Blues managing director John Nixon (JN) spoke to BBC Radio Cumbria's Paul Newton (PN) on Friday afternoon about Carlisle United posting a trading profit of £105,365 for the financial year 2010-11 :
JN
Well, they are a good set of figures, we have been pleased with them because we knew that last year was a different year, I know we got through to Wembley again and we had a reasonable cup run in the JPT, but our FA Cup run wasn't exactly the same as the season before. Then of course the numbers going to Wembley and the reward that we got from it was significantly lower than the season before. So, it has been a good year overall last year and then we are pleased that we made our targets and plans.
PN
When we talk about this trading profit, are we talking about an operating profit or a net profit?
JN
We are talking about an operating profit, we have got a trading profit or an operating profit of £105,000, which is genuine at the end of the day. Any other profit figures that we have done there, we have been moving some figures from one set of balance sheets to the other and Holdings and Carlisle United 1921 which is the operating company of the club to try to simplify our accounts process when we go forward.
PN
How much of a concern is the fact that overall turnover is down over the past 12 months?
JN
Erm, it is a concern but again the turnover is down because the football income is down, it is entirely due to the football income was down and that is where our turnover drop has come from. Our takings in cup matches for season 2009-10 which was the year before last were just over, well about £963,000, that doesn't mean to say we made a profit of that, that was our takings, and though we had expenses against it. Whereas our takings last year were £435,000 in cup games, so we were £527,000 out last year in cup and that is entirely where the drop in turnover has been.
PN
Given the new financial fair play laws which are set to come in meaning that clubs will only be allowed to spend their turnover, is there more importance now in trying to get that turnover figure up?
JN
Yeah, it is always quite important, this year we are now into a financial situation, albeit voluntarily, that we will spend no more than 75% of our turnover on wages, next year it becomes 65% and the year after 60%. So, the rules that are going into Football League clubs to try to make them more viable and have a longer term future are the right route at the end of the day. The clubs that are really running into difficulties are those clubs that are spending more than their turnover, and the only way to do that is to get somebody to come along and put extra money into the club to keep it going.
PN
One area which stands out is the £156,000 increase in loan player fees, just how sustainable is that level of spending?
JN
Well, no, part of it was planned, I think we have got to remember that last year part of it was planned, Ian Harte left us on the 30th of August, it wasn't a move that we had planned at all and we decided not to take a chance on going into the transfer market and spending quickly. We would go out and get the best that we could and then we would look and wait and see, so we got Lubomir Michalik and Lubo came on loan until the end of the year, and then we decided to negotiate and get him.
So, part of that was planned, but I mean the number of players that we had in last year, we had a major injury and infact Sean McDaid went out of the game in October, so there was a lot of coverage for that, and Danny Livesey virtually played no games for us at all at the back last year. So, if you look at the sort of players that we had in, I think we had 13 players in on loan last season. It is fine, I would rather spend an extra £156,000 or whatever the figure was on ensuring we get the right players rather than going into the transfer market paying money and coming out of it and finding out we have got the wrong ones, and that has happened in our recent history.
PN
Looking ahead to the next 12 months, how damaging could the early exits from both the League Cup and the Johnstone's Paint Trophy this season be do you think?
JN
Erm, look, we plan and we always set our season out assuming that we are going to go out in the first round of every cup, so we have set our forecasts out which is a pure break-even situation. Not making £105,000 profit, but making virtually nothing, so we have planned to spend what we bring in, and we have planned to go out of the cup at the first round.
So, you could say we are meeting our plan, which is damned unfortunate at this stage but we don't know where we are going to be in the FA Cup. It is like any other business, you have to lay out your plans and the only thing I can say is that although it is like any other business football is not always quite like any other business in so much as that there is a lot of chance in it.
The big chance is for example on Sunday that it is the FA Cup draw, and will we get drawn at home against a team like Tipton again, which would be great for us, or we will get drawn away from home against maybe a Huddersfield or a Sheffield United or even Sheffield Wednesday, which wouldn't be so great for us, it would be a real hard battle. So, there is a lot of chance in the business when you have to rely on things like cup draws and where you are and how many turn up etc. But, there are a lot of other parts of the business that are just like running an ordinary business, and we plan to break-even over this coming season.