Reality bites – the figures that show why Norwich City are having to do things differently this summer
- Credit: Jason Dawson/JASONPIX
Forget cries of cheap options and where’s the money gone? There is a stark financial situation facing Norwich City, starting this summer.
City’s decisions to release seven players at the end of June and reject the expensive option to permanently sign Ajax defender Mitchell Dijks, were met by those initial sentiments from some, desperate for the Canaries to make a better fist of returning to the Premier League next term.
However as featured in the latest edition of The Pink Un Magazine, despite a parachute payment of £41m covering last season and an expected final £31m for next, City have little choice but to cut their cloth – and hope they can avoid a third season outside the top flight.
If that happens there would be no parachute payment and City’s total Championship revenue away from ticket sales would be little more than £8m. They finished this season with a wage bill near £34m.
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That figure will already be lower next season thanks to City’s departed seven of Youssouf Mulumbu, Kyle Lafferty, Michael Turner, Sebastien Bassong, Ryan Bennett, John Ruddy and Steven Whittaker – all having earned a Premier League salary at some point during their Canaries stay.
The wage bill will continue to fall with each established player sold – thinking that underpins a signing like Mario Vrancic, and then likely exits of Jonny Howson and Graham Dorrans.
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The club’s cash balance – effectively current account – will stand at the brink of £8m into their overdraft this summer, although the club remains debt-free and the sales of Martin Olsson and Robbie Brady should ensure an initially projected £12m loss for the season will actually end up being inside £5m. City already owed their overdraft approaching £3m last July, having pushed the boat out to secure top-flight survival that never came.
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Pay-offs and no play-offs mean the money has been spent. Now Norwich are trying to get more value from their investments, while still making do without external injections of cash.
Earn promotion in 2018, and City will earn £100m. Fail, and the cheque stops at £8m. Some may feel it’s preparing for failure. In reality, it seems the most feasible way to ensure they survive.
• Read the full feature in the latest edition of The Pink Un Magazine – keep your eyes peeled for it on magazine shelves or order online at buyamag.co.uk/pink5
• For the latest Norwich City news and opinion follow Michael Bailey on Twitter @michaeljbailey and Facebook @mbjourno