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Sheepshanks gets full backing

PUBLISHED: 18:30 06 December 2002 | UPDATED: 13:09 03 March 2010

In the final part of its look at the troubles of Ipswich Town and club chairman David Sheepshanks, The Evening Star reports on the annual shareholders' meeting - and finds the chairman, though understandably a little nervous, enjoys full backing.

In the final part of its look at the troubles of Ipswich Town and club chairman David Sheepshanks, The Evening Star reports on the annual shareholders' meeting – and finds the chairman, though understandably a little nervous, enjoys full backing.

THE sentiments were undeniably sincere and the content forthright, but the delivery was less than flawless.

However, it was the reception that David Sheepshanks received upon reaching the end of his speech that underlined the faith which the shareholders, at least, have in his ability to lead Ipswich out of the choppy financial waters in which they currently find themselves.

Subsequently re-elected on a unanimous show of hands to serve on the board for a further three years, Sheepshanks appeared uncharacteristically nervous as he painted a candid picture of the current scene.

Perhaps he was worried that those he addressed would bombard him with difficult questions. If so, he was unduly concerned.

Rather than fireworks, the latest annual general meeting produced a damp squib response from the floor and the chairman, far from being given a hard time, had a remarkably easy ride.

Awkward questions? Forget it. The Ipswich shareholders are hardly renowned for putting the chairman on the spot – and once again they didn't let us down with an entirely predictable performance.

Can it really be that Town have just reported net debts totalling £31.4 million for the financial year to June 30 2002?

Are you sure this is a club that will inevitably have to raise revenue from further player sales next month in order to trim a wage bill for the period of £24m?

Maybe the impression was not entirely of a club in clover, but nor did the mood reflect the full extent of the cash crisis currently gripping Portman Road.

I could not help thinking how different it might have been at other clubs. Take West Ham, for example, where the natives' restlessness is directed firmly in the direction of the boardroom, rather than at a manager whose team are still waiting to record their first home win of the season.

But perhaps Sheepshanks' counterpart, the largely reclusive Terry Brown, is paying the price for an apparent reluctance to 'come clean' about the situation at Upton Park.

No such accusation could be levelled at Sheepshanks, who came out fighting – metaphorically speaking – with a straightforward barrage of verbal blows designed to land with maximum impact.

Read his speech, which is published in its entirety on page 43, and you will see what I mean.

There was no attempt to camouflage the truth, but rather highlight the seriousness of the situation, while at the same time stressing his confidence in being able to right the ship.

I will even forgive him his occasional swipe at the press which, since The Evening Star has been in the forefront of probing the full extent of Town's cash crisis and others have only recently woken up to it, I assumed was aimed in my direction.

Indeed, the first question related to the Star's recent exclusive highlighting the net loss of £3.3 million, obtained from independent sources and two days ahead of the club's planned embargo.

"Have you established the source of the leak?" queried a shareholder in concerned tones, soon after the generous applause that followed Sheepshanks' speech had died down.

The chairman replied: "Investigations are on-going but, no, I am not aware of exactly where the leaks are coming from.

"We were very upset that a leak regarding our accounts appeared in one newspaper, despite the established embargo that hitherto had always been observed."

Sheepshanks went on to explain that the reason for the embargo was to ensure that shareholders received their copies of the club's annual accounts prior to details being published in the press.

But before the debate changed direction, he acknowledged: "The press are there to do their job. They like a scoop, but I am sorry for any embarrassment over what you read in that one publication."

Another shareholder wanted to know the position regarding axed boss George Burley's contract, the terms of which the club are continuing to honour, should he wish to take up new employment elsewhere.

Sheepshanks' reply offered some assurance that Ipswich will not be saddled with settling Burley's deal, understood to be around £1m a year and not due to expire until 2006, in full.

He revealed: "We are in discussion with George and his advisors over a settlement that will be right by him and right by us, but I feel it would inappropriate to say any more at this point."

The inference was clear – that Burley is just as anxious to free himself, in order to step up his search for a new job, as the club are to avoid forking out the maximum to which he would be entitled if he were to choose to sit tight.

Long-serving supporter John Eastwood, best known for his detailed history of the club, The Men Who Made The Town, which was published in 1985, asked for clarification about the net debt figure of £31.4m in the accounts.

Sheepshanks explained that the figure included the £25m bond and added: "It is a mortgage. We reduced our overdraft and borrowing from £7.9m to £4.9m, but we took out a mortgage with payments over 25 years.

"We have built two new stands, tidied up the ground, and built an academy and training ground, which I think is very good use of money."

He said the board had considered a number of scenarios, including that of Ipswich being a yo-yo club and alternating between the Premiership and First Division at regular intervals.

"That, perhaps, is the most likely scenario," he added. "But even with the most ghastly of scenarios, that following relegation we would never, ever get promoted, the debt is manageable."

In response to a question that related to players' contracts being renegotiated after Ipswich took the Premiership by storm to finish fifth two seasons ago, Sheepshanks admitted this had been necessary to keep them on board.

Newcomers were also rewarded with bumper deals and it is this commitment, together with falling revenues relating to the likes of television income, that has contributed greatly to the gloomy financial outlook.

The chairman added: "It is easy with the benefit of hindsight but, given the situation in which we were in, did any of you think for one second that we could be relegated last season?"

Not surprisingly, with the transfer window looming next month, the subject of possible player sales was eventually raised.

Sheepshanks said: "We don't want to sell any more than we have to, but we are governed by market values and I would ask you to trust the board.

"As far as possible, when we have to sell, we will extract the best value we can. But I wouldn't want to mislead you – the transfer market is no different to the FOOTSIE and shareholders will just have to get used to it."

Sheepshanks also explained that the loan deals affecting Italian goalkeeper Matteo Sereni and French winger Ulrich Le Pen could well become permanent.

The pair, who cost a combined total of over £6m, are currently with Brescia and Strasbourg respectively on season-long deals.

"There are agreements for both these clubs to make the moves permanent, and for fees," said the chairman before adding, to a ripple of laughter, "so we wish them exceptional success between now and then!"

One shareholder asked about the strength of the board and Sheepshanks wasted no time in responding.

He said: "Cut them in half and you will find they are all blue and white. They are on the board because of their love of the club, their expertise in different walks of life and their contacts within the community.

"I stand by my fellow directors. We are extremely lucky to have such a stable, rather than split, board."

It was explained that new owners Powergen had agreed to continue with the sponsorship deal negotiated with TXU Energi and Sheepshanks said: "We are confident of an on-going relationship."

Asked if he was blessed with the benefit of hindsight whether there was anything he would do differently, Sheepshanks came up with a one-word answer: "Plenty."

But he quickly added: "It is not going to be helpful to say anything else here, but we would still continue to support the manager of the day.

"And we would still have built the two stands. Yes, absolutely. We grasped the opportunity and we now have a stadium that offers us a great deal more potential going forward, together with an academy that is the lifeblood of the club."

Great emphasis was placed on the club's efforts, spearheaded by new chief executive Derek Bowden, who was also elected to the board, to maximise its earning potential.

One shareholder highlighted the fact that staff numbers had increased, despite a significant drop in turnover.

Sheepshanks said: "Natural wastage has accounted for six or seven jobs in the past few months and none of them have been replaced."

He went on to explain it would be "shooting ourselves in the foot" to further reduce numbers at a time when fully-fledged conference facilities open seven days a week were presently generating a seven-figure annual sum.

Former chairman John Kerr, who resigned in 1995, paid tribute to Sheepshanks' contribution since succeeding him.

He said: "David has been very transparent tonight. He has washed the dirty linen in public and been very frank with you. Nothing has been hidden."

And dismissing rumours earlier in the day that he was poised to resign, Sheepshanks instead pledged: "I will do my best in the next three years to bring about more success."

Such was the upbeat mood that one could have been forgiven for thinking the depressing figures in the annual reports and accounts, copies of which were clutched by everyone present, had been an aberration.

But, while his feared ordeal at the hands of the shareholders may be over for at least another year, Sheepshanks knows he faces a further struggle to prevent having to confront them in 12 months' time with an even more miserable set of accounts.

Just what would it take, I wonder, for the shareholders to show a semblance of frustration or even anger? Will we ever know?

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