The current state of Arbroath FC Ltd - the future is bright

Last updated : 08 February 2008 By Fargone
To gain insight into the running of the club, as opposed to the playing side, dr Gary Callon on behalf of the club agreed to answer a series of questions on how healthy the business is and how it is managed. The questions were set before two recent events - the Andy Webster ruling, and the handsome new sponsorship deal with Crown Parks Ltd, as well as the Annual Account up to May 2007.

1: Since

Arbroath FC converted itself into a private company 2-3 years ago, in what ways has this affected the governance and management of the club, including the finances?

The situation is much better now t
hat the large overdraft is gone. Because of that it generally becomes more comfortable to run the Club on a day to day basis and a significant amount of money is now not leaving the Club each month as interest payments to the bank. As a limited company, Directors and over 220 other share holders have their own money invested in the Club and there is much more of a responsibility on us now to looking after the best interests of the Club and that money that is invested by doing the best we are able to for the shareholder.

2: How often does the Board/committee meet, and what are the main agenda items? What issues generate most debate in these meetings?

The board usually meets at least once a fortnight and sometimes once a week, though more frequently if the need arises. The agenda items can vary from meeting to meeting, though common ones which regularly appear include budgeting projections and highlighting areas where effort is needed, discussions with manager, promotion of hospitality, sponsorship and advertising etc. Items such as these can generate much in the way of constructive debate and ideas. It should also be noted that members of the board regularly communicate with each other on a daily basis.

3. How do you assess the current financial status of the club - does income cover running costs? Broadly speaking, how is any gap covered (overdraft, etc)?

The Club is on a much better financial footing now than it has been for many of the previous years. Although the limited company is still in its infancy, our primary aim is that we do not run each financial year at a loss. We therefore have become much more prudent with regards to budgeting and projections based on income and expenditure to do the best that we can to meet this. If we were to anticipate a possible shortfall, we would act to make this up by pushing possible sources of income further. As you can imagine, it can be difficult to try and project finances when they rely on crowds, cup runs, money from SFA and SFL etc. but we do our best to constantly monitor the situation and keep on top of it. We have been successful in being able to achieve a healthy profit in our first 2 years as a Limited Company.

4.: Is there any realistic hope of mobilising additional investment for the club in future? What are the realistic possibilities for generating income such as the hospitality initiative, expanding the lottery or of significant business or individual investment or sponsorship?

As you may have seen in the media recently, there have been some recent exciting developments for bringing income into the Club that have been the fruition of much hard background work. Crown Parks for instance have agreed a 2 year deal to sponsor not only the first team but also the 4 youth development teams in what really is a tremendous deal for Arbroath FC. They have also expressed a willingness to possibly assist the Club with funds when the transfer window opens again to help bring in quality players to Gayfield next season. The new Hospitality Suite has also already shown that it has serious potential as a great facility for the Club. It is proving to be extremely popular on matchdays and we have been highly praised over the quality of service we are providing. We have also taken several bookings for functions outwith football and we continue to actively promote the facility. We constantly work behind the scenes in all areas that can generate income.

5: Does the club harbour any expectations of a future pay-out from the Andy Webster saga?

You may be aware that FIFA initially ordered Andy Webster to pay Hearts £625k but that Hearts appealed against the amount as not being enough. The appeal was heard and the final ruling actually went the opposite way and Webster was ordered to pay only £150k. Arbroath FC did include a sell on clause when Webster was sold .to Hearts for a percentage of any fee received if his registration was transferred while he was still under contract. Since the initial move was made by Webster from Hearts, we have been in contact with Hearts and the SFA on several occasions to keep updated with the situation. We do expect that Hearts will honour this agreement and the SFA have intimated a willingness to assist us in any claim we may have to make.

6: Q: Finance apart, does the club do enough nowadays to reach out and connect with the town? Are there any thoughts of improving community or business involvement, or tapping other local resources (apart from funds)

We have certainly been doing more over the last couple of years and a key factor in this is enthusiastic people who have become involved in the Club, including John McGlashan and Directors. We reintroduced children's coaching sessions and regularly invite children down to Gayfield to meet the manager and players at our open day sessions which are also open to everyone. There have also been some exciting recent business associated developments, and we have also become involved with Arbroath Round Table. The new hospitality suite is also beginning to prove very popular with activities outwith football and is being actively promoted to the business community.

7: Arbroath has quite a good record of bringing through younger players. Is this likely to continue - what are the constraints?

Arbroath FC is actively promoting its youth set up and has worked very hard to increase its profile in the last 2 or 3 years. We introduced teams at Under 15 and Under 14 levels of the SFA Youth Initiative to increase our activities, our level of grant funding and to promote young local talent as a route towards our Under 17 and 19 SFL sides and onto the first team. By raising our profile, we aim to continue bringing through younger players and hopefully increase the numbers who go on to play 1st team football. There are several constraints, particularly with finding unpaid volunteers willing to play a part in trying to make it successful. The youth setup does not only involve coaches. It needs to be administrated properly by the Club Secretary and there are many child protection issues that require a qualified individual who is willing to give up their time. Some Clubs can afford full time youth staff but we rely solely on volunteers.