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Following yesterday’s End of Season Financial & Strategic Update, the ‘Well Society board today issued the following statement.

Most of you will now have seen the statement the Motherwell board issued yesterday outlining the stark reality of the club’s financial situation and setting an ultimatum to the ‘Well Society. We welcome the clarity and will emphatically embrace the challenge.

We would like to offer our thoughts on the way ahead but first of all we must apologise to ‘Well Society members for a lack of communication in recent weeks following the annual general meeting.

There were a number of significant developments in the run-up to the meeting on May 2 and discussions with the club in the intervening period which made the situation very fluid. So, we felt it best that we wait to communicate with members once the club had outlined its position. But we acknowledge that communication must improve significantly in the weeks and months ahead.

In its statement, the club explained that it posted losses totalling about £780,000 for Stuart McCall’s first two full seasons in charge and expects to record another deficit for the most recent season.

The club has explained some of the reasons behind this performance: the loss of Rangers to the top flight; the continuing lack of league sponsorship; falling attendances (the average attendance at Fir Park was 700 lower this season than during Maurice Malpas’s campaign in charge, when we stayed up on the final day); redistribution of money to the lower leagues; the decision to reduce the prize money for finishing second in 2013; declining commercial income.

Whatever you think of the financial decisions taken, the reality is that the club needs money to underpin these losses. In the past John Boyle plugged the gap but he is under no obligation or expectation to do so again having already donated his shares to the club. These shares were earmarked for the fans through the Well Society and can still be ours.

In the past few months the ‘Well Society loaned the club £230,000 which helped it through a short-term cashflow situation, but the club also sought funds from a third party. The previous year the ‘Well Society made a £150,000 capital injection during a similar period of cashflow issues. In the difficult months of February, March and April next year the club is likely to again need money to see it through to the end of the season when the full SPFL prize money comes in.

If the club cannot get the money from us, they need to seek it elsewhere. That means that time is running out for Motherwell fans to raise the money needed to meet the aims of the ‘Well Society – the main goal being a majority stake in the club. We have been given until the end of November to reach the £800,000 mark, with the total being just over £420,000 at the end of April.

There are effectively three scenarios that will unfold from now onwards.

(1) We do not raise enough money and the club raises cash from external sources.

This could be soft loans from Motherwell-minded business people who are open to the idea of community ownership. We know the club retains the goal of fan-ownership as its priority and would seek to raise money under those terms. However, there is a possibility that the club could be forced to sell the shares donated by John Boyle to perhaps one individual or group. There are no guarantees that their motives and ideals would be shared by the Motherwell support, or that they could successfully run a football club.

We have already experienced administration and it was fortunate that John Boyle took a financial hit and stayed around to put the club on a level footing and give us the opportunity to own the club. But who knows what could happen if a new owner comes in and gets the club into trouble? There are too many examples of Scottish football clubs suffering financial problems in recent years not to have some concern about the unknown.

(2) Neither the club nor the Well Society raises enough finance and the Motherwell directors are forced to slash the wage bill.

The club statement revealed that Motherwell would be forced into a “very substantial reduction in expenditure plans” if they could not raise capital in the coming season, which would “diminish our competitive capabilities on the field and create a negative financial spiral”. Inevitably, people will lose their jobs and more players will leave, and days like the other Sunday at Pittodrie and European trips will be highly unlikely to recur in the near future. Long term, the club could find itself fighting to maintain our top-flight status.

We know the Motherwell board would do everything they can to avoid that scenario, but again there can be no guarantee of raising sufficient capital from other sources. John Boyle put the club up for sale several years before the ‘Well Society was founded and no suitable buyer emerged. St Mirren are among the best-run clubs in Scotland – a debt-free, top-flight club with a new stadium and training ground – but they have been up for sale for years without attracting an offer that is acceptable to their board. People are not queuing up to invest in Scottish football. As a support, we have possibly been spoiled by the safety net of John Boyle’s personal wealth in recent years. If we can afford to, it is time we took responsibility for our own club rather than taking our eyes of the ball and depending on another white knight to come along.

(3) The Well Society meets a key target set to us by the club of raising £800,000 by the end of November.

We stabilise the club’s finances and in return we would soon afterwards move into position to take majority ownership of the club while continuing to raise funds and increase our membership.

For us to meet the long-term goals, it is imperative that fans come forward urgently to join the Well Society if they have not already done so. We appreciate it is not easy to meet membership fees on a one-off basis but there are flexible opportunities to pay monthly so you can contribute whatever you can afford. We are also urging members to upgrade their memberships – again there are ways to do so gradually. It is now or never to show we can grasp this opportunity.

We are as frustrated as anyone by the lack of significant progress in raising funds. Some complicated issues have held us back – such as last year’s share purchase and the subsequent change of rule over lending the club money and ongoing discussions over renewal fees/benefits – when we should have been focusing on recruiting members and raising cash.

As a board we have had relatively little time to raise enough funds, but we know now that time is running out and we need everyone to pull together to help raise money and support for the ‘Well Society. We will step up our fundraising efforts, re-launch our recruitment plans in the very near future and again try to simplify the model – but anyone can join at any time now.

Another frustration is that we have not been able to engage the business community as much as we would have liked and need to, despite extensive efforts. One of the decisions made at the AGM was the election of Robert Montgomery to the ‘Well Society board, after Sandy Kilpatrick stepped down following 18 months of hard work. Robert will help focus ‘Well Society efforts on attracting business investment.

We know that some fans might be reluctant to hand over money to the society amid uncertainty over whether it will achieve its goals. If we do not achieve majority ownership, our aim is to achieve a significant holding that can give the fans substantial influence in the way the club is run, and offer checks, safeguards and protection should a new majority shareholder come in. So every penny will count.

We will have discussions with the club on the mechanics of this if we do not achieve our main goal, and the decision will also rest in the hands of the members, but the aim of the Well Society board is to become a significant shareholder, even if we fall short of full control. But full control remains the goal to which we must all be committed.

To conclude our message, we make a general appeal to all those who can join the society or contribute more. Few fan bases get such an opportunity to own their club and protect it for future generations, outwith times of crisis, and sometimes times of crisis are too late. If the society does not raise enough funds in the coming months, we may indeed be too late.

If you are a ‘Well Society member, please, please try to persuade more of your friends and family to join, or upgrade your membership, if you can. If you are not a member, please join now. Otherwise this once-in-a-lifetime opportunity to secure majority ownership for Motherwell fans may be lost forever. And no-one can tell what the consequences will be.

The ‘Well Society board
May 22nd 2014

To join the Well Society click on thewellsociety.co.uk/join-the-society/ or phone Alison on 01698 338006

The Board of Motherwell FC today issued its annual End of Season Financial & Strategic Update.

For the attention of Shareholders, Members of the ’Well Society, Season Ticket Holders and all Motherwell Supporters.

Once again we are delighted to have celebrated an exceptional on-field performance in the league campaign. While results in both cups disappointed and we did not progress in Europe beyond the early stages, we cannot overstate the achievement in reaching the runners-up spot for the second year in a row.

Given the turnover in core first team playing staff, the ability of Stuart McCall and his team to recruit, motivate and reconstruct the first team has been quite exceptional. He has done so while maintaining an excellent culture that is becoming the trademark of our family club.

We now look forward to European competition for the sixth year in the last seven. Once again a remarkable achievement given the economic realities facing our competitive position.

We put on record our sincere thanks to the management and players and all the support staff for the great credit they have brought on both themselves and this club.

Notwithstanding the excellent news on the pitch, the Board would like to draw the focused attention of our shareholders, members and supporters to the financial reality we face off it. In the last few years we have been at pains to ensure that our strategy is clearly understood and that we communicate both our financial performance and prospects with transparency. We did this in the summer of 2012, to allow members to make an informed judgement on the implications of SPL decisions as affecting Rangers FC. We do so again today to allow everyone who cares about Motherwell FC to understand the context of the decisions we have made as a Board and to allow time for individuals to determine their own actions before the Board determines the next set of strategic decisions that we must make.

Strategic Context

Our aim since the launch of The Well Society has been to create a sustainable model for the eventual fan ownership of the majority of the equity in the club. This required good governance structures to be created and function, fit and proper individuals to be nominated that could perform as full Club Directors and financial targets to be reached for the Society, that would provide the Club’s effective “strategic reserve”. From the outset, a figure of £1.5 million has been identified as the required strategic reserve.

This strategy was created purposefully with the objective of stabilising the Club’s financial position on a sustainable footing so that we could maintain the financial strategy that has underpinned the Club’s competitive position which has produced the sporting success we have enjoyed over the last five years and more.

Update on Financial Performance

The following points should be considered in detail:

1. We have made a full year loss in the last two years of just under £600k in 2011/12 and £184k in 2012/13 respectively.

2. For 2013/14 we currently anticipate a loss moderately in excess of five figures for the year.

3. These losses have so far been absorbed by existing cash reserves and then by the ongoing cashflow management of the club in anticipation of future income, underpinned by a number of measures we have outlined below.

4. We have already recorded the reasons for these losses. In particular we have maintained our player budget in the face of falling central revenues and from gate and commercial receipts, as the Board judged the balance of risk to our competitive performance and the financial implications merited this, given all of the information at our disposal and having made reasonable judgements about likely outcomes. The main downside impact on our financial outcomes have been:

• Last year’s (2011/12) in-season recalibration by the SPL of the financial rewards for second place, before our agreed bonus structure for the team could be changed, meant we received no net additional income from finishing second.
• Overall the total pool of distributed funds by the SPFL to top league clubs has been reduced following the decision to pay more to the lower leagues.
• Combined revenue from gate receipts and season tickets has fallen by approximately 10% since season 2010/11 meaning a cumulative loss to the revenue of the club over the subsequent 3 years of £200k. Our home attendances this year have not been as strong as anticipated given the strength of team performance.

5. The governance of the ‘Well Society is working well and we have two Society nominees acting as full and equal club directors.

6. The ‘Well society has recruited 869 adult and business members and accumulated total funds of just under £470k. This is equivalent to 21% of our season ticket holders. In other words when taking account of regular pay at the gate fans we have recruited less than 1 in 5 of our loyal core base to the society.

7. The society holds 6% of the equity in the Club injecting £150k into the club’s balance sheet. In addition the society made available a bridging loan to the club of £230k in February 2014 and retain a further £40k in reserve. The total distributed/distributable sum at the disposal of the Society is therefore just in excess of £420k which is very significantly short of the clear target for the “strategic reserve” of £1.5 million.

8. In the current financial year the Board agreed a short term asset finance loan of £125k which was underpinned by the personal financial guarantees by a number of our Directors. It is our intention to pay this back within the next 3 months.

9. The Club has an outstanding historic loan to Mr John Boyle of just under £350k.

10. The financial position of a number of our competitor clubs has stabilised and improved for a variety of reasons.

Implications for the Financial Position and Future Strategy of the Club

The figure of £1.5m as a strategic reserve was arrived at as a reasonable estimate, based on past experience, of the funds which the Club would require to have at its disposal to fall back on in the event of a series of losses being sustained.

As detailed above, losses have been sustained but the strategic reserve has not been met.

Qualification for Europe has allowed the Board, based on past revenues generated and making reasonable assumptions on income for the coming season, to maintain the playing budget at the same level for season 2014/15.

However, this is the last year in which we will feel able to do this unless a very substantial improvement in our revenue position occurs and/or the targets for the ‘Well Society are reached.

A sustainable step-change in our revenues is not likely to be enjoyed in the short-term unless we enjoy the windfall of unexpected player sales or exceptional Cup performances. Given our experiences in recent years the Board cannot, and has not, planned for either as a central assumption.

This means we must turn our attention to the achievement of our strategic reserve target of £1.5 million as an urgent financial priority for the club.

Achieving our Strategic Reserve Target of £1.5 million

Following repayment of the loan to the Society, the Society’s reserves will sit at approximately £270k after the purchase of equity in the club. As noted above this, when combined with the equity injection amounts to 28% of our target and reflects the reality that fewer than 1 in 5 of our core support has joined the society. The number of 1886 and Claret members is significantly lower than we had hoped.

While not wishing to diminish the simply outstanding work and commitment of so many people to make the Society a reality, this performance to date is disappointing and, to be crystal clear to everyone, does not represent the sustainable financial underpinning for the Club’s strategy that we hoped for and require.

The Board met on the 7th May to consider our current financial performance in the light of our qualification for Europe and anticipating the scenarios we faced the subsequent Sunday in the play-off for second place. The Board agreed unanimously on the course of action we must now take in the interests of the Club:

1. That we should give the Management clarity in the player budget to allow them to secure some stability on the field, as we face European competitive opportunities and an increasingly competitive race for the top six.

2. That an increase in the capital available to the Club is essential and that such a capital injection should be pursued as a matter of urgency. The preferred source of that capital would remain the ‘Well Society, however, other sources of capital investment, including the sale of shares to private individuals have to be explored. A number of our competitor clubs have recently been able to raise significant funding from a small number of fans, further weakening our competitive position.

3. That we should set a deadline for the Society achieving the goals that were set on its launch in November 2011. The next intermediate goal we set was for the society to achieve a reserve of £800k by the end of November 2014 in order to underpin the club’s finances and to prove that reaching the full reserve of £1.5m is achievable in the near future.

4. In the event that this first target is not reached the Board has authorised officers of the Club and its Directors to consider alternative routes to achieve the strategic reserve target that the Club requires. In all circumstances we will do everything we can to ensure that the future fan ownership of the club can become a reality. But we will have to consider all proposals put to us.

We urge all fans of the club to recognise the reality of the financial situation we face and to do anything they can to assist the club urgently.

We recognise that our on the field success and the generally positive culture and atmosphere at the club has meant that there is no perception of “crisis” and therefore no imperative or urgency for many otherwise deeply loyal supporters to join.

While we are not yet at a “crisis” position, we are flagging that we require to take action now to ensure the continued financial stability of the club. This action will either mean a substantial increase in resources towards our reserve or a very substantial reduction in our expenditure plans.

This latter route would have the inevitable impact of diminishing our competitive capabilities on the field and creating a negative financial spiral. The consequences of this latter route are only too familiar to all supporters of the game in Scotland

The Board of Directors continue to believe that the ‘Well Society can achieve its stated aim of raising sufficient capital to acquire and run the club on a sustainable basis. If the target figure of £800k is achieved by November 2014 the plan of fan ownership can be a reality. This can only happen if those who support this aim act now by joining or contributing further to the Society.

We therefore ask all of our shareholders, members and supporters to reflect very closely on what we have set out above and to consider their position carefully. We know how much we have to rely on a very small number of people but we are all in the same position. We urge everyone who shares our love for the Club to act.

The Board of
Motherwell Football Club
21st May 2014

Motherwell FC is today (Wednesday) delighted to confirm the signing of midfielder Josh Law.

Law, 24, is the brother of former Steelmen playmaker Nicky and has most recently been playing for Skrill Premiership outfit Alfreton Town.

The Nottingham-born player, who knocked back offers from League 1 and League 2 to move north, spent some of his youth career with Sheffield United and Chesterfield before signing professional with the Spireites.

He joins the club on an initial one-year deal after his contract expired with the Derbyshire side earlier this month and is ‘Well’s first new signing of the summer.

Speaking exclusively to MFC TV, Josh said: “I am really delighted to be signing for Motherwell and I can’t wait to get started.

“Nicky obviously enjoyed two great years at the club and couldn’t speak highly enough of the place, the people and the fans.

[pullquote]I’ve been about for games and training so I think I’ve got a good feel for it. It’s obviously a step-up for me from my previous club, but it’s a challenge I am relishing.[/pullquote]

“I’ve been about for games and training so I think I’ve got a good feel for it. It’s obviously a step-up for me from my previous club, but it’s a challenge I am relishing.”

‘Well boss Stuart McCall added: “We’ve had Josh up for training several times last season to look at him and we think he’ll really add something to the squad.

“He’s a similar type of player to his brother in that he’s a midfielder who likes to get on the ball and create.

“We are really pleased to have him here and I am sure he’ll add something a bit different to what we have currently.”

Although Josh signed his contract with the club this morning, he will have to wait until June 10th to be registered when the International Transfer Window reopens.

-WATCH JOSH’S INTERVIEW EXCLUSIVELY ON MFC TV–

Motherwell FC can today confirm James McFadden will leave the club when his contract expires at the end of this month.

Faddy, 31, exploded onto the scene as a teenager before securing a big money move down south to play for Everton, Birmingham then, latterly, Sunderland.

He returned to the club in February 2013 and made an instant impact, helping the club finish second in the table.

He signed on again last summer and started 23 times during the last campaign, scoring five goals, again assisting the Fir Parkers to finish as top league runners-up.

Stuart McCall said: “I had James in last Friday and we had a discussion about the future and everything was very amicable.

[pullquote]I cannot speak highly enough of his attitude, desire and professionalism whilst he was here, particularly when going through a difficult patch or when he was injured.[/pullquote]

“I cannot speak highly enough of his attitude, desire and professionalism whilst he was here, particularly when going through a difficult patch or when he was injured.

“In the past, we could possibly have used James in a number of positions, but I think he is at his best when played through the middle as a striker.

“We have five different options in that position and need to utilise the budget in other areas of the squad.”

The club is still in discussions with a number of other players and hopes to announce details of these soon.

In the meantime, everyone at Fir Park would like to sincerely thank James for his huge contribution during his two spells at Fir Park and wish him all the best in his future career.

Motherwell FC is today delighted to confirm defender Stephen McManus has signed a new two-year contract at the club.

McManus, who joined from Middlesbrough last summer, was a virtual ever-present for the side during the 2013/14 campaign, playing 42 times, missing just one (the Boxing Day win at Pittodrie).

He also scored vital goals against Hibs, Aberdeen, Partick Thistle and St Johnstone, which helped the Steelmen into a second place finish.

And the 26-times capped former Scotland skipper spoke of his delight at extending his stay in North Lanarkshire saying: “Last season couldn’t have gone any better for me personally.

[pullquote]I wanted to come here at the start of last season, play as many games as possible and, hopefully, bring something to the team.[/pullquote]

“I wanted to come here at the start of last season, play as many games as possible and, hopefully, bring something to the team.

“I’ve really enjoyed it and the decision to extend really was a no brainer.”

‘Well boss Stuart McCall added: “On the pitch, Stephen is a rock for us at the heart of the defence as well as a real influence in the dressing room and around the club.

“He played more than anyone at the club last season, missing just one game, so we’re thrilled he has extended his stay.

“We hope to be in a position to confirm new deals for other players in the very near future too, with preparations for next season already well underway.”

-WATCH STEPHEN’S INTERVIEW EXCLUSIVELY ON MFC TV–

Good afternoon ‘Well fans,

It has been too long since I penned my last mail to fans and I felt today was a good day to bring it back. I will endeavour to return to a more regular email next season, as it’s something people often ask me about.

Some of the staff and I are just about to enjoy a short break so I’ve put this down before I go.

Needless to say, it has been an incredible twenty-four hours for everyone involved at the club. The players, staff and everyone at Fir Park really deserve everything they got yesterday and don’t let anyone, anywhere tell you different.

It has been a monumental effort this season, to win 22 games from 38 has been absolutely fantastic and something I am extremely proud of. It has certainly been our greatest achievement in my three and a half years at the club.

The game yesterday was a battle but, in many ways, typified what has worked for us this season: hard work, determination, focus and a real desire to win. We had a game plan to keep things tight until the closing stages then go for it, and that’s exactly what the players did and we got our rewards.

Yes, there was an element of luck attached to it, but it’s luck we have very much deserved, particularly if you look back at some of the previous matches against Aberdeen this season, where it has been us on the end of contentious calls.

That brings me onto this summer and your input as supporters. The backing we’ve had this season has been fantastic and you can sense the real bond we have between the lads, the club and the fans. The colour and noise is a huge positive and I thank you for that.

The club currently has Season Tickets on sale now and I am personally asking each and every one of you who can, to consider buying one. It’s a vital part of the year which helps us plan budgets for various areas of the football club.

We’ve seen a steady rise over the last few years and it would be brilliant if we could keep that trend going. Next season is going to be another test, but we’ve got great foundations to kick-on. Together, we can carry on this fantastic story.

Cheers

Stuart McCall
Manager

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Extended highlights from Pittodrie as Craig Reid’s late strike stunned The Dons to send The Steelmen into second place in a dramatic climax to the season.

-WATCH THE HIGHLIGHTS EXCLUSIVELY ON MFC TV–

Action pictures from this this afternoon’s incredible 1-0 win over Aberdeen at Pittodrie.

Snaps courtesy of SNSPix.

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