2021 Football Distress Report (England)

Business Health Statistics

| June 2nd 2021

More News by Gerald Krasner

Date Published: 2nd June 2021

2021 Football Distress Report (England)

2021 Football Distress Report: Govt and League support gives English clubs extra time but experts warn of future woes citing 94% rise in early signs of distress

The annual Football Distress Survey, conducted by business recovery specialist Begbies Traynor since
2012, has revealed a deceptively rosy picture of football club health, skewed by a number of Covidrelated
factors that cloak an undercurrent of rising debt and financial issues, pushed onto next season
and beyond.

None of the clubs in the English Football League showed signs of significant distress according to their
latest filed accounts, but worryingly the very early ‘Red Flags’ of financial problems rocketed by 94%, with
33 out of the 72 clubs in the three tiers below the Premier League displaying early signs of distress,
compared with 17 in the previous survey, in May 2020.

“What we can see is that the Covid‐relief packages from the Government, as well as the money that came
down from the Premier League, have gone some way to easing the pain of clubs in the EFL during 2020,
but we can also see from a detailed analysis of the Premier League accounts that have been filed so far
that other cash flow measures have been needed,” said football finance expert Gerald Krasner, a partner
at Begbies Traynor.

“Against the backdrop of the European Super League debacle, and an ever increasingly polarised picture
of health between the billionaire‐owned, super‐rich clubs and the majority of British football, we’re
seeing a whole raft of fundraising or actions to relieve cash flow, many of which will not necessarily
impact balance sheets and P&Ls for another 12 months.”

Krasner, who led the team of administrators that successfully sold Wigan Athletic Football Club out of
administration in March this year, has previously been on the board of Leeds United and is one of the
UK’s leading football restructuring experts.

He said: “Rights issues by shareholders have injected capital in some cases where owners have the means
to step in, and in other cases bank debt and deferred payments to creditors including players and senior
managers have helped.

“However, although these measures have been successful in securing the short‐term survival of clubs and
pushed the threat of administration further down the road, the cumulative effect is to build up a wall of
debt that will have to be serviced and ultimately paid off.

“As in the wider economy, the continued suspension of court cases is also creating the illusion of stability
among clubs that is likely to be shaken when the courts reopen. So while the help that football has
received from the Government and the Premier League have provided the lower division clubs with
much‐needed ‘extra time’, the escalating symptoms of early financial distress are a very real signal that
for many clubs the full financial effects of Covid are yet to be fully felt.”


About the author

Gerald Krasner

Partner

Meet our Team of Experts

Gerald qualified in 1971 as an ACA with Peat Marwick Mitchell and subsequently joined Bartfields Chartered Accountants where he began to specialise in Insolvency. He was one of the first licence holders in 1986 when he specialised in CVAs before they became more popular. Gerald has worked on numerous successful cases including Krasner v Dennison, for which he won in the Court Of Appeal and as a consequence changed the treatment of a bankrupts' pensions.

In 2004 he became chairman and part owner of Leeds United AFC which had debts of circa £103 million. These were reduced to £24 million before the club was sold the following year. In 2007 he sold the insolvency division of Bartfields to Begbies Traynor and became a partner at the firm.

Gerald has lectured both nationally and internationally to fellow insolvency practitioners and other professionals, and has also been involved in committees for both R3 and Insol.

Network of Over 100 UK Offices

Find your local Begbies Traynor Group office and speak to an adviser today.

Find your Local Office
0800 063 9221

Call our Confidential Advice Line. Calls to this number are free of charge.

Call us now...
Request a Meeting

We invite you to come and discuss your enquiry with us at your convenience.

Request a meeting...
0800 464 0871

Call our Confidential Advice Line. Calls to this number are free of charge.

Call us now...
Request a Meeting

We invite you to come and discuss your enquiry with us at your convenience.

Request a meeting...
0161 837 1700

Call our Confidential Advice Line. Calls to this number are free of charge.

Call us now...
Request a Meeting

We invite you to come and discuss your enquiry with us at your convenience.

Request a meeting...
Begbies Traynor Group plc, announces that it has completed the acquisition of CVR Global LLP
CVR is a leading independent firm of insolvency practitioners, forensic accountants and experts in other related complementary disciplines.
Read More →
 
Coronavirus pushes financially distressed companies over the half-million mark
Number of businesses in significant distress stands at 509,000 – the highest number measured by the Red Flag Alert research
Read More →
 
BTG Advisory accelerates growth with appointment of four new partners to its London office
BTG Advisory, the boutique advisory arm of Begbies Traynor Group announces the appointment of four new partners to its Canary Wharf office
Read More →
 
Eighty jobs saved with £1m sale of engineering business
South Yorkshire company Newburgh Precision rescued through administration
Sale enables 75-year-old business to continue trading
Read More →
 
Join thousands of professionals by signing up for our updates
Analysis and Opinion from our Partners
Top Industry News
Register Now →
 

Advice you can trust

We are accredited by the following industry leading organisations

Insolvency Practitioners Association Institute of Chartered Accountants in England and Wales R3: Association of Business Recovery Professionals ICAEW Business Advice Service Turnaround Management Association ICAS | The Institute of Chartered Accountants of Scotland

Contact the Begbies Traynor Group team

or Find your Nearest Office

Here at Begbies Traynor Group we take your privacy seriously and will only use your personal information to contact you with regards to your enquiry. We will not use your information for marketing purposes. See PRIVACY POLICY

Processing...

This site uses cookies to monitor site performance and provide a more responsive and personalised experience. You must agree to our use of certain cookies. For more information on how we use and manage cookies please read our PRIVACY POLICY