The stark reality that York City must sell to survive has been confirmed in the club's latest balance sheet published today.

That grim fact remains despite the club making a record profit of £1,274,202 for the year ending June 30, 1999.

However, but for the six-figure sales of star players Richard Cresswell to Sheffield Wednesday and Graeme Murty to Reading and the club would have made record losses.

Their sales, plus the cash raked in from Jonathan Greening's continuing appearances at Manchester United and the sell-on money received following the switch of former Minstermen 'keeper Dean Kiely from Bury to Charlton, helped offset a trading loss of approaching £500,000.

The final operating loss of £483,096, up more than £75,000 on last year's restated deficit, confirm that City rely on the cash generated from the sale of their brightest talent.

Gate receipts, although showing a slight increase on last year, are not sufficient at the present levels to sustain the club, especially in a year when the Bootham Crescent payroll almost reached £1,500,000 - a staggering rise of 23 per cent

The final payroll figure is £1,427,028, compared to last year's total of £1,159,062 and confirm the growing consequence of the 'Bosman' ruling where a decrease in cash transfers is resulting in higher wages for players.

Over the last five years at Bootham Crescent wages have risen by 80 per cent.

The blunt reality means that, despite the million pound profit, if its current rate of operating losses was maintained the club could only guarantee its survival for a maximum of just over two years.

In his chairman's report, to be presented with the balance sheet to the shareholders of Bootham Crescent Holdings (BCH), the former shareholders of York City Football Club, on December 20, Douglas Craig states: "Once again the accounts show just how important it is for the club to attract and develop young talent for it is only by selling these home grown assets that the club remains financially viable.

"Directors remain committed to this policy and will continue to invest in the facilities and staff necessary to sustain it."

Income at the club, excluding transfers, stood at £1,501,008, up almost £290,000 on last year's restated figures.

However, much of that increase comes from the first £138,000 instalment of a four year grant from the Premier League and English Sports Council, coupled together with a £69,444 grant from the Football League carried over from last year.

The money must be used solely for youth development activities at the club, including City's Centre of Excellence.

A big increase in 'outgoings' came from the 'maintenance of pitches' which more than doubled from £29,041 to £67,164 due mainly to the replacement of the drainage system at the club's Wigginton Road training base.

With the replacing of crush barriers at the Grovesnor Road end of Bootham Crescent and seats in the popular stand 'repairs and renewals, including ground safety work' rose from £21,844 to £44,658.

Confirming the club's bid to hunt out hidden gems, scouting expenses rose from £2,608 to £11,562.

Home gate receipts and season ticket sales, helped by matches against the likes of Sunderland in the Worthington Cup and Manchester City, broke through the £500,000 barrier to £513,079 as opposed to £473,379 in 1998 and £483,267 in 1997.

Turnover from the club shop and from programme sales dropped from £149,525 to £119,146, although football retail sales nationally have dropped and with City's replica home kit in its second year a reduction in sales was expected.

Chairman Craig said the year featured had been "significant in two respects".

Firstly, the relegation of the club to the Third Division after six years in the Second.

Secondly, the restructuring of the company by creating a holding company, BCH, with York City Football Club (YCFC) as its wholly owned subsidiary and its property assets transferred to BCH.

Craig said as a result of the a marketing workshop in September and the appointment of a public relations officer, Sophie McGill, the club was "embarking on a programme of trying to establish better communications between the club and supporters and also to generate more income from the marketing of the club".

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Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.