Hull warned over finances
Wednesday 28 October 2009
Hull's accountants have raised concerns over the club's "ability to continue as a going concern" should they be relegated from the Barclays Premier League.
The Tigers managed to retain their top-flight status on the final day of last season, and are currently third from bottom.
The accounts have now been filed, five months late, to Companies House.
The period covers the year ending 31 July 2008, when Hull made a loss of nearly £10m as they won promotion to the Premier League via the play-offs.
This does not include any figures from the club's first season in the top tier of English football, and the directors remain confident the next set of results will be much more positive.
However, auditors Deloitte nevertheless warn a surplus of some £23million would need to be raised just to meet current liabilities.
Should Hull stay up, they would still, according to the report which is now a matter of public record, need to produce an additional £16million, with another £7million needed should they go down.
The report read: "These forecasts demonstrate that in order to operate within the company's finance facilities Hull City AFC will need to generate a surplus £23million during the next 12 months through player trading, match day and commercial income and/or through additional finance raising.
"In the event that the club retain Premier League status for the 2010-11 season, the additional funding required for the 12 month period will be in the region of £16million. This is reduced as a result of the guaranteed level of Premier League distributions that will be received.
"As is common with all football clubs, Hull City AFC will make player purchases and sales during the course of the season to manage the company's cash flow as and when required.
"The directors acknowledge that player purchases and sales are uncertain in terms of timing and quantum and some uncertainty exists over the availability and quantum of additional facilities should such be required.
"These conditions indicate the existence of a material uncertainty which may cast significant doubt about the company's ability to continue as a going concern."
Hull, though, remain confident once the additional revenue from their first Premier League campaign is factored in - worth an estimated minimum of some £40million - then the results for 2008-09 will be more positive.
The directors' statement concluded: "The financial benefits arising from the Premier League's broadcasting rights are not recognised until the following financial year, where the losses incurred this year are forecast to be made good.
"The club are currently in advanced discussions with finance providers for the acceleration of known Premier League distributions for amounts of £7million. These discussions are expected to be concluded in the near future and would reduce the surplus finds required by £7million.
"The directors have a reasonable expectation that the company have adequate resources to continue in operational existence for the foreseeable future."
Top Gear presenter is no stranger to foot-in-mouth controversy
New essay by JK Rowling went live on pottermore site this morning
Charlie Sheen could be set to revive his role as a hedonistic womaniser
Review: Mike Leigh's biopic is a rambling, rich character study
Want to ward off (or welcome) trick-or-treaters? Here's how
Latest in Sport
Manchester City vs Manchester United combined XI: No place for Yaya Toure... or any United defenders
Sami Khedira transfer news: Arsenal can win the Premier League if they sign Khedira in January, says Perry Groves
Paul Scholes: At last! Some credit for Sam Allardyce
EXCLUSIVE: F1 heading for eastern revolution as new team emerges from Romania
Impressive Kurt Zouma may save Chelsea millions by replacing John Terry
- 1 'Nasa Confirms Six Days of Darkness in December': No, they don't - it's a hoax
- 2 Canadian actor punched in face after 'Islamophobia' experiment goes wrong in wake of Ottawa shooting
- 3 Topshop at centre of row over body image as 'shocking' skinny mannequin photo goes viral
- 4 If you think Russell Brand’s new book is confused, you should read what his critics have to say about it
- 5 Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
Pope Francis declares evolution and Big Bang theory are real and God is not 'a magician with a magic wand'
Huge surge in Ukip support after EU funding row, according to new poll
Ukip ‘exploiting grooming scandal’ to secure party’s first police chief
Nigel Farage: 'There’s nothing wrong with white people blacking up'
Maureen Lipman says 'she can't vote Labour while Ed Miliband is leader'
Muslims, immigration and teenage pregnancy: British people are ignorant about almost everything