Revenue down £2.5m but donations see Hearts post profit
Loan: Ann Budge (pic: SNS Group)
Donations of more than £3m helped relegated Hearts cushion the effects of Covid-19, according to the club’s latest financial accounts.
Thanks to contributions totalling £3.7m, the club was able to post a profit of £473,000, although turnover was down £2.5m at £12,270,000 for the year ending 30 June 2020.
Donations from benefactors, including James and Morag Anderson, were £3m for the 12 months and now total £11.75m over the past four years.
The Foundation of Hearts contributed £603,000 after their final repayment to owner Ann Budge.
Wages were up by over £500,000 at £8.7m and are now just over 71 per cent of total turnover.
The accounts also show the club spent nearly £650,000 on its unsuccessful legal fight to stay in the Premiership.
“Despite losing nearly four months of income, we still managed to return a small profit, thanks in large part to donations received,” said Mrs Budge.
“Financial year 2019/20 saw us cope not just with the direct impact of the pandemic, but also with the consequences of the ‘end the season’ decisions taken by the SPFL board and its members, which endorsed the relegation of clubs, despite the season not having been completed.
“The unprecedented challenges facing businesses across all sectors during 2020, in the wake of the Coronavirus pandemic taking hold, unsurprisingly, impacted our 2019/20 financial results and will, unquestionably, continue to impact financial performance for the foreseeable future. – Ann Budge
“This placed further financial burdens on all clubs so affected, including ourselves. Faced with enforced expulsion from the Premiership and the consequential ongoing financial implications, the board sought, unsuccessfully, to challenge the decisions taken, on the grounds of unfair and prejudicial treatment.
“The board raised this action, knowing it would come at a cost and knowing that the chance of success was slim. However, in the interests of openness, fairness and integrity, simply to accept this decision, was never an option. The legal costs have been carried in full in the 2019/20 accounts.”
After loaning the club £700,000 last year, Mrs Budge, via her company Bidco (1874) Limited, has loaned a further £1.2m to aid with running costs, taking the amount she is owed to over £2m.
“Further financial implications of relegation will require to be borne both in this current year and beyond,” she said.
“The unprecedented challenges facing businesses across all sectors during 2020, in the wake of the Coronavirus pandemic taking hold, unsurprisingly, impacted our 2019/20 financial results and will, unquestionably, continue to impact financial performance for the foreseeable future.
“COVID-19 brought the 2019/20 football season to an abrupt halt early in March 2020. With no match-day income from that point and the subsequent lock-down of all other business activities, the year’s accounts effectively cover eight months of trading and 12 months of costs.”