Grendel
Well-Known Member
The point is it’s a reflection of owner strategy
19/20 Accounts (5 Viewers)
- Thread starter Frostie
- Start date
The point is it’s a reflection of owner strategy
SkyblueDad
Well-Known Member
Grasping at straws a bit there even 6000 at £20 is a loss of £2.2 million but what do you think the gates would have been in the crunch games v Rotherham, Pompey and Sunderland plus the FA cup tie v Brum.
SlowerThanPlatt
Well-Known Member
Yes for one off games not an average across the season
Sky Blue Pete
Well-Known Member
It’s something like £6 in income per person rather than £20 in terms of children and senior etc but its still a lot of money
Sky Blue Pete
Well-Known Member
Why is it ok to show purchases as losses but not use sales as income??? You can’t have it both ways grendel
As you do not know what it would have cost to stay at the Ricoh you cannot comment on their strategy
Grendel
Well-Known Member
Im not just referring to that I am referring to the losses incurred as a direct result of owner strategy
Sisu also can’t have it both ways. They can’t on the one hand complain about lack of income and a requirement to sell assets when their own strategy has helped create that
You make frequent claims about a stronger bond but it’s never actually manifested itself in action. Compassionate owners don’t behave the way she does. Perhaps it’s done with a smile now but she’s as ruthless and reckless as ever
Brighton Sky Blue
Well-Known Member
How many clubs without a rich benefactor do not rely on player sales and other conventional revenue streams?
Grendel
Well-Known Member
Well I think it would be unlikely to have cost the amounts we are talking here. Of course both sides will have a different interpretation of events and what occurred but given one party has “form” it’s natural to be sceptical
The club has achieved some success on the pitch. This clearly has given them some leverage but if it becomes a struggle again a lot of that goodwill will vanish
Grendel
Well-Known Member
I wouldn’t know I also wouldn’t know what owners charge 14% on loan interest every time a loan is made
If you read the notes the interest rate also carries with holding tax as the monies go to a non UK taxpayer
As the loan is mainly unsecured no chance of being repaid quickly, similarly the interest there is verly little impact on cash flows
VC introducers and managers tend to only get paid on a successful outcome - I would have thought that would have to be a positive thought in her strategy
Only one party ?
Dividends, management fees , consultancy etc are all returns to the Shareholder so dont get stuck on "interest"
And of course ccupation charges for the stadium owned by the Club Owners
Grendel
Well-Known Member
Yes I’m aware the loans are unsecured - is it not the case, however, that interest has been paid back previously - though now it’s all been out back in again as further loans
Have you read the full accounts - not just the summaries?
fernandopartridge
Well-Known Member
Not good, obviously a small Covid related impact but to an extent that would be netted off with a late season reduction in costs.
Lease charges up by approx £0.6m coupled with a reduction in matchday income of circa £1.2m shows that as a minimum St Andrews lost the club £1.8m compared with 2019, it's likely greatly understated as had the club topped the league all season at the Ricoh, you'd be looking at a 3 fold increase in gates compared with St Andrews. Without the profit on whichever player it was it would have been catastrophic.
Lease charges up by approx £0.6m coupled with a reduction in matchday income of circa £1.2m shows that as a minimum St Andrews lost the club £1.8m compared with 2019, it's likely greatly understated as had the club topped the league all season at the Ricoh, you'd be looking at a 3 fold increase in gates compared with St Andrews. Without the profit on whichever player it was it would have been catastrophic.
Probably FRS 102 has the answer
HuckerbyDublinWhelan
Well-Known Member
Whilst not arguing the losses, isn’t it worth pointing out that we lost 5 home games on 2019?
That’s significant in itself - and I’m convinced that on the roll we were on we’d have hit 20k by the end of the season.
ultimately they do seem to show that promotion and the Wilson sale stopped us falling off a cliff given the pandemic. I dread to think what would have happened had we played the season out in league one. Especially with that wage bill.
oldskyblue58
CCFC Finance Director
Lets see if we can simplify things regarding the loss. (refer to my previous post on this thread 131 for thoughts on calculations)
The loss was £3,385,242 in 2020 (2019 was a profit £69,916) For both years that is the figures after including any interest charged on loans whether repaid physically or not
Estimated break down of loss
1)Move to Birmingham (see post 131) - all estimates
- Calculated lost turnover £875k
- Calculated increase in direct costs £161k
- Calculated increase in lease costs £600k
Sub total or estimated minimum cost of Birmingham move £1,636,000
2) other items affecting the loss (see published financials)
- increase in wage costs £1,213,509
- increase in amortisation of player contracts £441,266
- increase in interest cost paid to owner related entities £198,123
- decrease in profit on player sales £562,219
- savings made on other overheads (£332,875) (balancing figure as no detailed breakdown provided this year)
3) Government employment grant received( £333,000)
Total of 1, 2 & 3 = £3,385,242
In 2019 SISU related companies extracted from Otium/CCFC capital of £253,448 and interest of £1,477,906 total =£1,731,354
In 2020 SISU Master Fund made an interest bearing loan of £1,635,397. effectively putting back the amounts drawn in 2019
At the end of the 2020 financial year there was £1,149,176 in the bank (2019 £56,603). Two thoughts on this. firstly that must mean only £542k had been used of the loan funds to fund the business in 2019/20. Secondly given the pandemic and the bonuses due (£711k )it was perhaps prudent to keep a cash fund available to Otium.
The logic of that in my opinion is that SISU remain a funder of last resort. Any player purchases and operating costs are still intended to be funded from normal CCFC trading and player sales. The club is supposed to be self sustaining - clearly it is not. The owners support has not been to provide additional funds for player funding but has been as the auditors report says by not calling in the existing loans and sourcing additional working capital if it has to.
Any successful player dealing is down to MR and his management team (so are any duds that are signed)
The balance sheet is now a negative £23.1m that is £3.4m worse than 2019
Expect 2021 financials to be at least as bad.
The loss was £3,385,242 in 2020 (2019 was a profit £69,916) For both years that is the figures after including any interest charged on loans whether repaid physically or not
Estimated break down of loss
1)Move to Birmingham (see post 131) - all estimates
- Calculated lost turnover £875k
- Calculated increase in direct costs £161k
- Calculated increase in lease costs £600k
Sub total or estimated minimum cost of Birmingham move £1,636,000
2) other items affecting the loss (see published financials)
- increase in wage costs £1,213,509
- increase in amortisation of player contracts £441,266
- increase in interest cost paid to owner related entities £198,123
- decrease in profit on player sales £562,219
- savings made on other overheads (£332,875) (balancing figure as no detailed breakdown provided this year)
3) Government employment grant received( £333,000)
Total of 1, 2 & 3 = £3,385,242
In 2019 SISU related companies extracted from Otium/CCFC capital of £253,448 and interest of £1,477,906 total =£1,731,354
In 2020 SISU Master Fund made an interest bearing loan of £1,635,397. effectively putting back the amounts drawn in 2019
At the end of the 2020 financial year there was £1,149,176 in the bank (2019 £56,603). Two thoughts on this. firstly that must mean only £542k had been used of the loan funds to fund the business in 2019/20. Secondly given the pandemic and the bonuses due (£711k )it was perhaps prudent to keep a cash fund available to Otium.
The logic of that in my opinion is that SISU remain a funder of last resort. Any player purchases and operating costs are still intended to be funded from normal CCFC trading and player sales. The club is supposed to be self sustaining - clearly it is not. The owners support has not been to provide additional funds for player funding but has been as the auditors report says by not calling in the existing loans and sourcing additional working capital if it has to.
Any successful player dealing is down to MR and his management team (so are any duds that are signed)
The balance sheet is now a negative £23.1m that is £3.4m worse than 2019
Expect 2021 financials to be at least as bad.
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SlowerThanPlatt
Well-Known Member
It was claimed our budget was mid table for L1, with £6m being spent on wages and second only to Sunderland in agent fees I would doubt that.
I still do not understand why the cost of acquiring a player has to be amortised but observers do not accept the subsequent sale is comparable revenue?
Sky_Blue_Dreamer
Well-Known Member
But we've also seen many cases whereby 'local boy done good' takes over and due to that emotional investment overstretches themselves and the club.
It'd be nice to have that, but they'd also need that business brain to know when they couldn't push further without some serious jeopardy involved.
oldskyblue58
CCFC Finance Director
Because CCFC were not promoted until 9th June 2020 (after the year end 31/05) the bonuses were not contractually due at the Balance sheet date because no one knew if promotion would happen at 31/05/2020 the figure will be included in the 2021 financials. Well that is what the financial statements say
Maximise your assets is often quoted. If that means disposing of one that has run its course for something better ( or potentially so ) that is perfectly acceptable
Grendel
Well-Known Member
Touché to an extent - however once again history shows their presence really was created by the actions of the clubs hierarchy and an engineered move which if successful would have looked smart but it wasn’t - it failed with dire consequences
in the end it’s not just the accounts is it? Seppalla creates enemies through her actions. Yes you could argue she has to create returns but again her image and that of her company is hard nosed aggression in the face of adversaries
She therefore will take strategic risks and has used the club as collateral in the process and no doubt will continue to
You can only measure someone’s success over achievements in the actual performance of the organisation. She’s entering a 15th year at the helm.
We have made zero progress on stadium 1 or stadium 2. We are increasing debts year on year. The success on the pitch though welcome has actually only bought us back to where we were (actually I think we were 7th when she took over). I suppose the termination of the original lease was a success of sorts but the price of that was a heavy one in reality. She’s seen 2 administrations, appointed incompetent and ridiculous board members and been part of 2 relegations which both occurred with notable slashing of budgets and dire managerial appointments.
She I’m sure will claim some form of 5th amendment on the Ranson years but that was her choice.
It’s perfectly legitimate to look at her with distrust. Her tenure has not been good for the club in my opinion. I accept the Northampton move was clever and strategically thought out but it failed.
I’m sure she will claim this move was not engineered but really? I’m afraid the alienation of all around her makes it difficult to believe that the European appeal wasn’t done for spiteful reasons and also was certainly done with no regard for the club.
The club would have been in an impossible position had it not been allowed back to Coventry - it would be in the last year of a 3 year deal which was probably the best option and as we have seen is financially not stacking up.
It’s obvious she’s not going anywhere - the club isn’t worth anything and no one will buy it for a price she would want.
Is that a good thing? In my opinion no - we are back where we started and in an ideal world she’d be moved on
SlowerThanPlatt
Well-Known Member
Do you think we have already reached our ceiling under the current ownership?
Sky Blue Pete
Well-Known Member
I absolutely agree with that about reducing income but I’m not sure it was a choice this time but more as a consequence of many peoples intransigence. I think it’s a fair ask shmmee has put that any shortfall would be covered by the owner and whether a loan at a high interest rate is the only way this can be done.
Grendel
Well-Known Member
Have they ever made it higher after 15 years?
oldskyblue58
CCFC Finance Director
But then if you include the turnover for those 5 games you also have to include the costs. I think there would have been an increase in crowds but not sure we would have got to 20k from an average of 6677
SlowerThanPlatt
Well-Known Member
Yeah no chance of 20k in Birmingham, even under Mowbray when we were competing it was 15k
HuckerbyDublinWhelan
Well-Known Member
Fair point. We were up to 13 for the Rotherham game. We only hit top after the Sunderland game.
I’m convinced that the fickleness nature of our fanbase would have seen a sharp increase towards the end of the season.
That’s all speculation. We knew it would hit us financially hard. Ultimately as I’ve said - Promotion has likely stopped that move being a disaster.
dread to think of the losses if we were 15th
HuckerbyDublinWhelan
Well-Known Member
I’m more talking when it became evident we were going to win the league. We’d have packed any stadium in the last home game when we’d have lifted the trophy.