Arsene Wenger to recieve larger transfer budget in the future?
Part II of a Special Report
By Triplec1988, proud member of TheGoonerForum
As we discussed two weeks ago, Arsenal Holdings, through wise investments and short-term sacrifices, has laid the foundation for greater long term growth and financial stability. The transition from Highbury to The Emirates has resulted in a doubling of match day revenue for the 2006/2007 season. Furthermore, the development of Highbury Square and surrounding properties owned by the group are poised to provide Arsenal Holdings with greater long-term revenue. The development of Highbury Square is expect to yield around £300 million with the group stating in their year end financial report released in September 2007 that over 90% of the units have already been sold with the revenue from this development expect to be on the books for the next financial report to be released in September of this year. The smart refinancing package that the group complete two seasons ago consolidated bank debt into around £260 million of long term bond debt with a combination of low fixed and floating interest rates, giving the group greater flexibility in servicing its debt.
The half yearly financial report that covered the group’s finances from the May-November 2007 reaffirmed the sound financial base and potential for greater growth that the group outlined in the 2006/2007 report. The half yearly report noted that profits had risen by £20 million before taxes. Revenue for broadcast was up as Arsenal and the Premier League gain more popularity over seas. Furthermore, The launch of Arsenal TV in January 2008 in association with Setanta Sports is expected to increase broadcasting revenue even more. The move to the Emirates is also progressing nicely. International friendly matches and two Bruce Springsteen concerts will net the group a healthy return. The Emirates Cup has also been highlighted as an added source of revenue as the group reported that as of November 2007 match day revenues were already an astounding £41.4 million, with that number clearly expected to rise with the release of the next year end financial report due in September.
So what does all of this mean for the average fan? We can expect revenues to rise and debt to fall leaving the club with greater disposable income in the long run to use for wages and transfers. Since Arsenal’s debt is revenue generating and held over the long term, short term fluctuations in economic patterns will not effect the long term potential of the club and over a long enough time line the move to the new stadium will pay for itself resulting in greater power in the transfer market as well as a great ability to reward success players for outstanding seasons. This will help further cement Arsenal as a global football powerhouse able to compete financially with any club in the world without fear of future debt and possible bankruptcy al la Manchester United. So while we might yell at the papers and scream at the websites now over the perceived weakness of the club in the transfer market or our supposed inability to hold in to key players, in 3-5 years time the full effect of the move will start to iron themselves out and a new era will begin in North London. So cheer up Gooners, the sun is just starting to rise over the Grove.
Opinionated? Join us at TheGoonerForum and have your say on all things Arsenal