Partner Article

Newcastle United partner rides relegation and recession

The firm which manages Newcastle United’s hospitality services has offset a 30% dip in takings at St James’ Park with a new £5m deal on Tyneside.

In 2008, the Mike Ashley regime took the decision to outsource the catering and hospitality services on Barrack Road to Sodexo Prestige.

The five-year, £38m deal awarded to the national outfit saw it assume a North East workforce of 1,100 as it dished out pies and pints to bumper Premier League attendances of around 52,000.

However relegation from football’s top table followed which – alongside the fallout from the economic downturn – has led to a drop of between 20 and 30% in Sodexo’s earnings at St James’ this season.

Managing director David Johnson told bdaily that the main cause of the dip has been a drop off in non-match day corporate events at the stadium as attendances have held relatively firm.

He also said the company would be significantly boosted by Newcastle’s increasingly-likely promotion back to the Premier League.

He said: “Our average spectator numbers are holding up very well between 43,000 and 45,000 depending on the fixture. There are a lot of Premier League clubs that would like to have those numbers.

“There’s been between a 20 and 30% fall in hospitality numbers but I can only assume that’s down to relegation. Promotion will take hospitality back up to the same numbers that we had in 2008.

“I think if the club is promoted there will be a lot more confidence in using the facilities outside of football days. Everyone likes to be associated with the success of the team.”

But, despite the slight plunge in its NUFC revenue streams, the company has outlined the North East as a key area for its future growth as it begins work on a new £5m contract in the region.

The contract with Tyne & Wear Museums will see it handle catering and hospitality at events across the group’s portfolio which includes Great North Museum, the Laing art gallery, the Discovery Museum and Segadunum.

Mr Johnson said the company would be looking to grow the reputation of TWM’s sites as venues for corporate events outside museum opening times.

This was posted in Bdaily's Members' News section by Ruth Mitchell .