift in key sponsorship deals, and the club's progress in both cup and European competitions.

Spurs generated an operating profit of £14.3m, before amortisation. Profit on disposals (player sales) came in at a total of £15.2m, which after all other trading brought profit on ordinary activities, before interest and taxation to £20.9m (2005: £5.8m).

Premier League gate receipts were marginally higher than in the same period last year, representing the same number of league games with attendances consistently at or near capacity. The key difference for the period was the receipts from Cup competitions, which were £4.5m higher than in the corresponding period last year due to the five additional home games played in the period.

Sponsorship income of £7.0m for the six months was £3.8m up against the corresponding prior period. Corporate hospitality also contributed a strong performance, producing income of £5.9m (2005: £5.3m) boosted by the income from additional cup games.

Media and broadcasting revenues in the period rose by £1.7m, largely due to increased live Sky television appearances compared to the same period last year but also from the sale of broadcasting rights for the club's home UEFA Cup games. This revenue stream will continue to outperform prior years as the new media deals for domestic and overseas rights from the 2007/2008 season are substantially higher.

The merchandising division also improved against the same period last year, with turnover up by £1.5m.

Operating expenses before amortisation were 4% higher at £33.5m, compared to £32.1m in the comparative period, the key increment being player salaries and the additional cost of transporting the team around Europe for Uefa Cup matches.

Amortisation of intangible fixed assets continued to increase, seeing a 30% rise, reflecting continued investment in the squad. This was balanced by the profit on disposal of players.

During the period the club drew down £20m of securitised funding which is repayable over a 16-year period. This was set up to fund investment in the proposed new Academy and First Team Facility. These monies have been ring fenced from operational requirements, together with additional funds from the club's own resources, while the planning process continues.

Daniel Levy, chairman, said: The overall position is a significant improvement as we continue to push every area of the club to perform at its best. The financial position remains strong and we remain in the elite group of Europe's wealthiest clubs, as defined by the Deloitte Football Money League. The key is to build on European progression and ensure we attain greater consistency in the league, and domestic cup competitions."

Financial Highlights

Six months to 31 Dec 06 £m Six months to 31 Dec 05 £m

Turnover 47.8 36.3

Amortisation of intangible fixed assets (8.6) (6.7)

Profit on sale of intangible fixed assets 15.2 8.3

Profit before tax 20.0 4.4

Retained profit for the financial period 13.8 2.5

Earnings per share - basic 14.8p 2.6p

Earnings per share - diluted 7.9p 1.9p