Huddersfield Chairman & FFA

Regarding your takeover, why did you say in your statement that ‘not a single meaningful offer was received’, when Paul Haigh’s consortium had tabled a bid three weeks prior to your own?

ANSWER….
Ken Davy said that he only dealt with the administrator. The administrator said to Ken Davy that there was no meaningful bid on the table when their consortium were putting their bid forward.

He then went on to explain that any other bid may have been put to creditors or the administrators might have considered them but as far as he was concerned that was what he was told.

He did however say that Paul Haigh had been in touch with him in the January of 2003 to see if he was interested in getting involved but Mr Davy declined.


Why did you transfer Town’s 40% share in the stadium to Huddersfield Rugby League Football Club (1994) in December 2003, which was later renamed Huddersfield Sporting Pride?

ANSWER…
Ken Davy said he had previously done the same with The Giants share to protect them from the same scenario. He pointed to the fact that KSDL could at any time call on the other parties if they suffered any major financial difficulties. The Giants and HTAFC finances are not strong enough to carry further financial burden for KSDL.

Also with £370,000 of rent unpaid in 2003 the shares could have been lost in any case.


If this was ‘to protect Town from any future liabilities’, why only three months earlier, when Kirklees MC reduced their debt from £7m to £4m, did you say ‘this would at a stroke remove all uncertainty that has surrounded the stadium for some time’?

ANSWER…
Ken Davy said this was strictly not true. What happened was that Huddersfield Town’s debts to the banks were underwritten by KMC, who decided to pay lump sums of £250k to reduce the stadium risk to KSDL. So in effect KMC were paying part of the money to themselves as they are part of KSDL.


When will it be ‘deemed appropriate’ to return Town’s 40% share in the stadium?

ANSWER..
Essentially it is highly unlikely and would be a pointless exercise, as the KSDL debts will not be paid off for at least another 15yrs.


Why are Town not part of Huddersfield Sporting Pride, whilst the Giants are?

ANSWER..
It is just chance & circumstance at the time that it happened like that, and really it does not make a difference. In hindsight maybe it would have been better to have HSP and Giants separate too, but because of time constraints to set up the umbrella company it did not happen.


Why is the rental formula, or ‘service charge’, being allowed to have such a detrimental effect on Town’s finances?

ANSWER..
It cannot be altered. It is linked to attendances, and number of games, of each sporting club. Giants only have 13/14 home games but are contracted to pay for 15games.

Their total attendance for the season is divided by 13/14 and multiplied by 15. Hence his statement that the Giants in a way ‘subsidise’ Town.

Guessed at the start of the seasons and adjusted at the end. The higher the gates the bigger percentage is paid. When he took over the Giants in 1995/96 Giants paid 12.33 and Town paid 87.67%. In 2005/06 the figures were Giants 22.58% and Town 77.42%. It is estimated for 2006/07 to be Giants 30% and Town 70%.


Given that, shortly after Town went into administration, Graham Leslie stated some of Town’s financial problems stemmed from high rents and loan payments committed to KSDL, will they ever be renegotiated?

ANSWER..
Ken Davy went out of his way to contact Graham Leslie that particular day and although Graham Leslie did have issues at one time on how the stadium was faring he no longer has issues and is actually taking an active role in the re-shaping of The Stadium hence his sponsorship of it.


In 1994/95, the first season at the new stadium, Town’s turnover was £3,518,560 with staff costs of £1,605,557 and rent of £144,563. In the 2004/05 season Town’s turnover was approx £4,100,000 with staff costs of £1,346,441 and rent of approx £611,000. Why has the rent increased well above inflation given that Town’s turnover has increased and staff costs have fallen?

ANSWER…
The ‘properties’ (advertising hoardings & boxes etc) used to be sold by the stadium company and all monies were knocked off the rents at source at that time. Hence the low figures for the early years. That situation changed in the Rubery era as he thought he could do a better job of selling them.

Now rent is paid but the ‘properties’ income is used by each club to help pay their rent. Hence the higher rent figures recently. ‘Properties’ income is split according to the rental percentages e.g. Town estimated to receive 70% this year. The other benefit to come out of this is that if the club selling the ‘properties’ take on anything neither football or rugby related say for a KSDL venture the sporting club get a percentage of that sale.


What outgoings are Town committed to, other than rent, which are contributing to the large projected loss?

ANSWER..
Usual football club expenses. Nothing extraordinary except for the club’s commitment to pay £350k per year for ‘depreciation’ e.g. accounting for the ex players wages which have been fully repaid, but those payments are accounted for over 10yrs, rather than the 3yrs it took to clear them. Merchandise in the club shops is solely for the club it relates to. Each club pays a contribution to cover costs of running the shop, but Town get income from town stuff, and the Giants get income from Giants stuff. He referred to the synergies the clubs share and an example was running one good shop instead of 2 bad ones, running one ticket office instead of 2 .It saves monies for both clubs.


Why did you budget for Town to be losing ‘over £1,240 per day for every single day of the year’, when only two weeks prior to your statement, Andrew Watson in an interview on Radio Leeds said ‘we are not running this club on losses again’ and ‘Town will be run on their own cash’?

ANSWER..
We do run on losses, but budgeted for losses. We budget each year for a £200k – £400k loss, assuming that we only reach the 1st round of each cup, and the not get to the play offs. Hence the struggle this year with 3 first round defeats & being mid table. Last year’s small profit explained by Chelsea money etc being used to cover the ‘projected loss’. It is nothing to worry about, and he insists this club will never run on unrealistic debts whilst he is in charge.


Why are Town losing such a large amount when their wage bill is such a small percentage of turnover (approximately 35%) and would you agree that Town’s wage bill is not excessive, given that their players only earn the League One average, and they have a small squad?

ANSWER..
He said he’d covered it earlier but then went on to add that he was also trying to change the whole of the land around KSDL and try and in that way to make KDSL more profitable. He said with it being a waste site in the past it was proving a hard task but he feels he will succeed and through KSDL Huddersfield Town and The Giants will benefit.


Why, when you took over the club, did you allow Town to repay debts (Kirklees MC and the North Stand) when these could have been written off as part of the administration process?

ANSWER..
As part of the admin process the previous loans to cover those debts were written off, but as part of the Joint Venture Agreement between the clubs & KMC a new loan was taken out. If it hadn’t have been Town would not have been allowed to play at the stadium.


Why did Andrew Watson say in his radio interview on 16th September ‘we invest heavily in the academy ..that costs us £500k a year’ when, as you know, the club only covers any shortfall from all the grants, lotteries and supporters groups?

ANSWER..
The lotteries etc are ‘driven by the club’ and if the academy wasn’t there they would still get a good percentage of that £500k to utilize elsewhere. So the statement was correct but they agreed that it could be construed as ambiguous, as could many of their public statements, which they agreed did need looking at.


What processes are in place to give Town a realistic chance of being a top 30 club by 2008, which has always been your stated target?

ANSWER..
Ken Davy said every chance, and they are striving for it with a bit of luck. There is investment for players but Jacko has chosen not to spend it all, either this season, or last January transfer window when Davy says he made money available to ensure the play offs was achieved. Davy was on the phone to Watson daily during this last month to ask why Jacko had not spent the monies available. Jacko is ‘under no illusions that the plays offs are intended targets for this year’. There is enough money to secure another one, and probably two, players on the same kind of wages as Sinclair. Jacko has provided the board with a list of 38 players he asked about but could not persuade to join us. They were mostly players from teams higher in our division, and in the Championship.

They went on to say that in Jacko’s defence he has stated he doesn’t want to waste money and any player he brings in must be of a higher calibre than the player he would hopefully replace.


Are you actively looking for investment in HTFC and have you ever refused any offers of investment since you announced your bid to take the club out of administration?

ANSWER..
Hasn’t looked for any, but likewise has never refused any money. Nobody from any ‘meaningful bid’ has ever offered him any money at any time. Also the present board are all working within the club and have something to offer in the way of services, as did Martin Byrne before them.


Why have you refused to have contact with Supporters Trust, and will your stance ever change?

ANSWER..
The relationship has broken down for a number of reasons, and he does not see this changing until there are changes to the ST’s make up. They wish they could have a good relationship with a supporters group, but they do not see this as being with the ST.


If Huddersfield Town needs crowds of 12,500 to break even, and the Giants need crowds of 8,000, how can any supporter be expected to look to the future with any optimism?

ANSWER..
12,500 was the figure for the budgeted £454k loss. The break even figure is nearer 13,500 this season, which is close to our average attendance last year. With cup runs and a few lucky breaks here and there it’s not as negative as it seems.


What plans do you have to attempt to avert the potentially dramatic drop in season ticket sales, and to maintain an average attendance that will allow.

ANSWER ..
The Club are optimistic that season tickets will stay steady and that they want the whole club, including the fans to work together to help gain momentum as the club goes forward. They agreed that people had walked away this season, but they hoped they would return, and that they may have to look at ways of attracting back the floaters.

SUMMARY:

All in all an in-depth meeting. Ken Davy was surprisingly forward in all his answers and Roger Armitage was at ease to answer as he seemed fit also. At one point Marcus asked him about the introduction of £600,000 and if this went onto the debt of HTAFC and what the arrangement fee was to pay back the debt.

Ken Davy said ‘listen if we get into a position where HTAFC can pay it back and I’m still alive then maybe I’ll get it back’.

We more or less all agreed that the set-up and finances of Huddersfield Town were Championship related and Ken Davy said ‘well that’s where we want to be then’ he also said he hadn’t given up on 2008.

During the meeting he quoted what he’d said in his statement regarding why he’d taken over ‘ I didn’t do it for The Giants, KSDL, KMC or the supporters of any of the clubs I did it for the community’ was what he said. I asked him ‘I take it your stance has changed somewhat because at the time of the takeover it was because KMC asked you to get involved didn’t they?’ He replied, ‘Of course my feelings have changed I never thought I’d get to like football but I do , if you met any of my associates from around 10 years ago and described what I do now they’d tell you you’ve got the wrong person’.

Ken Davy also during conversations accepted criticism of the public relations between the club and supporters and actually said that he was still learning.

We fought for answers and as far as we’re concerned we got our answers.

Ken Davy wants everyone to pull in the right direction and move onwards and upwards.

Isn’t it time we did?