untapped revenue?

[brummie]

spurs, a team with a lower profile than us, signed a 4 year £34m sponsorship deal, that rises even further in the event of champs league qualification. our deal over the same period yields £14m less. a simple renegotiation of the shirt sponsor would perhaps double our income from that source.

 

when we were in the champs league under Bobby, less than $10m separated the annual incomes of Us, Arsenal and Liverpool. Now that we've dropped out of that competition and Arsenal and Liverpool have had good runs in it, arsenal are $43m ahead while liverpool are $53m ahead in annual income. and these teams both had much smaller stadiums than us.

 

Indeed, and at the moment Liverpool are looking seriously like they might not get a Champions League place for next year, and are said to be "shitting it", given that they are in huge amount of debt and need to build a new stadium (unless this proposed takeover goes through, obv).

 

That's how important CL football is these days. If you look at some of the stuff coming out of the G14 about clubs wanting to protect their income streams it is quite frightening - these clubs are effectively hinting at *guaranteed* CL football for themselves. If that happens, we may as well all pack up and go home.

[Slugsy]

 

So how do you think Belgravia are looking at it?

 

A property play is my guess, based on the Casino and that land plus a re-financing of the debt.

To be honest, I can't see why any business would want to buy us, it makes no financial sense whateseover!

 

If I was them, I would be looking to move us out of St. James to a new site, with nice sweeteners from the Council.

 

I would love it if they were coming in with the long term view of investing in the playing staff and getting the club into a positon to compete with the top 3 but that takes a long term view with a lot more cash.

 

Lets look at it this way:

 

Cost of buying the club:

 

Market cap at moment                                                                                       c£90m

 

Premium to be paid on a acquisition of a PLC (range varies                              c£30m

I am advising on a acquisition of a PLC where the premium

is 25%, but I've seen it higher and I know Shepherd

wants a bigger premium - lets ay 30%)

 

Exisiting debt (total guesswork, from the prelim results                                    c£75m

could be circa £75m - I'm including £5m additional

in there that hasn't been disclosed that is owed to

Mirage - but this could be higher as we are most likely

funding losses at present)

 

Add in deal fees of circa £5m and that adds up to a total purchase price of £200m!!

 

That's before any development of the casino and that land - who knows what that will cost.

 

I cannot fathom why any business would pay that outlay even before investing in the playing squad.  There is no way you could recoup that cash from just the football side, not in the short-medium term.  You are probably looking at an overall cost (including investing in the playing squad and development of the Casino ) of c£300m!

 

I don't know what the angle is but I'm sure its more than just making NUFC a better football team!                                                                                                                                                     

[brummie]

Why does building a casino always get mention in football takeovers?

 

You don't need to buy a football club to build a casino, and you can't just build a casino where you want, either.

[Slugsy]

Why does building a casino always get mention in football takeovers?

 

You don't need to buy a football club to build a casino, and you can't just build a casino where you want, either.

 

Good point, I'm guessing there is something we don't know about.

[OzzieMandias]

Well, a casino is only a possibility. Depends on getting one of the licenses. Belgravia have talked of hotels, and say they hope to build a casino, but that nothing depends on the casino. Their sums add up without it.

 

I'm curious what property people think we have that is worth buying the rest of the club to get hold of. To me it's the other way around: the deal makes no sense without the football.

[Matt]

If I was them, I would be looking to move us out of St. James to a new site, with nice sweeteners from the Council.

 

The fans like our location. The council likes out location. We have £40m of debt outstanding with regards to investment on the SJP site.

 

Moving the ground makes zero sense and it isn't going to happen. If they wanted a plot of land in the centre of Newcastle they could do it in any number of much cheaper ways. They could even offer to buy the land the club owns around the Metro station. It certainly wouldn't cost £40m, never mind the £200m it could cost to buy the club.

 

They obviously want the property development and football club to help each other- it's the only way a scheme like this coudl work.

[Guest shaun11177]

The deal makes no sense at all to me from a financial point of view.

ok you buy the club for 200m-you can always sell it for 200m-the initial investment is pretty safe.

Based on the current costs the club needs to be turning over 100m not the 80m it is at present to be able to buy players without borrowing more money.So we must get into the Champions lge and that could be getting tougher-Man Utd and Chelsea are not getting weaker and who knows what money will be available to Villa,Pompey-W Ham?.We would need an investment of at least 20-30m.So Belgravia will be looking to get that money back and if we dont qualify are they going to invest another 20m then another 20m-dont think so.

What is their reaction going to be if the club starts making losses?

 

Also wouldnt it be nice if the Halls said look just pay us the share price and the premium put that into players. 

[Matt]

ok you buy the club for 200m-you can always sell it for 200m-the initial investment is pretty safe.

 

No it's not. Quite the opposite.

 

Having paid a premium for the club Belgravia would have to find another very interested party that would be prepared to pay that premium. In effect they 'lose' that premium as soon as they complete the deal and would look to justify the premium by way of increased income from operations in future years.

 

 

[Colos Short and Curlies]

The deal makes no sense at all to me from a financial point of view.

ok you buy the club for 200m-you can always sell it for 200m-the initial investment is pretty safe.

Based on the current costs the club needs to be turning over 100m not the 80m it is at present to be able to buy players without borrowing more money.So we must get into the Champions lge and that could be getting tougher-Man Utd and Chelsea are not getting weaker and who knows what money will be available to Villa,Pompey-W Ham?.We would need an investment of at least 20-30m.So Belgravia will be looking to get that money back and if we dont qualify are they going to invest another 20m then another 20m-dont think so.

What is their reaction going to be if the club starts making losses?

 

Also wouldnt it be nice if the Halls said look just pay us the share price and the premium put that into players. 

 

£80m current turnover

£5m per year stadium name rights

£5m renegotiate N Rock deal

£5m renegotiate Adidas deal

(I think we've 2-3 years left on them)

New TV deal from next season £5m

 

You've then easily got your £100m turnover

[Kitman]

These guys are experts at identifying opportunities to make money - brand exploitation, TV and merchandising rights, property development and so on.  I expect they'll have far more of a strategy to build revenue than our current board and they won't think twice about buying in the expertise to do so.  They won't just copy what everyone else has done either.  I'm thinking it's not impossible that they'd see major opportunities that the current board don't.

 

The flip side is true of course.  They won't care about cutting costs wherever they can, if it's not part of their plan.  That could include transfer fees and players wages.  They won't care about selling off assets that aren't needed, they don't live in the area and will remain largely anonymous.  They have no sentimental attachment to the club like Shepherd & don't care about the north east in the slightest.

 

However people predicted disaster for MUFC with the Glaziers and it hasn't happened - yet.  The Glaziers seem to have increased revenue through better sponsors, TV rights, higher ticket prices, more merchandising and re-negotiating the finance to reduce costs.  Maybe that's what they've got in mind?

[Nobby]

1997/98 Football Shirt Sales

Manchester United are top at 850,000 earning an estimated £34m/yr

Newcastle dispite finishing 13th in the Premiership are joint 2nd with Liverpool and are selling 600,000/yr earning an estimated £24m/yr on shirt sales alone each

Rangers and England surprisingly share fourth spot on 500,000

 

1 Man United 850,000 (2)

2 Newcastle 600,000 (13)

= Liverpool 600,000 (3)

4 Rangers 500,000 (-)

= England 500,000 (-)

6 Celtic 350,000 (-)

= Arsenal 350,000 (1)

8 Spurs 250,000 (14)

9 Leeds 230,000 (5)

 

(Premier League finishing positions in brackets)

 

 

Daily Express

[Rob W]

you have to remember that the club only LEASES the ground - so any deal will probably need to be split with the council - and if anyone tries to go it on their own I think that Planning Permission coulld be ...difficult

 

We can up the prices a bit

 

League position is worth about £ 1 million per place - so if we keep on like this we'll get LESS $$$ this year cp last

 

Success sells shirts and merchandise and naming  rights

 

Whoever come sin will have to speculate and try and

 

a) ensure we get Yuroean football EVERY year

 

b) try for a CL place

 

c) Winning a trophy wouldn't do any harm either

 

 

 

 

 

 

[Matt]

That could include transfer fees and players wages.

 

It's likely we will see fewer 'top dollar earners' at the club until we secure regular increases in turnover, but I doubt Belgravia would allow the playing side to flounder. That harms ticket sales, prize money and our attractiveness to potential sponsors.

 

There are few assets at the club which are 'not needed' so I'm not sure what significang revenue could be derived from asset sales or downsizing- they will only serve to harm the core business.

 

I also don't think it will be in their interests to appear too detached from the club. They will look to seize on the fact that the current board are not flavour of the month, look to quickly build bridges with fans while not hiding that they see the club as a business venture first and foremost (a bit like Lerner at Villa). The men at the top will be in a tax haven somewhere, but there will be a figurehead Chief Exec and it wouldn't surprise me if they considered a local for the position.

[Guest Canny_Fettle]

The flip side is true of course. They won't care about cutting costs wherever they can, if it's not part of their plan. That could include transfer fees and players wages. They won't care about selling off assets that aren't needed, they don't live in the area and will remain largely anonymous. They have no sentimental attachment to the club like Shepherd & don't care about the north east in the slightest.

 

  The first bit of cost cutting will be the £1m wages currently being paid to Shepherd and Hall. 

 

Why is selling off assets that aren't needed such a bad thing?  If they are not needed why hold onto them - their depreciation being an unnecessary cost!

 

They don't live in the area  - well the Hall's haven't lived in the area for a number of years, so what's the difference. The Hall's are just "absentee landlords" and I don't think they seem to care muchfor the North-East either - well not now anyway.

 

No sentimental attachment like Shepherd - so he's been a good chairman because he's got sentimental attachment. Don't think so.  Perhaps no sentimental attachment will mean looking at the bigger picture and making decisions which may be unpopular in the short term but may bear fruit long term.

 

As for not caring for the North-East - do the Glaziers give a toss about Salford? Does Roman care about the West End of London?  Probably not - but if Belgravia have plans to build hotels and a casino which will create jobs and create extra turnover (for the City as well as the club) - well is'nt that positive!  The creation of a 5 star hotel near to the ground means we can compete for UEFA cup and Champions League finals to be held as SJP.  This will increase revenue plus raise the profile of the club and the area

 

 

[Guest Canny_Fettle]

That could include transfer fees and players wages.

 

It's likely we will see fewer 'top dollar earners' at the club until we secure regular increases in turnover, but I doubt Belgravia would allow the playing side to flounder. That harms ticket sales, prize money and our attractiveness to potential sponsors.

 

There are few assets at the club which are 'not needed' so I'm not sure what significang revenue could be derived from asset sales or downsizing- they will only serve to harm the core business.

 

I also don't think it will be in their interests to appear too detached from the club. They will look to seize on the fact that the current board are not flavour of the month, look to quickly build bridges with fans while not hiding that they see the club as a business venture first and foremost (a bit like Lerner at Villa). The men at the top will be in a tax haven somewhere, but there will be a figurehead Chief Exec and it wouldn't surprise me if they considered a local for the position.

[Kitman]

The flip side is true of course. They won't care about cutting costs wherever they can, if it's not part of their plan. That could include transfer fees and players wages. They won't care about selling off assets that aren't needed, they don't live in the area and will remain largely anonymous. They have no sentimental attachment to the club like Shepherd & don't care about the north east in the slightest.

 

  The first bit of cost cutting will be the £1m wages currently being paid to Shepherd and Hall. 

 

Why is selling off assets that aren't needed such a bad thing?  If they are not needed why hold onto them - their depreciation being an unnecessary cost!

 

They don't live in the area  - well the Hall's haven't lived in the area for a number of years, so what's the difference. The Hall's are just "absentee landlords" and I don't think they seem to care muchfor the North-East either - well not now anyway.

 

No sentimental attachment like Shepherd - so he's been a good chairman because he's got sentimental attachment. Don't think so.  Perhaps no sentimental attachment will mean looking at the bigger picture and making decisions which may be unpopular in the short term but may bear fruit long term.

 

As for not caring for the North-East - do the Glaziers give a toss about Salford? Does Roman care about the West End of London?  Probably not - but if Belgravia have plans to build hotels and a casino which will create jobs and create extra turnover (for the City as well as the club) - well is'nt that positive!  The creation of a 5 star hotel near to the ground means we can compete for UEFA cup and Champions League finals to be held as SJP.   This will increase revenue plus raise the profile of the club and the area

 

 

 

Please try not to put words in my mouth.  I was presenting a balanced view of Belgravia, rather than arguing for the current board.  Cheers 

[Guest Invicta_Toon]

there seems to be a lot of bollocks being posted around the place about Belgravia coming in and improving the team, as it naturally leads to increased tickets/ merchandising / Sky money

 

Does this add up?

 

Who honestly thinks there are more tickets to be sold? (considering the already full take up year on year)

 

how much more merchandising gets sold if we are 5th? (someone post the robson year's figures if they have them)

 

how much more TV money comes with success? IIRC we lost £2m max due to fewer cup games. Also, the majority from Sky is fixed collectively no?

 

and if there is, does this increase cover the proposed investment?

 

I don't think it does. Belgravia are looking at something else to recoup their investment, possibly the casino or individual media/TV contracts when Sky finishes

 

 

Improving the team would increase revenue in all sorts of ways. Television revenue gets bigger. The Champions League brings loads of cash. The brand becomes more valuable which means more sponsorship and more shirts etc are sold outside of home territory. I'm sure they can bring in a brand-manager/marketing type who can do a better job than Dougie sodding Hall.

 

But yes, they would also look for revenue in new ways. There have been articles posted on here that mention plans for a hotel or two, and the hope of a casino (though they stressed that no plans depended on the casino). If a hotel on the site would prove to be a solid revenue stream, increasing the wealth of the club and stability of its finances, and they have the investment needed to build it, then as far as I'm concerned they should go right ahead.

 

(Pure speculation, but combine a hotel and whatever at the Gallowgate end with an expansion of stadium capacity and what's not to like?)

 

For sure, the club under Fat Fred probably doesn't have the vision and evidently couldn't muster the cash for that sort of development. We're still paying for the stadium and he's scrabbling around for funds to buy players.

 

thats exactly the wishy washy bollocks i'm on about - no-one has any figures for this, or even proof it happens. Everyone is taking it as fact. We already have massive sponsorship contracts. We already have international fans. Exactly how many Malaysians went out and bought merchandise during our last campaign?

 

IIRC absence of the champions league matches brought in £5m in one year - is that a big enough return for someone to invest however many 100 mill and GAMBLE on the fact they can build a team that will get into the top 4?

 

I think we can take it as fact that an investment group capable of putting upwards of £150 million into taking over the club is at least confident that they're not throwing all that money away.

 

Now, whose judgement do we reckon is more firmly based in a consideration of the various financial realities?

 

Theirs?

 

Or yours?

 

 

 

 

read the original post and get back to me

[Guest Invicta_Toon]

thats exactly the wishy washy bollocks i'm on about - no-one has any figures for this, or even proof it happens.

That's not how you argue or prove something though. 

 

You can't say "because no one has proven me wrong I must be right".  If I bang on with some nut theory about all Venezuelans being trained to invade mexico in 2012 I'm not right just because no one's proven me wrong.  If you believe there is no correlation between success and TV money then back that up with something. 

 

However the TV revenue on http://www.nufc-finances.org.uk/profits2.htm in our 4,3,5 th placed years really blows the 13,13,11,11 years out of the water.  Now granted I'm sure there's been reworking of deals but I fail to see how you can go on and say there's no proof that more success brings more TV money in light of those stats.  Add to that the quote at the bottom:

The 2006 results contained the statement "The FA Premier League recently announced new broadcasting agreements, commencing in 2007/2008 season, in which overall income levels will be significantly higher than the current contract. To fully benefit from these additional revenues the Club must seek to compete in the upper regions of the FA Premier League".

 

and it becomes even more clear that money, least of all TV, is clearly tied into success on the pitch.  And that's just the league. 

 

I didn't say it doesn't increase, what I said was this increase looks like peanuts compared to the investment being made. That's not a lot of return for taking the gamble that they can create a top 4 side

[Guest Invicta_Toon]

Just plucked a few figures from the internet of other clubs revenue.

 

Man Uniteds new sponsorship dael was for £56.5m over 4 years (£14.1m per year).

Chelseas is worth £20m pper year.

 

We are currently 5th in the Premier league sponsors at around £5m per year with Northern Rock

Man Uniteds Nike deal was worth £300m over 13 years, Nike pay Brazil £7m per year for their contract.

 

Our Adidas contract is currently worth about £5m per year.

 

You think Addidas looks at us the same way as Man Utd. What odds would you give for sustained success over 13 years for both clubs, even with a takeover?

 

Our TV money is around the £30m mark, Real Madrid have just agreed a £700m TV deal over 7 years (£100m per year) on top of their Champions league money.

 

see above, also, give me a list of all the clubs who get more than £30m from TV - it won't be very long

 

 

Man United brought in £20m in merchandising in 2002/03 (no definition of merchandise). In the same year we brought in £8m

So there's some obvious ares for growth before even looking at sponsoring the stadium etc.

 

again an unbackable statement. The international profiles don't even compare. Merchandising will be domestic as well as global. 2002 was one of our better years and we never even got close to ManU

 

[Guest Invicta_Toon]

Just plucked a few figures from the internet of other clubs revenue.

 

Man Uniteds new sponsorship dael was for £56.5m over 4 years (£14.1m per year).

Chelseas is worth £20m pper year.

 

We are currently 5th in the Premier league sponsors at around £5m per year with Northern Rock

Man Uniteds Nike deal was worth £300m over 13 years, Nike pay Brazil £7m per year for their contract.

 

Our Adidas contract is currently worth about £5m per year.

 

Our TV money is around the £30m mark, Real Madrid have just agreed a £700m TV deal over 7 years (£100m per year) on top of their Champions league money.

 

Man United brought in £20m in merchandising in 2002/03 (no definition of merchandise). In the same year we brought in £8m

So there's some obvious ares for growth before even looking at sponsoring the stadium etc.

 

 

 

You compare us to Man U  

 

The only team that has driven up those income streams in a short space of time is Chelsea and they are still making £200m losses.

 

You can't get more advertising, sponsorship unless you are successful, unless Belagravia are going to put in hundreds of millions into the team itself (you can kid yourself it would take less by all means but we are light years behind the top 3) , we can whistle in the wind for the levels that Man U achieve, certainly over the short erm.

 

Long term goals are another matter but I would be strongly sceptical as to the long term goals of Belgravia.

 

It wasn't a case of comparing us to ManU - or indeed Real Madrid. It was just a case of showing how far behind we are.

 

I can see a more open market for our next shirt sponsorship deals if Fred leaves - if a casino opens by St James expect to see MGN or similar splashed on the front of our shirts and Nike are always looking for new clubs.

 

And whilst we may be 'hundreds of millions' behind the top 3, the immediate aim is to get back into the top 4. Spurs and Everton have shown that any team can get into the top 4 on a given season without huge investment, its staying there that will be the tricky part

 

so where is there huge windfall from this success? Andy Johnson? I suppose spurs have been buying every player under the sun I suppose

[Guest Invicta_Toon]

The deal makes no sense at all to me from a financial point of view.

ok you buy the club for 200m-you can always sell it for 200m-the initial investment is pretty safe.

Based on the current costs the club needs to be turning over 100m not the 80m it is at present to be able to buy players without borrowing more money.So we must get into the Champions lge and that could be getting tougher-Man Utd and Chelsea are not getting weaker and who knows what money will be available to Villa,Pompey-W Ham?.We would need an investment of at least 20-30m.So Belgravia will be looking to get that money back and if we dont qualify are they going to invest another 20m then another 20m-dont think so.

What is their reaction going to be if the club starts making losses?

 

Also wouldnt it be nice if the Halls said look just pay us the share price and the premium put that into players. 

 

£80m current turnover

£5m per year stadium name rights

£5m renegotiate N Rock deal

£5m renegotiate Adidas deal

(I think we've 2-3 years left on them)

New TV deal from next season £5m

 

You've then easily got your £100m turnover

 

and that can't be done now becasue?

[Colos Short and Curlies]

Just plucked a few figures from the internet of other clubs revenue.

 

Man Uniteds new sponsorship dael was for £56.5m over 4 years (£14.1m per year).

Chelseas is worth £20m pper year.

 

We are currently 5th in the Premier league sponsors at around £5m per year with Northern Rock

Man Uniteds Nike deal was worth £300m over 13 years, Nike pay Brazil £7m per year for their contract.

 

Our Adidas contract is currently worth about £5m per year.

 

You think Addidas looks at us the same way as Man Utd. What odds would you give for sustained success over 13 years for both clubs, even with a takeover?

 

Our TV money is around the £30m mark, Real Madrid have just agreed a £700m TV deal over 7 years (£100m per year) on top of their Champions league money.

 

see above, also, give me a list of all the clubs who get more than £30m from TV - it won't be very long

 

 

Man United brought in £20m in merchandising in 2002/03 (no definition of merchandise). In the same year we brought in £8m

So there's some obvious ares for growth before even looking at sponsoring the stadium etc.

 

again an unbackable statement. The international profiles don't even compare. Merchandising will be domestic as well as global. 2002 was one of our better years and we never even got close to ManU

 

 

See my following reply, it wasn't a case of look what we should be getting, it was a 'look what others are getting compared to us, with the right strategy we can increase income from these areas'

[Colos Short and Curlies]

Just plucked a few figures from the internet of other clubs revenue.

 

Man Uniteds new sponsorship dael was for £56.5m over 4 years (£14.1m per year).

Chelseas is worth £20m pper year.

 

We are currently 5th in the Premier league sponsors at around £5m per year with Northern Rock

Man Uniteds Nike deal was worth £300m over 13 years, Nike pay Brazil £7m per year for their contract.

 

Our Adidas contract is currently worth about £5m per year.

 

Our TV money is around the £30m mark, Real Madrid have just agreed a £700m TV deal over 7 years (£100m per year) on top of their Champions league money.

 

Man United brought in £20m in merchandising in 2002/03 (no definition of merchandise). In the same year we brought in £8m

So there's some obvious ares for growth before even looking at sponsoring the stadium etc.

 

 

 

You compare us to Man U  

 

The only team that has driven up those income streams in a short space of time is Chelsea and they are still making £200m losses.

 

You can't get more advertising, sponsorship unless you are successful, unless Belagravia are going to put in hundreds of millions into the team itself (you can kid yourself it would take less by all means but we are light years behind the top 3) , we can whistle in the wind for the levels that Man U achieve, certainly over the short erm.

 

Long term goals are another matter but I would be strongly sceptical as to the long term goals of Belgravia.

 

It wasn't a case of comparing us to ManU - or indeed Real Madrid. It was just a case of showing how far behind we are.

 

I can see a more open market for our next shirt sponsorship deals if Fred leaves - if a casino opens by St James expect to see MGN or similar splashed on the front of our shirts and Nike are always looking for new clubs.

 

And whilst we may be 'hundreds of millions' behind the top 3, the immediate aim is to get back into the top 4. Spurs and Everton have shown that any team can get into the top 4 on a given season without huge investment, its staying there that will be the tricky part

 

so where is there huge windfall from this success? Andy Johnson? I suppose spurs have been buying every player under the sun I suppose

 

Read the last sentance, its staying power that is needed.

 

And anyway, when was the last time Everton spend upwards of £10m in one summer before this year?

[Colos Short and Curlies]

The deal makes no sense at all to me from a financial point of view.

ok you buy the club for 200m-you can always sell it for 200m-the initial investment is pretty safe.

Based on the current costs the club needs to be turning over 100m not the 80m it is at present to be able to buy players without borrowing more money.So we must get into the Champions lge and that could be getting tougher-Man Utd and Chelsea are not getting weaker and who knows what money will be available to Villa,Pompey-W Ham?.We would need an investment of at least 20-30m.So Belgravia will be looking to get that money back and if we dont qualify are they going to invest another 20m then another 20m-dont think so.

What is their reaction going to be if the club starts making losses?

 

Also wouldnt it be nice if the Halls said look just pay us the share price and the premium put that into players. 

 

£80m current turnover

£5m per year stadium name rights

£5m renegotiate N Rock deal

£5m renegotiate Adidas deal

(I think we've 2-3 years left on them)

New TV deal from next season £5m

 

You've then easily got your £100m turnover

 

and that can't be done now becasue?

 

Shep won't rename the Stadium and will keep the shirt sponsors as local companies.

 

And the TV deal aint kicked in yet