Nottingham Forest Financial Review 2014-15

Things move so fast in football and so slow when it comes to publishing statutory accounts that when you want to take a look at performance you feel very out of date. The financial statements for the financial year to 31 May 2015 reflect yet again a year of turmoil for Nottingham Forest Football Club.

The excitement that greeted returning hero Stuart Pearce on opening day against Blackpool turned to a sense of loss and mourning just a few months later as he was dumped out of the door and replaced by Dougie Freedman. If I’m honest it is a loss that I still feel. We will always have that special day and we’ll always have the amazing win at Pride Park but it was emotionally tough at the end, really tough.

The previous year’s accounts had already landed us with a transfer embargo for failing Financial Fair Play (FFP) and the expectation was that things would not have improved with these latest results. Of course during the current season things have improved and the club advise that they expect FFP restrictions to be lifted next summer as a result, but we will have to wait for those numbers to come through.

The headline figure is an accounting loss for the period of £21.5M, which is actually a decrease of compared to the previous year’s loss of £24.0M, but this is due to the inclusion of £6.1M profit from the sale of Karl Darlow and Jamal Lascelles to Newcastle United. It is also in part due to the restatement of last year’s accounts which increases the reported loss for 2014 from £22.9M to £24.0M. Whilst this is not a huge thing it is worthy of note that it is the second time in two years that prior year accounts have been restated by the club.

In the analysis that follows I have taken the same approach as last year focusing on EBITDA, Financing and Balance Sheet transfer activity to give a picture of what happened financially during the year. You can go back and read that review if you wish here and you can read all of my previous financial statements articles here.


Losses before interest, tax, depreciation and amortisation were £20.5M, which is an increase on both the restated figure for last year, £19.9M, and the number originally published for that year, £18.8M. The reason for this is that staff costs have increased by £2.5M to £29.5M, which more than offsets the increased turnover which has risen from a restated (reduced) number of £15.4M for 2014 to £17.4M.

The various movements which confuse the accounts, hopefully not deliberately, mean that staff costs as a percentage of turnover have actually reduced, although they remain extremely high at 170%. Non staff costs appear to have plateaued at a little over £8M.

2015 P&L

Note 27 at the end of the accounts confirms that the restatement in turnover relates to £1.1M of sponsorship revenue agreed with companies controlled by the Al-Hasawi family for shirt sponsorship, as well as sponsorship of areas around the City Ground.  This agreement was cancelled after the filing of the last accounts so the prior year results have been adjusted, reducing turnover and increasing the loss for the year. This additional gap has then been covered through the club’s loan facility rather than through increased revenue.

As explained last year EBITDA gives a good indication of the club’s day to day sustainability as it ignores non-cash items such capital depreciation and player transfer fee amortisation, as well as windfall items such as profits made on player sales. It should come as no surprise to Forest fans that the club would not be in any way sustainable without the massive subsidy of the club’s owner.

Although the financial numbers do not make any judgement on the way the club is run when they are compared with the team’s performance on the pitch it looks like poor value and realistically that is in large part down to haphazard leadership and poor decision making. As referenced in the introduction the hope is the current year’s results will show improvement on that front and that the future will see sharp improvements in leadership and direction from the owner.

Balance Sheet Transfer Activity

EBITDA is used to understand the day to day running of the club so to understand investment in the playing squad we turn to the balance sheet. This is because when a player is purchased their transfer fee is capitalised and then released through amortisation over the course of the player’s contract with the club. For example, Brit Assombalonga’s fee will be spread over 5 years in the Profit and Loss Account.

2015 Transfer Activity

Last year the club invested £9.7M on new players, which was dominated by the signings of Britt Assombalonga from Peterborough United and Michael Antonio from Sheffield Wednesday, but also included a further 7 players. In addition the club sold a total of 10 players who had a combined original cost of £5.5M. In reality most of those players were released for no fee and the sales were dominated by Karl Darlow and Jamaal Lascelles moving to Newcastle. As those two players were home-grown through the academy they had no Balance Sheet value from any previous fee paid and so the club made a significant profit on them in the year they were sold.

The total profit on players sold during the year was £6.2M and as sated above this is why the reported loss for the year reduced year on year even though the EBITDA increased during the same period. Once again though the owner has been shown to have invested heavily in his squad, which suggests that the problem at Forest has not been a lack of investment but rather a lack of direction and focus in that investment and in the overall management of the club. A problem of long term strategic leadership rather than money.

Balance Sheet Financing

When you are making losses you need to finance those losses through sources of funding other than turnover. At Forest, as with many other football clubs, this is achieved through the owner who has a loan facility for the club to draw down on.

At Forest there are two significant loans in place. The first is an indirect one from the owner via his company NFFC Group Holdings which relates back to the purchase of the club and remains at £14.9M (see previous reviews for more detail). In addition there is a loan direct from the Al-Hasawi family which covers the ongoing losses since the takeover. This loan has increased during the year by £29.7M to £67.0M, reflecting the losses made by the club in the first 3 years of the Al-Hasawi family’s ownership.

2015 Balance Sheet Financing

In addition cash balances fell from £600k to £68k and finance leases were reduced to £239k. As a result the Net Debt of the club has increased from £52.0M to £82.1M in the year. Whilst it can be argued that this debt is mostly owed to the owner himself, rather than to external parties, it remains a very large figure and it would be reassuring to see him take the approach that owners of other clubs have done and convert the debt to equity.

The size of the debt also draws a clear line below the other comments about annual losses, confirming the consistency of those losses over the three years of ownership we have figures for.


To be honest the conclusions have not really moved on since the last set of results, in much the same way as the club itself had not progressed between the two dates. The first three years of ownership by the Al-Hasawis have been extremely poor and have severely affected confidence and trust in them as owners. As a fan you only have to look at the turnover of managers, players and other staff to see that there has been a lack of vision, leadership and planning and that has resulted in the combination of poor results both in the accounts and on the pitch.

Some hope has been derived from the season in progress in that the club seems to have finally understood the importance of Financial Fair Play. It is essential that claims that the club will pass FFP this year and come out of its transfer embargo are realised. If that does happen then it is an opportunity to draw a line under the past 4 years and start to move forwards. If it doesn’t then trust will again take a knock and it will be hard to rebuild.

Even if Forest are released from the Football League restrictions next summer there is still some way to go before we can feel confident that there is now a coherent strategic vision for the future. The first 4 years have not been good however you look at them and there is no point pretending that they haven’t happened. The club is, however, reliant on the ongoing investment of a wealthy owner if it is to have any hope of competing in a Championship that will only get tougher as parachute payments increase, so we must hope that this experience has at least provided Fawaz Al-Hasawi with a chance to learn and that he will improve his performance in the years ahead.

Pricing Strategy

img308The problem with the recent ticket price debate in football is that it has been turned into a simple one of good fans being forced away by bad clubs. It is rare that any argument can be defined with such duality, even though it is common for opposing sides to try to make it so. The issue that needs to be addressed is not the top price that people are paying to attend a football match, or even really the average price, but rather is it accessible. To get there we need to look not so much at pricing statistics as a pricing strategy.

Most clubs probably have a section of support that has a good amount of money to spend and that is prepared to stump up some serious cash to watch their team. These people are important because they can help to generate funds that can build a successful club, so if they want to pay £100 to watch a football match why not let them do it? Their ability to pay can generate funds that allows the club to have other sections of the ground that are a lot less expensive. This is essentially what the plan was at Liverpool with a small section of seats being priced at £77. Now, I don’t want to get into a detailed argument about Liverpool, they are not my team, but if there are wealthy fans out there why not take some money off them?

At Forest the equivalent might be the central area of the Main Stand, which has always been the most expensive despite the facilities of the ageing stand not being the best. When Forest put their pricing strategy together if they find that there is a group of fans happy to pay £77 for a ticket in that area then I would have no problem with the club charging that, so long as they approach this as meeting the needs of one section of their supporter base but not the whole. The idea that plenty is twenty doesn’t take into account those who can and will happily spend more.

By the same token for other fans twenty really is enough, maybe too much, and there needs to be areas of the ground priced appropriately to keep those long standing fans involved. At Forest the pricing for season tickets in the Trent End and the Lower Bridgford Stand has been kept low, with 2016-17 tickets available to new supporters for £396, or just over £17 per match, which seems like excellent value. If this is tied in with matchday prices that include sections for £20 a broad spectrum of supporters could attend regularly and matchday prices could allow for the fact that some people, as well as tight budgets, have restrictive working hours or family situations that mean a season ticket isn’t practical.

With a high level of supporter engagement and consultation it might be possible to go even further, such as offering a section of tickets at massively reduced prices so that people who really struggle to find the money can still be involved. Finding a way to build strong relationships with fans is the critical element in all of this, alongside an understanding that fans are not a homogenous group with identical needs. If one group of fans is happy paying a high price for a seat in a central area, perhaps with better facilities, and another is happy to keep it cheap and cheerful just to see their team play, then why shouldn’t these groups exist together at the same club?

Ultimately a full stadium that draws committed, long term support from all of the local community will provide the strength that a football club needs to develop and succeed. To achieve that clubs need to be creative and flexible about how they approach pricing, not be restricted by a soundbite. Key to the whole thing is that football should be accessible and rooted in its community. With a date set for a meeting to discuss  the potential role of a Nottingham Forest Supporters’ Trust in early April, this may be one way for our club (and others) to reach out to their fans and understand them so that together they can find answers to these questions that deliver the best outcome for all concerned.

Happy Anniversary Dougie Freedman

DFIt is a year since Dougie Freedman was appointed the manager of Nottingham Forest and that in itself feels like a reason to celebrate. An anniversary is a milestone that Sean O’Driscoll, Alex McLeish and Stuart Pearce all failed to reach, making Freedman only the second manager appointed by owner Fawaz Al-Hasawi to still be in the job twelve months later (and the other is best forgotten).

Putting the owner’s problems to one side, however, Freedman’s efforts on behalf of the club do deserve recognition. He arrived following the painful departure of a club legend and walked straight into the fallout from Forest’s failure to meet the league’s Financial Fair Play (FFP) rules. Despite this he has calmly gone about fashioning a team that can compete in the Championship and they currently sit in 11th spot, which is higher up the table than I reasonably expected as a target for the season.

The main aims for the club this season have been to reduce the cost base, which had got completely out of hand since the 2012 takeover, and ensure that by the end of the season the FFP restrictions imposed by the Football League were removed. Although we do not know for certain whether the club will get that clearance in the summer Freedman appears to believe that he has achieved this first goal of his management. That will in part be down to the sale of Michail Antonio to West Ham so it may mean that further work needs to be done as we look ahead, but progress has certainly been made.

At the same time Freedman has shown an ability to adjust his approach and as a result change the fortunes of the club, as demonstrated by the current 12 game unbeaten run in the league, which has seen the team take 22 points. He has also been imaginative in the transfer market securing the services of a number of Championship quality players despite the limitations of a partial embargo, whilst also keeping the door open for academy graduates Ben Osborn and Oliver Burke to continue their development.

I’m not going to get carried away, there is still an awful lot of work to be done, especially given the number of players in the current squad who are either on loan or are coming to the end of their contracts, but Freedman has begun to set us on a more sustainable path in a similar way to the vital work Nigel Clough did at local rivals Derby County. Indeed it is ironic that just as Forest start behaving in the manner which won such plaudits at Derby for several years, that club has chosen to spend vast sums chasing a promotion that could yet elude them and build up problems for their future.

In an ideal world there are things on the football side of the club that I would change. I would rather have some separation between the Head Coach and the recruitment structure, so that the latter strategy remains consistent even if the coaching input is changed. With the club operating in a way which lacks structural integrity though Freedman is the only person providing leadership and as such all aspects of the footballing operations will flow from him. This makes stability in his position even more important, as removing him would once again put the whole club back to square one.

So looking back at a year under the management of Dougie Freedman it feels right that this anniversary is celebrated. On balance he has done a very good job so far and the club is in a better state for the efforts he has made. That there remain doubts about the club as a whole is sadly undeniable, but those issues do not reside with the manager who has merely had to deal with the fallout. Thankfully he has done that with intelligence, creativity and a calm resilience. Happy anniversary.

Debate Forms Around A Supporters’ Trust

There has been a sense for years now that the game of football is becoming detached from those who have traditionally sustained it. The spiralling wages of footballers in the higher levels of the game make it difficult for fans to relate to their heroes and the influx of wealthy individual owners, spending sums that can barely be comprehended by the average working supporter, makes the clubs themselves seem separate in nature.

The fans as an entity seem to have been devalued in this era of massive television deals and global sponsorship partners. Even in the Championship, where television revenues are much smaller, owners who want their club to compete finance losses that exceed ticket revenues, so the season ticket holder questions the value of his or her input despite the efforts they had to make to scrape together the money to pay for it.

Out of these frustrations comes the urge to play a bigger part. Football clubs are community entities but they are owned largely by private individuals. To make that work for the benefit of all there needs to be some sort of governance that ensures that this temporary stewardship is carried out in the best interests of the club’s long term future. There are a number of ways that this could be achieved but one of the more appealing ones is the growth of Supporters’ Trusts.

There are some high profile trusts that have clearly made a difference at their clubs, indeed owning them in some cases and making demonstrable progress in league terms in doing so. The idea of a trust at Nottingham Forest has been muted a couple of times over the years but it seems now to have developed enough momentum to see it gain some life. In part this may be because of the growing frustration on the pitch but Interim Chair Richard Antcliff is quick to stress that talk of a Trust is not an attempt to launch a coup, in the boardroom or the dugout. “This is definitely not a manager or owner in-out campaign, far from it. This is a long term project to give fans and the club a better relationship and understanding.”

Although there is a strong argument for some form of governance structure to hold an owner to account, given the community emphasis and historical context of football clubs, the company structure does not really allow for such a setup as it is wholly owned by the individual and that person is unlikely to restrict themselves via an independent board. A Supporters’ Trust may therefore be able to bring about a more formal level of independent governance if it can build trust and engagement with the owner.

Richard Antcliff further explains, “I have simply been asked by a group of fans that has quickly grown in numbers, to create some debate. The first task is to explore whether various supporters clubs, fans forums, season ticket holders or anyone else thinks it’s a good idea. If there is enough support and it’s something we feel has merit then we’ll be happy to take it forward and seek further assistance from Supporters Direct who are an umbrella organisation set up by the government.”

The first stage, therefore, is to understand the level of support across all groups and stakeholders. The only way for a Trust to succeed is to include and be accessible to the whole fan base. It also needs to be credible and professional enough to be taken seriously in its dealings with the football club. Beyond that, however, it needs to be formed by the beliefs, hopes and expectations of its members and it is with that goal that an open meeting in the coming weeks will look to take the idea forward. Notification of the meeting and updates will be provided via the Twitter account @NFFCTrust as well on fan forums and through the local media.

MLS: I found my way to San Jose

My son has been developing an interest in North American sports for a while now. With a planned trip to the USA in the pipeline for some time he adopted a number of teams local to our friends in Mountain View. So he follows the Sacremento Kings for basketball, the San Francisco Giants for baseball and 49ers for American Football, the San Jose Sharks for ice hockey and the San Jose Earthquakes in Major League Soccer.

So, as we set out across the Atlantic for our summer holiday with the sporting seasons largely against us, we targeted the visit of the Colorado Rapids to San Jose’s Avaya Stadium as an opportunity to see one of these teams in action. We had already seen a couple of games on the television before we left but now was our chance to join the ranks of the San Jose Ultras and form a proper bond with our adopted team.

The Avaya Stadium is a shiny new development that opened its doors for the 2015 MLS season. It is a smart, well designed stadium that reflects the relaxed culture of spectating and also the very agreeable climate of San Jose. A single structure wraps around three sides of the pitch housing 18,000 seats and a small supporters’ terrace behind one goal, whilst behind the opposite goal is a huge screen that sits atop a long bar, which according to the free match programme is the largest outdoor bar in the US.


The sun shines in San Jose and the temperatures are high so it makes sense that the hospitality areas are open to the elements rather than boxed in as they would be in England. Seats are provided in the first few rows of the stadium with sectioned off areas of the concourse providing food and drink, but there are no walls separating the “prawn sandwich brigade” from the average fan. The pleasant climate also lends itself to the provision of a 2 acre “Epicentre” space for pre-match shenanigans such as eating, drinking, collecting freebies and listening to live music.

On the evening of our visit the club were celebrating the local Portuguese community and culture and the club seems to be well tuned to its neighbourhood with this type of event featuring regularly at games. The programme previewed future matches which will recognise the LGBT and Mexican communities and another that will mark the first goal scored at the new stadium by giving away bobblehead figures of Fatai Alashe, the goalscorer. Sadly we are unable to return for that match as Alashe is one of my favourite Quakes players.

The modern day San Jose Earthquakes map their heritage back to a club of the same name formed in 1974 that played in the North American Soccer League and later the Western Soccer Alliance. The MLS club itself though was formed in 1994 under the moniker of the Clash, taking on the traditional name of Earthquakes for the 2000 season.

The club were MLS Cup Champions in 2001 and 2003 under the management of former Ipswich Town player Frank Yallop. They have also won the Supporters’ Shield in 2005 and 2012, the latter again being under Yallop’s charge after he had returned to the club in 2007. Current Head Coach Dominic Kinnear had been Yallop’s assistant during both of his stints in charge and was also Head Coach in his own right when securing the 2005 Shield.

The Quakes lined up for the game with Jordan Stewart the familiar name from English football, the former Leciester City and Watford player starting at left back but leaving the action with a nasty looking injury after just 27 minutes. With Fatai Alashe, the young US U23 international who had won our hearts back home with his committed performances in defensive midfield, suspended Godoy and Garcia made up the central midfield with Wondolowski, the big hero of the team, slightly more advanced behind Qunicy Amarikwa. Wondo is the star man having excelled for many seasons with the Quakes, scoring over 100 goals for the club, but Amarikwa had caught our attention on the TV screen and was high on our scale of anticipation for this live game.

Colorado were fielding a couple of familiar faces in the form of central defender Sean St Ledger, of Preston and Ireland, and his compatriot and fellow international striker Kevin Doyle, most recently of Wolves. In addition Honduran left back Maynor Figueroa, previously of Wigan and Hull, lined up in Rapids’ colours, but despite their familiarity they were of little concern to us.

In the end it was central defender Clarence Goodson who provided the vital goal, heading home Amarikwa’s cross to secure the Quakes first win in 7 games. In all honesty it was not the greatest game of football you will ever see, some of the passing was extremely poor with two sides perhaps lacking in confidence and struggling for form, but there was quality in there too and the key thing was for the Earthquakes to get that win. Since that game they have added victories in each of their next three beating Sporting Kansas City 5-0, DC United (top of the Eastern Conference and managed by former Nottingham Forest loanee Ben Olsen) 2-0 and big local rivals LA Galaxy  1-0.

We were able to watch this latter game, which is titled the CaliClassico such is the nature of the rivalry between the two teams, on TV having returned to the UK and it was great to see the Quakes with renewed confidence turning over Galaxy with their big names like Steven Gerrard, Robbie Keane and Giovani Dos Santos.

That run of wins has put the Earthquakes back into the playoffs picture and turned around what was looking like a failing season. We like to think that we kick started the upturn in results with our presence and had a positive influence on the club. The fans, who were the real highlight of our visit to the Avaya, certainly left a positive mark on us.

Drums and flags feature heavily amongst the crowd as they relentlessly cheer their team on. There appear to be a number of fan groups represented either on the Supporters’ Terrace or the seats above it. The San Jose Ultras are positioned in the seats behind the goal, announced by their banner, and fly a number of flags whilst singing and banging their drums. The Faultline also have a banner but on the Supporters’ Terrace, though they seem a small group from what we could see they certainly bring enthusiasm and more drums. A third group El Imperio Sismico certainly made an impressive entrance (see below) and brought more drums and an electric atmosphere to one side of the terrace.

The drums from these different groups of supporters pound out an almost unbroken beat through the game that can at times drown out the singing and chanting of fans that is more recognisable to us from the English game,  but they certainly ensure that the atmosphere is maintained whatever is happening on the pitch.

In other sections the stadium appears sparsely filled at times but this seems to be in part because many fans who have bought tickets for the seats actually end up watching from the long bar behind the far goal. The appeal of this is clear – and unlike in England you are quite welcome to watch the match with a beer in hand – but it can mean that a game is said to be sold out despite empty seats being clear to see.

What matters most though is that we made the trip and took our place at the home of the Earthquakes. It’s easy to adopt a club from across the ocean but it takes a visit to the ground, standing amongst the weekly faithful, cheering on the team to connect that club to your heart. I do not know when we will be back to see a live game again, maybe it will be years, maybe (but hopefully not) never, but we will always be a part of it now. We have made our commitment, we are Earthquakes fans.




Go Quakes!


Nottingham Forest Financial Review 2013-14

On the pitch the 2013-14 season for Nottingham Forest was again characterised by disappointment and change. After an awful run of form in the second half of the season, the team finished 11th in the Championship. Although a horrendous injury crisis played a major part in the team’s problems on the pitch, manager Billy Davies was sacked after a humiliating 5-0 defeat to local rivals Derby County.

This meant that Chairman Fawaz Al-Hasawi had sacked 4 managers in just 2 years in charge and gave every impression that the club was rudderless. It is this period that the financial statements discussed here cover and they reflect the erratic nature of that leadership. Of course since the date of these accounts the club has gone on to sack Stuart Pearce as manager too, after just 6 months in charge. They quickly announced Dougie Freedman as the 5th “permanent” manager in just two and a half years.

It has also been confirmed that Forest, along with Leeds United and Blackburn Rovers, failed the Championship’s Financial Fair Play (FFP) rules and were therefore subjected to a transfer embargo. It should be noted that this penalty is the result of the financial year 2013-14, which ended 31 May 2014 and to which these latest published accounts relate, rather than the current financial year and associated season.

Whilst headline losses have increased from £17M to £23M and this reasonably indicates the overall direction of travel financially I am going to focus on 3 key areas of the accounts in this review. These are Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA), balance sheet transfer activity and balance sheet financing.


EBITDA shows how the club is managing day to day as it compares generated income (turnover) in the year with day to day running costs. As such it is a good indicator of the financial health of the business and the extent to which the club – as it is currently being managed – can survive within its natural means, as opposed to requiring ongoing financing from external sources such as banks or wealthy owners.

It should be noted that the accounts for 2012-13 financial year have been restated in the new accounts with an additional income category of Loan Players being added. The loss for the year remains unchanged but turnover and costs have both increased. Below I provide the Profit and Loss Account for the last 3 years including 2012-13 in both its original and restated forms.

Profit and Loss

It is clear that the day to day activities of the club require massive subsidisation from external sources and this reliance is only increasing. Turnover has increased year on year, mainly due to the Al-Hasawi family paying £1.1M in the year for advertising around the City Ground, whereas no payment was made for this in 2012-13, but the wage bill continues to escalate sharply.

Staff costs rose from £21.0M to £27.2M, a 29% increase year and year and a 55% increase on the staff costs inherited from the previous ownership in 2012. Staff costs are currently running at 165% of turnover and it is important to realise that these liabilities continue into the future and will need to be met irrespective of whether the current owner continues to fund the club. Rising wages also create a spiral of expectation amongst players whether they are joining the club as new signings or renewing existing contracts, although the penalties applied through FFP will actually constrain the club’s ability to offer wages beyond £600k per player for the time being at least.

As a result of these increases in both revenues and costs, EBITDA has increased from £14.1M to £18.8M, a 33% increase in the year and a 111% increase on 2011-12. So long as all bills are paid and the owner remains happy to fund losses then this need not be a problem in itself but it does raise questions about the ongoing viability of the club, especially if the owner were to change his mind about funding, and also whether the club is following an appropriate strategy for building long term success.

Balance Sheet Transfer Activity

The financial value and impact of transfer activity can be distorted both by accounting policies and by the way cash payments are often staggered over time. The balance sheet view of transfers, however, shows how much value has been added to the playing squad through committed fees. As a result it gives a clearer indication of the investment that is being committed in a given year.

Balance Sheet Transfer Activity

In 2013-14 the club purchased player registrations at a cost of £8.4M, heavily investing in the playing squad and recruiting 9 new first team players. In addition they sold players who had been bought for £1.1M for around £2.3M. A net investment of around £6M in the year shows that the owners are keen to develop the squad, but also adds to the requirement for external sources of funding.

On the one hand the willingness of the owners to invest in improving the squad and making it better able to challenge for promotion to the Premier League is a good thing, but on the other when this high spending is combined with a rapid turnover of managers and players it can also breed instability and create an environment that is less likely to succeed.

In the first two years of their ownership the Al-Hasawi family made 18 permanent signings and a number of loan signings. The 2013-14 accounts also comment that since May 2014 a further £9.4M has been spent on players (the largest of course being Britt Assombalonga at a reported £5.5M), albeit offset by £6.6M of player sales.

Clearly for a club with aspirations to be promoted there is a need to invest in the quality of the squad but the scale of purchases and the increase in wage costs when combined with the club’s league position over this time and the high turnover of those players (11 of the 18 permanent signings from these 2 years have already left the club) suggest that the spending to date has been poorly directed.

Balance Sheet Financing

In order to fund all of this expenditure the club can turn to 3 main sources; its own cash reserves (and other banking facilities), its use of credit with suppliers and drawing down funding from its owner.

Balance Sheet Funding


Cash balances in the period reduced by £2.4M as the club utilised its bank account to fund some of the shortfall in income over expenditure.  In 2012-13 the club had increased cash balances by a similar amount so the bank balance at £600k is not much reduced from what it was in May 2012 (£899k).

In 2012-13 the club significantly increased its use of credit to fund its expenditure. Net debtors and creditors rose by £4.1M suggesting a change in approach to paying creditors. That is not to say that the club was doing anything wrong, it could just be down to either a change in payment terms or greater use of time provided by payment terms, although there were reports of court orders being issued during the period. In 2013-14 a similar approach was taken with a further £4.5M increase in net debtors and creditors, the bulk of which relates to trade creditors, HMRC and accruals and deferred income.

Other funding comes from an interest free loan facility provided by the Al-Hasawi family. In 2012-13 the family provided £14.9M to the club through this facility and in 2013-14 they provided a further £21.0M. With no interest being charged on this loan the balance as at 31 May 2014 is £36.0M.

In addition to these funding sources there is another loan on the Balance Sheet which relates to the purchase of the club in 2012. Nottingham Forest Football Club is wholly owned by its parent company NFFC Group Holdings Ltd, which is owned by the Al-Hasawi family. At the time of the takeover in 2012 the football club owed the Doughty estate £85M. Of this £65M was written off by the Doughty family through shareholders’ funds but the remaining £20M was paid to the Estate by the football club.

To facilitate this transaction NFFC Group Holdings loaned the football club the £20M it needed to pay off the Doughty Estate. In 2012-13 interest was charged on this loan creating a debt of £20.5M, however, in 2013-14 this interest was revoked and the debt became interest free. The principle value was also reduced by £5.1M leaving a loan on the balance sheet of £14.9M.

All of these instruments combine to create a net debt position of £50.7M, made up of £14.9M relating to the takeover and £35.8M relating to the ongoing running costs of the club between 31 May 2012 and 31 May 2014. In addition the club has increased its net debtors and creditors by £8.6M over those two years, a figure that remains payable but is not included in that net debt figure.


Clearly the club is operating in a way that would be impossible without the continued financial support of its owner. This is nothing new for Forest who were previously reliant on Nigel Doughty in a similar role for many years. The scale of that financial dependency has increased though with costs rising rapidly.

Promotion would change the nature of the game completely but maintaining this approach in the Championship is very costly and raises serious concerns about the direction and sustainability of the club. Whilst spending can be viewed as ambitious it can also be reckless and Portsmouth are a telling example of what can happen if an owner creates obligations for a club that he does not then settle himself.

Fawaz Al-Hasawi has publically proclaimed his long term commitment to Nottingham Forest, which is a positive thing, but it feels like the club is gambling on promotion and that can prove a dangerous and expensive game.

What does a transfer embargo really mean for Nottingham Forest?

So, we all knew that a transfer embargo was heading our way but what does it actually mean in practical terms for the club? Whilst the embargo is in place Forest will only be able to sign players where no fee is required, whether that be permanent transfers or loan signings. They will also only be able to spend a maximum of £600k per year on wages and associated costs for any individual player and can only keep a squad of 24 senior player – which is defined as players over the age of 21 who have played at least 5 first team games.

That last element should not be too much of a problem as that seems a reasonable squad size when you consider that young players coming through the ranks, such as 19 year old midfielder Ben Osborn, are not included. The other elements of the embargo will mean that Forest are limited in the market they can operate when it comes to building their squad and that could present a problem given how many players the club could lose next summer.

The background to where we are is that in the last published accounts for the year to 31 May 2013 the club lost £17M. Not all of that will relate to the FFP rules as youth academy costs and capital expenditure can be removed. There is also a complicated situation around how club’s account for transfer fees. The key year for the current embargo is to 31 May 2014 and these accounts will not be made public until March 2015, although they have been submitted to the Football League. Most people would expect losses to be substantially higher than in the previous year, so the £8M limit under FFP will probably have been missed by a huge margin.

With losses in 2014/15 having to fall below £6M it also seems unlikely that Forest will be able to come out of this embargo quickly, unless they sell some prized assets. There is an option to ride it out for another year because the rules change for the season 2016/17, which will rely on the financial results for 2015/16. That would leave the club constrained for a long time though and may not be tenable for the owner, manager or players looking to progress their careers. It’s easy to be flippant about the FFP rules (as previous club officials were) but there are in fact real consequences.

In the very short term the impact will probably be small. In January we could still make loan signings so long as no fee is attached and we are all keeping our fingers crossed that Andy Reid and Jack Hobbs will bolster our squad in the new year as well. The summer will be a different story though and will need some careful planning by the scouting team.

At present Forest have two recognised first team goalkeepers, but Darlow is due to return to Newcastle in the summer and de Vries, who has seen little action since joining the club, is out of contract. The club had been linked with young Southend ‘keeper Daniel Bentley but under the embargo no fee could be paid which would presumably put paid to that move. De Vries could be offered a new contract, Darlow might be available for another loan (although it would have to be without any loan fee involved) and youngster Evtimov will return from his loan at Mansfield (indeed the club has a glut of promising young ‘keepers at the moment) but clearly action needs to be taken in this position.

In defence we have similar issues. High profile players (with no doubt associated wage costs) in the form of Mancienne, Hobbs, Wilson and Fox will remain but Lascelles returns to Newcastle with Darlow and Lichaj, Harding, Halford and Collins are all out of contract and Jack Hunt is only on loan until January with again fees being a problem in retaining him. We do have Roger Reira and Louis Laing in the U21 squad and on loan at Notts County respectively but with defensive issues apparent on the pitch right now there is some work to be done in finding appropriate transfer targets within our operating constraints.

In midfield and attack we do have players who remain under contract beyond the summer so the biggest issue might be convincing them a club under a transfer embargo is able to fulfil their ambitions. Antonio and Assombalonga have had eye catching seasons so far and are certain to attract attention. We also seem to lack that traditional midfield general in our current squad, but the workload for the club’s recruitment team in these areas seems lighter than at the back, unless we have to cash in on leading stars. The club also has young players like Veldwijk and Walker to bolster numbers and one would expect the club’s U21 and youth squads to play a leading role in the post FFP environment.

To be fair though for most of us this is all in the future. Whilst one would hope that the club are preparing for all scenarios and will put together detailed plans for whatever actually happens between now and the summer, as fans we are much more focused on the current season. Form has not been great recently but with potent attacking players we always have a chance to turn things around and if we can get Reid and Hobbs back on the pitch regularly in the second half of the season we could yet challenge for the playoffs.

The crucial thing for me remains that we get some stability into the club. Constantly changing managers always puts greater emphasis on spending money because new managers want transfer funds to put their own stamp no a squad. Hopefully if we retain a single man in charge for a sustained period of time he can build an effective team without such a need to pull on external finance. It seems impossible to challenge in the Championship without making some losses but Forest have wasted a lot of money over the years by constantly turning over management and playing staff. A bit of stability in both might help us achieve our aim of promotion without breaking the bank.

“Dirty Northern B*st*rds!” And Other Tales from the Terraces by Tim Marshall

DirtyI have to admit that when I first saw the title, the cover and the dreaded word “banter” I wasn’t sure that Dirty Northern B*st*rds! would be my thing, but I was quickly won over by the well balanced mix of humour, serious themes and history – both football and social. It turned out to be a light and easy but fascinating trip around the country discussing rivalries and stereotypes, the wit of the terraces, the roots of deep feelings and where lines are sometimes crossed, whilst providing regular chuckles, occasional moments for thought and reflection and a host of fascinating little historical tales.

The book is split into three sections, first half, second half and extra time, and they cover different aspects of football chants with the first one largely focused on rivalries and how chants have developed by emphasising our differences. The highlight of this section for me was an interesting discussion around interpretation that can lead to a chant being one side of offensive or the other. This particularly comes into focus with the issue of race and being only a distant observer of Tottenham Hotspur the focus on the “Y word” was fascinating. The influence of being in a crowd also plays an important part in this to the extent of individuals joining in with songs that they might find personally offensive outside of a football ground because of the group mentality.

The second half was my favourite as it covered signature songs of clubs around the country and their origins. I am a regular participant in Nottingham Forest’s rendition of Mull O’ Kin Tyre by Wings, in which the words are changed to “City Ground, oh mist rolling in from the Trent” and have always been impressed by visiting Stoke fans when their massed choir sings Delilah, though I never understood why before. It was also pleasing to finally discover all of the words to one of my favourite signature tunes; Sheffield United’s version of Annie’s Song by John Denver. Those words in full are:

“You fill up my senses

Like a gallon of Magnet

Like a packet of Woodbines

Like a good pinch of snuff

Like a night out in Sheffield

Like a greasy chip butty

Like Sheffield United

Please fill me again”

At the risk of upsetting Sheffield Wednesday fans I heartily recommend a trip to Bramall Lane to hear it sung by the Blades fans in person. In fact that was the great thing about this book, it introduces us to the history and character of clubs all around these Isles and putting rivalry aside in favour of the wider game it pricked my interest further in travelling around our football grounds to experience each unique twist on a shared passion. Redressing the Sheffield balance a little the Wednesday fans apparently serenade their team to “Honolulu Wednesday”, their take on a song that featured in the 1933 Laurel and Hardy film “Sons of the Desert” and there are a host of similarly obscure journeys made by songs to football terraces.

The final section is a bit like a Tim Vine show of one liner chants and wise cracks from the terraces and brings the book to a fast paced and funny close. The pace is suddenly slowed right at the end though for its best three pages. It focuses on Stockport County but its brilliance lies in the way it captures so much that is good about the game. I will leave it for you to discover for yourself but it is a perfectly selected way to end a book that is all about what it means to be a fan.

Apart from some inevitable bias towards the author’s favourite club this is an enjoyable journey through football and Tim Marshall has done his research to tell the narratives behind the songs thereby allowing us to glimpse a little of the heart of each club and its fans. On a Saturday afternoon we are rivals but this book celebrates both our unique and our shared stories for which we are all richer.



Jumpers for Goalposts – How Football Sold Its Soul by Rob Smyth & Georgina Turner

JumpersThe spiel on the back cover of Jumpers For Goalposts begins “On August 15th 1992, the Premier League kicked off for the very first time to the sound of money.” On August 16th 1992 I took up my familiar position at the City Ground as Nottingham Forest hosted Liverpool for the first live Sky television broadcast of a Premier League match. At the end of the game the roaming camera went straight to Teddy Sheringham, who had scored the only goal of the game to secure a Forest win, and he proclaimed whilst still on the pitch his desire for a move to Tottenham. It was a moment that announced to me that everything had changed, for my club and for the game as a whole.

This book is a lament for things that have been lost. It is not saying that everything in the past was perfect or that our modern game is all bad, it simply recognises that important things have been set aside as football’s collective head has been turned by money. That collective culpability is important. Yes, we have been let down by governing bodies and the way they have been blinded to their proper responsibilities by the bright lights of the Premier League. Yes, our heroes have turned sour as wealth beyond a normal person’s imagination has shaped their lives. But we fans also have to share some blame as we turn a blind eye ourselves to cheating, violence, racism and rape so long as the goals go in.

The voice of the book is that of the ordinary football fan and as such is as accessible as the thousands of pub debates that have taken place across the country every weekend since football began, which in case you’re in any doubt was long before 1992. It’s only real problem is that, just like the 24/7 rolling football coverage that bombards us from our television screens and internet feeds, it is relentless. With each tale of corruption and greed the reader’s heart grows heavier and there is a reluctance to keep going, but we need to face and acknowledge these painful realities if we are ever going to change them.

In Chapter One Theo Walcott happily tells the world how he heroically convinced his teammate Andrei Arshavin, who had been awarded a penalty, not to tell the referee that a mistake had been made. Walcott tells us that Arshavin was simply “too honest” but thankfully Theo spotted that honesty coming and quickly halted it. It is not simply the cheating that hits us in this story, we see that all too often now, but the way that Walcott happily tells this story painting himself as the force for good laughing at his fair minded teammate’s naivety.

Elsewhere we review the host of decisions that have been taken to re-organise competitions at club and international level in order to pocket some extra cash and the damage those decisions have done to the integrity and quality of those competitions. The decline of the FA Cup, begun by the FA themselves when they pressured Manchester United in 1999/2000 to withdraw from it in favour of the World Club Championship, to protect England’s 2006 World Cup bid. The expansion of both the World Cup and the European Championships that renders much of it, including qualification, meaningless, not to mention the corporate bullying that accompanies such tournaments. The creation of the Champions’ League, a complete misnomer given that champions make up a minority of teams playing in it and the revamped UEFA Cup, now renamed the Europa League, once a proud competition now held in disdain by even minor teams.

Rather than simply pointing the finger at everyone else, however, we are also encouraged to do a bit of self-reflection and in this we might find both the biggest problem and the solution to modern football – our consumption of it. We are now able to watch so much football and spend so much additional time analysing it and arguing about it that all the goodness is being sucked from the game we love. There is no mystique to visiting European teams or far off World Cup players because we have watched them via our TV subscriptions and signed them on Football Manager. There is no room for simple and genuine mistakes when every decision can be analysed to death, no time to build a team when transfer deadline hysteria kicks in and ambition is measured in pounds spent, no patience for developing young players when the manager’s head is called for after two or three defeats and no limit to our myopia when our star player crosses moral lines.

This is a book for fans who remember a time before Sky’s billions and know that not everything has changed for the better and for fans who have heard others complain that football isn’t the same anymore and want to know what the fuss is about. It is a timely reminder of important things that have been lost but should not be forgotten, or assumed to be irretrievable, and it is a call to consider how we participate in the national game and whether we might have had too much of a good thing. Read it, put together your own Soul Team, reaffirm your values and then carry them into the stands with you and reclaim the game.


Who Are We? – A Supporter Consultation Evening

Last night I joined a small group of other season ticket holders for a consultation meeting. The idea behind the meeting was to build bridges with season ticket holders and discuss ways in which this particular group could be valued and encouraged. It was, rightly, stressed that this was not about claiming one group of supporters is somehow better than another but acknowledging that season ticket holders make a big commitment in money, time and emotional investment and the club would like to recognise this.

From the club side the meeting was attended by the new CEO Paul Faulkner, Head of Finance Lalou Tifrit, Operations Manager Joe Sharphouse, Safety Officer Alan Bexon, Media and Communications Manager Ben White and John McGovern. I’ve left our legendary former captain to the end because I am not sure what his job title is, I like to think it might be something like Club Guardian such is his clear passion for our football club, but more of such talk later.

The format of the evening was that each club representative moved around the tables to have informal discussions with smaller groups of supporters. This meant that we didn’t have a chance to talk to everyone on the management team but Paul Faulkner summarised all discussions at the end, having had time to collate everyone’s notes whilst McGovern entertained us with stories from his career.

Some Nuts and Bolts

The table discussions focused on a range of tangible areas which perhaps breakdown into some key areas: a movement to season ticket cards rather than books and the implications of such a move, safe standing, pricing strategies, Peter Taylor and then added value and benefits.

The cards were a major discussion point because they have so many knock on impacts. From the club perspective they would bring advantages when it comes to security and fraud and for fans there are a host of potential improvements. For starters a card is easier to carry around than the current bulky book, but there are other practical benefits.

Cup tickets could be bought and automatically credited to the card, removing the need for a separate ticket. Lost cards could be easily deactivated and replaced. The club could credit benefits to the card, such as offering credit at the club shop or catering outlets. Fans could use them to save for next season’s ticket by crediting amounts to their card when they can afford it and then offsetting the balance against the renewal cost.

The cards have clearly been a discussion point at the club for a number of years but there is a desire to introduce them amongst the current leadership. Paul suggested that it would probably take a couple of years to implement but the consensus was certainly that the club should be working towards it.

Safe standing was an obvious discussion to have with Alan Bexon and it was an interesting discussion. It is clearly an issue that matters a great deal to those who want to stand, but that is probably a relatively small cohort of supporters. The discussion covered both the safety and the general management issues that standing, even in rail seats, can cause but I thought the most interesting aspect was a point of principle.

Having talked through some of the issues, Alan expressed his personal belief as a fan of the club as well as its Safety Officer that Forest were in a unique position as “the other club” in the Hillsborough disaster. As such he felt that it would not be appropriate for Forest to be at the forefront of re-introducing standing at football. I realise that for those who are passionate about wanting to stand at games that might feel like a cop out but personally I would see such a position, if it was to become official club policy, as entirely understandable and principled. It might not be something that was universally agreed with but it would be a stance that expressed the values of the club, which are important as I will discuss later.

Pricing was another important topic that came up. The club were obviously conscious that some season ticket holders do not like to see major special offers made to one off purchases that they cannot benefit from. Those in the room didn’t have an issue with trying to fill the ground and saw their season tickets as good value in themselves. The club were keen to stress that they were committed to making sure the season ticket remained the best value way to attend matches but everyone understood the need to use pricing offers to attract people to less appealing fixtures.

There were some interesting points about the implication of price points, particularly around child tickets and kids for a quid. The club see 12 as a key age because of the safeguarding issues around young fans attending matches on their own. It was clear that policies about pricing are more complicated than they might first appear and explaining why the club does something is a valuable exercise.

Recognition for Peter Taylor was also brought up and the club seemed to understand that this was an area that had been missed in the past. There was some talk of the possibility of a Clough and Taylor statue near the ground and also that this may be an area for supporter driven activity, in a similar way to the campaign that led to the Brian Clough statue in the city centre.

Most other items were of a more specific nature such as offering some added benefits like the open training sessions, consultation evenings like the one we were attending, session with the players to develop links between them and fans, benefits such as offering access to Forest Player for season ticket holders, how to make best use of travel incentives for away trips and so on. All ideas were noted down and collated for consideration by the club in due course.

After the round table discussions John McGovern took centre stage to share tales from his career, obviously dominated by Messrs Clough and Taylor given his long association with them at different clubs. This gave club officials time to pull together what they had heard into some cohesive notes and also shifted the mood a little to the essence of the club, rather than the mechanics of being a season ticket holder.

McGovern is an ideal person to be an ambassador and advisor. In the late 70’s we seem to have been blessed not only with a stunningly successful team but also a group of players with a genuine humility and impressive character. They all talk so eloquently about what was achieved during that period, without any sense of arrogance, and it was very clear last night that he cares deeply about this club, our club. This sent me back to familiar territory.

Something to Believe In

The sense of club is for me personally one of the defining elements of my support. As a season ticket holder I am in practical terms buying access to 23 games of football but in reality I am buying into a narrative that will run not only the course of this season but invokes 150 years of history and continues into an as yet untold future. That is why I want the club to have a vision, an identity and a set of values that remain constant.

In all honesty this has been missing for many years. There has been a tendency to define the club only in terms of its lack of, and desire for, a place in the Premier League. Not only is that a poor way to define a football club, it has no roots and therefore allows for wild swings in values and personality. I don’t want to re-hash old ground – largely because I am very positive about the new structure we have at the club today – but suffice to say that the first two years under the current ownership highlight this issue perfectly.

We have an opportunity now with Stuart Pearce at the helm of football activities (supported by a strong looking coaching and development structure), John McGovern as a sort of personification of the club’s history, Paul Faulkner as an experienced Chief Executive and Fawaz Al-Hasawi as a passionate and financially committed owner, to put in place the vision and values that will root us in our history whilst defining our future. If we have that and then behave in a way that is consistent with it we have something to buy into which can transcend short term results.

It is no use having an early bird season ticket offer if as a fan I have no idea what the club will look like by the start of the next season. So that is my plea to the club. It is great to talk about ticketing and pricing and these events are a genuinely positive way to build links between the fans and the club hierarchy, but all of it must sit within a clear, consistent and lived out understanding of who we are as a football club. If the Premier League is all that matters then we can buy a ticket to one of the existing Premier League clubs, but what really counts to us is Nottingham Forest and that is wrapped up in so much more than where we are in the league.

Of course, the other side to this plea is a similar one to our supporters. We have our part to play as much as the officials who steward our club. Let’s engage, let’s help to set that vision, let’s pull together, understanding that progress takes time and can also include setbacks, let’s get behind all of our players without exception and roar them on when they take to the pitch and let’s all of us, fans, owner, staff and players (current and past), make this a club to be proud of.



As a well brought up boy I would like to take this opportunity to thank everyone involved in last night’s event. It was a very enjoyable and informative evening and everyone representing the club came across very well. These efforts to engage with fans are very much appreciated, thank you.

Accounting Treatment for Transfers and FFP

In the light of recent activity at Nottingham Forest and statements from the owner I thought I would write a short piece to clarify the way that transfer activity is accounted for and the potential impacts that this has on Financial Fair Play (FFP) calculations.

I should stress that whilst the numbers used in this article are roughly linked to reports in the media they are only used here as illustrative. The principles will be shown but the numbers should not be assumed to be correct as most transfer dealings are not revealed fully. I also want to stress that this is not necessarily Forest’s strategy, I am just using their recent transfer activity to demonstrate what could happen within an FFP accounting framework and how a large spend could still reconcile with FFP, at least in the short term.

The table below summarises the clubs transfer activity so far this summer. I have only included those players that have been signed for a fee as free transfers do not affect the calculations and I have also excluded players released at the end of their contracts for the same reason.

FFP Transfer Spend

Clearly FFP is not restricted to transfer fees, there are wages and other associated costs, but this article is merely dealing with how fees are accounted for and how they can be used to influence FFP calculations. Forest will have saved money on wages for players released, although in some cases payments will have been made to players transferred without requesting a transfer (contractual loyalty payments) and others will have had contracts paid up in part or full on leaving.

The important accounting treatments are that when a player is purchased the fee is capitalised to the Balance Sheet and then amortised through the Profit and Loss account over the length of their contract. When a player is sold the fee received is taken immediately to the Profit and Loss account alongside any Net Book Value (NBV) that remains for that player on the Balance Sheet.

This summer the club has sold Darlow and Lascelles for £5M. As these players came from the club’s own academy no fee was paid for them so there is no capitalised cost on the Balance Sheet. The whole £5M is therefore taken to the P&L account.

Djebbour on the other hand was given a free transfer. We bought him for £2M in January 2014 and that cost will have been capitalised. At the end of the last period, May 2014, we would have released 5 months amortisation on his 2.5 year contract (£2M divided by 30 months of the contract multiplied by 5 months amortisation is £333,333). This year Djebbour’s NBV is therefore £2M less the amortisation already accounted for of £333,333, leaving £1,666,667 on the Balance Sheet. We received no fee for him so the whole amount goes to the P&L account as a loss on the transfer.

The proposed sales of Cox and Mackie will also involve NBVs being released from the Balance Sheet. Cox signed a 3 year contract and is in the final year. He cost £2.5M so a third of that needs to be released to the P&L. Mackie cost £1.5M and is in the second year of his contract so if he is sold the remaining £1M of NBV is released to the Balance Sheet. If the pair are sold for less than the £1.8M released from the Balance Sheet a loss will be recorded on their transfers. The table shows the impact of selling them for £500k each, a total loss of £800k in the year.

Taking all of these transfers together then our new outgoing activity this summer will have raised about £2.5M which is a profit against FFP rules. Of course we have spent some of that as we’ll see below.

It should be stressed that in addition to these there will also be historic amortisation for fees of players still at the club, these are Hobbs, Wilson, Collins, Halford and Harding. I have not included these as they could distract from my main purpose but Wilson for example cost £2.5M so we could be amortising another £800k for him alone.

Our purchases have grown substantially in the last 24 hours and raised questions about how this can still fit within FFP. The crucial element is that purchases are amortised over the length of the contract so if you give out long contracts you can make big short term benefits.

Mancienne, Veldwijk and Antonio have cost about £2.5M in total and all been given 3 years contracts, so £2.5M is capitalised and then a third of that, £833,333, released to the P&L. The big move is Assombalonga who has cost a reported £5.5M but was given a 5 year contract. His amortisation costs this year is therefore only £1.1M.

In essence what has happened in this illustration is that Forest have spent a net amount of £2M on transfers this summer but they can account for it as a £566k profit in the current year. If it wasn’t for the losses made on selling Djebbour, Cox and Mackie this distortion would have been even more dramatic. The problem comes if they do not get promoted, because next year they will start the summer with a net transfer spend loss of nearly £2M as a result of these deals and the same again the following year and still have further losses on Assombalonga through 2 further years.

If the club is only just meeting FFP this year it would need to sell more players at substantial profit to remain in line. It amounts to a gamble, bringing forward spend in an effort to increase your chances in the current year at the risk of creating a deficit in the future if you don’t get promoted, thereby accessing the increased income of the Premier League.

Taken to an extreme it would be possible for a club to sell a young academy graduate for £5M and if each new signing received a 5 year contract immediately release £25M of transfer spend whilst still posting a net spend of zero for FFP in the current year. That’s quite an advantage, but if something goes wrong and promotion is not achieved there is suddenly a £5M hole in the FFP accounts for each of the next 4 years that needs filling.

I hope that this helps explain how you can use accounting to achieve two objectives that look incompatible, spending big whilst meeting FFP. Please feel free to comment or ask questions in the comments section below and remember all numbers are estimates for illustrative purposes, I do not know nor want to get into an argument about actual transfer fees. I also stress again that this is not necessarily a strategy Forest are pursuing, it is just a way things could work within FFP.

A Summer Break?

It is June 6th. The Championship season came to a close just two weeks ago when QPR secured promotion through the playoff final, whilst Forest played their final game of the campaign only five weeks ago. It is the summer, a time when supporters should be recharging their batteries, perhaps watching a little cricket, and enjoying a break from the increasingly pressurised atmosphere of second tier football fandom. But alas, we see no such thing.

Not only does this week see the start of the World Cup in Brazil it also marks the official start of fevered speculation amongst internet Reds fans with Stuart Pearce announcing at the weekend that today could see the first new signings of his managerial reign confirmed. As breakfast bowls across Nottinghamshire were being cleared away this morning there had already been a host of potential transfer targets both hailed and dismissed, the treadmill is back.

Pearce himself is heading off to the World Cup to fulfil his contractual duties with Talksport, his new job at the City Ground due to start on 1 July, but he has been hard at work laying the foundations so that when he officially walks through the door he can hit the ground running. The backroom team is largely in place with his former England coaching colleagues Steve Wigley and Brian Eastick confirmed and they would appear to set the tone of this new era with a focus on development. Indeed everything that Pearce has said to date would seem to be about taking our club back to basics, putting down stable footings on which to earn the top flight status that has eluded wealthy owners for 15 years now.

Today saw another step taken as the new manager revealed what he hopes will be the solution to the team’s perceived primary problem from last season, goals. Although nothing had been officially confirmed at the time of writing the gossip is all about Matty Fryatt, who is out of contract with Hull City, and Lars Veldwijk, who scored 30 goals in 38 appearances for Dutch side Excelsior, in Holland’s second tier, last season.

Fryatt strikes me as the classic example of a player who will not get everyone excited when he signs for your club but would have you worrying should he turn out for the opposition. With Forest fans adept at this type of thinking, writing off a player who signs for us whilst hailing anyone who signs elsewhere as the clear answer to our problems and a poor miss by our club, he is likely to be received with mixed feelings at best. Despite this he has a decent, if not outstanding, goalscoring record and will unsettle most Championship defences.

Despite being 6 feet 5 inches tall Veldwijk does not appear from the video circulating on Twitter to be a target man for long balls from the back. Whilst strong on crosses he seems to prefer passes to his feet so that he can hold off defenders, receive the ball and turn. It is difficult to tell whether a player coming in from abroad and a lower level will step up but at 22 he has made a strong start to his career and he will hopefully be greeted with enthusiasm and positivity from the Forest faithful.

If these two signings are confirmed the club will have 6 strikers on the books with Fryatt, Veldwijk, Cox, Henderson, Blackstock and Djebbour so departures are likely. Blackstock’s career appears to be in the balance as a result of injury and even if he recovers he might reasonably be expected to be loaned out in the first instance. Meanwhile, Djebbour’s uncertain status will probably finally be resolved with a move away from the City Ground, at significant cost to the club.

It should be noted that the 3 promoted teams last season conceded on average 41 league goals compared to Forest’s 64, so scoring wasn’t the only problem. The key defensively, however, is probably to be found mostly in the fitness of the players the club already has available and the ability to select consistently from them, so Pearce is right to focus his transfer activity higher up the pitch.

It is 33 days until the team line up against Ilkeston FC for the first game of pre-season and I am already looking forward to it. There is an excitement about this coming season that I haven’t felt for some time, so much so that I‘ve even dusted off my own boots and dragged my protesting legs back onto the field of play.

For those who haven’t seen it yet here’s the YouTube montage of Veldwijk’s goals:

Shaping the Future: A Vision for Nottingham Forest under Stuart Pearce

With another season coming to a close in slightly disappointing fashion at the City Ground and another new manager preparing to walk through the door it seems appropriate to take stock, look at what Stuart Pearce will inherit and consider how he might shape that inheritance into a convincing vision for the future of Nottingham Forest.

I have talked for some time about the need for Forest to take a longer term view in all aspects of their activity but especially when it comes to moulding a squad. That means setting down some foundations in terms of style of play and types of player that will determine the club’s DNA and culture. It also means integrating the processes of player development through the academy and player identification through the scouting network.

There is a great deal of work to be done here and Pearce will need to rebuild the scouting structures which have suffered a great deal of upheaval in the last couple of years with Keith Burt and Bobby Downes both being sacked from the post of Head of Recruitment. He will also need to radically change the culture of the club’s transfer activity and succession planning to support team evolution and better manage turnover of players

To think holistically about the current situation I have asked for some help from Grant Nelson, who follows the academy closely, to provide some insight into the young players who are hovering around the fringes of the first team squad. Grant and I both agree that the way forward for the club is to take a long term view of squad building incorporating the coaching, academy and scouting elements of the club into a single strategy for development and hopefully Pearce’s arrival into a structural vacuum will see that happen.

At the end of the season Forest had 34 first team squad members, defined as players who have appeared at first team level this season and remain on the club’s books, but Pearce has moved quickly to make his own mark by releasing those who are out of contract or on loan, except for Danny Fox who has signed a 3 year contract as agreed at the beginning of his loan spell. The remaining list is:


Of these it seems likely that Rafik Djebbour will not become a permanent signing after it emerged that he had only signed on loan originally, with a view to a permanent £2.5M transfer, and Forest are intending to send him back to Greece. It would not be a surprise if the club seek to sell or loan out Djebbour’s fellow Algerian international Djamel Abdoun as well as he appears to have struggled to settle.

If these moves happened it would leave a squad of 23 for Pearce to build on and of those de Vries, Evtimov, Lichaj, Halford, Harding, Collins, Cox and Henderson will be entering the final year of their existing contracts. It is likely that several of these players will not be retained beyond next season but I do believe that whilst they are here they need to be clearly part of the squad and supported by manager and fans alike. There is a tendency amongst fans to make a decision that particular players are not good enough and to turn vociferously against them but all of these players are capable of contributing to a Championship squad and should be backed to do so.

In order to build a positive squad atmosphere and also establish a culture it is important not to have a huge turnover of players every year. Ideally the club should only be looking to add 2 or 3 new players to the mix each season to lift the quality of the squad, perhaps alongside another couple from the club’s own academy ranks, players who already understand the ethos of the club and who are ready to build their experience by working with and occasionally featuring in the first team squad.

At the moment Forest are blessed with a strong core of players, assuming that all those who have suffered injuries recover fully, and have a good level of experience. I would therefore encourage Pearce to focus on young players with energy and pace to bring a finishing spark to his squad. Early indications are that Pearce will focus on up and coming talent with reports that he has watched the likes of Alex Pritchard, Britt Assombalonga, Callum Wilson and Jack Grealish. But what does he have at the club already?

The goalkeeping position is an interesting one as there is plenty available to Pearce. Karl Darlow has established himself as first choice and is also attracting a lot of attention from Premier League clubs, whilst Dorus de Vries is an experienced and capable second choice. In addition 20 year old Bulgarian Dimitar Evtimov has featured in the first team squad already and Grant suggests that he isn’t the only exciting young ‘keeper coming through the ranks.

“All the talk has been of Evtimov who has been in the academy system in the last few seasons but Jordan Smith a young goalkeeper who hails from South Normanton in Derbyshire is every bit as talented. He does the basics extremely well and a big plus is his constant awareness and communication with his defence in front of him. Under O’Driscoll he travelled with the senior squad to a few games and last season he travelled to Bournemouth.”

This leaves Pearce with his first decision to make with regard to long term planning. Should he seek to retain Darlow, who is hugely popular and has shown considerable potential, or should he sell his number one while his stock is high and use the experienced de Vries to bring through these two youngsters? A strong case could be made for either approach, but this is a clear example of how the different areas of the club need to come together to consider the best way forward and the input of the academy is crucial. Decisions are not as clear cut as they may seem from the stands.

In reality Evtimov and Smith are still very young and it makes sense to give them more experience before elevating them too far, so keeping Darlow would be preferable and allowing de Vries to both support him and help bring through the youngsters. Loaning out Evtimov and Smith for half a year each could be a logical step, with one player out on loan whilst the other works with the first team ‘keepers and then swapping over in mid-season.

In defence the problem has been injuries with several players being out with long term problems. There has to be a worry here about recovery as Cohen has now had two major injuries, as has Hobbs and Wilson seems to be developing ongoing issues. If fully fit, however, Lichaj, Hobbs, Wilson, Lascelles and Cohen are all very strong Championship players and in a normal season Halford, Harding and Collins are reasonable squad players for the level too. Fox has also been added and although he did not hugely impress on loan he does have a strong pedigree at Championship level.

Again the different specialists at the club need to work together to assess the injury problems and it is heartening to hear that the club plans to investigate the issues from the season just past to try to identify what caused such a damaging injury list to form. If there are concerns about the long term fitness of some of those key first choice players it may be necessary to think about adding a little extra strength as the academy is less strong in these positions with only U21 skipper Kieran Fenton pushing for promotion to the first team squad in Grant’s opinion.

“The left-sided centre-back is capable of playing left-back and hails from Alrewas in Staffordshire.  He has been involved in pre-season training with the first team for the last 2 seasons and impressed in games against Notts County and Mansfield. Under O’Driscoll he was involved in matchday squads at the City Ground. A classy player on the ball who at 6ft3 can compete in the air as well.  Last season he captained the u21s and spent a successful loan period at Tamworth until injury struck.”

It may be that Fenton’s development is best served with a loan at a club higher up the pyramid than Tamworth, as a spell at Stevenage certainly helped Lascelles push on. Retaining Lascelles and fully rehabilitating the injured players are the immediate priorities at first team level but the club also needs to be thinking ahead to next summer when Lichaj, Halford, Collins and Harding will all be out of contract.

The midfield has also had significant problems with injuries but again assuming that they can return to full fitness the first choice trio of Vaughan, Lansbury and Reid has outstanding quality for the Championship and a lot of experience. There is no doubt that the loss of these three players was a major factor in the deterioration of Forest’s season. In addition Ben Osborn has made a very impressive start to his first team career in the last few games and although Majewski has been largely disappointing he does have quality which Pearce can hopefully re-inspire.

It is also an area of the field where the club is well served in the U21 squad. Stephen McLaughlin is now 23 and it might be considered that he has not developed enough in his time at Forest, but he did prove capable of filling in when required with a couple of solid performances at the end of the season. Josh Rees, who made his debut as a substitute on the final day of the season, and Jack Blake are perhaps more likely to push on though in the future and according to Grant will be looking to catch the new manager’s eye this summer.

“Josh Rees, the former Arsenal man, enjoyed a good first full season at Forest and even captained the u21s when Fenton and Osborn weren’t available. He is an industrious midfield player with excellent timing of runs into the box and at Arsenal had a goal scoring reputation – don’t think that his header at the back post was a co-incidence on his debut. He will be hoping to build on his first 15 minutes v Brighton.

Jack Blake, or ‘JJ’ as he is nicknamed, has good set piece ability just like we have seen with Ben Osborn but he would be the right foot version. He is capable of dictating play from deeper positions with good One-Two ability. That doesn’t stop him from getting up-and-down and contributing with goals too as he has shown that ability right through the academy levels. He spent a bit of time on loan at Mansfield last season and the local lad from Nottingham will be hoping to impress Stuart Peace and his coaches in pre-season.” 

And so, it will be no surprise to regular spectators, that the area which needs most attention is the forwards. I think that our resources at the moment suit a 4-3-3 formation which means we need a selection of forward players across that frontline with one central figure and two wide forwards who can play flexibly across the line.

Jamie Paterson has had a very good 2014, scoring 12 goals in 24 appearances this calendar year. At 22 he looks to have a bright future ahead of him and he is an ideal fit as one of those wide forwards coming in off the wing and breaking with pace. Jamie Mackie is a very different proposition, more about determination and work-rate than flair, but despite lacking subtlety can be a big part of a promotion push.

Pearce has also been linked with some exciting young players in these positions such as Alex Pritchard, a Tottenham player who was on loan at Swindon last year, and Jack Grealish, who returned from a loan at Notts County to appear for Aston Villa’s first team at the very end of the season.  A couple of signings of that calibre, either permanently or on loan, to compete with Paterson and Mackie would be an exciting proposition and provide genuine attacking options.

It still leaves a big hole down the middle though. Cox and Henderson are both capable of scoring goals but neither feels like a candidate to lead the line if we are genuinely seeking promotion next season, whilst Blackstock may never return from serious injury, so it seems unlikely that the club will not add to its striking resources.

Callum Wilson who scored 22 goals for Coventry last season has been the strongest link so far and perhaps confirms Pearce’s desire to work with players on an upward career curve but any recognised goalscorer will come at a price and will be hard to prise from their existing club. We may need to be patient when the transfer window opens but I would like to see a striker with pace and power added to the squad. At the same time I hope that Cox in particular can be lifted by the new manager and accepted by the fans.

Cox perhaps gives us a good opportunity to talk about formations. Pearce might be expected to play either a 433 or a 4231 formation given his background at England Under-21 level and the prevalence of these formations in the modern game. Cox simply isn’t suited to the 433 setup as he has neither the pace to run at defenders nor the strength to lead the line. In a 4231 though he could fill the number 10 role behind the main striker, especially if we can add pace in wide areas and power down the middle.

Interestingly, at the end of last season the U-18 and U-21 teams both made a switch to playing in a 433 formation which perhaps implies that the club will move towards an overriding ethos and style of play when Pearce takes over so that young players can move easily between the levels as they progress. As Sean O’Driscoll said during his brief time at the club establishing a DNA is important for long term development and such a move would be a positive step and focus the club’s recruitment efforts.

In our youth ranks Grant advises that: “James Demetriou is a hard working centre-forward with an imposing presence who joined us from Sydney FC at the beginning of the season. On trial he impressed with goals against Fulham and other teams and subsequently spent time in the u21s where he scored 3 goals until injury struck.”

In addition to those players who have made a mark already at U21 level and are now pushing for consideration as part of the first team squad when needed, there are also others who are now making a similar progression from youth football to the U21 team. Grant’s top 3 to watch out for in the development squad are:

“Joe Worrall: Tall right-footed centre-back with good ability with the ball at his feet and strong in the air. Had pretty much a full season with the u21s despite only being a first year scholar and the lad from Hucknall will be hoping to keep progressing as a young defender and with the likes of Pearce around that can only help.  His season was so impressive because despite his young age he showed a great maturity in dealing with the challenge of u21 football despite minimal u18 football under his belt. He should lead the u18s out in the FA Youth Cup next season.

Oliver Burke:  Despite an injury plagued first season with the academy Ollie made as much progress as he could have and there is still plenty more to come from him. A tall imposing wide-player with blistering pace and the ability to take players on is a rare talent and we have that with Oliver. He has more goals in his locker than he showed last season but  with his type of player he will create many goals for his team mates too. He will be encouraged by the carrot dangled at the end of the season with 3 u21 appearances showing how much potential the coaching staff believe he has.

Tyler Walker: There was a big buzz around before the last senior game of the season with the talk that a former legend’s son might make his senior debut. It didn’t happen but if he shows as much progression this season coming as he did last season it will only be a matter of time. The Nottingham-born forward has pace to burn and likes to play off the shoulder of the last defender.  If you combine that with goal scoring ability in the box as well as good strikes from outside those are his strengths.  If he impresses in pre-season who knows what next season could hold.”

Hopefully the disappointment of the season past is starting to dwindle for most fans and is being replaced by anticipation for the arrival of Stuart Pearce. He has talked a lot about his desire to develop players and to put the academy at the heart of the club. With a large number of players released there is plenty of scope for Pearce to bring in some of his own and leave room for our own academy graduates to stake a claim.

If he can re-build the club on those principles of identifying and developing talent it could be a very exciting time to be a Forest fan, but there are some large holes in the structure of the club that need filling to achieve that. In many ways that blank slate is an opportunity and hopefully Pearce will be given the time and support to mould some strong foundations on which to build a successful future. A crucial factor in his chances of success could be a supportive atmosphere for players to develop in and we fans are a key part of that. Let’s unite behind this Nottingham Forest legend and put a smile back on our club.

I would like to thank Grant for his input into this article not just in the parts where I have quoted him directly but also in the general discussion about how to take the club forwards, something we hope will get people thinking in a more long term way and spark further debate amongst fans. If you have any interest in the development side of the club I strongly recommend that you follow him on Twitter @Grantnffc1.

Book Review: Fan by Danny Rhodes

The opening chapter of Fan, the new novel from Grantham born author Danny Rhodes, made me feel like this might be a book for Nottingham Forest fans of a certain age. I followed my team to Wembley to see them lift the League Cup, I was at the City Ground when we bade farewell to Brian Clough, Highbury when Brian Rice became a legend and I was at Hillsborough when a beautiful Spring day turned into a nightmare and as a teenager I came face to face with death on an awful scale. Later I even sat behind Clough at Eton Park as we both supported his son Nigel in his first steps into management. The fictional John Finch walked many of the same roads that I trod myself in real life.

It isn’t just about a personal history of following Forest, however, there is a wider social history in these pages that will resonate with a much broader audience. All football fans in the 1980’s, before Italia ’90, the Premier League and prawn sandwich hospitality, were impacted by the emphasis on control rather than safety of football crowds and the chapter on the Bradford fire will cause all fans to bristle with anger. And whilst football is a major backdrop these events also coincided with the Thatcher government, the Miners’ Strike and huge social change in Britain.

There is also a fierce human energy that drives the book forwards through a series of short, snappy chapters that keep the pages turning and emphasise the desperate emotion of a man overflowing with demons. The football is a backdrop but John Finch is really facing two points of crisis and transition, ones that we all recognise. In 1989 the safe and familiar environment of his youth is falling away and he is wondering what lies ahead of him, old friendships coming to an end and Hillsborough bringing the reality of death crashing into the experience of previously indestructible youth. Whilst in 2004 he is faced with another major change, a partner who wants to settle down and start a family, but he cannot provide a solid future for a potential wife and kids when his past is still unresolved.

Finch heads back to his home town of Grantham to face his demons, but it’s messy. He has to see the world through other people’s eyes as well as his own, has to learn to accept who he was and who he is now and has to acknowledge that life isn’t straightforward, answers are not perfect, the world does not revolve around him and everyone is just trying to make the best of it in whatever way they can. The narrative glides between these two periods of time as Finch tries to bring proper closure to his first departure so that he can leave again more able to move on into the responsibility of adulthood. It is an emotional human story that will appeal to anyone who has mourned lost youth and feared the responsibility of family life.

As a football fan it is the story of a game that has also had to face great change and has done so imperfectly. The warnings upon warnings that built up to death on a horrific scale at Hillsborough are devastating. Why did it take so long for anything to change? Why did the football authorities, the clubs, the government and the media seek to criminalise and dehumanise football fans, determined to control rather than protect? Why did the fans themselves not refuse the cages of death they were forced into each week and also refuse the violence within their own ranks?

In the end it took the loss of 96 innocent lives in Sheffield to make change happen and much of it has been good – the ability to watch football safely should never be under-valued, the past never forgotten – but in amongst it something significant has been lost. The changes have been used to increase prices, to sanitise atmosphere, to commercialise football and to replace the passion of labour with the wealth of capital. Football has been cleansed and as a result sterilised.

In his closing acknowledgements Rhodes calls for the game to be given back to the fans. It is an appealing statement but also a broad one that has all sorts of interpretations and implications. It is difficult to pin down, it’s messy, just like John Finch’s journey through his past and his tentative steps forward into an uncertain future. It is good that the game has moved away from its violent past, but it also needs to take some time to reflect on what it has become and where its future lies. Football is about the fans, but fans are a diverse group with different needs and all need to be considered.

The best writing stays with you, makes you think well beyond closing the back cover. Fan does that on two levels; life and football. What else is there?