Football club finances / FFP

[moomba]

About now that football clubs release their annual financial results. Particularly important this year as it will be the first reporting period for FFP.

Chelseas came out last night (good time to bury bad news?).

Revenue of £255.8m and a loss of £49.4m. Combined with last years profit if £1.4m they reckon that is enough to fall within FFP guidelines.

In div 2 Bolton turned over £28.5m and lost £50.5m. Their debt stands at a pretty worrying £163.8m. Just shows the imbalance between those clubs at the top end of the premier league and those on the fringes. Swiss Rambke estimated their income from TV money alone would have been over £50m if they were still in tbe premier league.

That sort of imbalance can't be good for the game.

 

[Thistle]

We only just fell under the FFP threshold. Were never going to come close to the profit we made in our Champions League year. Also shows that winning the Europa league isn't as profitable as making it out of the CL group stages. Unfortunately the current capacity of Stamford Bridge will always limit our potential income.

 

[Kreuuuzeurns]

I've never really read enough to understand the FFP rules but I'm sure it's quite simple. IIRC Tan wiped off around 80m in debts, surely this is to much in one year?

 

[moomba]

I've never really read enough to understand the FFP rules but I'm sure it's quite simple. IIRC Tan wiped off around 80m in debts, surely this is to much in one year?

It's not so much about debt, more profit and loss.

Under FFP you can have as much debt as you like (so leveraged buyouts are perfectly acceptable under FFP). And you can pay off as much debt as you like.

But you can only make a combined loss of €45m in the last two financial years tomcomply with UEFAs FFP.

Having a quick look, £70m of the £80m refers to debt incurred before FFP came into being. So you can ignore that straight away.

So a £13.5m loss last season, same again and you won't have any problems.

 

[moomba]

We only just fell under the FFP threshold. Were never going to come close to the profit we made in our Champions League year. Also shows that winning the Europa league isn't as profitable as making it out of the CL group stages. Unfortunately the current capacity of Stamford Bridge will always limit our potential income.

Getting out of the group stages gives you the potential to earn big but a R16 exit is only worth an extra €5m or so. Getting into the group stages is the big money spinner, I think the worst English team last season (us) still earned around €30m from the comp.

Chelsea earned around €15m from the Europa last season (including gate money, TV and prize money)

 

[Rustin Cohle]

Chelsea is fine. Record turnover and will have extra money from the new PL TV deal, plus a 300m sponsorship deal with adidas.

 

[moomba]

Just having a bit more of a look. Chelsea got just under €60m in UEFA distribution from winning the champions league, a touch over €41m for winning the Europa league (but that includes champions league money as well). There is an extra home game involved to win the Europa League (€1.5m at a guess) and qualification for the UEFA super cup is worth a minimum €2.2m (€3m for the winners).

 

[Magma]

is there like a release of the financials anywhere?

 

[moomba]

is there like a release of the financials anywhere?

I think clubs have to report to Companies House. Deloitte do their money list next month so expect all would have been done by then.

 

[glenferry23]

The Deloitte report is always interesting reading. I like reading the ratios when it's all available, debt to EBITDA, liquidity ratios and profit as % of revenue are very good indicators.

Chelsea's result is extraordinary. How does a club lose £50m from a revenues of approx a quarter of a billion? Would need to look at the figures closer, but £300m of expenses? Probably some losses on asset realizations or losses on players sold etc.

 

[moomba]

Player wages would eat up a good portion of those revenues.

 

[glenferry23]

Yes that's always the highest cost. But it's a staggering loss at face value. Can only imagine what the weekly cost of some their bench players like Mata, Essien etc would be.

 

[Magma]

terry and lampard are on mega wages in particular.

 

[Thistle]

terry and lampard are on mega wages in particular.

Lampard just took a big pay cut to sign on this season

 

[moomba]

I'm going to be interested to see our wage figures this year. I am hoping for a significant drop, hopefully get back below Chelsea.

 

[Latro]

Chelsea need to make a profit for 2 of the following 3 seasons and can only afford a 2.5 million loss in the other. But new sponsorships and the new TV deal will help a lot.

 

[Gus Poyet]

Looking at the Championship it seems some clubs are taking it quite serious and others are rolling the dice and trying to get into the PL before it kicks in.

 

[Gus Poyet]

http://www.bbc.com/sport/0/football/24024109

Financial Fair Play: Brighton hope for Football League clampdown
Brighton & Hove Albion head of football operations David Burke hopes the Football League will clamp down heavily on those clubs who fail to abide by the new Financial Fair Play rules.
Championship clubs are permitted to make a loss of £8m this season,according to rules approved by member clubs last year, with those who fail to comply set to face sanctions from the League.
"We at Brighton have been planning and working hard to get in line with FFP," Burke told BBC Sussex.
"There are a number of clubs that we know already will not be within the financial limits.

Play media​

"We hope the Football League will be really strong with the transfer embargos and the fines, or taxes, are imposed properly.
"The idea is that these clubs will be penalised."
The Seagulls have undergone extensive cost-cutting in order to fall into line with the new system, which is aimed at controlling spending.

 

[chef]

If you deduct the £15m in CFC Youth / Infrastructure spending etc we come in just below the year 1 of FFP. Include the sponsorship, increased TV fees, progression in CL while some players will be sold on and a number of youth team playersd developed then also sold(which seems to be a real focus), lowering wages of high earners over 30 etc and there's still room to buy while meeting year 2 of FFP with ease. Quite clever all-in-all. I'd like to think this is the handy work of Ms Granovskaia rather than Gourley/Buck.

Considering we haven't had an outside source back roll a huge stadium for us(like quite a number of big clubs world wide) we are travelling quite well. Can't see us ever having trouble complying.

So really a £34.4m loss isn't it?

When do City announce their loss?

 

[moomba]

If you deduct the £15m in CFC Youth / Infrastructure spending etc we come in just below the year 1 of FFP. Include the sponsorship, increased TV fees, progression in CL while some players will be sold on and a number of youth team playersd developed then also sold(which seems to be a real focus), lowering wages of high earners over 30 etc and there's still room to buy while meeting year 2 of FFP with ease. Quite clever all-in-all. I'd like to think this is the handy work of Ms Granovskaia rather than Gourley/Buck.

Considering we haven't had an outside source back roll a huge stadium for us(like quite a number of big clubs world wide) we are travelling quite well. Can't see us ever having trouble complying.

So really a £34.4m loss isn't it?

When do City announce their loss?

Loss?

Any time really. Was in december last year so should be soon.

 

[chef]

Loss?

The Times is reporting that you are likely to require exemptions from UEFA to meet the targets.

 

[moomba]

The Times is reporting that you are likely to require exemptions from UEFA to meet the targets.

What are they referring to when they say exemptions?

Infrastructure/youth spending? Pre-July 2010 contracts? I'd imagine we'll need all of those to comply.

 

[chef]

What are they referring to when they say exemptions?

Infrastructure/youth spending? Pre-July 2010 contracts? I'd imagine we'll need all of those to comply.

Don't know, it was pretty vague.

Cant link the article by Matt Hughes as it's one of those ones you have to pay for, here's what it says....
Manchester City recorded losses of £97.9 million in their most recent accounts to December 2012 despite winning their first Barclays Premier League title that season, and, as they have continued to invest heavily on new players, are likely to require exemptions from Uefa to meet the £37.4 million loss limit.

 

[moomba]

That'll just be those ones I mentioned above, available to everyone. Pre July 2010 contracts are exempted from this reporting period only, and only if it is the difference between passing and failing FFP.

 

[chef]

That'll just be those ones I mentioned above, available to everyone. Pre July 2010 contracts are exempted from this reporting period only, and only if it is the difference between passing and failing FFP.

Any word what sort of loss City would be looking at?

They've been bringing it down from £197.5m in 2011 to £97.9m in 2012. Will be interesting to sell what 2013 is like.