Portsmouth Finances 2022-23

Living In An Island

It has taken 12 years, two administrations and three points deductions, but Portsmouth will be back in the Championship next season after clinching the League One title under the impressive young coach John Mousinho, who replaced Danny Cowley in January 2023.

Up until 2010, Pompey had enjoyed seven seasons in the Premier League, winning the FA Cup in 2008, then playing in the UEFA Cup, before suffering three relegations in just four seasons, ending up in League Two. They spent four seasons in England’s fourth tier, before securing promotion to League One in 2017, while it took them another seven years to get back to the Championship.

History

Portsmouth’s rise to the top flight had been bankrolled by Serbian-American businessman Milan Mandaric, but the club really started to spend money like it was going out of fashion after it was acquired by French-Israeli business man Sacha Gaydamak in 2006

Things looked good for a while, but they took a major turn for the worse in the 2009/10 season, when Portsmouth somehow went through four different owners. They kicked-off the new campaign under Gaydamak, son of the colourful Arcadi, who was accused of making money from illegal arms deals.

Having apparently been badly impacted by the credit crunch, in August 2009 Gaydamak decided to sell the club to Sulaiman Al-Fahim, the self-proclaimed power broker behind Abu Dhabi United Group’s takeover of Manchester City.

However, just 40 days later Al-Fahim gave up trying to find the money to complete the purchase and sold his shares to Ali al-Faraj, who was actually never seen at Fratton Park. According to reports at the time, he was some sort of commodity broker, but however he made his money, precious little of it found its way to the South coast.

The resultant financial difficulties meant that Balram Chainrai took ownership, but this seemed to be more a case of an exasperated creditor attempting to protect himself and/or pick up Portsmouth’s major asset (the ground) on the cheap.

Either way, Chainrai put the club into administration, thus triggering a nine-point penalty, which effectively confirmed the club’s relegation from the Premier League (though they did manage to reach the FA Cup final, where they lost 1-0 to Chelsea).

A year later, the club was sold yet again, this time to a Russian businessman, Vladimir Antonov, though he ended up being convicted of fraud in his home country. Meanwhile, the club went into administration for the second time in two years, leading to a 10-point deduction and relegation to League One.

The club’s financial issues led to another 10-point penalty, confirming another relegation, this time to League Two.

Owners

It’s not overly dramatic to say that at this point Portsmouth were close to going out of existence, but they were saved by the fans, as the Supporters Trust took ownership of the club in April 2013.

They inherited a club with no training ground, no kit deal, no commercial agreements and indeed no players, so it’s been a long way back. However, the Trust managed to steady the ship, before Portsmouth began the slow road to recovery. This was a great example of a club doing well under fan ownership.

However, in August 2017 the Trust approved the sale of the club to Tornante, an American company headed by former Disney chief executive Michael Eisner, as it felt that Portsmouth needed an owner with deeper pockets. Tornante paid around £6m and invested £10m in equity.

Given Portsmouth’s chequered financial history, I thought it would be interesting to look at how the club’s finances have developed in the last 10 years including a detailed review of their latest available accounts from the 2022/23 season.

Profit/(Loss) 2022/23

Portsmouth’s loss slightly widened from £2.9m to £3.1m, despite revenue rising £0.6m (5%) from £11.9m to £12.5m and a £0.9m improvement in player sales, which swung from a £0.2m loss to £0.7m profit. However, this was offset by a steep increase in operating expenses, which rose £1.6m (11%) from £14.8m to £16.4m.

Portsmouth saw revenue growth in both match day, up £0.5m (8%) from £5.3m to £5.8m, and commercial, up £0.4m (14%) from £3.4m to £3.8m. On the other hand, broadcasting fell £0.4m (11%) from £3.3m to £2.9m.

Wages only grew 5% (£0.4m), the same rate as the revenue growth, rising from £7.9m to £8.3m, while player amortisation actually dropped by a third from £0.9m to £0.6m. Depreciation was up from £0.7m to £0.8m, but by far the largest increase came in other expenses, which shot up £1.4m (26%) from £5.3m to £6.7m.

Portsmouth’s £3.1m loss was mid-table in League One, significantly lower than Derby County £30.4m, Ipswich Town £18.2m and Charlton Athletic £9.6m. Only one club managed to generate a profit last season, namely Exeter City – and that was just £0.3m.

Player Sales 2022/23

Portsmouth made £0.7m profit from player sales, which was a big improvement over the prior year’s £0.2m loss. This was mainly thanks to the transfers of Marcus Harness to Ipswich Town, Alex Bass to Sunderland and Reeco Hackett to Lincoln City.