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Reading - Be Afraid, Be Very Afraid


Silvio Dante

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13 minutes ago, Silvio Dante said:

Promotion seems the only way out of this - but could that be challenged/is this a QPR scenario?

Saw this earlier. I don't study the finances as close as some on here, but that is scary numbers. They could be really could be in trouble very soon without going up.

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2 minutes ago, BetterRedthenBlue said:

Wages 211% of revenue... Surely the FA have to look at this. This is a mockery of FFP even with covid reducing revenue. 

Sometimes I think the only answer is for a reasonable sized club to get liquidated. With the amount of money that Sunak has thrown around during Covid (forget whether you think it was enough, it was a lot regardless) I really cannot see HMRC being so lax at debt recovery moving forwards. There is a lax attitude around football, and you see it so much from posters on here, that "it will be alright, football always gets away with it". I'm really hoping that Covid and the inevitable reduction in attendances from here puts some common sense back into football. 

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9 minutes ago, Northern Red said:

211% is actually an improvement, it was 226% the year before!

Phew - I was worrying it was all bad news for them!

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30 minutes ago, Silvio Dante said:

Promotion seems the only way out of this - but could that be challenged/is this a QPR scenario?

 

17 minutes ago, BetterRedthenBlue said:

Wages 211% of revenue... Surely the FA have to look at this. This is a mockery of FFP even with covid reducing revenue. 

 

15 minutes ago, 1960maaan said:

Saw this earlier. I don't study the finances as close as some on here, but that is scary numbers. They could be really could be in trouble very soon without going up.

 .....and on another thread the Villa Fan questions why we need/have ffp and how it is unfair.

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7 minutes ago, Harry said:

You have to question the morality of spending £16m on new players and yet claiming nearly £1m from furlough. 

Tbf the accounts year end is July, therefore the fees would have been accrued before Furlough/Covid became an issue so it’s not that they got furlough in and then spent it immediately.

lts still not great optics, and I do think if you could afford £16m you shouldn’t be claiming, but it’s not as bad as first glance may suggest

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1 hour ago, Numero Uno said:

Sometimes I think the only answer is for a reasonable sized club to get liquidated. With the amount of money that Sunak has thrown around during Covid (forget whether you think it was enough, it was a lot regardless) I really cannot see HMRC being so lax at debt recovery moving forwards. There is a lax attitude around football, and you see it so much from posters on here, that "it will be alright, football always gets away with it". I'm really hoping that Covid and the inevitable reduction in attendances from here puts some common sense back into football. 

 

It won't happen.

Why I say this is that there are two different items in play here:  the ownership of the football club through a limited company and the football club.

Owners can and do go bust but the club continues because there will alway be somebody who wants to own a football club; and if no individual then a fans consortium will step up.

When a club is in administration then the administrators are looking for the best deal for teh creditors and that is to sell the club as a going concern.

Or, as with Bury, the fans just start up a new Bury playing elsewhere leaving the existing owner with the ground, name and badge but no players or league in which to play.

 

 

On 30 August 2020, 12 months after the club's EFL expulsion, the Manchester Evening News described its situation:[95]

Bury FC still exists, though, if only on paper. With no players, no league to play in, and no employees to speak of, it is little more than a hollow shell of the club fans knew and loved.

The report says that the club "continues to limp on" but its future is uncertain and the danger of liquidation remains, though most fans still hope for an eventual resurrection.[95] Meanwhile, Dale began making statements on the club website, and, in one of these, he branded the fan-owned Bury AFC as "fake".[96][97] Bury AFC had arranged a groundshare deal with nearby Radcliffe FC and began the 2020–21 season in Division One North of the NWCFL.[97]

On 27 November 2020, Dale placed the club into administration, with Wiseglass appointed administrator.[98] In January 2021, a Nottinghamshire-based businessman and investor in Ilkeston Town, David Hilton, was reported to be interested in buying Bury F.C.,[99] which was said to have debts of over £15 million.[100]

https://en.wikipedia.org/wiki/Bury_F.C.

 

This is why I always find these "Save XXXX FC" appeals pointless because all that they serve to do is to allow the existing owner to limp on for another season rather than selling the club to somebody who has the money to run it.

 

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1 hour ago, Silvio Dante said:

Tbf the accounts year end is July, therefore the fees would have been accrued before Furlough/Covid became an issue so it’s not that they got furlough in and then spent it immediately.

lts still not great optics, and I do think if you could afford £16m you shouldn’t be claiming, but it’s not as bad as first glance may suggest

Wonder what have gone into this season’s projected accounts (submitted March).

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On one hand I really don't want City to be impacted in any way, but on the other hand, the sooner football as a whole hits a massive reset in the way it spends money the better - and if that means some clubs go to the wall so be it.  

It's irresponsible that clubs/businesses are allowed to run in to this much debt (that includes agents fees and player wage demands which are scandalous amounts of money).

I appreciate that there are some well run clubs out there but this is madness. 

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56 minutes ago, Steve Watts said:

A Reading fan mate of mine thinks that they'll sell Olise, Moore & Joao and probably lose half the squad.  Administration isn't looming, but a relegation battle next year is very much on the cards irrespective of which league they're in.

I have the unfortunate case of Living in Reading atm and have too been told the same things, rumours are that some players have been lined up to be sold/been sold behind the scenes in advance. From how It was also relayed to me, its not just the big names; the owner has made it pretty clearly the entire squad will be made "available" for purchase

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29 minutes ago, Malago said:

A Reading fan mate of mine thinks that they'll sell Olise, Moore & Joao and probably lose half the squad.
 

To whom?  Not to a championship club, unless they are prepared to sell at well below market value.

And this is the shift Football is hopefully going to make.  As soon as selling clubs, agents and players realise the 'COVID market' they're trading in, the sooner their demands might start to become realistic. And hopefully clubs will also stop bendingover backwards to their demands. Mind, I can't really see it happening until the 'first person blinks'.

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A rough calculation suggests that they need to make a net FFP profit of £1 across 2019/20 and 2020/21 to hit the FFP test for 2020/21.  That seems to translate into a £20 million accounting profit for 2020/21.

That would be some turn around.

Good to see the transfer embargo imposed by the EFL forcing all the 2020 accounts in.

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I've only seen the headline figures to date, but this is roughly in line with where I thought it'd be, loss wise.

They, along with a clutch of others I'm sure, would have been docked points if not for the rollup of last and this season into one period.

The Projected would therefore take in 2017/18 Actual results, 2018/19 Actual results then an average of 2019/20 actual and 2020/21 Projection would yield T.

I think they may well be set to fail.

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5 hours ago, Numero Uno said:

Sometimes I think the only answer is for a reasonable sized club to get liquidated. With the amount of money that Sunak has thrown around during Covid (forget whether you think it was enough, it was a lot regardless) I really cannot see HMRC being so lax at debt recovery moving forwards. There is a lax attitude around football, and you see it so much from posters on here, that "it will be alright, football always gets away with it". I'm really hoping that Covid and the inevitable reduction in attendances from here puts some common sense back into football. 

You just know it won’t though, football finances and common sense don’t go together.

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10 hours ago, Eddie Hitler said:

 

This is why I always find these "Save XXXX FC" appeals pointless because all that they serve to do is to allow the existing owner to limp on for another season rather than selling the club to somebody who isn't pocketing the money to run it.

 

FTFY, at least in Dale's case.

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It's interesting to see the reaction on their forum though- they seem quite blasé about FFP in general and this loss too.

https://hobnob.royals.org/forum/viewtopic.php?f=1&t=188455

Let's not forget that this is a club who were released from Soft Embargo in June/July 2019...and then promptly signed Joao and Puscas!! Madness.

There is a question as to whether we should use the Reading FC or the Renhe Sports Management accounts for FFP.

Aggregate losses for Reading FC in 2017/18, 2018/19 and 2019/20- not yet factored in FFP allowances etc, just the figures to date! SwissRamble suggests it's £5m per year, maybe it's between £5-£6m given Infrastructure and Depreciation?

Reading FC

£93,020,780

Renhe Sports Management Co. Limited

£86,860,426.

It's still a pretty huge fail whichever way you look at it! Incredible for bottom third, lower midtable and midtable seasons respectively.

That's what it can buy you at this level. 20th, 20th and most recently 14th!

All makes Birmingham's overspend which was the first under the new system all look rather innocent tbh- signing Pedersen under a soft embargo aside.

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11 hours ago, Eddie Hitler said:

 

It won't happen.

Why I say this is that there are two different items in play here:  the ownership of the football club through a limited company and the football club.

Owners can and do go bust but the club continues because there will alway be somebody who wants to own a football club; and if no individual then a fans consortium will step up.

When a club is in administration then the administrators are looking for the best deal for teh creditors and that is to sell the club as a going concern.

Or, as with Bury, the fans just start up a new Bury playing elsewhere leaving the existing owner with the ground, name and badge but no players or league in which to play.

 

 

On 30 August 2020, 12 months after the club's EFL expulsion, the Manchester Evening News described its situation:[95]

Bury FC still exists, though, if only on paper. With no players, no league to play in, and no employees to speak of, it is little more than a hollow shell of the club fans knew and loved.

The report says that the club "continues to limp on" but its future is uncertain and the danger of liquidation remains, though most fans still hope for an eventual resurrection.[95] Meanwhile, Dale began making statements on the club website, and, in one of these, he branded the fan-owned Bury AFC as "fake".[96][97] Bury AFC had arranged a groundshare deal with nearby Radcliffe FC and began the 2020–21 season in Division One North of the NWCFL.[97]

On 27 November 2020, Dale placed the club into administration, with Wiseglass appointed administrator.[98] In January 2021, a Nottinghamshire-based businessman and investor in Ilkeston Town, David Hilton, was reported to be interested in buying Bury F.C.,[99] which was said to have debts of over £15 million.[100]

https://en.wikipedia.org/wiki/Bury_F.C.

 

This is why I always find these "Save XXXX FC" appeals pointless because all that they serve to do is to allow the existing owner to limp on for another season rather than selling the club to somebody who has the money to run it.

 

Technically, Bury still limp on- the original Bury I mean in addition to what you say about the new club. In theory if someone brought them and cleared the debt on Gigg Lane...and the company who owned the debt have themselves gone into admin I believe.

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Might also add on Reading, they could sell the Stadium...

Nope- Done that.

Training Ground? Done that!

Land or old Training Ground (unsure which)- Yes, you've guessed it.

Loan fee for Player to Owners Other club? £3m for Aluko in 2018/19!

Done all that in that 3 year period and still the humungous 3 year losses! ?

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