Aberdeen in crisis as Cormack warns over £1.2m/month losses

Dave Cormack has warned Aberdeen fans that their club is facing a financial crisis with a loss of at least £5m expected through the summer due to the Coronavirus.

On March 13 Scottish football was suspended with the Dons having four more home matches for the season and a Scottish Cup semi-final to keep the cash rolling in.

Derek McInnes’ side were preparing to face Motherwell on the fateful Friday with no sign of that match, or any other, being rescheduled.

Last week Ann Budge announced 50% pay cuts from next month at Hearts with the entire Scottish game now in danger with income halted at a critical stage of the season.

Aberdeen have tightened their belt greatly over the last decade, living within their means and refusing to ‘break the bank’ for footballers despite pressure from supporters to push for the next level.

On the club website Cormack warns:

It is hard to comprehend the extent of the unprecedented circumstances we are facing. In these worrying times, what happens in football needs to be put into context. However, we recognise that many, particularly those who depend on the Club for their livelihoods and our fans, are looking to us for some answers.

Our priority has, and will continue to be, the health and well-being of all our employees, including football management and players, our fans and sponsors as well as our suppliers and contractors. We are acutely aware of the anxiety they will be feeling, which is exacerbated by everyone working from home.

The over-riding aim of the Board is to provide clear and transparent leadership in this unparalleled period of uncertainty. But, as Scottish Clubs await the decisions on what happens next, there are so many moving parts, largely outwith our control, that it’s impossible to provide any degree of clarity or certainty at this time.

What we do know is that we are facing a collapse of income that is going to be almost impossible to sustain for a prolonged period.

Three weeks ago we were in a healthy financial position; free of external debt, with £1.5million in the bank. We had expected income of about £1million from four home league games and the Scottish Cup Semi-Final and, potentially, £5million in season ticket sales, seasonal hospitality and new shirt sales coming in through mid-July. Our monthly running costs are about £1.2million and it’s only prudent to assume that, realistically, there will be no football until July perhaps, at the earliest.

During this period, we are therefore facing £5million in outgoings with no expected income. No matches are planned and we have no idea when a new season starts, never mind the current season ending, and it is highly unlikely there will be any player sales in the summer.

This situation is clearly unsustainable. No club, whatever their size, scale or level of investment, can withstand a total lack of income over a period of anything between three to six months.

Any threat to Aberdeen would have an impact on Celtic and the rest of Scottish football with the Dons a fixture in the top six in recent seasons as well as being regulars in cup semis and finals.

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With Aberdeen and Hearts going public with their cash concerns the big question is which club will be next to announce their financial problems due to Coronavirus.