Fans Forum

Monday 24th February 2014 - Sir Bobby Robson Suite, St. James' Park

 

CLUB REPRESENTATIVES

Kate Bradley - Head of Newcastle United Foundation

Lee Charnley - Club Secretary

John Irving - Finance Director

Lee Marshall - PR and Supporter Liaison Manager (chair)

Eddie Rutherford - Head of Facilities

Steve Storey - Head of Safety and Security

Wendy Taylor - Head of Media

Stephen Tickle - Box Office Manager

 

SPONSORS

Damian Peachey - Wonga, Media Relations

Nick Stone - Wonga / Sportquake

 

SUPPORTERS

Gareth Beard - Newcastle United Disabled Supporters Association

Steve Cole - Supporters Branch Representative

Thomas Concannon - Away Fan Representative

Chris Forster - East Stand Representative

Gordon Gilchrist - Over-65s Representative

Steve Hastie - NUFC Fans United

Mark Jankowski - Gallowgate Stand Representative

Susan Joyce - Milburn Stand Representative

Sharron Lee - Long Distance Fan Representative

Andrew McClay - Members Representative

Vishal Vedhara - Equality Representative

 

APOLOGIES

Bob Moncur - Club Ambassador

Liam Hall - Young Persons Representative

Michael McCarthy - Leazes Stand Representative

Phil Patterson - Corporate Representative



1. Introduction

The group were welcomed by Lee Marshall (LM) on behalf of the Club.

Meeting protocol was reaffirmed, where it was requested and agreed that no tweeting, live updates or independent reporting takes place until official minutes are published, pending the pre-approval of all supporter members.

LM ran through an update on the previous Fans Forum minutes. It was confirmed that the Young Persons area at St. James' Park had been reconfigured for the 2014/15 season since the guest presentation by 'ultras' movement Division 92, and that internal discussions would need to take place accordingly before a proposed meeting with Division 92 in the near future.

It was outlined that questions from the previous Forum meeting in relation to the Club's aims and transfer policy, Academy structure and commercial performance would be reiterated and given further explanation during the meeting.

The club outlined that feedback had been received on Wonga's decision to use clapperboards rather than scarves or flags and that this would be explained and opened for questions later in the agenda.

Eddie Rutherford (ER) confirmed that a lighting issue affecting disabled supporters in the car park had been resolved as requested - in the same week as the issue was raised during the previous Forum.

Kate Bradley (KB) and her Foundation staff were congratulated on their work behind the Toon Times exhibition launch and media coverage.

Apologies were received from Liam Hall (LH) and Phil Patterson (PP). LM placed on record the Forum's best wishes for a speedy recovery to Bob Moncur (BM) and Michael McCarthy (MMc), who were both unable to attend due to illness.

LM explained that a report on emails by Forum members would be circulated in coming days along with all relevant action taken by the relevant members and/or the Club as appropriate.

 

2. 'Where we are'

The board explained that it had reviewed questions raised by supporters and Fans Forum members in relation to the Club's aims and had accordingly collated its messaging from across the season to re-emphasise its objectives.

It was explained that while the Fans Forum had been selected as the Club's preferred method of direct fan communication, match day programme notes under the name of its former director of football had publicly carried consistent board-level messaging in relation to a wide range of matters throughout the season.

It was clarified that the owner and senior staff including its former director of football, Joe Kinnear (JK), determined the key Club message for those notes, with the final wording prepared on JK's behalf but with his full approval.

The Club accepted that, while the notes were printed publicly and indirectly became a marketing asset for the programme; this messaging should also have been circulated via its official website in order to reach as many supporters as possible.

Gordon Gilchrist (GG) suggested that it was less than transparent for the former director of football not to have physically written his own notes.

LM explained that it was common practice at professional clubs (and many other organisations) that similar notes would be dictated by a director but typed up on his behalf or ghost written.

SC asked why the notes were attributed to Joe Kinnear.

The board clarified that Joe Kinnear was involved in the drafting of the notes but that the overall messaging was determined collaboratively and could be read as communication from the board.

All forum members were provided with a hand-out of the season's ten relevant programme notes and LM read the key points contained within them.

The board explained that the views contained within the programme notes, which covered issues such as transfer policy, the Academy, Foundation and the responsible and sustainable running of the club, had remained consistent over the season and remained its views now.

 

3. Financial results 2012/13

LM explained that the Club wanted to give the Fans Forum its latest financial results first in order to explain the context to supporters openly, fully and directly.

The point was made in the previous section that finances were a significant issue as they had a direct impact on the Club's potential strength on the pitch.

The board subsequently presented to the Fans Forum on the financial accounts to the end of June 2013, which are embargoed to coincide with publication of official Forum minutes on Tuesday. The accounts will be filed with Companies House at the same time.

The board explained that mandatory Financial Fair Play (FFP) rules continue to be a key influence on strategy for every club under UEFA's jurisdiction. It was explained that the Club has been working hard on its model for 5-6 years which will satisfy FFP.

Headline figures

Turnover was up even though the Club finished 16th in the Premier League (PL) - 11 places lower than the previous season. Operating loss was down from £5.1m in 2012 to £616,000 in 2013. While the club spent significantly more cash on players than it recouped in the financial period, the club made a profit on player trading after amortisation. As a result, overall profit stood at £9.9m - well within FFP requirements.

Turnover

Match day turnover (season tickets, gates, hospitality) increased significantly due to good season ticket renewals and extra UEFA Europa League games.

Media turnover (TV) was lower due to the 16th-place PL finish but was slightly offset by additional income received from advancing to the Quarter Final stage of the UEFA Europa League.

Commercial revenue - one of the key areas the Club has been working hard to improve - was up by almost 25% and does not yet include the sponsorship by Wonga, which will show in next year's figures. The board expects commercial revenue to increase again next year.

The Club's wage bill has been reduced from £64m to £61m, well within PL rules, but only shows six months of wages for the five senior signings made in January 2013.

It was explained that 'cash versus profit' can be confusing. The Club spent £28.8m in cash on players and recouped £11.1m cash during the financial period.

The Club explained that its overdraft had increased to £4.5m, but that this was just a snapshot of that specific day (June 30th 2013) and is operating well within its overdraft limits.

Debt to owner Mike Ashley (MA) remains static at £129m and is interest free. The Club explained that the rumour of the owner taking cash out of the club is simply not true, as reflected in the accounts. Overall, the Club is being operated in the right way in order to meet the FFP regulations.

 

4. Open questions

GG: "What is the reaction of clubs within the Premier League when they see clubs running up large losses, and then covering it with 'manipulative accounting'?"

The board suggested the proof will be in what UEFA and the PL do to penalise those who don't comply. The Club operates within the regulations and expects all clubs to do so. The Club believes next year's accounts will be key for all clubs.

GG: "Do you see some clubs calling out other clubs who appear to be flouting the rules?"

The board believes all clubs will be analysing the figures just as fans and media do.

Chris Forster (CF): "The debt hasn't changed but a question I'm asked a lot is whether or not the owner will do anything with the club until he gets his money back. When will that be?"

The board confirmed there are no timescales for any repayments and that the owner has never set a timescale or asked for any of this debt back. It was explained that in accounting terms, the interest free debt the Club has is the best structured debt it could have. It was states that the debt isn't linked to the profit the Club makes i.e. if the Club makes £9m in profit; debt to the owner is not reduced by £9m. The money generated by the Club stays within the Club.

CF: The perception amongst fans is that the owner wouldn't sell the club until he receives the debt back.

MJ: "If MA is committed to owning the club, why doesn't he just write the debt off?"

The board explained that it would be an option that some clubs would consider, but from the perspective of our group structure there's a requirement to have debt within the structure.

Steve Cole (SC): What is the saving that Sports Direct makes on advertising around the stadium?

The Club suggested that while it is always proactively looking to attract new commercial partners and to sell that advertising space, in the current climate it could not command a sum for that space anywhere close to the £129m invested into the club interest free by the owner.

AMc: "Can the commercial value of that advertising not come off the debt that the Club owes the owner?"

The board explained that the owner's position is clear and that the Club is not attempting to hide it. To add context, it was explained that the Club's debt cost £8m in interest alone every year before Mike Ashley purchased the club.

GG: "Why aren't the electronic advertising boards controlled centrally by the PL?"

The board explained that the boards are leased, as is the case with most PL clubs. As part of this deal, Club partners and PL partners get a specified number of minutes-per-game and the rest is sold. Only 2-4 clubs own the advertising space outright.

Steve Hastie (SH): "Commercial revenue seems to be the key to meeting FFP. It's important to get across to fans how essential it is to increase commercial revenue locally, nationally and internationally.

The board clarified the importance of this point for the benefit of the meeting minutes. Looking at turnover, matchday and commercial revenue is a key driver because that's where the Club can compete with - and outperform - others. In line with FFP, clubs' own revenue can be used to enhance their spending capabilities.

Vishal Vedhara (VV) noted that from an accountancy standpoint, the trend of performance is positive year-on-year and, the fact the owner hasn't set a repayment schedule for the debt means that increasing returns are there for the Club's best interests and investment to help it progress.

SH: "One of the problems the Club has is in relation to transfer policy. Fans see that if it's so tightly controlled, the Club can't take into account form and injuries etc. and react."

The board clarified that it does take those things into consideration. It was explained that the Club assesses the strength of the squad continually.

CF: "There seems to be a lack of ambition at the Club, that's the feeling that fans have."

The board explained, as in previous Forum meetings, that the aim for the Club is always to finish as high up the league table as possible, with top ten a minimum requirement this season. In the context of commercial revenue (which it was earlier explained has a major bearing on clubs' spending power) and overall income, the six teams currently above NUFC and Everton should, theoretically, given their financial power, finish higher year-on-year. It was explained the Club had achieved a higher finish than two of those clubs two seasons ago which proved it can be done.

CF: "Fans wanted us to capitalise on the 5th-place finish and invest the same as those top six clubs to push further."

The board posed a question of how much it would have needed to invest in order to ensure year-on-year it finished above the likes of Chelsea and Liverpool given their resources and income levels. The board reiterated that everyone at the Club wants to finish as high up the table as they possibly can, not just 10th or the current position of 8th.

GG - "If the clubs higher than Newcastle have to redevelop their stadiums soon, then they may not have the money to invest in their squads etc."

The board suggested this may be true in theory and that UEFA and the PL would be watching clubs' finances closely.

SH: "How can the Club get the message over that it has never said it wants to finish 10th at the highest?"

It was suggested that the misreporting of previous minutes had perpetuated this idea. It was reiterated that the club saw 10th as a minimum target.

VV: "This club is a bit special and if we won something, the impact would be very positive." VV also felt that winning a trophy could drive the Club's commerciality which has been clarified as an important growth area.

CF: "A lot of fans come here looking for a cup run. There is a regular discussion amongst fans at the moment - 'would you prefer to win a cup and be relegated'?"

The Club highlighted that the strength of the team selected by the manager to play Cardiff City in the FA Cup was capable of winning that game. However, as in any match, results are also influenced by performances of players on the day. The Club also referenced the result after extra-time against Manchester City in the League Cup and the chances to score which were unfortunately not taken on the night.

VV made reference to following other clubs' examples in growing year-on-year, such as Arsenal.

The board suggested that if a club can sustain itself as 'top ten' team year-on-year with a stable structure and the right finances, there is every chance it can push even further up the table.

VV commented that supporters are "desperate to see success", while SH added that the Club "carries the huge weight of dreams that fans have."

The board underlined that everyone in the Club aspires to do the best they possibly can to help it flourish.

GG: "Finances will be forgotten tomorrow, but results are remembered."

LM explained an earlier point that commercial revenue and finances translate to the strength of squads (and therefore, in theory, consistency of results), which is why they were being discussed.

GG suggested that with some players not contributing to the team at present; it was a waste of money.

The board explained that transfers are not an exact science but that on the whole, its record was very strong in recent years. The board explained the risks associated with acquiring players and why, accordingly, the Club is careful in its dealings. It was explained that if it was felt a player was no longer able to contribute, solutions would have to be found to benefit the Club. The board outlined the benefits of loaning mainly younger players out to give them experience and assess their quality.

Members referred to the contributions of specific players in the squad. CF agreed that the Club gets most decisions on players right. VV added support to specific deals made in January 2013.

The board explained that decisions on players are based on what those involved with player recruitment see, allied to the financial and contractual elements, but that again, it isn't an exact science and that all deals carry an element of risk.

CF: "Fans are frustrated that the Club sold Yohan Cabaye and didn't have a replacement lined up."

Mark Jankowski (MJ): "There appeared to be a lack of strategy in respect of replacing him. Fans can understand not spending unnecessarily, but what about loan deals?"

The board suggested that if it was to be self-critical, it should have had a young player who could naturally step into the squad as it aims to in all positions.

In respect of the transfer, the board explained that the Club did not want to sell the player. However, the player was adamant he wanted to leave. The Club made a substantial bid for a replacement but an agreement could not be reached with the prospective selling club. The Club also pursued other options but particular clubs were unwilling to sell. The board explained that the January window is disruptive for clubs and that there are far more options available to it in the summer window.

AMc: "Couldn't we have told Yohan he couldn't leave?"

The board repeated that the player was adamant he wanted to leave. The board also explained that the player could not be sure the opportunity to join PSG would be available at a later date and he therefore wanted to take it. The Club's preference was to keep the player and for him to remain at the Club long term.

SC: There is a rumour that the Club wanted £25m. Wasn't it worth gambling that if he had successful World Cup, he would have been worth more?

VV added: "Given what happened earlier in the season and the reality that you cannot really impose playing for the football club, I think it was the right decision to let him go."

The Club explained that its challenge is to strengthen the team as and when appropriate.

CF suggested 'quite a big rebuild' was needed due to other players potentially departing.

The board pointed to the fact the manager has already talked about improving the squad in the summer and that meetings had already taken place about the business the Club needs to do.

SC: "Are there any plans to recruit a new Director of Football?"

The board said this would be reviewed in the summer.

SC also asked about the reserve team manager position.

The board explained that Peter Beardsley has undertaken the role, assisted by Dave Watson.

GG: "The Club's future has been addressed this evening, but fans are still waiting to hear from the owner. It's reported that he hasn't been to games this season - has he lost interest?"

The board stated that there is daily contact with the owner. It was explained that it is common for owners of football clubs to not attend all fixtures, including several examples in the Premier League. The board explained that the owner is very engaged in the Club.

AMc: "It would be nice to have a statement from Mike Ashley on his short and long-term goals. Could he attend a fan meeting?"

The board stated that the owner was part of the group which determined the key messages in the programme notes.

It was also stated that the owner is fully aware of the Fans Forum and is happy with the Club's current representation at Forum meetings.

Sharron Lee (SL): "Is it possible that the manager can attend?"

The board will discuss the idea with the manager.

GG explained that he would like to see the Club attempting to improve the tone of coverage afforded by NCJ Media by ending the current ban.

The Club referred to its comments in the previous Fans Forum meeting and had nothing further to add.

AMc: "Is it the same for the Sunday Express?"

The Club confirmed this was the case.

GG: "Is the Club aware that Wendy Taylor (WT) has been publicly criticised as a result of these bans?"

The board explained that it makes it clear in its respective statements that these are Club decisions and are not the decisions of WT.

GG: "What is the relationship with FootballDirectNews.com?

The Club was aware that a commercial relationship had been in place between Sports Direct and the news outlet but that this had recently ended. During this commercial relationship with Sports Direct, the website had complete editorial independence. It no longer has any link whatsoever with Sports Direct. It did not - and does not - have any such agreement with the Club or any form of access.

SC raised the issue of "media access packages".

The Club stated that the newspaper story claiming it had written to media with a suite of packages was not true. Written media are still permitted access in line with PL rules; however the Club's primary focus is on enhancing the mutually beneficial relationships it has with those who contribute to the Club commercially, including BBC Radio Newcastle and rights-holder broadcasters such as Sky Sports.

AMc: "Can you give a figure for how many season ticket holders haven't renewed?"

The Club confirmed that it's a similar level to last season. The Club explained that it ordinarily loses between 5-10% each year due to changes in personal circumstances such as jobs, personal finances, moving away from the area etc., with a similar number of new season ticket holders coming in. This has been the case for many years.

SH: "It's natural for some fans to make knee-jerk decisions sometimes. As suggested at an NUFC Fans United meeting, would the club be interested in some form of amnesty for those with significant loyalty points who cancel their ticket but change their mind later in the summer?"

The Club explained that with its long-term price freeze deals, the convenient monthly payment plans starts in March which is why prices are announced early. The Club always wants to fill the stadium so season ticket prices for 2014/15 were ratified internally back in October and were confirmed last week.

Fans Forum members proposed a ticketing working group consisting of interested Forum members to meet and discuss SH's idea and others in relation to the Box Office. The Club will now look at forming this group.

Stephen Tickle (ST) explained the away ticket Loyalty Points system.

Thomas Concannon (TC) suggested midweek away games could be worth more points but was of the view that the current system works well.

Susan Joyce (SJ) suggested points could also be awarded for Cup fixtures in order to enhance attendances even further.

SC also shared the idea that members with more loyalty points should be able to purchase additional tickets.

It was proposed that these suggestions would also be relevant to the ticketing working group.

TC: "What is the Away Fans Fund being spent on?"

LM explained that the Club has to disclose its spending in this area to the PL and will be doing so shortly. LM will also be attending a meeting with the PL and club supporter liaison representatives next week where this subject will be discussed and ideas shared.

The board stated that it does not agree with the concept of subsidising away match tickets as this simply means it has to hand money over the home club, which doesn't discourage it from setting fair prices. Instead, the Club has pursued reciprocal pricing deals with other clubs but that this still represents a loss of revenue for those participating, which is offset against the Away Fans Fund.

TC agreed with the principal of reciprocal pricing and thought it was a good idea.

The Club disclosed that a significant amount had already been spent on the visitors section at St. James' Park this season, with the Away Fans Fund designed to be spent on the clubs' own fans who travel and the designated away end in their stadium.

The Club is funding away travel for the Newcastle United Disabled Supporters Association (NUDSA) to Hull City next weekend, with tickets, travel, food and stewarding all provided.

Gareth Beard explained that NUDSA was unable to travel in large numbers to other PL away fixtures due to the lack of available space for disabled supporters.

The Club asked supporters to continue sending in ideas. The Club also noted guidance from Fans Forum members that discounted travel was not universally popular due to supporters who travel from different areas and on other forms of transport not standing to benefit.

CF: "Does the Club have plans to refurbish the East Stand?"

ER explained that the Club refurbishes right across the stadium but that a considerable amount had been spent on the East Stand specifically in recent years. ER explained that significant work had gone into the flooring and PA system in the East Stand recently, with 11 new speakers in the last four months. ER asked fans to report any problems in any stand to the Club so that they could be addressed quickly.

VV: "In the first Fans Forum, we discussed introducing an 'Equality Ambassador' from the playing staff. What action has the Club taken?"

LM explained that Gael Bigirimana had taken on the role, with his background of fleeing civil way in Africa proving a powerful and compelling story to raise awareness of discrimination. The role has included linking up with the Newcastle United Foundation, Kick It Out and significant media work with national media and globally with CNN. In addition, other players are assisting with similar projects and the manager has recently pledged the club's on-going support to the Football v Homophobia campaign.

AMc: "We were told this season's kit was one of the best-selling for years. Why is it being discounted to as little as £16.49?"

It was explained that the Club purchases a set amount of stock in advance each season and that while it has sold extremely well, there are still some shirts remaining which the Club needs to clear ahead of new kits next season.

SC raised the issue of minutes applauses for those who have passed away.

LM stated that discussions will take place to look at ideas for the Club to acknowledge and pay tribute to fans, staff and players who have passed away on an annual basis.

GG wished to thank KB and her staff for their excellent work around the Toon Times exhibition at the Discovery Museum and the PR coverage it received.

GG also requested that Club organises a tour of the Academy, training ground and disabled facilities at St. James' Park for Forum members.

LM agreed this could be beneficial and will circulate a list of possible dates.

AMc asked if there was anything the Club could do to support the women's team.

The board explained that it has met with the organisers behind NUWFC on a number of occasions and is continuing to find ways to assist. The Club has also been raising awareness of the team on social media and has recently given the women's team access to its training ground.

CF: "Can the Club expand on Joe Kinnear's departure?"

The Club had no further comment to make.

CF asked if those in place on the Fans Forum could reapply for their seats.

LM confirmed that specific seats on the Forum are to be replaced at the end of the season as originally scheduled in order to enable other fans to participate and offer fresh views. 50% of individual representatives will be retained as planned to assist with continuity. (As per the Fans Forum design, outgoing members are unable to reapply for a seat for two years.)

AMc: "Someone who gets a 10-year season ticket has to pay for membership which goes up each year, why is that?"

The Club explained that membership is included as part of a season ticket's overall cost but the cost of membership has risen in recent years. The Club confirmed that this will not be the case for those on the 10-year deal who have renewed for next season.

TC: "Will the Club go back on its 'no general sale to non-members' policy with regard to away tickets?"

The Club explained that there were no plans to end this policy but that the sale of memberships was not the Club's priority when bringing the system in.

 

5. Wonga

Damian Peachey (DP) thanked the Forum for their contributions and explained that the main driver behind the sponsorship was partnering the Club's fans.

DP explained that Wonga are very keen to assess how successful their sponsorship initiatives have been this season and outlined plans to conduct their own research and use the Club channels to gauge supporters' views.

DP invited Fans Forum members to give their views on the clapperboards used ahead of the derby fixture. CF, SJ, VV and GG agreed they were effective visually but suggested they hadn't made the impact which Wonga would have hoped for. It was explained that cost had been prohibitive with regard to free scarves for fans and that Wonga had wanted to do something stadium-wide as opposed to a specific area of the stadium.

DP also explained that thoughts are turning to next season and that Wonga remains open to fans' ideas for 'set-piece' occasions.

DP was unaware that the large flags had not been available for the Tottenham and Aston Villa fixtures. LM said the Club would ensure they were back for the next home fixture.

ER confirmed that a Club surfer banner will be returning to St. James' Park shortly.

 

6. AOB

GG requested that the next meeting is brought forward a week from the originally scheduled date of Monday 19th May 2014 (end of season).

LM will circulate suitable dates to members for consideration.