Financial Fair Play / Profit & Sustainability

[The College Dropout]

8 minutes ago, Froggy said:

 

Why are we acting like this is the first time? You think we wanted to sign Wout Weghorst on loan last year? 

For all the crap your owners get - you've ended up doing pretty well to avoid being in this mess for June. Obviously you have massive revenues but clearly you'vve restrained yourselves in the transfer market a bit to avoid this situation.

[ExiledGeordie]

I’d hazard a guess that moving forward we will have more wiggle room and there’ll be less critical situarions like this. More sponsorship deals will certainly ease things a bit but we are still hamstrung by PSR and APT rule changes. 

[Zero]

14 minutes ago, r0cafella said:

They practically all voted for it and it’s really good for the majority. Especially with the championship having similar rules. Basically everyone is looking over their should and not forwards, most clubs have done to accept the position they have and are happy to ride the gravy train. 
 

PSR is only an impediment to those wishing to challenge the established order and most of the league are quite content with how things are, that actually hasn’t changed. 

For now yes, but I predict sooner of later most of the “content” clubs would be crying for help as the big clubs no longer be able to spend big, thus affect their income and ultimately lead to financial troubles.

 

After the Everton Forest cases, I doubt Brighton could still make those ridiculous sales. You may not aware but Brighton was hoping to sell Mitoma and Evan Ferguson on a high - interests are gone already. No clubs willing to pay the required fees now.

[The College Dropout]

4 minutes ago, Zero said:

For now yes, but I predict sooner of later most of the “content” clubs would be crying for help as the big clubs no longer be able to spend big, thus affect their income and ultimately lead to financial troubles.

 

After the Everton Forest cases, I doubt Brighton could still make those ridiculous sales. You may not aware but Brighton was hoping to sell Mitoma and Evan Ferguson on a high - interests are gone already. No clubs willing to pay the required fees now.

The big clubs can always spend big. But the others can't. Us, Villa, Everton, Forest - we had been stimulating the market.

 

I also don't think the other clubs mind. They are like us in many regards with Ashley. The PL is the gravy train. Clubs like Brighton just need to stay up to be profitable. A struggling Everton  & Forest is a good thing. 2 more teams likely to go down. Why would they want more ambitious owners like Villa, those are more clubs that won't get relegated? Brighton just vultured us for Minteh. They are loving it.

[Colos Short and Curlies]

27 minutes ago, Adam P said:

 

I think the margins could be smaller than that. The 70m losses are for 21/22 and 22/23. The PSR date was June 24 so there is something missing, no?

 

The June date also 'creates a market' so it becomes a de facto time to sell. We probably did need a sale but i would say that if the CEO, COO or CFO are anywhere near what they are paid, then the deficit would be smaller than the minimum estimated selling price of Mineh. Otherwise they have built an unacceptable level of risk. 

 

 

 

 

You're right on the 21/22 and 22/23 losses, the 3 year cycle up to the end of June 2024 needed a profit of £35m for the 23/24 season/year to balance out.

 

The first £70m drops out now so we have a total of £105m allowable to June 2025 and are starting with a £70m loss and £35m gain (in simple terms this could be more) = £35m loss. Hence we can drive a loss of £70m this year to be compliant. If the rules weren't changing then we'd have a further £70m loss to play with in 2025/2026 and need to balance this with a £35m profit in 2026/2027.

 

I don't know our CFO personally of course but he does have a pretty decent rep and I don't see where figures of needing £60m+ last week could have come from unless the premier league are threatening something and we've created headroom for that. 

 

Having said that, I don't think it would be unacceptable to have a sale of someone like Minteh or Anderson built into the plan from Jan, we are trying to be aggressive in our development, but again it wouldn't surprise me if the thought was we'd sell for £20m and have just taken a windfall when we got the likes of Lyon, Dortmund and Everton biting

[Elliottman]

27 minutes ago, The College Dropout said:

You have to look beyond face value.

 

1. That Anderson fee is inflated and not genuine. We will spend similar money on a Forest player if not more. We haven't fleeced them like we did for Wood.

2. Minteh deal to us is like the Lewis Hall deal from Chelsea. Aye we've got a good fee for a youngster that probably isn't ready to start regularly. But we've also sold a prospect that could play in the side for the next 10 years - with a ceiling of ability that high. We'll end up using the money we've got to spend more money on a replacement. Nobody thinks Chelsea's approach is cool - not even their own fans.

 

1. You don't know that, you're speculating. But even if it means we get a MGW for a slightly inflated price, its still worked out well for us. 

2. We're just over 2 years into a project which they've said will take 10 years. We had no infrastructure, awful commercial income, no squad. They've flipped Minteh in 12 months to prevent us losing a Bruno or Isak. If it was happening 3 or 4 more years down the line I'd see your point. 

 

They've done an unbelievable job.

[Colos Short and Curlies]

43 minutes ago, r0cafella said:

Putting your CFO hat on, and of course I know revenue generation wouldn’t be your wheelhouse but what do you anticipate the plan is to catch the big 6’s financials?

 

There can only be one way of catching them and that's through really smart recruitment.

 

We aint going to be signing many 'tier 1' superstars but if we box clever with the likes of Isak and Bruno then we'll grow success on the pitch which then snowballs into financial growth from all sorts of areas.

 

A sale of Bruno or Isak could accelerate this by allowing a bumper transfer window or 2, but I'd look more to Arsenal's model where they have a pretty consistent level of player trading at a given level, and this then steps up as league position/champions league qualification comes in.

 

it's not a complicated financial model, but its damn hard to get right operationally

[The College Dropout]

2 minutes ago, Elliottman said:

 

1. You don't know that, you're speculating. But even if it means we get a MGW for a slightly inflated price, its still worked out well for us. 

2. We're just over 2 years into a project which they've said will take 10 years. We had no infrastructure, awful commercial income, no squad. They've flipped Minteh in 12 months to prevent us losing a Bruno or Isak. If it was happening 3 or 4 more years down the line I'd see your point. 

 

They've done an unbelievable job.

1. We already gave Forest cash for a player we don't want or need. 

2. I genuinely think the plan was to sell Bruno. It's the only plan that makes sense. The Minteh situation 70% great scouting, 30% luck that he's been so impressive, so quickly. And even then - he's been so good, we shouldn't sell him.

 

These things look great on paper. But within context, you have to ask a few questions.

 

Yes - they've done a great job overall. This situation hasn't been great though.

[The Prophet]

 

[Maggies]

Maybe the Anderson transfer was an offer too good to turn down. Worst case figures from people like Swiss Ramble had us needing £40m so hopefully the Anderson plus Minteh gives us £30m more profit than needed…

 

I have no idea to be honest. But if we were ready to drop £60m on Olise then you’d like to think there’s a decent chunk of money available to spend.

 

 

Edited July 1 by Maggies

[JonBez comesock]

 

[JonBez comesock]

Sorry I duplicated 

[Zero]

Wow, we still need a trading profit of 15m?

[Maggies]

13 minutes ago, Zero said:

Wow, we still need a trading profit of 15m?

I think it means…

 

£15m added to amortisation line equates to spending £75m this summer on new signings.

 

To be PSR compliant we would then need to sell £17m worth of players (e.g. a Wilson or Almiron).

If we sell more or bring in more commercial revenue then we can spend more.

 

 

Edited July 1 by Maggies

[Adam P]

54 minutes ago, Colos Short and Curlies said:

 

You're right on the 21/22 and 22/23 losses, the 3 year cycle up to the end of June 2024 needed a profit of £35m for the 23/24 season/year to balance out.

 

The first £70m drops out now so we have a total of £105m allowable to June 2025 and are starting with a £70m loss and £35m gain (in simple terms this could be more) = £35m loss. Hence we can drive a loss of £70m this year to be compliant. If the rules weren't changing then we'd have a further £70m loss to play with in 2025/2026 and need to balance this with a £35m profit in 2026/2027.

 

I don't know our CFO personally of course but he does have a pretty decent rep and I don't see where figures of needing £60m+ last week could have come from unless the premier league are threatening something and we've created headroom for that. 

 

Having said that, I don't think it would be unacceptable to have a sale of someone like Minteh or Anderson built into the plan from Jan, we are trying to be aggressive in our development, but again it wouldn't surprise me if the thought was we'd sell for £20m and have just taken a windfall when we got the likes of Lyon, Dortmund and Everton biting

 

Got it, although i am still not clear if your thinking has the increased revenue for 23/24 built in. Is that 35m based on what were bringing in, in 22/23? 

 

Sounds like we are roughly looking at it the same, we knew we could get at least 20-25m for Minteh and our PSR deficit wasnt far from that. It makes no sense to think it was 68m so the narrative around Anderson sale was clearly managed. Cheers for the extra clarity anyway. 

[Keegans Export]

7 minutes ago, Maggies said:

I think it means…

 

£15m added to amortisation line equates to spending £75m this summer on new signings.

 

To be PSR compliant we would then need to sell £17m worth of players (e.g. a Wilson or Almiron).

If we sell more or bring in more commercial revenue then we can spend more.

 

That's what I think it means too.

 

So if we sell Almiron for +£17m profit then we can spend £75m. If we move on more players it gives us the flexibility to spend more than that. 

[Gallowgate Toon]

It's been a sobering week but it's this shit that'll make it all the sweeter when we win something.

[Colos Short and Curlies]

20 minutes ago, Adam P said:

 

Got it, although i am still not clear if your thinking has the increased revenue for 23/24 built in. Is that 35m based on what were bringing in, in 22/23? 

 

Sounds like we are roughly looking at it the same, we knew we could get at least 20-25m for Minteh and our PSR deficit wasnt far from that. It makes no sense to think it was 68m so the narrative around Anderson sale was clearly managed. Cheers for the extra clarity anyway. 

Yeah it’s based on all things being equal - so adidas = champions league.

 

however it’s £35m however you get there - I’ll take a look at that tweet when not on my phone later - so if we have additional deals coming in then we can either reduce our player sales or increase incomings accordingly 

[gdm]

7 minutes ago, Gallowgate Toon said:

It's been a sobering week but it's this shit that'll make it all the sweeter when we win something.

It’s genuinely making me hate football. We spent more time talking about this shit than actual football matches.

[DahnSahf]

19 minutes ago, gdm said:

It’s genuinely making me hate football. We spent more time talking about this shit than actual football matches.

 

Yeah, my Virgin contract is just ending. I'm seriously considering ditching the telly altogether and just keeping the broadband.

I have NFL Game Pass, so I'll maybe just stick with that. I'm no longer prepared to contribute to European football while it's completely rigged. I'd rather watch an old DVD for the fifth time.

 

 

Edited July 1 by DahnSahf

[Decky]

If we sell Miggy surely we’ll have a decent transfer budget given we made £24m on Minteh and Anderson was pure profit?

[Fezzle]

2 hours ago, Zero said:

Wow, we still need a trading profit of 15m?

There's a lot of assumptions going on there mind. 

[The College Dropout]

1 hour ago, Adam P said:

 

Got it, although i am still not clear if your thinking has the increased revenue for 23/24 built in. Is that 35m based on what were bringing in, in 22/23? 

 

Sounds like we are roughly looking at it the same, we knew we could get at least 20-25m for Minteh and our PSR deficit wasnt far from that. It makes no sense to think it was 68m so the narrative around Anderson sale was clearly managed. Cheers for the extra clarity anyway. 

There's no way we "knew" that in January which is the latest point we should've been formulating an escape plan.

[dilligaf]

2 hours ago, The College Dropout said:

1. We already gave Forest cash for a player we don't want or need. 

2. I genuinely think the plan was to sell Bruno. It's the only plan that makes sense. The Minteh situation 70% great scouting, 30% luck that he's been so impressive, so quickly. And even then - he's been so good, we shouldn't sell him.

 

These things look great on paper. But within context, you have to ask a few questions.

 

Yes - they've done a great job overall. This situation hasn't been great though.

1 You dont know that,  could be 1 mil for a 3rd choice keeper inflated for psr to cover Anderson overspend, both clubs win

2 'It's the only plan that makes sense' to you, to fit your agenda. Minteh if he was bought to hopefully make a profit on, its no good whining about it when it works 

[Adam P]

15 minutes ago, The College Dropout said:

There's no way we "knew" that in January which is the latest point we should've been formulating an escape plan.

 

Darren Eales' CV includes 14 years as a trader selling burgers on the quayside market, an admittedly successful stint in online gambling and has a BTEC qualification in excel, course he didnt have a plan.