Tom Fleuriot Posted August 16, 2012 Report Share Posted August 16, 2012 We've been making losses of about £10m+ pa and if my reading of FFP is correct ( happy to be corrected by anyone more expert than me) FFP requires us to break even by 2015, although I think there there is a small margin for error based on turnover - our turnover will be among the lowest so we won't have much margin of error to play with. In essence that means we have to reduce our running costs by £10m pa over the next 3 years. Our biggest expense is the player's wage bill so you don't have to be a genius to work out how that affects our transfer strategy. It also explains that while everyone was sorry to see club's staff being made redundant, it was a sacrifice the club had to make in order to free up as much as possible for the playing staff. The double whammy is that, at the same time as we have to reduce our losses and therfre reduce costs, the amount an owner like SL is allowed to invest into the club to fund running costs also has to be reduced. Please explain how this will not affect our spending too much? As for just having to be seen to be winding things down, the sanction for failing to meet the FFP targets is a transfer embargo you don;t just have to be seen to be doing somehting about it, you have to meet the football league's absolute financial targets by 2015. If you aren't happy that McInnes can't buy who you'd like at the moment, then you will be ecstatic when he can't sign anyone at all in 3 year's time. If my reading of FFP is wrong then I apologise unreservedly to you, and everyone else who feels that it is a red herring or won't affect us anything like I'm making out. Please, someone tell me I'm reading it wrong! Thought this was worth a new thread. Has anyone does the maths on this? On the back of an envelope: 13,000 fans per week @15 each @ 23 per year (crude average on season tickets, kids, adult tickets, assuming we have no decent home cup matches) = £4.5m per annum income (ish). Which works out at £86.5K (ish) per week over the course of the year. Which, assuming half goes on running costs, police charges, electricity, keeping the pitch nice, travel costs, other staff, leaves us £45,000 per week for players' wages. Which, assuming we have a squad of 22 players, leaves us with £2k per week for wages. That can't be right, surely? What am I missing? Link to comment Share on other sites More sharing options...
Monkeh Posted August 16, 2012 Report Share Posted August 16, 2012 Thought this was worth a new thread. Has anyone does the maths on this? On the back of an envelope: 13,000 fans per week @15 each @ 23 per year (crude average on season tickets, kids, adult tickets, assuming we have no decent home cup matches) = £4.5m per annum income (ish). Which works out at £86.5K (ish) per week over the course of the year. Which, assuming half goes on running costs, police charges, electricity, keeping the pitch nice, travel costs, other staff, leaves us £45,000 per week for players' wages. Which, assuming we have a squad of 22 players, leaves us with £2k per week for wages. That can't be right, surely? What am I missing? to break even yea Link to comment Share on other sites More sharing options...
Tom Fleuriot Posted August 16, 2012 Author Report Share Posted August 16, 2012 to break even yea So, basically, we're screwed unless about 10,000 more supporters turn up every week. Link to comment Share on other sites More sharing options...
cidercity1987 Posted August 16, 2012 Report Share Posted August 16, 2012 Well for a start our turnover is about £12million not £4m. http://www.bcfc.co.uk/staticFiles/fb/94/0,,10327~169211,00.pdf Link to comment Share on other sites More sharing options...
Clarky89 Posted August 16, 2012 Report Share Posted August 16, 2012 Commercial income, corporate income (matchday), food, drinks on match day etc. merchandise, cup money, City Player subscriptions, CATs income . . . . You haven't missed much. Link to comment Share on other sites More sharing options...
Tom Fleuriot Posted August 16, 2012 Author Report Share Posted August 16, 2012 Well for a start our turnover is about £12million not £4m. I see. My browser can't read the city website so I can't get the annual report. Any chance of you also throwing me running costs ex-salary? Link to comment Share on other sites More sharing options...
Tom Fleuriot Posted August 16, 2012 Author Report Share Posted August 16, 2012 Commercial income, corporate income (matchday), food, drinks on match day etc. merchandise, cup money, City Player subscriptions, CATs income . . . . You haven't missed much. Hence me asking the question as to where it comes from - I can't read the annual report. My basic question is what is a weekly wage budget that we can afford. Any ideas? Link to comment Share on other sites More sharing options...
cidercity1987 Posted August 16, 2012 Report Share Posted August 16, 2012 I see. My browser can't read the city website so I can't get the annual report. Any chance of you also throwing me running costs ex-salary? In summary: Turnover 12,000,000 Wages and Salaries (£16,000,000) Other Costs (£7,000,000) Therefore, Loss (£11,000,000) Other costs include amortisation of players contracts and also a significant amount of new stadium expenditure. So take other costs as £5m which leaves £6m-£7m to spend on salaries. Link to comment Share on other sites More sharing options...
Tom Fleuriot Posted August 16, 2012 Author Report Share Posted August 16, 2012 In summary: Turnover 12,000,000 Wages and Salaries (£16,000,000) Other Costs (£7,000,000) Therefore, Loss (£11,000,000) Other costs include amortisation of players contracts and also a significant amount of new stadium expenditure. So take other costs as £5m which leaves £6m-£7m to spend on salaries. Cheers mate. So around £6k per week per player. not so bad I guess. Phew. Link to comment Share on other sites More sharing options...
Nibor Posted August 16, 2012 Report Share Posted August 16, 2012 We can count on about £11m in football revenue. We should be aiming to get the wage budget for the entire football club (not stadium co) to under 70% of that - call it £8m - over the next few years. This gives us some margin for a bad financial year. Also that wage bill must be structured so that on relegation it drops by a significant % to guard against risk. Our wage bill at the end of 2010/2011 for the football club was £12.1m and the holding company which includes all the stadium revenue and cost made an 8 figure loss. The footballing wage bill probably didn't go down last season though I haven't looked at the accounts yet. FFP will affect us but not as much as some people think, because of the way the regulations exclude certain costs and allow a level of equity investment. However it makes sense in any case to reign in the reckless spending we've been doing for the last few years, especially given the risk to the stadium project. We lost a chunk of wage bill this summer with the players leaving the club which helps but we will have spent a fair proportion of that replacing them and aren't done spending yet. Football clubs should be quite pleased by these regulations as they reduce the bargaining power of players and agents for wages in a way that can't be easily worked around. The Etihad deal is being scrutinized and may not be counted as revenue for FFP, but it is fair to say nobody knows if FFP will have teeth yet either. The only real area of disparity is in the parachute payments from the Prem. IMO those need to be levelled out more. If you want to get a more accurate picture of the club's finances, the accounts are available on Company's House for £1 a document. Link to comment Share on other sites More sharing options...
Nibor Posted August 16, 2012 Report Share Posted August 16, 2012 In summary: Turnover 12,000,000 Wages and Salaries (£16,000,000) Other Costs (£7,000,000) Therefore, Loss (£11,000,000) Other costs include amortisation of players contracts and also a significant amount of new stadium expenditure. So take other costs as £5m which leaves £6m-£7m to spend on salaries. Those are figures for the holding company which include non football revenue and costs, much of which is excluded under FFP. Link to comment Share on other sites More sharing options...
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