Watford FC report pre-tax loss of £4.8m

Watford paid nearly £7m in bonuses for winning promotion to the Premier League while the summer’s transfer activity could cost them more than £36m, according to their report and financial statements for the year ended June, 30 2015.

The headline figures from the report statements published on the club’s website are:

  • Watford made a loss of £4.8m pre-tax during the year
  • They paid £6.7m in promotion bonuses
  • The club would have recorded a profit of £3.3m pre tax had it not been for promotion costs of £8.1m
  • Wages and salary costs almost doubled, from £11.9m to £20.7m
  • Significant transactions post June 30 include £22.8m on transfers, with a further £13.6m dependent on club / player performance
  • The size of the coaching staff is up eight from last year to 46. With 53 players, up one from last season, the ratio is almost 1:1
  • The highest paid of the four directors (Raffaele Riva, Scott Duxbury, David Fransen, Stuart Timperley) received £210,000 in remuneration

The club made a loss of £4.8m pre-tax during the year, but only due to the significant promotion bonuses they paid out. They cite £8.1m promotion costs, most of which (£6.7m) were bonuses.


Notwithstanding this they would have actually made a profit of £3.3m pre-tax, mainly due to the £7.3m generated by players sales, appearances and sell-on clauses for deals involving Britt Assomobalonga, Will Buckley, Javier Acuna, Jonathon Hogg, Craig Forsyth, Tom Rosenthal, Panos Armenakas, Carl Stewart, Javier Sanchez and Gavin Massey.

Watford would have made an operating loss of minus £4m for the year had they not sold any players, which would have made it challenging to maintain player and staff salaries at this level and compete in the Championship. Wages and salary costs almost doubled (74% increase), from £11.9m to £20.7m, largely due to the promotion bonuses. The wages to revenue ratio is now at 112%.

The concerted push for promotion therefore paid off as there will undoubtedly be an exponential rise in the match day turnover, TV revenue and commercial income generated by this season in the Premier League.


Although the balance sheet does not, on the surface of things, look that healthy: it has net liabilities that mainly comprise loans (including bonds) and amounts owed to the parent company (£2.8m). This is effectively funding the fact that Watford has been a loss-making operation over the last few years. However, it is widely expected they will return to profit this year and start to be able to pay these loans off, expecially if they stay in the Premier League. Cashflow was positive in the year which is a healthy financial barometer.

The post balance sheet events capture the significant transactions post June 30 and include £22.8m in respect of transfers with a further £13.6m dependant on club / player performance. This demonstrates just how many contracts and deals are performance related.

The employee information shows Watford now have 46 coaching staff, up eight from last year and 53 players, up only one from last year.

The full report and statement can be found by clicking HERE: