The Championship FFP Thread (Merged)

[Mr Popodopolous]

For the sake of comparison- essentially and quite rightly so it seems that the EFL can change tack if or when new evidence comes to light:

Last September, not long after news got out about the EFL commissioning independent valuations.

Didn't seem to help them did it! The bolded bits are not dissimilar...actually Derby went quite a bit further and deeper! It aged well.

Quote

Announcement on Financial Results

Exceptional promotion-related costs of £45.8m including a one-off £30m contingent payment to former owner Randolph D Lerner were substantial contributory factors in the £68.9m loss recorded in Aston Villa’s group accounts for the year ended May 31, 2019 published today. 

The Club’s ultimate parent company, NSWE SCS, introduced £30m by way of a capital injection to enable the Club to settle the liability when former owner Recon Group Limited defaulted on the payment.

The payment was made in accordance with the provisions of the purchase agreement of May 2016 between Recon Group Limited (Buyer), Randolph Lerner / Alfred Lerner Declaration of Trust (together the Sellers) and Zhejiang Ruikang Investment Co. Limited and Jian Tong Xia (together the Guarantors).

The terms of the agreement stipulated that if Recon Group Limited and the Guarantors failed to pay the £30m bonus due to the Sellers on Aston Villa’s promotion back to The Premier League, the Club would be liable for the payment.

On June 6, 2019, Recon Group Limited (Hong Kong) confirmed default on the payment. The liability was settled through payment on July 12, 2019. As a result, the Club made provision for a £30m liability in the 2018/19 year-end accounts.

NSWE SCS is wholly owned by Wes Edens and Nassef Sawiris.

During the year the ownership group introduced £105.7m into the Club all of which was in the form of capital injections which resulted in Aston Villa remaining debt free.

Aston Villa can confirm that in the 3-year period ending May 31, 2019, the Club complied with the EFL’s Profitability & Sustainability Rules. After promotion, The Premier League reviewed and confirmed compliance in accordance with their own policies and procedures.

Turnover in the financial year to May 31, 2019 was £54.3m, a fall of £14.3m compared to the year ended May 31, 2018. This was primarily due to a reduction in Premier League parachute payments in the third successive season the club competed in The Championship.

Quote

Derby County Football Club has adhered to the EFL’s Profit and Sustainability Rules with respect to the sale of its stadium.

The stadium was subject to an independent professional valuation before sale, nearly 18 months ago, and the EFL indicated in writing that the arrangement was in accordance with its rules and regulations.

The EFL cannot now, long after approving the arrangements, suggest Derby County breached the rules.

The Club regrets that Middlesbrough Football Club have said they are suing the EFL over the matter, but that is a matter for them. Derby County offered to show Middlesbrough its financial records but they declined the invitation and appear to have decided to bring a claim against the EFL instead.

The outcome of that action could not now affect Derby County, which has already had its financial returns for the relevant season approved by the EFL, and the Club is solely focussed on the current season.

The Club will not be making any further comment at this time.

 

Edited March 13, 2020 by Mr Popodopolous

[Port Said Red]

While part of me is thinking that some clubs are going to go to the wall during this period, the other part is thinking that the period for FFP compliance could be extended, which might save others?

[Mr Popodopolous]

The FFP thing is interesting.

Kieran Maguire, as of a few days ago,  believes that existing cases may well carry on as usual, I say clearly the tribunals themselves won't but the process, the fact they have already begun.

However that it might be suspended for the 3 years to this season.

I'm guessing that the Derby and Sheffield Wednesday cases won't be shelved, 3 years to May/June 2019- well it's a bit trickier but the period beginning in 2017/18 to be assesses for this season, yeah shelve it.

Edited March 18, 2020 by Mr Popodopolous

[Davefevs]

Projected accounts should be in around now.....maybe they have some use!!

[Mr Popodopolous]

37 minutes ago, Davefevs said:

Projected accounts should be in around now.....maybe they have some use!!

Usually the start of March isn't it...excellent point!

[Olé]

Plot twist (someone else to sell the ground to)

 

[Davefevs]

3 hours ago, Olé said:

Plot twist (someone else to sell the ground to)

 

Derby have sold it already

[downendcity]

8 hours ago, Olé said:

Plot twist (someone else to sell the ground to)

 

What about the other club - Wayne Rooney's Derby County - are they not part of the deal?

[Mr Popodopolous]

Some clubs are spawny, lucky I must say. 

Aston Villa spring to mind, Derby possibly maybe another, with respect to finance, FFP etc.

One bit of news. EFL have dropped/withdrawn the charges against Chansiri, Meire and Redgate. 

To be specific and clear, these are the personal misconduct charges. 

Part of me wonders if they are not pushing too hard on this aspect due to the exceptional circumstances. For example, might the very solvency of Sheffield Wednesday have been in doubt had Chansiri been banned, in these times with no revenue flowing in?

[havanatopia]

2 hours ago, Mr Popodopolous said:

Some clubs are spawny, lucky I must say. 

Aston Villa spring to mind, Derby possibly maybe another, with respect to finance, FFP etc.

One bit of news. EFL have dropped/withdrawn the charges against Chansiri, Meire and Redgate. 

To be specific and clear, these are the personal misconduct charges. 

Part of me wonders if they are not pushing too hard on this aspect due to the exceptional circumstances. For example, might the very solvency of Sheffield Wednesday have been in doubt had Chansiri been banned, in these times with no revenue flowing in?

Very flimsy if charges have been dropped due to totally unrelated world events. Surely even the FL would not stoop so low?

[Delta]

2 hours ago, havanatopia said:

Very flimsy if charges have been dropped due to totally unrelated world events. Surely even the FL would not stoop so low?

It's another one of Pop's famous conspiracy theories.  He thinks that the whole world is conspiring against lil old Bristol.

[downendcity]

1 minute ago, Delta said:

It's another one of Pop's famous conspiracy theories.  He thinks that the whole world is conspiring against lil old Bristol.

Shouldn't you be self-isolating?

 

[Mr Popodopolous]

2 hours ago, Delta said:

It's another one of Pop's famous conspiracy theories.  He thinks that the whole world is conspiring against lil old Bristol.

What is apparent to non belter trolls,  is that the FL do not want a punishment to jeopardise a clubs future. 

Shaun Harvey was careful with the massive fine QPR got- he did not want it to risk them going into administration or worse.

@havanatopia I'm suggesting that maybe it might not have been a top priority for them. Had Chansiri been banned, would he have continued funding them?

I honestly don't know but it was notable that this wasn't thrown out by the Independent panel as such, more that the EFL dropped them- maybe were accepting the inevitable granted but there's no published judgement etc online anywhere.

I'm not wildly bothered if Chansiri is banned or similar, my hope is that Sheffield Wednesday get their comeuppance.

[downendcity]

9 minutes ago, Mr Popodopolous said:

What is apparent to non belter trolls,  is that the FL do not want a punishment to jeopardise a clubs future. 

Shaun Harvey was careful with the massive fine QPR got- he did not want it to risk them going into administration or worse.

@havanatopia I'm suggesting that maybe it might not have been a top priority for them. Had Chansiri been banned, would he have continued funding them?

I honestly don't know but it was notable that this wasn't thrown out by the Independent panel as such, more that the EFL dropped them- maybe were accepting the inevitable granted but there's no published judgement etc online anywhere.

I'm not wildly bothered if Chansiri is banned or similar, my hope is that Sheffield Wednesday get their comeuppance.

I just wonder whether the current unprecedented situation will give the EFL a get out of jail free card, as regards clubs that have potential ffp issues, either on the horizon or under investigation.

No one yet knows the extent of the financial fallout when things get back to normal and I can well imagine the EFL seeing it as an opportunity to wriggle out of awkward confrontations by effectively wiping the slate clean, on the premise of not wanting to jeopardise any clubs future.  I'm not suggesting it is the right thing to do, but depending on ho long it takes for football to return to normal, quite a few clubs could be financially on the ropes and you can bet the EFL would not then want to be seen as the bad guys, by taking action that could tip a club over the edge. 

They would probably dress it up as an opportunity to re-write the rules, having "learned the lessons`' of the mistakes when drafting the current rules.

[downendcity]

On 10/03/2020 at 17:30, Mr Popodopolous said:

Oh yes...

Yes indeed!!

Maybe I'll book some leave if it's open to the public.

Just you and one other attending now Mr P!  

[wendyredredrobin]

15 minutes ago, downendcity said:

I just wonder whether the current unprecedented situation will give the EFL a get out of jail free card, as regards clubs that have potential ffp issues, either on the horizon or under investigation.

No one yet knows the extent of the financial fallout when things get back to normal and I can well imagine the EFL seeing it as an opportunity to wriggle out of awkward confrontations by effectively wiping the slate clean, on the premise of not wanting to jeopardise any clubs future.  I'm not suggesting it is the right thing to do, but depending on ho long it takes for football to return to normal, quite a few clubs could be financially on the ropes and you can bet the EFL would not then want to be seen as the bad guys, by taking action that could tip a club over the edge. 

They would probably dress it up as an opportunity to re-write the rules, having "learned the lessons`' of the mistakes when drafting the current rules.

Maybe the rules can be relaxed due to the effect of CV, but CV cannot and must not be used as an excuse for the misdemeanours that occurred before.

[reddoh]

2 minutes ago, wendyredredrobin said:

Maybe the rules can be relaxed due to the effect of CV, but CV cannot and must not be used as an excuse for the misdemeanours that occurred before.

one caveat rovers can't suddenly in vest billions.

[Mr Popodopolous]

24 minutes ago, downendcity said:

Just you and one other attending now Mr P!  

If only this had been two years ago, Shaun Harvey may have learnt a thing or two.

[Delta]

7 hours ago, Mr Popodopolous said:

What is apparent to non belter trolls,  is that the FL do not want a punishment to jeopardise a clubs future. 

Shaun Harvey was careful with the massive fine QPR got- he did not want it to risk them going into administration or worse.

@havanatopia I'm suggesting that maybe it might not have been a top priority for them. Had Chansiri been banned, would he have continued funding them?

I honestly don't know but it was notable that this wasn't thrown out by the Independent panel as such, more that the EFL dropped them- maybe were accepting the inevitable granted but there's no published judgement etc online anywhere.

I'm not wildly bothered if Chansiri is banned or similar, my hope is that Sheffield Wednesday get their comeuppance.

In what way is it apparent Pops?  Do you have evidence to support this claim or have you just included the word "apparent" in order to add value to your claim?

You yourself have stated many times that there are numerous sanctions available.  If wrongdoing has occurred then it should be addressed.  In this case, the league have decided that no wrongdoing has occurred and you have decided that this is because of Covid 19.

In your blinkered world, everyone is guilty and those who are not charged have benefited from some warped conspiracy theory or other.

[Delta]

7 hours ago, downendcity said:

I just wonder whether the current unprecedented situation will give the EFL a get out of jail free card, as regards clubs that have potential ffp issues, either on the horizon or under investigation.

No one yet knows the extent of the financial fallout when things get back to normal and I can well imagine the EFL seeing it as an opportunity to wriggle out of awkward confrontations by effectively wiping the slate clean, on the premise of not wanting to jeopardise any clubs future.  I'm not suggesting it is the right thing to do, but depending on ho long it takes for football to return to normal, quite a few clubs could be financially on the ropes and you can bet the EFL would not then want to be seen as the bad guys, by taking action that could tip a club over the edge. 

They would probably dress it up as an opportunity to re-write the rules, having "learned the lessons`' of the mistakes when drafting the current rules.

I'm not quite sure why you think the league are faced with "awkward situations"?

They seem to have dealt with both Birmingham and QPR swiftly and effectively.

I have every confidence in the league dealing with these issues fairly.  Points deductions will still be implemented if wrongdoing has occurred and there will be little room for sympathy (that's just a silly suggestion) as Bolton and Bury will confirm.

[Mr Popodopolous]

3 sets of results from last season.

Wigan- lost £9.2m last season. That's inclusive of Profit on transfers etc. Only have headline figures.

Huddersfield (in the PL)- made a profit of £3.85m. 

Fulham (in the PL) - made a loss- a LOSS- of £20,448,00. May yet be higher given that Fulham Football Leisure is the immediate parent company and Fulham Cougar HoldCo the ultimate undertaking.

[Bristol Rob]

Appreciate this isn't Championship, but I dare say some of the whizz-kids here will have an opinion.

 

[wayne allisons tongues]

https://www.bbc.co.uk/sport/football/52063085
 

Interesting  points regards wages and transfer embargo for clubs that defer wages.

[Mr Popodopolous]

8 minutes ago, wayne allisons tongues said:

https://www.bbc.co.uk/sport/football/52063085
 

Interesting  points regards wages and transfer embargo for clubs that defer wages.

Thanks. 

Surely that stuff should be on hold in these exceptional times.

[wayne allisons tongues]

11 minutes ago, Mr Popodopolous said:

Thanks. 

Surely that stuff should be on hold in these exceptional times.

I agree but can also see it from other teams situation that it’s been only 2 home games at most so why do clubs need to cut wages so dramatically. Is it because they are on the brink of FFP and where is the missing deferred wages coming from if they can’t pay now.

[Mr Popodopolous]

57 minutes ago, wayne allisons tongues said:

I agree but can also see it from other teams situation that it’s been only 2 home games at most so why do clubs need to cut wages so dramatically. Is it because they are on the brink of FFP and where is the missing deferred wages coming from if they can’t pay now.

I think it's more cashflow- remember most clubs at this level a) Pay in excess of 100% of turnover in wages and b) Make a loss anyway, even with these exceptional times. You then strip out gate receipts, commercial revenue, etc etc- how is TV money paid as well, is it all in one lump sum or is it in stages?

FFP might be a consideration for some of course, and the League need to look at this closely to see if it isn't a getout.

There is a little thing called solidarity too...why should some get a free pass when society has some significant problems/hardship/people taking a hit in this crisis? Including many fans of clubs. Is the country all in it together or not?

Lastly, if I'm an owner why would I want to subsidise further when I'm already underwriting losses- all in it together is bollocks anyway but let's not at least confirm it.

Edited March 27, 2020 by Mr Popodopolous

[Mr Popodopolous]

As for Rovers and their losses.

I don't think they're that bad considering. Clearly a lower cost base in League One than the Championship- the latter is worst from all angles as high stakes gambling to get into the PL but not all that much TV money at all...growth in costs has significantly outstripped growth in other revenues.

I think if we were in League One, say settled as an upper League One club we would break even or possibly turn a profit- we would sell key players, rely on Cup runs, combined with good revenue streams and SL is one of the more prudent on the wage front (by football standards). Or if we were a bit of a yoyo club between the two divisions, we could certainly break even if not every year then often, or over a period of time- no desire to do that though!

Suggests to me though we certainly don't know for sure, that they rose their wage bill a bit, a % but not massively- the increased amortisation also suggests a bit of extra ambition but it's not huge- dare say their owners can subsidise £3-4m losses for some while to come, question would be do they want to?

One curiosity is that their operating costs for last season as per the Bristol Rovers 1883 Ltd accounts have fallen.

For example, in these accounts last season it stated that their Operating Costs were £8,968,183...whereas this year in the Headline figures it states that they were £8,283,814 for the 2017/18 season.

@bert tann any ideas on this?

Edited March 27, 2020 by Mr Popodopolous

[Lrrr]

https://www.bbc.co.uk/sport/football/52049672

Huddersfield now need to repay £35m in loans to former owner now as well

[Mr Popodopolous]

They might have it reasonably under control, with the parachute payments and if they keep costs fairly low. If they're fairly prudent.

Could absolutely constrain them for a year or 2, or longer moving forward though.

Edited March 27, 2020 by Mr Popodopolous

[Delta]

6 minutes ago, Mr Popodopolous said:

They might have it reasonably under control, with the parachute payments and if they keep costs fairly low. If they're fairly prudent.

It could well be the case that this payment will not fall under the parameters of FFP (see Villa's payment to Xia).

You would assume that the new owner was aware that this money would have to be paid.  With that in mind, you'd think a contingency is in place - Either parachute money or a cash injection directly from the new owner.

PS - How much would the McAlpine stadium be worth (dons tin hat).

[Mr Popodopolous]

9 minutes ago, Delta said:

It could well be the case that this payment will not fall under the parameters of FFP (see Villa's payment to Xia).

You would assume that the new owner was aware that this money would have to be paid.  With that in mind, you'd think a contingency is in place - Either parachute money or a cash injection directly from the new owner.

PS - How much would the McAlpine stadium be worth (dons tin hat).

Could well be, I'm thinking of solvency they should be fine from that perspective too of course.

New owner isn't all that rich so Parachute Payments it'd be.

Think clubs doing that will be forbidden sooner or later...at least in terms of revenue for FFP purposes.

Value? Who knows- dunno if it's ever been valued, seems to be or have been carried at cost...

Edited March 27, 2020 by Mr Popodopolous

[View from the Dolman]

28 minutes ago, Delta said:

PS - How much would the McAlpine stadium be worth (dons tin hat).

Worth remembering the club only own a 40% stake and the local council and rugby league team have stakes in the stadium company. 

[Mr Popodopolous]

23 minutes ago, View from the Dolman said:

Worth remembering the club only own a 40% stake and the local council and rugby league team have stakes in the stadium company. 

It is. Also means that selling and leasing back the ground as it stands surely a non starter?

Looked up a number of years of what I assume to the stadium company- Kirklees Stadium Development Limited- and so far there's no valuation at all! Seems to have always been carried at cost, that said there are 25 years worth of accounts to look through...fun times!

Edited March 27, 2020 by Mr Popodopolous

[1960maaan]

And back to Derby 

Their poorly vailed attempt at pulling the wool over the eyes of the EFL money men may have come back to bite them. Be an interesting conversation when Derby ask for a loan....... but Mr Morris, didn't you recently get £80m cash injection from the sale of your ground? 

[Mr Popodopolous]

As far as I can tell, loans don't or shouldn't be classed as income for FFP- but that's a side issue for now!

They could always impose a wage cut/deferral. For a start. Wonder what the terms of this loan would be, could be a slippery slope they're getting on. 

That £81.1m appeared in the cash flow as if it'd been paid though so their losses over this and last season...wow!! Unless of course that was a fudge too. :think:

Definitely appears in statement of cash flows for 2017/18 though.

[Mr Popodopolous]

Fresh investment to take advantage of FFP restrictions being temporarily loosened?

[Bristol Rob]

3 hours ago, 1960maaan said:

And back to Derby 

Their poorly vailed attempt at pulling the wool over the eyes of the EFL money men may have come back to bite them. Be an interesting conversation when Derby ask for a loan....... but Mr Morris, didn't you recently get £80m cash injection from the sale of your ground? 

That's a very good point.

Hadn't considered the ground transaction when read the story.

[Davefevs]

3 hours ago, 1960maaan said:

And back to Derby 

Their poorly vailed attempt at pulling the wool over the eyes of the EFL money men may have come back to bite them. Be an interesting conversation when Derby ask for a loan....... but Mr Morris, didn't you recently get £80m cash injection from the sale of your ground? 

 

59 minutes ago, Mr Popodopolous said:

As far as I can tell, loans don't or shouldn't be classed as income for FFP- but that's a side issue for now!

They could always impose a wage cut/deferral. For a start. Wonder what the terms of this loan would be, could be a slippery slope they're getting on. 

That £81.1m appeared in the cash flow as if it'd been paid though so their losses over this and last season...wow!! Unless of course that was a fudge too. :think:

Definitely appears in statement of cash flows for 2017/18 though.

I’d be very worried if I was a Derby supporter.  I’m not sure now is the time to be taking loans out.  Suggests that the ground sell got them sorted for the period up to 18/19....perhaps this covers the next period (and beyond) and maybe a change in amortisation model??

Only speculating.

[Mr Popodopolous]

5 hours ago, Davefevs said:

 

I’d be very worried if I was a Derby supporter.  I’m not sure now is the time to be taking loans out.  Suggests that the ground sell got them sorted for the period up to 18/19....perhaps this covers the next period (and beyond) and maybe a change in amortisation model??

Only speculating.

Dave, do you mean in FFP terms or do you mean solvency/admininistration risk?

You could well be right- incidentally, their accounts due out at end of March though Covid 19 may have put all that on hold.

A quick search at CH suggests that:

• Derby County is now controlled by Gellaw Newco 203 Limited.
• Their first set of accounts were due by March 18th 2020- showing as overdue.
• The ones who brought the ground were Gellaw Newco 202 Limited.
• Their first set of accounts were due by March 19th 2020- showing as overdue.
• Gellaw Newco 204 Limited own/are the controlling party for Gellaw Newco 202 Limited.
• Their first set of accounts were due by March 18th 2020- yes, you might have guessed it. Showing as overdue!!

Like I say, could all be due to Coronavirus but other clubs have got their accounts in- see Fulham, Huddersfield and though I've not yet had a proper look, Sheffield United.

Sevco 5112 is no longer the controlling party of Derby County therefore.

Edited March 30, 2020 by Mr Popodopolous

[Mr Popodopolous]

Oh yeah, to further muddy the waters the following are still presumably revenues that flow to the club, while potentially FFP costs relevant to these offset against:

1. Club DCFC Limited
2. Stadia DCFC Limited
3. The Derby County FC Academy Limited

These 3, from which the club surely will benefit from revenue, are all still listed at CH as being controlled by Sevco 5112 Limited.

Edited March 30, 2020 by Mr Popodopolous

[Davefevs]

5 hours ago, Mr Popodopolous said:

Dave, do you mean in FFP terms or do you mean solvency/admininistration risk?

You could well be right- incidentally, their accounts due out at end of March though Covid 19 may have put all that on hold.

A quick search at CH suggests that:

• Derby County is now controlled by Gellaw Newco 203 Limited.
• Their first set of accounts were due by March 18th 2020- showing as overdue.
• The ones who brought the ground were Gellaw Newco 202 Limited.
• Their first set of accounts were due by March 19th 2020- showing as overdue.
• Gellaw Newco 204 Limited own/are the controlling party for Gellaw Newco 202 Limited.
• Their first set of accounts were due by March 18th 2020- yes, you might have guessed it. Showing as overdue!!

Like I say, could all be due to Coronavirus but other clubs have got their accounts in- see Fulham, Huddersfield and though I've not yet had a proper look, Sheffield United.

Sevco 5112 is no longer the controlling party of Derby County therefore.

Either / Both

[Mr Popodopolous]

Couple of lines. 

Sheffield United lost £21m last season. However they only lost £1m year before and maybe £6m in 2016/17 in League One. 

A model for many. Bear in mind too that loss last season will surely include promotion bonuses which aren't included in FFP calcs, and rightly so.

The Depreciation of fixed assets, the academy/youth expenditure, community expenditure and I guess infrastructure expenditure once amortised. Oh yeah and women's football.

Surely they're absolutely fine- it's also possible that their 2016/17 League One title included promotion bonuses too.

Anyway their headline losses are £10-11m below £39m even before allowables, promotion bonuses. An example to all!!

Edited March 31, 2020 by Mr Popodopolous

[Mr Popodopolous]

Another couple of lines.

Wigan lost £9.2m but that was despite and inclusive of a £7m profit on disposals. Quite big losses without but still not in FFP hot water just yet...They maybe 13 month accounts, not had a proper look yet. 

Fulham appear to be fine for FFP. Selling Sessegnon for £30m was it has probably meant they're fine for one more year after this. Worth a look however.

Brentford have taken advantage and extended their date to get accounts to CH to June 30th 2020. This 3 month extension to deadlines due to Covid 19.

West Brom appear not to have taken advantage, they've submitted accounts and will be there at CH in the next few days I expect.

I say submitted accounts. On closer inspection, West Bromwich Albion Holdings and West Bromwich Albion Group have, so presumably that'd be the overall Group accounts but West Bromwich Albion FC have not yet.

Which is a bit strange, I'd expect a club followed by consolidated given the club is included within the latter. Consolidated accounts will surely give a good indication anyway.

Derby...who knows. Who knows. Their choppy structure makes it hard to be sure.

Birmingham City Stadium Ltd. St Andrews appears to be classed as an Investment Property. Paid in receivables possibly, just skimread it.

Reading have taken advantage like Brentford of the 3 month extension to the deadline.

Edited March 31, 2020 by Mr Popodopolous

[Mr Popodopolous]

One more line.

https://www.cityam.com/football-clubs-fear-efl-sanctions-unless-they-sack-staff-or-make-pay-cuts/

Looks like FFP isn't being scrapped or majorly watered down. One bit of good news!

I think you can simply add lost revenue in this period to allowable costs so simply £39m + standard allowable costs + revenue lost in this time=FFP loss. No need to relax it beyond this IMO.

Either this or use projected accounts as the real ones as a starting point. Then go from there.

Edited March 31, 2020 by Mr Popodopolous

[Mr Popodopolous]

West Brom had operating losses of around £17m last season, but profit on player disposal took this down to around £7m.

I think that for FFP in the 3 years to May 2019, they're aok not even a doubt and likely to May 2020 as well, but as with all clubs, have their owners stuck equity in? That is a factor that has potential to change things significantly.

[Mr Popodopolous]

Hi @Delta interested in your take on one issue.

FFP. Seems not to be getting suspended as it stands in the Championship- not if that City AM article anything to go by.

In the event you end up back at this level in the next season, it could be interesting? Mind you, for the bulk of if not all the division too!

My personal view is that I hope they don't suspend it, but merely tweak it as necessary in the circs.

Edited April 1, 2020 by Mr Popodopolous

[Delta]

19 minutes ago, Mr Popodopolous said:

Hi @Delta interested in your take on one issue.

FFP. Seems not to be getting suspended as it stands in the Championship- not if that City AM article anything to go by.

In the event you end up back at this level in the next season, it could be interesting? Mind you, for the bulk of if not all the division too!

My personal view is that I hope they don't suspend it, but merely tweak it as necessary in the circs.

Personally, I'm still of the opinion that FFP will be relaxed in some form or other.

However, if we find ourselves back down, we will most likely receive £100m + in transfer sales.  Whilst this will probably be spread over a 4 year period, it will still see over £25m come in for the relevant year.

From our previous experience, I sense that relegated teams have 2 seasons in which to get back up - The 3rd year of parachute payments falling substantially.  If we went down, with Leeds & WBA out of the way, I'd be fairly confident of us going back up within 2 years.

[Mr Popodopolous]

4 minutes ago, Delta said:

Personally, I'm still of the opinion that FFP will be relaxed in some form or other.

However, if we find ourselves back down, we will most likely receive £100m + in transfer sales.  Whilst this will probably be spread over a 4 year period, it will still see over £25m come in for the relevant year.

From our previous experience, I sense that relegated teams have 2 seasons in which to get back up - The 3rd year of parachute payments falling substantially.  If we went down, with Leeds & WBA out of the way, I'd be fairly confident of us going back up within 2 years.

I think the onyl relaxation of FFP should be the deficit in gate receipts and other associated revenue basically- just my view.

e.g. £39m (or £61m in your case) + allowable costs + the deficit caused by 5 or 6 home games off or behind closed doors  (I'd have to check exact numbers) but there should in my view for any club be no relaxation beyond that level. Or we could take the projected accounts that clubs submit as the actual data given the exceptional circs.

Doubtless there will be relegation clauses written into contracts- the £100m would all depend on their current book value. If Grealish as he's an academy product goes for £60m, that is £60m profit e.g. Mings and McGinn two other big saleable assets.

3rd year is interesting- think WBA e.g. are fine now not least due to their large profit in 2016/17, unsure how they fit in terms of equity but if they somehow blow promotion...

Oh yeah, on Parachute Payments the 3 year rule thing- if a side is in the League for one season now ie ujp then straight bacvk down, then it's Year 1 (as usual) Year 2 (as usual) then Year 3? Zero. Didn't hurt Norwich, but Middlesbrough OTOH...might hurt Fuham if they don't go up by May 2021. Whereas if a club are up more than 1 season then it's Years 1 and 2 as usual, then the significant fall in Year 3. As Stoke will find out in 2020/21.

[Mr Popodopolous]

Derby and Leeds accounts still not at CH but Blackburn's are- that said Venkys London Limited maybe the relevant one there- will be there tomorrow or so probably in Blackburn's case.

Interesting snippet from Kieran Maguire's feed last season, in terms of Derby's structure etc.

"Disposed of the subsidaries'- FFP relevant? Profit on disposal?

[Mr Popodopolous]

One bit of news.

It was stated that Reading and what I assume to be the parent company at least in the UK, Renhe Sports had applied to get it in by 30th June 2020.

Well seems they've submitted their accounts- probably in tomorrow, Saturday, Monday- dunno when but within the next few days.

They are one of those clubs who have a bit of an FFP question mark so these will be quite interesting...

Edited April 2, 2020 by Mr Popodopolous

[Mr Popodopolous]

Courtesy of Kieran Maguire. 

Losing money certainly, but probably not in FFP issues.

Reading tomorrow maybe? Monday? In the coming period anyway.

[Mr Popodopolous]

Some interesting thoughts on FFP, it encompases the Championship a bit too.

https://www.chiesaditotti.com/2020/4/1/21203034/uefa-postpones-all-june-matches-financial-fair-play-suspended-for-2021

[Mr Popodopolous]

Apologies wrong link.

https://www.bavarianfootballworks.com/2020/4/3/21199926/bayern-munich-financial-fair-play-covid-coronavirus-crisis-bundesliga-premier-league-championship

Meanwhile, elsewhere...

https://www.thestar.co.uk/sport/football/sheffield-united/process-decide-value-sheffield-uniteds-stadium-and-other-properties-has-begun-2527742

NOT strictly Championship related but given that Hillsborough sold for £60m and Pride Park £81.1m (though the EFL beg to differ, and it's £49-50m in their eyes) and even Villa Park for £56.7m, it'll be interesting to see what this throws up- and if it sheds light on the process.

[Mr Popodopolous]

Derby have (unsurprisingly) taken advantage of the option of the chance to extend their deadline to submit to CH by 3 months Covid 19 means that companies can.

Reading's results are out. Must say their compliance is doubtful indeed -  you might be interested @Davefevs

Lost £30m- that's Thirty million last season. Given they did the sale and leaseback albeit seemingly at fair value (£26.5m) they're surely in a tricky position, whereas had it been say £36m, they'd have more leeway and it probably would still have been seen as an okay price given the location etc.

One other interesting note. Their rent on the Madjeski in 2017/18 was £750k per year. Now it seems to be £1.5m!! 

[Mr Popodopolous]

Ohh and one thing I never noticed until I saw Kieran Maguire's analysis.

Reading sold the training ground as well last year. Despite the profit on this, they still lost £30m!!

Paid for in the form of shares apparently though I'd have to re-read. How does that fit with FFP, equity limits etc?

They're now a villain of the piece.

Successive seasons they've done a fixed asset transaction with a related party.

Further to that, there was a £3m loan fee for Aluko too with Beijing Renhe...another related party.

Edited April 4, 2020 by Mr Popodopolous

[Bristol Rob]

Not FFP more a story of potential lost revenue for Burnley, but thought those following this thread might be interesting.

 

 

[Mr Popodopolous]

Yeah, football clubs are by no means immune to this- in fact no or little income vs biggest cost- tough times for a fair few I'd have thought.

On Reading, took a look at the parent/group/controlling company Renhe Sports.

Interestingly, and unsure how it fits with FFP, they lost 'only' £11,753,640.  Made a profit on sale of Fixed Assets of £29,929,818- unsure which one is relevant for FFP though.

From early investigation:

• Renhe Sports appear to have sold the Madejski Stadium to Prestige Fortune Asia Limited- a commonly owned company.
• Says something about £37.5m- unsure what % of that is profit and what % is price paid, book value etc as there have been a number of transactions in terms of fixed assets with related parties.
• The Training facilities (Bearwood) were sold in 2018/19 for £13m. Sun Elegant Group.
• Paid for in the form of loans- again, owned by the owner of Reading. Think the profit was £7-8m.

Anyway, in the BEST case scenario, they've lost a total of £40-41m (before allowable costs) over the last two seasons despite £29m in fixed asset sale profits!?  Plus a £3m loan fee for Aluko to China.

Edited April 4, 2020 by Mr Popodopolous

[Mr Popodopolous]

It's almost an irrelevabnce with all that's going on outside of football, in the country and the world in general.

However there have to be serious questions over Reading and their FFP compliance- possibly to June 2019 but certainly to June 2020. From last season, Swiss Ramble showed a list of their losses minus allowable costs but add backs of excluded revenues.

Even if they use Renhe Sports and even if fine to June 2019 which seems uncertain, I'm not at all convinced that they even without Covid 19 would be fine to June 2020.

Edited April 5, 2020 by Mr Popodopolous

[Mr Popodopolous]

Forgot to tag but @downendcity you might be interested in Reading and their possible FFP issues...

...Notwithstanding the fact that it is Reading of course.

[Bristol Rob]

https://www.bbc.co.uk/sport/football/52184178

 

[Mr Popodopolous]

Birmingham's troubles may not be over yet...though tbh I'm not fully sure what the EFL's case is here.

What it does tell me though is that the EFL will fight anything and everything all the way- under this leadership anyway, Harvey nah don't see it.

That has to be a good sign IMO.

[Lrrr]

[Lrrr]

Above confirmed we were pretty much bang on the median wage and just under the average, probably changed a lot with our summer purchases though so we may be just about upper top half of the table for wages overall but per player we may still be paying relatively mid table.

[Robin101]

13th for wages paid

13th for wages/income

10th for revenue generated

12th for losses 

Suggests that we’ve been punching above our weight after all. At least up to this season. And it’s promising that we’re 10th for revenue generated. 

[Mr Popodopolous]

Remember and treat with a bit of caution as some of those clubs still haven't released accounts yet- however yes, there are some encouraging signs.

That's Kieran Maguire/Price of Football @hodge ?

Losses of course, though I know you'll know this but in case anyone reading isn't, are presumably those before profit on disposal of players and beneficial transactions let's call them- basically the Operating Losses?

Think those Birmingham figures maybe for 2017/18 though, at least in terms of the Operating loss.

Edited April 8, 2020 by Mr Popodopolous

[phantom]

49 minutes ago, Robin101 said:

13th for wages paid

13th for wages/income

10th for revenue generated

12th for losses 

Suggests that we’ve been punching above our weight after all. At least up to this season. And it’s promising that we’re 10th for revenue generated. 

Only if money equates to guaranteed success

[Mr Popodopolous]

Leeds accounts look interesting.

I don't think they're in FFP trouble yet but if they stay down this season, cutbacks surely quite necessary.

Courtesy of Kieran Maguire earlier.

It's not shit or bust though, in terms of FFP, allowable costs and all that too- but changes would surely at some level be needed.

Their commercial revenue, as usual, is very strong for a non PL club.

Edited April 8, 2020 by Mr Popodopolous

[Mr Popodopolous]

https://www.independent.co.uk/sport/football/football-league/coronavirus-news-latest-efl-championship-leeds-west-brom-aston-villa-reading-birmingham-wigan-a9454261.html

Saw this elsewhere, decent read.

[Mr Popodopolous]

Couple of interesting lines.

1) 5-8 clubs could be in FFP trouble, possibly even possibly to the extent of points deductions to begin next season!? Whether as many as that got docked points is a different debate but if Parry and co apply things correctly...

https://www.dailymail.co.uk/sport/football/article-8201753/Championship-rivals-fight-relaxing-rules-host-sides-set-fail-financial-fair-play.html

2) Though not strictrly Championship related, I couldn't help but notice when looking up the new PL head, which side he supports.

Investigation was apparently carried out and as we know cleared.

Which side does he support/have a connection to- but in this case he apparently supports them? Think you maybe able to guess @Davefevs .

Give people a clue...the same as: an ex PM (so they said!), the ex head of the Bank of England, the Chair of the West Midlands Combined Authorities Growth Strategy and the President-Designate of the FA...

How handy!

Edited April 13, 2020 by Mr Popodopolous

[WarksRobin]

On 30/03/2020 at 11:34, Mr Popodopolous said:

As far as I can tell, loans don't or shouldn't be classed as income for FFP- but that's a side issue for now!

They could always impose a wage cut/deferral. For a start. Wonder what the terms of this loan would be, could be a slippery slope they're getting on. 

That £81.1m appeared in the cash flow as if it'd been paid though so their losses over this and last season...wow!! Unless of course that was a fudge too. :think:

Definitely appears in statement of cash flows for 2017/18 though.

What happens with Rooneys megabucks deal? I assume it will be automatically extended to see out the season but if the gambling sponsor doesn’t pay more contribution, Derby will have to fund all the extension.