"I'm really pleased with where the club is at this moment in time. "The headline figures reflect the investment we've made in the squad over the last few years. "Businesses don't get into difficulties because they don't make profits; they get into trouble because they run out of cash, which is a really important distinction that has to be made. "We've been able to sustain this because we've been investing in the squad thanks to our owner investing in us, in terms of giving us the cash to support the purchase of players. "We have a stable position in terms of our ownership and our key management people which is also important from a financial perspective. "Our external term debt is now less than it's been at any time since the takeover by the Drumaville Consortium and is coming down year on year." Walton says the headline figure is misleading as much of the loss is attributed to the process of 'amortisation' of transfer fees. The outlay to acquire a player is spread each year across the term of the player's contract, after which it has zero value in the club's accounts. If the club renews a contract then it gets spread out even longer. For example, a player purchased for ã4m on a four-year contract would be recorded in the accounts as costing ã1m per year even though the club's may have paid all the ã4m in one amount on signing. In addition, home-grown players like Jordan Henderson don't appear in the balance sheet at all! Walton explained: "When you look at the amount which is actually lost in the accounts, most of that is a result of amortisation of players. "There's a big disconnect between cash and profit. The transfer fees of many of our players appear in the last published accounts even though we paid out the cash for them some years ago" He added: "It's also important to remember when we buy players we are also buying assets. If we buy wisely then there is a good chance that they will appreciate in value. This is particularly true with a young squad. "If you look at the most recent accounts the net book value of our players was just over ã50m and that was before we spent nearly ã20m on Gyan and Sessegnon. By most people's reckoning, our current squad is worth substantially more than that. "You could probably get something near that figure from two or three players, never mind the entire 25-man squad." Meanwhile Walton also says that the club's income levels should ensure that the percentage of turnover taken up by wages falls in the current financial year. That marks part of a planned progression to turn a profit at the operating level and continue the encouraging trend of further reducing external debts. The continued progression of the club on the commercial side is also important to Walton, who already has a good impression of the financial picture for the next set of accounts. "The reason I'm comfortable is because I'm aware of what our figures are going to be for this financial year," he said. "The majority of the numbers are more or less cast in stone. We will be turning over more money this year because the TV deal was better and we've been doing well on the pitch. "Our wages have gone up again, but crucially the percentage of wages to turnover will decrease. "We've received some criticism for the figure being above 80% that certainly won't be the case this time. "We are going to see a journey where we've peaked in terms of the losses and are going forward reducing that loss each year. "I'm not going to say we're not going to make a loss this year because that's not practical in terms of where we are and our development. "Times are tough out there. It's important to keep the business in good health and income streams like this summer's pop concerts will help us." Sunderland are currently seventh in the Barclays Premier League, with Walton and the board working towards establishing the club as a major player in tandem with the efforts of manager Steve Bruce and his coaching staff. Chairman Niall Quinn has highlighted the importance of increased attendances; something the chief executive says would be a "great statement" to the rest of the division exemplifying the positive strides being made by the club in all areas. "I personally believe we're a top-ten club now," he said. "We've played some great football. "Our gates are marginally down, which in my mind is due to the economic climate we're all currently operating in. "They've certainly been affected less than at some of our fellow clubs and we're still seventh in the batting order of attendances in the Premier League. "Niall has been very vocal about more people coming to watch us in the stadium, and he's doing that largely from a footballing point of view because he feels passionately the team have a bigger chance of winning games with a big crowd behind them. "But from a progress point of view, a few more people coming to watch us each week will mean we'll average gates in excess of clubs like Liverpool, which would be a great statement to the football world that Sunderland is a big club which is here to stay in the upper echelons of the division. "I'm a lifelong Sunderland supporter and we all feel the same way. We never want to dream too much because we've had so many false dawns. Well I think it's time to start dreaming." http://www.safc.com/news/20110225/walton-sheds-light-on-accounts_2256213_2301215
Now that has cheered me up no end, I hope Niall reads it. Not only does Walton sound like a good CEO but he also sounds like a true Sunderland fan. Lets hope this puts to bed the daft, we may have to sell crap.
i've just found ã20 in my garden so it's already been a good start to the day for me, this has made it even better
What a great, and timely statement to read. I can honestly say that has removed any small doubts i had about us, he answered all of my questions. Seems Quinn DOES just want the best atmosphere back for the team, and we can't deny that dspite the decent numbers, the vocality of us has dropped tragically. We need to get this sorted. This is something WE can influence.
this is the first time i have posted on Not606 but having just read Steve Waltons statement, it just gives me such a great feeling that our great club is moving forwards together as one. I understand Nialls frustrations with regards the attendance but it does look like he is saying it from a purely football point of view. To get the SOL rocking with 43K+ is like us having an extra Gyan and can only help us carry on. The magic carpet ride is still going and getting more exciting by the week. the future is red and white
Woke up this morning with nothing on the horizon but doom and gloom, logged on and read this and all of a sudden the future looks bright once again. Cracking read and i'm so pleased we have guys like this at the healm.
good read, and i've got a lot of time for walton, he's one of the top financial advisers whose expertise lies in football, so he'd be the right man for the job anyway, but he's a do or die mackem to boot. maybe he can have a word in quinn's ear next time he wants to drop soundbites...
Walton: "I'm a lifelong Sunderland supporter and we all feel the same way. We never want to dream too much because we've had so many false dawns. Well I think it's time to start dreaming." Top man
I didn’t know much about Steve Walton until a few weeks ago. Now I realise that he is almost as important as Quinny – that is, from Ellis Short’s perspective. Steve Walton is a Seaburn lad. A Sunderland fan / supporter. A great brain. Feckin brilliant for SAFC.
Just loved what I have read, it makes me pleased to have who we have at the helem, unlike the unwashed up the road where they must be wondering if the owners etc really like the club at all. The fact that he is a Sunderland fan (and sounds like a good lad at that), makes it all the more real. Words from the heart, and even when SNQ is on his rants, it's because he cares for the club and wants us to be a force to be reckoned with (I hope ) ktf
