Guest fading star Posted January 22, 2009 Share Posted January 22, 2009 needing to repay the stadium debt in the event of the club being sold was highly publicised years before ashley came onto the scene. it's part of the cost of purchasingf the club and if ashley didnt know about it then he has only himself to blame as the info was freely available on websites like nufc finances. saying that, it seems he hasnt even paid that off, just switched our debt so that we owe him or his holding company. it is preferential as the rates may be lower, but then again they might not be. He's paid the debt off. as a loan As opposed to doing what? Genuine question. as opposed to 'putting his hand in his pocket to pay off the debt' something for which most on here praised him. for over a year. probably repeated a thousand times over. people thought that, dont try and reinvent the past to make it look like everyone thought it was a loan from the start. im not criticising Ashley for it but at the same time im not going to praise him as, thus far, we've not had the knock-on effect of the money freed up being used to make us better. So how would you account for it in the accounts? Putting his hand in his pocket is exactly what he has done. He's taken £100m from his bank & cleared the clubs debt with the loan holders. okay, maybe we should call it 'putting his hand in his pocket on the condition that he gets back at least the amount he took out of his pocket.' people on here seemed to think of it as a donation, not what it actually is. anyway, afk, donating to Oxfam on the condition that they give me all my money back in 4 years. You really don't get it, do you!?! If he "gives" the club the money, the value of the club goes up by that amount. If he "loans" the club the money, the value of the club stays the same and so does the debt. It equates to the same thing. If he sells the club he gets money for it, be that through an increased sale price or through repayment of debt, or are you hoping he'll give it away? The club was about £100m in debt when Ashley bought it, and it was still about £100m in debt at the end of the last full tax year. Hardly reason to ignore the state of the club is in two years after Ashley took over. Link to post Share on other sites More sharing options...
Baggio Posted January 22, 2009 Share Posted January 22, 2009 Article in the Chronicle about it. http://www.chroniclelive.co.uk/nufc/newcastle-united-news/2009/01/22/newcastle-united-s-finances-for-2008-revealed-72703-22755062/ Link to post Share on other sites More sharing options...
quayside Posted January 22, 2009 Share Posted January 22, 2009 Just to be clear about the 20m, 17.5m of it is just accounting, its not real money that ashley has to transfer out of the sportsdirect coffers into northern rock, its just a reduction in the value of the playing staff. The real loss is 2.5m as far as i can tell. If you think about the amount of money that will be freed up when one of those asset values falls to zero, the financial picture is not that bleak. That's what I was getting at earlier, just didn't phrase it that well. So if the 'real' loss is £2.5m, are people justified in claiming Ashley should have spent more on the first team? It wasn't the real loss in cash terms. We went from owing £70 million at 30th June 2007 to owing £100 million at 30th June 2008, increasing to £110 million after that. If you forget amortisation (which is a perfectly good concept btw) and all that and just focus on Ashley's cash position it puts it into perspective. £30 million of extra cash was stuck into the business for the club to (at best) stand still. where do you think that's gone, considering wages only went up £5m and player trading only cost half a mil net? is it a case of one-off costs associated with the takeover or is the club just not being ran all that well? I posted this earlier, it's the best I can do given the time and information at my disposal. It just shows where the cash went under fairly broad headings. Cash flow in basic terms: Operating cash flow - £5 million (ie cash loss on day to day business) Finance servicing costs - £8 million (mostly interest on loans now paid off) Net capital spend - £21 million (net spending on assets, haven't had time to look closer yet!) Loan repayment - £70 million (obvious) Total out = £104 million This was financed by : Ashley £100 million Overdraft £4 million Total £104 million cheers. the £21m looks like the key figure. the debt repayment is switching to a more favourable lender (ashley), £8m no longer applies and as we wont be paying that we shouldnt really be making a loss. wonder what the £21m has been spent on, something to do with 'the system'? The net capital spend is mainly players. We acquired £23 million of new players registrations and spent £3 million on "fixtures and fittings" (ie the clubs facilities such as the ground). This was Alardyce's transfer window and I think we can all remember who came in. As I remember we sold Dyer, Parker and Luque for money and let a few others go for nothing. I think we also bought Babayaro out of his contract. Anyway remembering that all transfer fees are not settled immediately the figure of £21 million in the cash flow above is the net amount that actually went out of the club during the year from all those transactions, and probably includes one or two other transfers (in and out) from previous years. Link to post Share on other sites More sharing options...
fredbob Posted January 22, 2009 Share Posted January 22, 2009 needing to repay the stadium debt in the event of the club being sold was highly publicised years before ashley came onto the scene. it's part of the cost of purchasingf the club and if ashley didnt know about it then he has only himself to blame as the info was freely available on websites like nufc finances. saying that, it seems he hasnt even paid that off, just switched our debt so that we owe him or his holding company. it is preferential as the rates may be lower, but then again they might not be. He's paid the debt off. as a loan As opposed to doing what? Genuine question. as opposed to 'putting his hand in his pocket to pay off the debt' something for which most on here praised him. for over a year. probably repeated a thousand times over. people thought that, dont try and reinvent the past to make it look like everyone thought it was a loan from the start. im not criticising Ashley for it but at the same time im not going to praise him as, thus far, we've not had the knock-on effect of the money freed up being used to make us better. So how would you account for it in the accounts? Putting his hand in his pocket is exactly what he has done. He's taken £100m from his bank & cleared the clubs debt with the loan holders. okay, maybe we should call it 'putting his hand in his pocket on the condition that he gets back at least the amount he took out of his pocket.' people on here seemed to think of it as a donation, not what it actually is. anyway, afk, donating to Oxfam on the condition that they give me all my money back in 4 years. You really don't get it, do you!?! If he "gives" the club the money, the value of the club goes up by that amount. If he "loans" the club the money, the value of the club stays the same and so does the debt. It equates to the same thing. If he sells the club he gets money for it, be that through an increased sale price or through repayment of debt, or are you hoping he'll give it away? The club was about £100m in debt when Ashley bought it, and it was still about £100m in debt at the end of the last full tax year. Hardly reason to ignore the state of the club is in two years after Ashley took over. So in your eyes theres absolutely no difference to the club having debt owed to 3rd parties like banks etc and owing it to Ashley? On top on the interest payments (approx £7m p/a) what do yout think would happen to this club if the bank decided to call in the debts? Link to post Share on other sites More sharing options...
johnnypd Posted January 22, 2009 Share Posted January 22, 2009 Just to be clear about the 20m, 17.5m of it is just accounting, its not real money that ashley has to transfer out of the sportsdirect coffers into northern rock, its just a reduction in the value of the playing staff. The real loss is 2.5m as far as i can tell. If you think about the amount of money that will be freed up when one of those asset values falls to zero, the financial picture is not that bleak. That's what I was getting at earlier, just didn't phrase it that well. So if the 'real' loss is £2.5m, are people justified in claiming Ashley should have spent more on the first team? It wasn't the real loss in cash terms. We went from owing £70 million at 30th June 2007 to owing £100 million at 30th June 2008, increasing to £110 million after that. If you forget amortisation (which is a perfectly good concept btw) and all that and just focus on Ashley's cash position it puts it into perspective. £30 million of extra cash was stuck into the business for the club to (at best) stand still. where do you think that's gone, considering wages only went up £5m and player trading only cost half a mil net? is it a case of one-off costs associated with the takeover or is the club just not being ran all that well? I posted this earlier, it's the best I can do given the time and information at my disposal. It just shows where the cash went under fairly broad headings. Cash flow in basic terms: Operating cash flow - £5 million (ie cash loss on day to day business) Finance servicing costs - £8 million (mostly interest on loans now paid off) Net capital spend - £21 million (net spending on assets, haven't had time to look closer yet!) Loan repayment - £70 million (obvious) Total out = £104 million This was financed by : Ashley £100 million Overdraft £4 million Total £104 million cheers. the £21m looks like the key figure. the debt repayment is switching to a more favourable lender (ashley), £8m no longer applies and as we wont be paying that we shouldnt really be making a loss. wonder what the £21m has been spent on, something to do with 'the system'? The net capital spend is mainly players. We acquired £23 million of new players registrations and spent £3 million on "fixtures and fittings" (ie the clubs facilities such as the ground). This was Alardyce's transfer window and I think we can all remember who came in. As I remember we sold Dyer, Parker and Luque for money and let a few others go for nothing. I think we also bought Babayaro out of his contract. Anyway remembering that all transfer fees are not settled immediately the figure of £21 million in the cash flow above is the net amount that actually came in to the club during the year from all those transactions, and probably includes one or two other transfers (in and out) from previous years. thanks for the reply. there was also an 'impairment fee' for getting rid of Luque of i think £7m. along with the insurance settlement for owen it mightve been counted in the previous year. Link to post Share on other sites More sharing options...
quayside Posted January 22, 2009 Share Posted January 22, 2009 needing to repay the stadium debt in the event of the club being sold was highly publicised years before ashley came onto the scene. it's part of the cost of purchasingf the club and if ashley didnt know about it then he has only himself to blame as the info was freely available on websites like nufc finances. saying that, it seems he hasnt even paid that off, just switched our debt so that we owe him or his holding company. it is preferential as the rates may be lower, but then again they might not be. He's paid the debt off. as a loan As opposed to doing what? Genuine question. as opposed to 'putting his hand in his pocket to pay off the debt' something for which most on here praised him. for over a year. probably repeated a thousand times over. people thought that, dont try and reinvent the past to make it look like everyone thought it was a loan from the start. im not criticising Ashley for it but at the same time im not going to praise him as, thus far, we've not had the knock-on effect of the money freed up being used to make us better. So how would you account for it in the accounts? Putting his hand in his pocket is exactly what he has done. He's taken £100m from his bank & cleared the clubs debt with the loan holders. okay, maybe we should call it 'putting his hand in his pocket on the condition that he gets back at least the amount he took out of his pocket.' people on here seemed to think of it as a donation, not what it actually is. anyway, afk, donating to Oxfam on the condition that they give me all my money back in 4 years. You really don't get it, do you!?! If he "gives" the club the money, the value of the club goes up by that amount. If he "loans" the club the money, the value of the club stays the same and so does the debt. It equates to the same thing. If he sells the club he gets money for it, be that through an increased sale price or through repayment of debt, or are you hoping he'll give it away? The club was about £100m in debt when Ashley bought it, and it was still about £100m in debt at the end of the last full tax year. Hardly reason to ignore the state of the club is in two years after Ashley took over. The club was about £75 million in debt when Ashley took over and was £105 million in debt at the end of his first full year. He funded that additional £30 million. And we have made no progress despite that funding. There are all sorts of reasons but one of them has to be too many ordinary or injury prone players achieving little and earning too much money. Link to post Share on other sites More sharing options...
Guest fading star Posted January 22, 2009 Share Posted January 22, 2009 How do these comments by Chris Mort back in August 2007 fit into all this. “It's a bit more complicated than saying there's a debt figure of £x. In terms of money being spent by the club it is more convoluted than that. It's not that debt has been squirrelled away, it's spending some of the money before it comes in, which frankly, is not necessarily debt, it's just a means of investing money before you've actually got it. There's been a bit of that, the club has done that." Surely this money that was spent before it came in has now arrived in the SJP piggybank? “the financial position of the club is not as strong as we hoped it might be. But that in itself has not held back our investment on the playing squad and it's something that we'll deal with. We did the typical due diligence one would do on a public takeover. There is no sense that anyone has tried to mislead us." If they’d undertaken due diligence wouldn’t they have spotted that FF had been spending money before it came in? “We are willing to spend on new players, but we will not be spending money just to show that we can." And where was this money for new players coming from? By selling Milner? http://www.independent.co.uk/sport/football/premier-league/mort-brings-sea-change-to-tone-of-business-on-the-tyne-460911.html http://www.guardian.co.uk/football/2007/aug/03/newsstory.newcastleunited Link to post Share on other sites More sharing options...
Guest fading star Posted January 22, 2009 Share Posted January 22, 2009 needing to repay the stadium debt in the event of the club being sold was highly publicised years before ashley came onto the scene. it's part of the cost of purchasingf the club and if ashley didnt know about it then he has only himself to blame as the info was freely available on websites like nufc finances. saying that, it seems he hasnt even paid that off, just switched our debt so that we owe him or his holding company. it is preferential as the rates may be lower, but then again they might not be. He's paid the debt off. as a loan As opposed to doing what? Genuine question. as opposed to 'putting his hand in his pocket to pay off the debt' something for which most on here praised him. for over a year. probably repeated a thousand times over. people thought that, dont try and reinvent the past to make it look like everyone thought it was a loan from the start. im not criticising Ashley for it but at the same time im not going to praise him as, thus far, we've not had the knock-on effect of the money freed up being used to make us better. So how would you account for it in the accounts? Putting his hand in his pocket is exactly what he has done. He's taken £100m from his bank & cleared the clubs debt with the loan holders. okay, maybe we should call it 'putting his hand in his pocket on the condition that he gets back at least the amount he took out of his pocket.' people on here seemed to think of it as a donation, not what it actually is. anyway, afk, donating to Oxfam on the condition that they give me all my money back in 4 years. You really don't get it, do you!?! If he "gives" the club the money, the value of the club goes up by that amount. If he "loans" the club the money, the value of the club stays the same and so does the debt. It equates to the same thing. If he sells the club he gets money for it, be that through an increased sale price or through repayment of debt, or are you hoping he'll give it away? The club was about £100m in debt when Ashley bought it, and it was still about £100m in debt at the end of the last full tax year. Hardly reason to ignore the state of the club is in two years after Ashley took over. The club was about £75 million in debt when Ashley took over and was £105 million in debt at the end of his first full year. He funded that additional £30 million. And we have made no progress despite that funding. There are all sorts of reasons but one of them has to be too many ordinary or injury prone players achieving little and earning too much money. Precisely, and our revenue is falling by the day. Link to post Share on other sites More sharing options...
Shearergol Posted January 22, 2009 Share Posted January 22, 2009 How do these comments by Chris Mort back in August 2007 fit into all this. It's a bit more complicated than saying there's a debt figure of £x. In terms of money being spent by the club it is more convoluted than that. It's not that debt has been squirrelled away, it's spending some of the money before it comes in, which frankly, is not necessarily debt, it's just a means of investing money before you've actually got it. There's been a bit of that, the club has done that." Surely this money that was spent before it came in has now arrived in the SJP piggybank? Eh? If you spend £10 before it comes in it means going £10 into debt. When you get the money back it means you have £0. What point are you trying to make? Link to post Share on other sites More sharing options...
Cronky Posted January 22, 2009 Share Posted January 22, 2009 People have to ask themselves why the Halls were so desperate to get out. All through the final year of Freddie's reign, we were persistently being linked with possible new owners, but Freddie wouldn't budge. In the end, the Halls had to go over Freddie's head, do their own deal with Ashley and railroad him out that way. They clearly did not see NUFC as a thriving business. They recognised that Freddie was taking the club down the pan and they wanted out. Ashley was rich enough to stablise the situation, but not rich enough to splash the cash in the way that people would like. No-one's happy with the position we're in, but blaming Ashley for it is a bit like blaming a fire-fighter for the fire. Link to post Share on other sites More sharing options...
TRon Posted January 22, 2009 Share Posted January 22, 2009 needing to repay the stadium debt in the event of the club being sold was highly publicised years before ashley came onto the scene. it's part of the cost of purchasingf the club and if ashley didnt know about it then he has only himself to blame as the info was freely available on websites like nufc finances. saying that, it seems he hasnt even paid that off, just switched our debt so that we owe him or his holding company. it is preferential as the rates may be lower, but then again they might not be. He's paid the debt off. as a loan As opposed to doing what? Genuine question. as opposed to 'putting his hand in his pocket to pay off the debt' something for which most on here praised him. for over a year. probably repeated a thousand times over. people thought that, dont try and reinvent the past to make it look like everyone thought it was a loan from the start. im not criticising Ashley for it but at the same time im not going to praise him as, thus far, we've not had the knock-on effect of the money freed up being used to make us better. So how would you account for it in the accounts? Putting his hand in his pocket is exactly what he has done. He's taken £100m from his bank & cleared the clubs debt with the loan holders. okay, maybe we should call it 'putting his hand in his pocket on the condition that he gets back at least the amount he took out of his pocket.' people on here seemed to think of it as a donation, not what it actually is. anyway, afk, donating to Oxfam on the condition that they give me all my money back in 4 years. You really don't get it, do you!?! If he "gives" the club the money, the value of the club goes up by that amount. If he "loans" the club the money, the value of the club stays the same and so does the debt. It equates to the same thing. If he sells the club he gets money for it, be that through an increased sale price or through repayment of debt, or are you hoping he'll give it away? The club was about £100m in debt when Ashley bought it, and it was still about £100m in debt at the end of the last full tax year. Hardly reason to ignore the state of the club is in two years after Ashley took over. The club was about £75 million in debt when Ashley took over and was £105 million in debt at the end of his first full year. He funded that additional £30 million. And we have made no progress despite that funding. There are all sorts of reasons but one of them has to be too many ordinary or injury prone players achieving little and earning too much money. Bingo...and most of them were bought by Allardyce and his predecessors appointed by you know who. Link to post Share on other sites More sharing options...
NJS Posted January 22, 2009 Share Posted January 22, 2009 My thoughts: So as I thought he hasn't cleared the debts - he's just shifted it to a loan owned by himself - I see the difference as being that he can have control of that debt in the future. If these accounts are to June 30th then why was there transfer activity after that if we were penniless? - Was he willing to fund transfers then and if so why not now? It would be interesting from my pov to compare these accounts in general terms with those of other clubs - especially those outside the top 4 who do continue to spend money in the transfer market. Of course some of these other clubs might not have as many players on Viduka/Geremi type wages but they may have more players in larger squads. Link to post Share on other sites More sharing options...
quayside Posted January 22, 2009 Share Posted January 22, 2009 My thoughts: So as I thought he hasn't cleared the debts - he's just shifted it to a loan owned by himself - I see the difference as being that he can have control of that debt in the future. If these accounts are to June 30th then why was there transfer activity after that if we were penniless? - Was he willing to fund transfers then and if so why not now? It would be interesting from my pov to compare these accounts in general terms with those of other clubs - especially those outside the top 4 who do continue to spend money in the transfer market. Of course some of these other clubs might not have as many players on Viduka/Geremi type wages but they may have more players in larger squads. He funded a net spend of £5,000 in the transfer window after June 30th. Link to post Share on other sites More sharing options...
OzzieMandias Posted January 22, 2009 Share Posted January 22, 2009 So as I thought he hasn't cleared the debts Link to post Share on other sites More sharing options...
Guest Edd Posted January 22, 2009 Share Posted January 22, 2009 Can someone point me towards NE5's posts please? 14th page on a subject he's always been very vocal about when all we could do was speculate, and now that we finally have some hard facts I can't see him anywhere. Link to post Share on other sites More sharing options...
EthiGeordie Posted January 22, 2009 Share Posted January 22, 2009 I can't imagin a person can spend this amount of his personal money over and then harm that thing. We need to be supportive of this guy and stop moaning. Wehave to think about the future and start building for long term. Link to post Share on other sites More sharing options...
EthiGeordie Posted January 22, 2009 Share Posted January 22, 2009 BTW I am just wondering how Fat Freddy plan to expand the ground to 60000. On what base on what budget I think that guy was living in a day dream. Link to post Share on other sites More sharing options...
Baggio Posted January 22, 2009 Share Posted January 22, 2009 Going back to the Summer where Keegan and the board were having run ins over them wanting the likes of Smith to be moved on, you can understand why they were so desperate to move some of the big earners on now. Link to post Share on other sites More sharing options...
Guest fading star Posted January 22, 2009 Share Posted January 22, 2009 If we can’t afford Alan Smith's wages why did Ashley sanction them? Link to post Share on other sites More sharing options...
Liam Liam Liam O Posted January 22, 2009 Share Posted January 22, 2009 If we cant afford Alan Smith's wages why did Ashley sanction them? He backed his manager. Link to post Share on other sites More sharing options...
NG32 Posted January 22, 2009 Share Posted January 22, 2009 If we can’t afford Alan Smith's wages why did Ashley sanction them? http://i212.photobucket.com/albums/cc302/xray_1005/cover-fonz-1.jpg Exactamundo! Link to post Share on other sites More sharing options...
Baggio Posted January 22, 2009 Share Posted January 22, 2009 If we can’t afford Alan Smith's wages why did Ashley sanction them? Because most of them came in while Mort was doing a review of the club from top to bottom and were negotiated by Shepherd Jr. Link to post Share on other sites More sharing options...
Guest fading star Posted January 22, 2009 Share Posted January 22, 2009 So Mort was lying when he said they’d undertaken due diligence and Ashley decided to sign up at least three players on big wages before he knew what the clubs financial position actually was? Link to post Share on other sites More sharing options...
fredbob Posted January 22, 2009 Share Posted January 22, 2009 So Mort was lying when he said they’d undertaken due diligence and Ashley decided to sign up at least three players on big wages before he knew what the clubs financial position actually was? Do you know much about the due dilligence process? Serious question becasue i remeber Mort also saying how it wasnt as simple as they'd first thought witht he 'incoming money' business - would due dilligence of revleaed this beforehand? To anyone out there? Link to post Share on other sites More sharing options...
Mick Posted January 22, 2009 Share Posted January 22, 2009 So Mort was lying when he said theyd undertaken due diligence and Ashley decided to sign up at least three players on big wages before he knew what the clubs financial position actually was? No. Link to post Share on other sites More sharing options...
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