SPOTLIGHT: Byrne perfects delicate balancing act as Sunderland embrace new financial reality (From The Northern Echo)

SPOTLIGHT: Byrne perfects delicate balancing act as Sunderland embrace new financial reality

8:00am Saturday 2nd March 2013 in Sport By Scott Wilson

AS Margaret Byrne sits in one of the directors' rooms in Black Cats House, the administrative headquarters of Sunderland Football Club in the shadow of the Stadium of Light, she can see four framed portraits hanging on the wall.

The first, slightly faded, contains signed cigarette cards displaying the 11 members of the triumphant 1973 FA Cup final team that beat Leeds United at Wembley. The other three, which are much more garish, contain pictures and memorabilia signed by Pink and members of Oasis and Take That, all of whom have staged concerts at the Stadium of Light in the last four years.

There, in a nutshell, is the balance Sunderland's youthful chief executive must strike every day as she seeks to create the off-field environment that will enable the club's players to succeed on the pitch.

History and tradition against expansion and progress. The closeted world of football against the wider commercial sphere in which it now exists. Serving and supporting the local community, while at the same time squeezing every last penny out of the global revenue streams that have become increasingly receptive to the Premier League product in recent years.

“First and foremost, our primary concern is to the local community and the local supporter base,” said 32-year-old Byrne, who was promoted from her former role as legal director and company secretary to replace Steve Walton as chief executive in 2011. “That's definitely key, but it's also about us spreading the name of their football club – our football club – around the globe.

“We're not trying to disengage anyone, it's just about getting the whole product – the football, the city – out to the wider world. Having someone like Rihanna at the Stadium of Light this summer, it's all about raising the profile of the football club and the city, and with that comes a bigger supporter base and more interest from the corporate sector, which will ultimately help us create more revenue for a better team and better offers for our supporters.

“It's really, really important that we get our revenues up from all different angles. We have the concerts and 1879, the new events management company, and we're looking at things like trying to get new sponsorship and initiatives in Africa. It's all about raising revenue and the club's profile, which go hand-in-hand. At all times, it's about trying to get the balance right, and that's what we're trying to do.”

In Sunderland's most recent set of accounts, released almost a year ago, the club announced an operating loss of £7.8m. Their next set of figures will also see them record a deficit, in part because owner Ellis Short resisted opportunities to cash in on the likes of Stephane Sessegnon in order to offset the £30m-or-so that has been made available to Martin O'Neill for squad strengthening.

The Black Cats are far from the most indebted club in the country, but they remain hugely reliant on the largesse of Short, who has invested well over £100m since replacing Niall Quinn's Drumaville consortium and capitalised the vast majority of his loans so they are no longer regarded as debts.

Unsurprisingly, there is a desire to reduce the extent to which Short is propping up the club's finances, and that desire gained added urgency when the Premier League clubs reached an agreement last month that limits the amount of television revenue that can be spent on wages.

“We're very lucky to have an owner like Ellis,” said Byrne. “We had offers for some of our players this summer that were pretty juicy offers, but ultimately Ellis, as owner of the club, said those players were not for sale.

“There was more interest for some of our players in January, but again we didn't sell. As chief executive, it's not nice to be reporting a loss, but you'd rather do that and stay in the league, then keep your best players and try to fight for Europe. The difference with this new deal is that we still have the ability to do all that, yet also start making a profit.

“In the past, all of the revenue went on players and agents, their salaries were simply hiked up. Now, the wages to turnover rate will change because the new rules that are coming in mean you're only allowed to spend £4m of the extra television revenue on wages.

“There's an increment which means you have the ability to keep your players and your salary sustainable. You can keep your best players and your salaries at a competitive level, yet this extra money comes in that helps address the big black hole of debt that every club has.”

So with the money from the Premier League's new television deal effectively ring-fenced, and UEFA Financial Fair Play regulations making it harder for a benefactor to plug gaping holes in the balance sheet, it is imperative for clubs to extract the maximum possible value from their other revenue streams.

For Sunderland, that means two main focuses. The first is the match-day attendance at the Stadium of Light, with this week's announcement of next season's season-card prices a key development in the ongoing battle to attract more supporters through the turnstiles.

Sunderland have reduced prices in certain areas of the ground, and with child season tickets starting from as low as £25, Byrne insists the club are doing all they can to ensure their product remains affordable yet also sustainable.

“It's a really big part of our income,” she said. “We have a product here that people want to come to, but we're also trying to keep prices realistic. Just to open the stadium, even before anyone comes in for a reserve game say, costs £10,000.

“We've tried to get the balance right. If you were going to a concert, then there's not many concerts you can get into for an average price of £20. We're mindful of the economic conditions, but it's a business and we have debts. We have plans to make profits.”

Those plans also involve a continued development of non-footballing revenue streams. The club's overseas expansion continued this week when they signed a partnership agreement with the Nelson Mandela Foundation, and their profile in the Asian market should increase when they take part in the Barclays Asia Trophy in Hong Kong this summer.

Stadium naming rights will be considered, while the Stadium of Light's growing reputation as one of the leading outdoor music venues in the country is of crucial importance to Sunderland's future business plan.

“That's even more important with these new rules,” said Byrne. “Although you're only allowed to spend £4m (from the television deal), any additional turnover you make can be used for players.

“If you reach a level where your salaries are up to 'X' amount and you can't go any further, you can say, 'Well hold on a minute, we've had these concerts and we've developed all these extra revenue streams that actually enable us to spend 'Y''. You can use those revenue streams for player purchases.”

Listening to Byrne address the thorny issues of global football finance with an authoritative tone, it is hard to believe the Northern Irishwoman only entered the footballing world when she applied for the post of Sunderland club secretary in 1997.

Born to a DHSS manager and a publican in the small South Armagh town of Dromintee, Byrne qualified as a lawyer after studying in Ulster and London.

She represented a range of defendants in north London - “nothing fazes you after you've argued on behalf of someone charged with attempted murder” - but opted for a change of tack when she joined Niall Quinn's boardroom team on Wearside.

She initially worked on contracts and signings, but stepped into her current position almost two years ago and has never looked back.

She was the first woman from a Premier League club to be voted onto the influential FA Council, but insists her gender has never been an issue despite football's reputation for being a heavily male-orientated world.

“Getting voted onto the FA Council was a big thing,” she said. “There was myself, Ivan (Gazidis), the chief executive of Arsenal, Paul Falconer from Aston Villa and Ian Ayre from Liverpool. The four of us were up for the vote to represent everyone else.

“I think they voted for me because they knew I was going to stand up for all of us and have the guts to say what was wrong. That was when I was able to really think, 'This man-woman thing doesn't count here'. They know I'm going to do a good job for all of them and I haven't found anything that's been a problem because of who I am.”