Revealed: Latest accounts for Sunderland AFC's last Premier League season

Sunderland AFC slashed its losses last season, the club's latest financial results show.

But the accounts released by Companies House highlight just how hard falling out of the Premier League hit the club’s coffers and its continued reliance on owner Ellis Short until last weekend’s announcement by the US billionaire that he was selling the club, subject to Football League approval, to an international consortium fronted by Stewart Donald.

The latest financial report covers the year from August 1, 2016, to July 31, 2017.

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The figures cover one of the most troubled periods in the Black Cats’ history, with David Moyes replacing Sam Allardyce in the dug-out and overseeing a desperately disappointing season in which the side claimed just two points from their first 10 Premier League games.

Relegation to the Championship was confirmed by a 1-0 home defeat to Bournemouth, with four games remaining.

The new report makes clear the importance to the club of returning to the top flight as quickly as possible.

Martin Bain.Martin Bain.
Martin Bain.
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A covering letter from chief executive Martin Bain says: “The directors consider the major risk of the business to be a significant period of absence from the Premier League,” it says.

“Ongoing investment in the playing squad aims to reduce this risk.”

Loss before tax was £9.9million for the financial year, down from £33million the year before.

Operating profit rose sharply, from £1.5million to £14.6million, while turnover jumped from £108.1million to £126.4million – largely on the back of the improved Premier League TV deal – and Short loaned the club a further £19.5million.

Ellis Short.Ellis Short.
Ellis Short.
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Net debt rose from £110.4million to £125.7million, of which £73million was owed to Short.

He had already written off £100million.

The 2016-17 season was the first year of a massive new deal between the Premier League, Sky and BT Sport, which saw domestic TV rights worth almost £2billion a season and foreign rights a further £0.9billion – by comparison, a televised home game in the Championship is worth just £100,000 and an away fixture £10,000.

Sunderland finished rock bottom of the Premier League in the period covered by the latest figures, but a place at English football’s top table was still worth £95.6million from television and other media rights, up from £71.5million in the 2015-16 season.

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Disappointing performances on the pitch were reflected in gate receipts, which fell sharply, from £10,439,000 to £8,955,000, while income from conference, banqueting and catering dropped even more, from £10,323,000 in 2015-16 to £7,233,000. Sponsorship and royalties and retail and merchandising were worth £9,777,000 and £3,586,000 respectively, little changed from the previous year.

The club made £33,144,000 profit on the disposal of players’ contracts, including the transfer of England goalkeeper Jordan Pickford to Everton.

Player trading and amortisation cost was £10.6million, down from £26.4million in the year 2015-16.

And while the club’s wage bill remained virtually static at £84.4million, the sharp rise in income meant the proportion of turnover devoted to paying its staff dropped from 77.6% to 66.8%.

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The number of full-time staff dropped from 408 to 364, including 71 full-time players and scholars, while the club had 645 part-timers, including match day staff.

Payment to directors, including pension contributions, was £1,736,877 (down from £1,812,619 in 2016).

Payments to the highest paid director, understood to be chief executive Martin Bain, totalled £1,243,829, including £80,000 in pension contributions.

Ellis Short did not draw a salary from the club.

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The club’s £9.9million pre-tax loss is almost exactly the amount the club was required to pay Inter Milan after losing a court ruling over the transfer of Ricky Alvarez.

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Sunderland signed Alvarez in 2015 on a year-long loan, to be converted into a permanent deal should they stay in the Premier League.

Alvarez missed much of the season through injury and the Black Cats argued that meant they could not be expected to sign him.

The Court of Arbitration for Sport did not agree and the latest accounts include a £9.7million “exceptional operating expense” to cover the ruling.