Watford Finances 2022/23

Into The Gap

Watford’s 2022/23 financial results covered a season when they finished 11th in the Championship following relegation from the Premier League the previous year.

There were the usual changes in management, as head coach Rob Edwards was replaced in September 2022 by Slaven Bilic, though the Croatian in turn exited stage left just six month later, succeeded by Chris Wilder on a short-term contract until the end of the season. The current incumbent is former Barnsley and WBA coach, Valérien Ismael.

That makes 13 coaches in five seasons, unless I’ve lost count, which doesn’t exactly inspire confidence in the club’s executive leadership.

Profit/(Loss) 2022/23

Watford swung from a pre-tax £16m loss to a £24m profit, despite revenue dropping by £62m (48%) from £128m to £66m following relegation to the Championship.

Operationally, this was largely offset by the club cutting expenses by £58m (38%) from £152m to £94m, but another big reason for the improvement in the bottom line was a significant increase in profit on player sales from £15m to £59m.

Excluding player trading, Watford still made a substantial £28m operating loss, whihc was actually £4m worse than the previous season.

The main driver of Watford’s £62m revenue decrease was broadcasting, which nearly halved in the Championship, falling £37m from £85m to £48m. Commercial income was also slashed by £26m (71%) from £36m to £10m.

However, match day was flat at £6.8m, while player loans actually increased from £0.5m to £0.8m.

Watford compensated for the lower revenue with a steep reduction in the wage bill, which was cut by £30m (38%) from £79m to £49m, while player amortisation also reduced by a quarter from £28m to £21m. In addition, other expenses fell £17m (46%) from £37m to £20m.

Watford’s £24m pre-tax profit is by far the best result of those Championship clubs that have published 2022/23 accounts to date. All the other eight clubs have posted losses, ranging from Hull City’s £5m to Norwich City’s £27m.

Promoted clubs often have the largest deficits, as they usually invest heavily in the squad and then pay hefty promotion bonuses, e.g. Luton Town £16m last season and Nottingham Forest £46m in 2021/22.

Indeed, Watford’s £24.1m profit before tax is the largest registered in the Championship since 2010, just ahead of Hull City £23.7m and Norwich City £21.5m, and possibly the highest ever in England’s second tier.