Birmingham turn losses to profits
LONDON, England (Reuters) -- Birmingham City's successful return to the top flight of English football helped turn last year's annual loss into a profit, the club has announced.
The Midlands club, who finished 13th in the Premier League last season, posted a pre-tax profit of 3.$5.9 million in the year to August.
The previous year the club, promoted after 16 years in the lower divisions, recorded a loss of $11.5 million.
"Our first season in the Premier League saw us finish in 13th position, the highest placed club in the Midlands," said chairman David Sullivan.
"We have continued to build upon this success in the 2003/04 season and are currently in ninth place in the league and in the fourth round of the FA Cup."
The turnaround in the club's financial fortunes comes on the back of a doubling of annual turnover to $66 million. Higher operating costs have been offset by a 27 percent rise in commercial income and a 19 percent rise in merchandising sales.
Birmingham said net operating costs rose to $46.5 million pounds from $32.4 million in 2002, because of higher salaries and the purchase of key players last December to stave off the threat of relegation.
Defender Matthew Upson joined from Arsenal for one million pounds, midfielder Stephen Clemence cost $1.6 million from Tottenham Hotspur and Jamie Clapham, another midfielder, cost $2.35 million from Ipswich Town.
Manager Steve Bruce also brought in former French international striker Christophe Dugarry on loan.
"We currently spend 54 percent of our turnover on wages, but expect this percentage to increase as we continue to improve the playing squad and heighten our ambitions," Sullivan added.
Sullivan said the board had hoped not to spend any more on new players until the end of the season, although a succession of injuries could force a review of that policy.
Birmingham shares rose 3.3 percent early on Tuesday, with the club now valued at around $21.7 million.
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