Dunfermline Athletic

DAFC Board Statement: End of season 2018/19

Wednesday, 8th May 2019

End of season 2018/19 review from Ross McArthur

Summary
We are at the end of what has proved to be an extremely difficult, disappointing and frustrating football season for everyone connected with Dunfermline Athletic. From the Board’s perspective, it has undoubtedly been the most challenging season since coming out of administration, ultimately developing into a “perfect storm”.

However, the Board, and I as Chairman, take full responsibility for the turn of events which have often not been to our liking or, indeed, the liking of anyone who loves Dunfermline Athletic and wants to see us move our club further forward.

As ever, I want to be as honest and transparent as I can, to outline to our loyal supporters where we are, and where we are going, in advance of season tickets going on sale later this week.

The key issues at this time are:

Season 2018/19
1. Financial Outcome: a substantial trading loss incurred after three years of modest profits.
2. Football Outcome: we have significantly underperformed on the park, leading to a change in football management and revamp of playing squad.

Season 2019/20
1. Strategy of building a young, hungry team of players seeking to reach their full potential, being guided by enthusiastic and diligent coaches.
2. Restructuring to reduce costs significantly and find ways of increasing our income.

Notwithstanding all of this, sincere thanks are due to supporters, staff and volunteers for a lot of hard work.

Financial outcome
The Club will make a substantial loss in 2018/19, after three years of modest profits. The Board’s budgetary assumptions were broadly the same as in previous years but matters frequently went significantly against us this year whereas in the past they did not do so. We also suffered a number of exceptional and unforeseen one-off costs. It is further evidence to prove that running a full time football club in the Scottish Championship, with the underlying cost structure and infrastructure required, is proving to be extremely challenging. Most clubs in the Championship will, sadly, report losses this year - and some significantly greater than us, but that is little comfort.

The view from the Boardroom

Season 2018/19:
At the beginning of the season, we backed our Manager who had achieved promotion and then helped the team improve within the Championship over the following two years. Our aim was to be challenging at the top end of the Championship. That did not happen, and we have massively underachieved on the park, considering the significant investment made in attempting to strengthen our playing pool.

Not only did we change our Manager and Assistant Manager in January, but we also had three other unplanned changes within our backroom staff this season, which is a quite exceptional situation. All of this gave rise to unbudgeted costs.

We have also met the unprecedented and expensive costs of 13 operations (plus associated expenses) on our playing staff. In the previous four seasons we had no more than three in any one season. Not only that, but we had a significant number of players unavailable at various stages of the season due to injury and this has impacted performances. I am sad to report that Joe Thomson’s knee injury will result in him missing a good part of next season. We will of course support our Player of the Year, Joe in his recovery, which we hope will soon see him back.

We also had four home games displaced from a Saturday, and these were against some of the better supported teams in the league (Partick Thistle twice, Dundee United and Ayr United). This directly resulted in reduced gate receipts from all of these matches.

We recognise that the standard and style of football on offer was an issue across all teams in our Division and our own home results this season were very poor. In fact, extremely worryingly, our total “walk-up” gate receipts were a six-figure sum down from last season, and were even marginally less than in League One, four seasons ago, when we did not have the same cost infrastructure. Our participation in the Irn Bru Challenge Cup actually cost us money, whilst losing at Raith Rovers put us out of the William Hill Scottish Cup at a disappointingly early stage. Our early season form in the Betfred League Cup was better news, however.

Influenced by a number of factors, but significantly by the poor on-field performances, neither the club shop nor catering met budgeted income totals.

The coming season: 2019/20
Budgeting for season 2019/20 has long been underway. We need to adopt a very clear and decisive approach. On the income side, given the considerable uncertainties, this is far from easy. It is clear, however, that we need to reduce our costs significantly.

The Centenary Club Lifeline is of huge importance to the Club as it is one of the few areas of budgeted income which is both predictable and provides a regular monthly cash flow for the Club. Since the crisis of 2013, numbers have been on a slow decline and that is of great concern. We really need your continued support by maintaining your Lifeline memberships or by joining, if you are not already a member. We do not take this for granted and are very clear about the debt of gratitude that is due to all those supporters who contribute. It is vital to the future of Dunfermline Athletic. We are a broadly-owned, community-based club, and can only prosper if the community continues to back us. It is important for supporters to understand that no Director takes any salary or even expenses. We too are supporters and contribute to the Lifeline Fund ourselves. We pay for our own season tickets and have contributed significant funding for the Club in terms of working capital. We need people of goodwill to be understanding of the ups and downs and unpredictability of a football season and stand together, as ultimately the functioning and goodwill of the Board relies upon this. We do not have the luxury of parachute payments or UEFA solidarity payments from the Premiership, nor do we have significant cash reserves following the 2013 administration.

We want to get DAFC back into the Premiership, but not by risking the existence of the Club. So, the expectations of our supporters need to be realistic. Our ownership model means that we cannot look to a wealthy owner ploughing seven-figure sums into the Club as has happened elsewhere, but we can have a competitive advantage in the SPFL Championship if the community backs the Club, albeit that this means a little more coming from all of us.

As custodians of Dunfermline Athletic, the Board is taking a number of decisive steps to ensure a positive future for the Club.

The playing budget, our most significant cost, will need to be reduced significantly. Our focus will be on investing in young, hungry players who are on an upward trajectory in their career, looking to develop those players as future assets which we can then realise to mutual advantage. We want to recruit young, talented and ambitious players who want to see their careers progress at East End Park, with all that we can offer them in terms of coaching and support, by working hard and taking instruction. Those players will need your whole-hearted support and encouragement if they are to flourish at East End Park.

That young team will be reinforced by a couple of positive-minded, experienced players who can provide leadership and mentoring. We have invested in a young and ambitious management and coaching team who we believe are best placed to get the most out of such players, even if it takes a bit of time. Recruitment is the hardest part to get right in any business, but probably more so at a football club, however that process is now more robust.

On the income side, we will reluctantly have to bring our prices into line with most other Championship clubs by increasing all of our admission prices by £2. We understand doing so, particularly after a disappointing season, is far from ideal, but we simply don’t have an option. It is important for supporters to understand the context of this increase. The average revenue we currently receive is only £9 per game from ground season ticket holders (excluding U12’s) after VAT. For walk-up tickets, the figure is £11.42 per game after VAT. Match day costs such as stewards, safety, first aid, police and match day paid staff cost a further £2 per supporter, per game. We have considered changing the charges for older supporters in line with other clubs and also the changing working environment so that the only discounted threshold would be at 65. However, we have decided not to do that for season tickets, but only for match day tickets.

It is therefore extremely disappointing to note the continued abuse of our concessionary tickets in some cases, and this will be addressed next season. In the case of the under-12 concessionary tickets, these will now require proof of ID and age, as well as a nominal one-off fee of £18.

Some important thanks
Despite the disappointing outcomes of this season, a great many people have worked long and hard to support Dunfermline Athletic. First, the Board would like to record their warm appreciation for the supporters in following our team home and away and giving great encouragement. Second, supporters raise funds for the Club not only by buying tickets and contributing to the Centenary Club Lifeline, but by organising, and attending, vital fund-raising events, buying merchandise, hiring our function suites, and freely giving of their time, skills and knowledge on many occasions. We are extremely grateful and appreciative to everyone for this.

Stevie Crawford’s preparation, enthusiasm and professionalism do him great credit. He took on the role of Head Coach at a very difficult time, as taking on such a role in mid-season is notoriously difficult. Stevie has sadly had to deal with a range of challenging issues, but has done so with calm authority, and has not shrunk from making some difficult decisions. He has been well supported by Greg Shields initially, and then a month later by Callum Davidson, who have helped to create a fresh, positive and invigorated working environment at East End Park. All of the backroom staff have worked immensely hard but, to single out one example, our physiotherapist, John Porteous, has been outstanding. Twice he has effectively gone full-time to help us out at short notice, and we are pleased to announce the imminent arrival of an outstanding young physiotherapist which will allow John to resume his preferred part-time role. Working quietly in the background and providing perceptive advice on football matters, Jackie McNamara has already begun to help both the Board and our management.

The Board would like to thank our loyal, non-football staff who have all worked so hard this year along with the very many volunteers who regularly help the Club in terms of laundry, kit, cleaning, safety, security, stewarding, turnstiles, catering, programme copy and sales, 50-50 tickets, ball boys and girls, mascots, media (website, social streams and Pars TV), photography, the Club and the DASC shops, the hospitality areas, our community and schools engagement programmes and the stadium maintenance team. Dunfermline Athletic Football Club is buttressed and supported by the Centenary Club Lifeline, the 1885 Business Club, the Pars Supporters’ Trust, the Young Pars, the Dunfermline Athletic Heritage Trust, the Formers Players, the Dunfermline Athletic Disabled Supporters ‘Club and all of the Supporters’ Clubs, each of which has contributed to the cause. Equally we are grateful to, and appreciative of, our many sponsors and advertisers.

Your support is not only hugely valuable but very much appreciated.

Your Board and management team are well aware of the challenges ahead but, with your support, we can, and will, develop an exciting future for Dunfermline Athletic. However, it is imperative that Pars fans continue to help our club by:

- Purchasing or renewing your season ticket for next season; and
- Joining the Centenary Club Lifeline, or renewing your membership if lapsed.


Our club needs your support!

I will, of course, be happy to take questions at our next Supporters Council meeting on 16 May.

Ross McArthur
Chairman



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