Debt

In Mike Ashley's first season at Newcastle he loaned the club £100m.  This covered a £50m mortgage that the lender demanded under the terms of a change in ownership and the running costs of a club that was earning less than it was contracted to pay out.  Those running costs included costs inherited from the previous owners and those added to the bill by Ashley himself in terms of transfers, increased wage bill and terminating the manager's contract.

Since then the loan has fluctuated up and down.  Extra borrowing has exclusively covered relegation costs.  Not since 08/09 has any money been put into the club by Mike Ashley while in the Premier League.  

Several loan repayments have been made, some on a short term basis in the same financial year the loan was provided, but most notably 

  • in 11/12 £11m was repaid of £29m that had been loaned in 08/09
  • in 18/19 £33m was repaid - £18m of which covered the remainder of the £29m outstanding from 08/09 and £15m that repaid the amount borrowed to cope with a season in the championship in 16/17.
Ashley has frequently claimed every penny stays in Newcastle United and he takes no repayments whatsoever.

April 2019

Club accounts for the season 17/18 state the loan to Mike Ashley remains at £144m, having temporarily grown to £154m during the year
Mr MJW Ashley and companies under his control continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2018 was £144.0 million (2017: £144.0 million).  The maximum amount outstanding during the year was £154.0 million (2017: £144.0 million). - Source

but that after the accounting period £33m had been repaid, leaving £111m outstanding
Subsequent to the statement of financial position date, and consistent with the groups previously stated policy of repaying shirt term borrowing, £33 million was repaid to Mr MJW Ashley and compaies under his control. - Source

Lee Charnley explained the repayment in an interview
“It was very important to pay the money back, the intention was to pay him back before. I think, as a football club, living within its means, standing on its own two feet, being able to spend what it has and what it generates is incredibly important.  We’ve given him that money back now so we’ve got, effectively, a clean slate and I think that’s a good place for the football club to be. The £111 million he’s put in has been there for just over a decade now and the intention around that is he would only take that back in the event of the sale of the club." - Source

May 2018
Club accounts state that during the year in the championship (16/17), Ashley's loans to the club were required to increase by a total of £15m from £129m to £144m.
Mr MJW Ashley and companies under his control continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2017 was £144.0 million (2016: £129.0 million).  The maximum amount outstanding during the year was £144.0 million (2016: £129.0 million). - Source

April 2017
Club accounts state that during the season 15/16 Ashley's loans to the club were unchanged  at £129m
Mr MJW Ashley and companies under his control continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2016 was £129.0 million (2015: £129.0 million).  The maximum amount outstanding during the year was £144.0 million (2015: £129.0 million). - Source

April 2016
Club accounts state that during the season 14/15 Ashley's loans to the club were unchanged  at £129m
Mr MJW Ashley and companies under his control continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2015 was £129.0 million (2014: £129.0 million).  The maximum amount outstanding during the year was £144.0 million (2014: £129.0 million). - Source

March 2015
Club accounts state that during the season 13/14 Ashley's loans to the club were unchanged  at £129m
Mr MJW Ashley and companies under his control continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2014 was £129.0 million (2013: £129.0 million).  The maximum amount outstanding during the year was £144.0 million (2013: £129.0 million). - Source

February 2014
Club accounts state that during the season 12/13 Ashley's loans to the club were unchanged  at £129m
Mr MJW Ashley and companies under his control continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2013 was £129.0 million (2012: £129.0 million).  The maximum amount outstanding during the year was £129.0 million (2012: £140.0 million). - Source

April 2013
Club accounts show that during the season 11/12, when Andy Carroll was sold for £35m,  £11m of Ashley's loan was repaid by the club, reducing the outstanding amount from £140m to £129m
Mr MJW Ashley and companies under his control continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2012 was £129.0 million (2011: £140.0 million).  The maximum amount outstanding during the year was £140.0 million (2011: £140.0 million). - Source

March 2012
Club accounts state that during the season 10/11 Ashley's loans to the club were pretty much unchanged  at about £140m
Mr MJW Ashley also continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2011 was £140.0 million (2010: £139.8 million).  The maximum amount outstanding during the year was £140.0 million (2010: £139.8 million). - Source

March 2011
Club accounts state that during the year in the championship (09/10), Ashley's loans to the club were required to increase by a total of £29m from £111m to £140m.
Mr MJW Ashley also continued to provide loan facilities to the group during the year.  The total balance outstanding at 30 June 2010 was £139.8 million (30 June 2009: £111 million).  The maximum amount outstanding during the year was £139.8 million (2009: £112 million). - Source

May 2010
Club accounts state that during Ashley's second season (08/09) he loaned the club a further £11m taking the total from £100m to £111m
Mr MJW Ashley also provided a loan to the group in the year.  The balance outstanding at 30 June 2009 was £111 million (30 June 2008: £100 million).  The maximum amount outstanding during the year was £112 million (2008: £105,322,124). - Source

January 2009
Club accounts state that during Ashley's first season (07/08) he had loaned the club over £105, but had recouped the £5m and change, leaving the total outstanding at £100m
Mr MJW Ashley also provided a loan to the group in the year.  The balance outstanding at 30 June 2008 was £100 million.  The maximum amount outstanding during the year was £105,322,124. - Source

September 2008
Mike Ashley's statement after Keegan's departure and his decision to sell the club makes some claims about the size of debt inherited, rather than what it  subsequently grew to.
"like any business with assets the club has debts. I paid £134 million out of my own pocket for the club. I then poured another £110 million into the club not to pay off the debt but just to reduce it." - Source
In an interview lack of clarity might be excusable, but in a written statement it's purposely over-egging the pudding.  The debt  had indeed grown to £111m by the end of the 08/09 season, but in the 16 months since buying the club Ashley himself had sanctioned the purchases of Barton (£5.8m), Rozenhal (£3.1m), Smith (£6m), Enrique (£6m), Gutierrez (£5.2m), Coloccini (£10.3m) and Xisco (£5m) among others.   Almost £50m was outlayed just on transfer fees for players on his watch, That's not to mention the wages they would command for the duration of their contracts or the huge payout to Sam Allardyce to get him off the books.  In terms of accruing the debt, Ashley himself was also culpable.


January 2008
Club accounts to 30 June 2007 make official some of the outstanding items Ashley inherited when he bought the club after the 06/07 season finished.  A subsequent event details a "change of control provision" that required the club to repay the entire mortgage on St James' Park, with interest and early repayment charge cost.  This came to £50m, which is half the amount Ashley loaned to the club during his first season (07/08)
Capital balances outstanding, together with accrued interest thereon totalling £45,715,000 were repaid on 10 September 2007.  An early repayment charge was payable which amounted to £4,273,000. - Source
A further £13.3m of inherited debt is detailed as having been repaid "so far" in the season 07/08
A number of other debts in existence at the balance sheet date have been repaid subsequent to the year end in line with their contracted repayment terms.  At the date of signing these financial statements the total debt repaid amounted to £13,303,000. - Source
The club had reported a loss exceeding £30m in 06/07 and over £12m the preceding season.  These ongoing and growing heavy losses would also have to be either reined in or covered by borrowing in subsequent seasons.  The losses would have been offset to some degree by the Premier league deal jumping from roughly £25m a year to £40m a year in 07/08.

August 2007
Chris Mort discussed the inherited debt during an interview published by The Independent

The most commonly reported figure for Newcastle's debt is £80m – to go on top of the £133m Ashley paid for the club. Is that accurate?
"It's a bit more complicated than saying there's a debt figure of £x. In terms of money being spent by the club it is more convoluted than that. It's not that debt has been squirrelled away, it's spending some of the money before it comes in, which frankly, is not necessarily debt, it's just a means of investing money before you've actually got it. There's been a bit of that, the club has done that.
"So there is something in the rumour that Newcastle spent their Northern Rock sponsorship money up front?
"I'd rather keep it broad. I just think the financial position of the club is not as strong as we hoped it might be. But that in itself has not held back our investment on the playing squad and it's something that we'll deal with. We did the typical due diligence one would do on a public takeover. There is no sense that anyone has tried to mislead us." - Source





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