The club AGM was held on a closed basis earlier this afternoon with only the Directors present. We can confirm that Craig Paterson was re-elected as a director after retiring by rotation and that Carson & Trotter were re-appointed as auditors for a further year. As shareholders were unable to attend in person, the Directors invited written submission of relevant questions prior to the event and promised to publish these with responses on here afterwards. These are listed below:

Question 1
Could the club break-even without receiving income from unreliable sources e.g. transfers or cup runs? If not: (a) is that deficit capable of being addressed and is there a plan to address it; and (b) assuming no transfer income, what level of performance in cups would be needed in order to break even? If covid makes this impossible to answer, what was the position pre-covid?

(I appreciate the exact answer will depend on our league prize-money, which is variable, so, if helpful, please assume the relevant prize money for our average position over the last five years, which is seventh place.)

Answer 1
The club sets a budget which aims to break even while assuming no cup progress or player sales.  Inevitably, of course, the playing budget tends to increase during the season to cope with injuries or deficiencies in the squad.  If there was a cash deficit, then this would be funded by the Directors.

Question 2
Based on average attendance, we seem to be at about the correct position in the pyramid – crowds and position above almost every part-time team and below almost every other full-time team. However, average attendance is not necessarily the most accurate way to judge a club’s actual potential.

To assess Queen of the South’s potential and formulate long-term objectives, do the directors look at other types of data in comparison with other clubs e.g. local population size, strength of local economy, local competition for funds and players, transport links, company accounts etc?

If not: is this because such an approach is considered inappropriate? If they do: (a) what types of data are looked at; (b) how often is the data looked at; (c) are the objectives then based on underperforming, matching, or outperforming clubs with similar metrics; and (d) based on this analysis, what do the directors consider as Queen of the South’s long-term potential (or, in other words, its “true” position in the pyramid)?

If covid makes this impossible to answer, what was the position pre-covid?

Answer 2
The club is aware that data analysis is very much in trend at present.  The board members are in regular contact with officials at other SPFL clubs, both in the Championship and beyond, and most conversations involve the sharing of information on both financial and operational matters.

The club is also assisting our Commercial Manager, Dan Armstrong, with funding his studies towards a Master of Science Degree in Football Business at UCFB.  Dan will take courses in football operations, football finance,  governance and regulation, and marketing and much of the content involves comparison of data from clubs of different sizes and locations. The board fully expect to draw on Dan’s knowledge going forward. 

The aim must be to play in the highest league possible.

Question 3
Is there any medium-term or long-term plan for the company?

If there is not such a plan: do the directors expect to formulate a plan or is this approach considered inappropriate for Queen of the South? If there is such a plan, what can they tell us about its: (a) objectives, methods to achieve those objectives, and duration; (b) when the plan was formulated, who wrote it, to whom has it been circulated; and (c) what form it takes (e.g. its length, whether in hard copy, etc)?

If covid makes this impossible to answer, what was the position pre-covid?

Answer 3
The plan for the club is to make the business financially self-sufficient by increasing non match day income, in particular, by developing the property assets owned by the club and increasing commercial activities.   Ongoing investment in infrastructure is required with the floodlights being upgraded during the current season and a planned replacement of the playing surface within the next couple of years.

With our involvement at both the King George V facility and the Lochmaben Community Centre, and with the Queen of the South Community Trust, the hope is that we can improve the club’s engagement with, and standing in, the community.  In turn this introduces the club brand to different demographics which should help to grow the football fanbase.

In short, the aim is to be as successful as possible, with the best facilities possible, without risking the financial future of the club.

Question 4
What are the ambitions of the board as the previous two seasons the club has been very fortunate indeed to avoid relegation and by having only a handful of players signed up through the close season then this would appear to the fans to strongly suggest that the club is lacking any thoughts of mounting a promotion challenge?

Answer 4
The board’s ambition is very much to mount a promotion challenge every season.   Short term contracts are a feature of the game in the Scottish Championship, with many players and their agents being unwilling to commit to clubs for more than one season.  

Two seasons ago, the club had a squad able to make a promotion challenge with Stephen Dobbie, Lyndon Dykes, Josh Todd and so on, but the Manager at that time, Gary Naysmith, did not wish to extend his contract early in 2019, and a subsequent downturn in form saw the majority of the squad leave the club at the end of the season.

As regards the 2019/20 season, the uncertainty caused by the Covid pandemic made it almost impossible to sign players through the closed season.    Given the delayed start to the current season, this would seem to have been the correct strategy.

The current playing squad has a number of young exciting prospects and the board is keen that contract extensions can be agreed over the next few months to provide greater continuity for next season.  It should be said, however, that no matter how much you allocate to the playing budget you cannot guarantee success.