Record Losses....

[Macho Man Randy Savage]

These losses are an embarrassment. Too many poor players have been bought on good contracts. We could easily have a squad of a similar quality and not be making losses at all.

[Fergal]

Should we reset the Poll after todays game?

[myf]

So what will this mean for us say over the next 5-10 years?  Are we in danger of going tits up?

There is a great danger of us doing a Sheffield Wednesday

Can you explain this. seems bit ott to me
.

[Legion]

Should we reset the Poll after todays game?

What poll? The McLeish sacked one?

[Greg N'Ash]

These losses are an embarrassment. Too many poor players have been bought on good contracts. We could easily have a squad of a similar quality and not be making losses at all.

that is the scary thing. if MON had just bought his first team then its very likely we'd have finished top6 or there abouts for a fraction of the cost as he rarely played the rest anyway.

So you'd have Barry, Gabby, Laursen, olof, Bouma

Carew £0
Freidal £4m
Milner £12m
Young £9
Young £5m
Petrov £7m

total cost = 40m

He could have kept some of the reserves like Davis, Cahill, whittingham etc. for back-up and replaced the likes of Barry, laursen when they got tapped up/injured with the fee's we received or the 40 odd million we hadn't spent.

[Fergal]

Should we reset the Poll after todays game?

What poll? The McLeish sacked one?

Yea, posted this comment in the wrong thread.

[Ad@m]

I've just downloaded the accounts and there are a few points of interest (not including those already covered above):

-  Loss after tax but before player amortisation of £22m (£7m loss in 2010) - the main movement year-on-year is the £12m compensation on managerial changes;
-  Group balance sheet is technically insolvent - ie total liabilities are now £20m greater than the "value" of our assets (£22m the other way in 2010) - this is not as bad as it seems however.  Any players who have come through the youth team will not have a value attributed to them and the liabilities mostly consist of very long term loans from Randy (more below);
-  Operating cashflows were positive to the tune of £4.1m (£18m negative in 2010) although this does include £24m put in to the club by Randy's US company;
-  £40.3m spent on player acquisitions (£40.5m in 2010) - Bent, Ireland and Makoun;
-  £22.1m received on player sales (£21.6m in 2010) for players who originally cost us £39m - Milner mainly;
-  Matchday income down to £21.4m (£24.4m in 2010) - average attendances fell by 1,400 and we had fewer home cup games:
-  Commercial income up to £16.7m (£14.4m in 2010) - includes sponsorship deals;
-  Full time staff numbers up to 551 (515 in 2010);
-  Total wages and salaries of £74m (£71m in 2010) - not just players, but all staff from the directors to the matchday stewards;
-  Total liabilities of £216m - including £127m owed to Randy (£90m in 2010), £12m to the bank (£21m in 2010) and £9m to the tax man (£9m in 2010);
-  Of these liabilities, £11m was due for repayment in the year to May 2012, £102m isn't due for repayment until at least May 2016;
-  The club could have to pay a further £4.7m in transfer fees if certain (undisclosed) clauses are triggered;
-  Since May 2011, £35m has been raised in player sales and £18m has been spent on player acquisitions.

So what does this mean?

Well it's clearly not great but equally it's not a Rangers-style disaster.  The big problem with these figures is that they're already 9 months out of date.  Wages are still too high for the level of turnover we have and that is covered in another thread on here about the summer clear out.  Although we have a lot of debt, it's long-term and gives the club breathing space to sort the books out.

I think Randy has seen that the scope for increasing the revenue is limited so that has been the driver for the sensible cost-cutting.  Matchday revenues are under major pressure due to reducing attendances and price-pressure from us fans.  Media revenues are also probably unlikely to grow massively unless the Al Jazeera rights story really takes off and creates a bidding war.  Commercial income is probably the only place the club can seriously grow income and hopefully the Genting deal is much better than the FxPro one was.

It all goes some way towards explaining the current goings on in B6 - I think the days of us splashing £50m a summer are long gone unfortunately...

[Walmley_Villa]

Thanks Adam, I think that paints a fair picture. It makes you wonder about the finances of the Likes of Fulham, Everton etc?

[TheSandman]

They probably weren't woefully mismanaged like we were by O'Neill, Lerner and Bradley from East Enders.

[Percy McCarthy]

Yes, thanks Adam. You have made me miss Risso a little bit less. Still waiting to hear what happened to my favourite Tory BTW, if anyone would be so kind.

[Legion]

He's taking a brief sabbatical.

[Percy McCarthy]

Ta Lee. Voluntarily or enforced?

[Legion]

Totally of his own choice. He assures me it is only temporary. He still reads the threads.

[Ad@m]

Thanks Adam, I think that paints a fair picture. It makes you wonder about the finances of the Likes of Fulham, Everton etc?

Based on an article the Guardian published last year (http://www.guardian.co.uk/football/2011/may/19/premier-league-finances-black-hole) Fulham and Everton both have significantly better wage bills than us but much lower revenues - both clubs undoubtedly being hamstrung by their stadia.  Both clubs lose millions every year (although not £54m granted!).

Fulham also have outrageous debts as although Al Fayed hasn't invested as much as Randy he's done it all in the way of loans which the club has to repay, whilst Randy has put half of his money in as share capital.