by MikeB » 31st October 2006, 14:17
As requested
From "Down at the Mac" ...
Before the game at home to Brighton several concerned Town fans handed out 4,000 leaflets in pubs and around the ground. Why?
It was in response to Ken Davy's statement a month ago in the Examiner and also in the match day programme. Previous attempts to get the Examiner to publish fans alternative views seem to have been met with some reluctance.
Below is a reprint of the two sided leaflet from Saturday 28th October.
Ken Davy's statement - fans respond
The publication of Ken Davy's statement a few weeks ago prior to the home game against Bournemouth was, according to Ken Davy, to set the record straight once and for all.
Due to the local media being reluctant to publish or broadcast many of the concerns many supporters have about the finances and off field activities of Huddersfield Town, we have decided to publish this leaflet to air our concerns to as many supporters as possible and we hope this encourages open and honest exchanges between the board of directors and the fans of our club, whether they are part of officially recognised supporters organisations or not. We will set our concerns out separately as per Ken Davy's statement.
1 The takeover
To quote from Ken Davy's statement: "Despite the administrator setting several deadlines and lots of puff and wind and hot air from the sidelines, not a single meaningful offer was received."
The Huddersfield Daily Examiner ran a story on April 23rd 2003 that former director Paul Haigh had lodged a bid with the administrators to rescue Town. A direct quote from the story says: "His bid is the first to be received since Town went into administration on March 31 with debts of more than ?17m."
Ken Davy's bid was not reported by the Huddersfield Daily Examiner until May 13th 2003, three weeks after Paul Haigh's consortium had tabled their bid.
Why is there the need to distort the facts?
2 The Stadium
When the stadium complex was built it was envisaged that in the future it would generate income for its shareholders extra to its normal sporting activities. The Stadium Company is still paying off some of the initial debt used to finance the building of the stadium and of course the subsequent building of the Panasonic Stand. Despite this KSDL are recording profits of around ?200,000 a year. Once the debts had been paid off there could well have been healthier profits to share between the shareholders of the stadium, including Town.
But not anymore. How many Town supporters know that Town no longer own 40% of the Stadium Company? How many people know that Town's 40% was transferred to Huddersfield Rugby League Football Club (1994) in December 2003? Huddersfield RLFC was then renamed Huddersfield Sporting Pride.
3 Huddersfield Sporting Pride
What do we know about HSP? We know that HSP owns 60% of KSDL. We know that HSP own the Huddersfield Giants. According to Ken Davy's statement HSP also brands the Stadium Superstore and the shop in town where both clubs sell their merchandise. We also know that HSP is also employing the new Director of Marketing, Sean Jarvis.
What don't we know? Who actually owns the Superstore and the shop in town? Do Town and the Giants pay rent for use of these shops? Do Town and the Giants keep their own profits from the sale of merchandise? What will be the proportions each club contribute to the salary of Sean Jarvis? Why is it alright for the Giants to be part of the company that now owns 60% of KSDL but Town are not part of that company?
4 Town, the Giants and KSDL
The sporting people of Huddersfield wish to see successful sporting clubs representing their town. The football and rugby league clubs have enjoyed a lot of national exposure following the building of the stadium. In terms of on the field success both teams have had their ups and downs.
Since the opening of the stadium, Huddersfield RLFC have progressed from an average second division side to an established Super League team culminating in this season's achievement of a place in the Challenge Cup final. No one begrudges them their success but many of us question the financial relationship which determines the amount of rent each club pays to KSDL. Is it fair that Town pay between 75-80% of the total rent KSDL charge both teams for the use of the stadium? After all both teams have office space all year round, both teams have use of the ticket office and Stadium Superstore all year round.
The formula which determines the amount of money each club pays is very hard to obtain. Ken Davy, at a Patron's Meeting at the beginning of this month, claimed not to know the formula. KSDL chief executive Ralph Rimmer, present at the same meeting, did not volunteer any information. We have written to KSDL company secretary and Kirklees employee Ken Gillespie in an attempt to obtain the exact formula upon which the rent is paid. After a less than full explanation about relative crowd sizes the point was still pressed and we were then subsequently told to ask the questions of Ralph Rimmer or from either club. Why the secrecy?
As Town fans we feel the Giants are not paying their fair share in rent for their use of the stadium. Former Town Chairman Graham Leslie criticised the relationship between Town and KSDL shortly after Town went into administration stating some of Town's financial problems stem from the high rents and loan repayments committed to KSDL. None of these arrangements has changed since we came out of administration. Are these financial arrangements partially responsible for a projected loss this season of ?454,275 as Ken Davy stated on 30th September?
5 Attendances, income, numbers and more numbers
We can accept that many of the free and discounted offers made to children are an investment for the future fan base of the club. We cannot accept that this should put us at a financial disadvantage compared with other clubs in this division. Other clubs have a variety of schemes aimed at attracting younger supporters so we are not alone in sacrificing income today in order to build a healthy fan base in years to come.
Ken Davy provided us with some figures in his statement. We have been comparing his figures with past years. In 2004/05 season our turnover was roughly ?4,100,000, our staff costs were ?1,346,441 and our rent was around ?611,000. In season 1994/95, our first year in the stadium, our turnover was ?3,518,560, our staff costs were ?1,605, 557 and our rent was ?144,563. With an increase in season tickets sales last season, increased crowd figures, income from replica shirt sales and the money from the cup ties and play off games we suspect there will be a significant increase in turnover, maybe as much as ?750,000. Our staff costs last season were ?1,590,864 and our rent will probably be around the same as the previous season.
As we can see, our staff costs are very similar to twelve seasons ago when our turnover was substantially less but alarmingly, our rent has increased well above inflation. Why?
6 More questions that need honest answers
During the past three seasons we managed to pay off all the money owed to ex-players. Why is that money not now available for Peter Jackson to strengthen the squad? Why has the squad got smaller and smaller for the past three seasons as turnover has increased?
What other outgoings are Town paying other than rent that is contributing to the projected loss this season of ?454,275? Are Town paying money to KSDL that should have been written off when we went into administration?
Where does the advertising income go from the perimeter advertising boards? Does it go to KSDL or the clubs? Does each club sell its own advertising and keep the income or is it sold as a joint package? If it is, what proportion goes to each club? Is it shared out on the same basis as the rent is charged or is there a different formula in place for distributing joint income? Surely shared income and outgoings should be set using the same formula?
Why won't Ken Davy publish full financial accounts so that we can see where our income and outgoings are coming from and going to? We used to get to see full accounts under previous administrations.
Ken Davy's projected losses for this season give many of us grave concerns about the future viability of our club and our ability to compete for the signing of quality players we will need to establish Town as a top 30 Football League Club. Many of us were blinded by short term on the field success when Barry Rubery and Steve Bruce were at the club. The legacy of that period has taught us not to divert our eyes away from the off field activities of the club just because we have made good progress on the pitch after coming out of administration. At the moment there are more questions than answers. This situation needs to change.
So now it's over to you, Ken Davy! The ball's in your court. I'm ready and waiting to print the answers to the fans questions on DATM.
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