Hearts report £1.65 million loss

Hearts face an uncertain future. Picture: Neil Hanna
Hearts face an uncertain future. Picture: Neil Hanna
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HEARTS have reported a loss of £1.65 million last season – almost entirely due to a historic tax liability – but increased their turnover by almost £2m.

The club, who face an anxious wait to see how Lithuanian insolvency practitioners will act in relation to their debt to bankrupt Ukio Bankas, yesterday announced their headline financial figures for the year to 30 June, 2012.

In a statement on their official website, Hearts revealed turnover had gone up to £8.7m from £6.9m the previous season, with their debt standing at £24.7m after what they termed a “modest increase”.

They put this improvement down to their participation in the Europa League qualifying rounds, where they faced Tottenham, and their

William Hill Scottish Cup triumph.

Hearts players faced delays in wage payments throughout the period in question and PFA Scotland submitted an official complaint to the Scottish Premier League midway through the season.

The club also recorded a net gain of almost £2m in player trading thanks to the sale of Lee Wallace to Rangers and Eggert Jonsson to Wolves.

The club have included in the figures a £1.58m tax liability, but they did not start paying back this amount until agreeing a repayment plan with Her Majesty’s Revenue & Customs in December last year.

Hearts also faced a winding-up order over a separate £450,000 tax bill around the same time, averting it with the help of a share issue which raised more than £1m.

Neither of those issues are reflected in the latest figures.

The club revealed they would hold their annual general meeting on 23 May but fans who purchased their stake during the October-December issue will not receive their shareholder packs until after that date and would only be “entitled” to attend future AGMs.

Earlier this week, Hearts assured supporters they were doing everything possible to trade normally in the wake of the collapse of Ukio Bankas, which is owed most of the club’s debt.

The bankruptcy court ruling in Kaunas last Thursday heightened fears that the club could face administration if the debt is called in over the coming weeks but yesterday’s statement took on an optimistic tone.

The club even expressed their desire to build a stadium that is “befitting of one of the biggest clubs in the United Kingdom”. Previous plans to boost Tynecastle’s capacity were shelved.

The statement added: “We continue, however, to work with the City of Edinburgh Council and business partners in order to deliver a stadium befitting of a top European football team playing in one of the world’s finest capital cities.”

Hearts stated that only a “realistic” offer would be considered by the supporters groups who are bidding to take control from UBIG, the investment group set up by Vladimir Romanov.

The statement continued: “The board can assure supporters that the club will only be sold on the basis of a constructive and realistic offer for the company and secondly, and as importantly, can prove that they have the resource, determination, and business acumen to allow Heart of Midlothian to prosper in future years.

“The board has, post-year-end, offered supporters the opportunity to take an increased share of

the club which could lead to an outright purchase of the club in the future.

“The club is delighted with the positive response received and this gives it confidence that supporter ownership can be a viable proposition for the club.

“We remain resolute and due to the commitment of all those associated with the club we are cautiously optimistic about the future of the business.”