Cash Flow Positive (2 Viewers)
- Thread starter jimmyhill
- Start date
if someone is 50k in debt and is paying, 3 percent interest on that money and you give them a pound they are not cash flow positive.
If you have 5 mill in debt, but your income in January is 300k and your outgoings are 300k and you give them a pound then yes they are cash flow positive.
edit - in fact in the second example even if you were loaning them the pound they would still be cash flow positive.
If you have 5 mill in debt, but your income in January is 300k and your outgoings are 300k and you give them a pound then yes they are cash flow positive.
edit - in fact in the second example even if you were loaning them the pound they would still be cash flow positive.
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basically cash flow positive means over a period of time the money coming in is greater than the money going out. it doesn't really mean anything in terms of how you are doing financially, unless cash flow gets so low that you arn't able to pay your debt.
you can have negative cash flow and great profit and you can have positive cash flow and be running up large debts. It's more misleading nonsence from fisher imo.
you can have negative cash flow and great profit and you can have positive cash flow and be running up large debts. It's more misleading nonsence from fisher imo.
chiefdave
Well-Known Member
You know that when they are so careful to say cash flow positive rather than something like no debt or making a profit they are trying to pull a fast one.
Of course they're cash flow positive, the wage budget has been cut again based on being at Sixfields and now we're back at the Ricoh selling way more season tickets and match tickets than budgeted for.
Of course they're cash flow positive, the wage budget has been cut again based on being at Sixfields and now we're back at the Ricoh selling way more season tickets and match tickets than budgeted for.
Cash flow positive doesn't necessarily mean profitable. There are items in the books that require depreciation and amortization. Something that doesn't involve cash but effects the bottom line.
I am sure OSB can tell us in a way we can understand.
It's basically just the money coming in vs the money going out over a period of time, could be a month, could be a year.
if you pay off 10m of debt, you arn't making yourself worse off, in fact it's probably a very positive thing for the future but it gives you negative 10m cash flow.
if you invest 10m in stocks and shares, you arn't making yourself worse off, in fact it's probably a very positive thing for the future but it gives you negative 10m cash flow.
if you are owed 10m and you write it off thats very bad but doesn't show in your cash flow at all.
if someone loans you 10m, it gives you 10m positive cash flow even though if you are borrowing this just to stay afloat it's probably a bad sign.
it doesn't really tell us anything and so as usual he is just trying to mislead us.
if you pay off 10m of debt, you arn't making yourself worse off, in fact it's probably a very positive thing for the future but it gives you negative 10m cash flow.
if you invest 10m in stocks and shares, you arn't making yourself worse off, in fact it's probably a very positive thing for the future but it gives you negative 10m cash flow.
if you are owed 10m and you write it off thats very bad but doesn't show in your cash flow at all.
if someone loans you 10m, it gives you 10m positive cash flow even though if you are borrowing this just to stay afloat it's probably a bad sign.
it doesn't really tell us anything and so as usual he is just trying to mislead us.
chiefdave
Well-Known Member
That's my point, they are using a term that most people probably don't come across very often and trying to make it sound like something it isn't. They are saying cash flow positive as if its a shining example of how well they are running the club but it doesn't really mean that at all.
rupert_bear
Well-Known Member
I look at 7700 for the last home game so with 5000 season ticket holders that's 2700 extra punters at £20 a head, £54000 maximum to last a fortnight, not going far on that are we.
shy_tall_knight
Well-Known Member
I'm not surprised that they are cash flow positive, and probably explains what SISU's tactics were for the foreseeable future, no more "investment" (doubt it was ever near the £50m quoted) - just keep us ticking along for years in the lower leagues hoping to get the Ricoh, the council leaders may as seen this as being their tactic also, hence the sale to WASPS to avoid the potential white elephant that the Ricoh may have become with SISU owned football club as the anchor tenant. Cash flow positive would be an achievement if we were at the top of the league pushing for promotion but a team that's won 6 league games in its last 34 then its nothing to be proud of.
Skyblueweeman
Well-Known Member
What about £14m?
if someone loans you 14m at a rate you can afford so you can pay off a 14m loan at a rate you can't afford, it gives you a positive cash flow in the future as your expenses drop and is a good thing. in the month you receive the 14m and pay off the 14m it doesn't change your cash flow as you increased both your incoming by 14m and your outgoing by 14m.
J
Jack Griffin
Guest
LOL, I mentioned this in a previous thread, but I did not explain it .... finally people are twigging what weasel words they are..
oldskyblue58
CCFC Finance Director
Basically the club are spending less than they are paying out. It is to be honest more about TF trying to put a positive spin on something rather than a particularly helpful statement - you only have to look at some of the questioning above to see it really told us not a lot.
As Godiva and others have said there is a difference between cashflow and net profit. As it implies cashflows are the actual physical amounts of money in and out. To be positive more physical receipts than physical payments.
Net profit will take in to account things like depreciation or amortisation of player contracts etc. which are items where no physical cash changes hands plus other accounting adjustments. So you could be cashflow positive and be making losses (negative net profit) and vice versa.
Questions you could ask TF
- does he mean at this moment or does he mean this season, or over the last year, month or week?
- are all creditors being paid as they fall due or are creditors growing?
- have any more funds been received from what he now calls "the creditor/investor" previously known as the owner or Seppalla
- If he means as of now this minute being cashflow positive then isn't that false position having just got ST holders to pay up front for the season ahead? that's worth about £1.4m so far
- if we haven't been cashflow positive in 15 years why the cashflow statements for the SBS&L group showed an increase in cash for the year in 2010 & 2008 and in the CCFCH group in 2000.
- If we are cashflow positive have all costs such as interest due to ARVO & SBS&L been paid out? or was any interest rolled in to the debt or exchanged for equity?
If you think about it in 2014 there have been huge reductions in overheads & wages set against positive cashflows from the Ricoh return, player sales (Christie & Wilson - yes some might be stage payments but even so) the cup incomes from Arsenal etc, the up front payments on Season Tickets etc. Cashflow positive could be by a couple of quid and his statement would still be true but not sure that would be very impressive - but it is what lies behind the statement that matters
I am also going to take a guess that yes we may be cashflow positive but that none of that positive cashflow is made up of any extra funds from SISU or ARVO - but we wont know that for 18 months or so when the 2015 accounts figures get published
Also interesting they have started emphasising the finances again ......
If things are so positive can we expect to be active in the transfer market in January? we apparently should have cash that could be used :thinking about:
Of course the problem he has is that most fans do not care about clever financial statements what they care about is what takes place on the pitch and that's not going so well is it. To remain cash flow positive they will need to keep tight control over costs which must mean it is unlikely that we will be going out to buy players or to even pay top salaries - that will feed in to what can be achieved on the pitch.
As Godiva and others have said there is a difference between cashflow and net profit. As it implies cashflows are the actual physical amounts of money in and out. To be positive more physical receipts than physical payments.
Net profit will take in to account things like depreciation or amortisation of player contracts etc. which are items where no physical cash changes hands plus other accounting adjustments. So you could be cashflow positive and be making losses (negative net profit) and vice versa.
Questions you could ask TF
- does he mean at this moment or does he mean this season, or over the last year, month or week?
- are all creditors being paid as they fall due or are creditors growing?
- have any more funds been received from what he now calls "the creditor/investor" previously known as the owner or Seppalla
- If he means as of now this minute being cashflow positive then isn't that false position having just got ST holders to pay up front for the season ahead? that's worth about £1.4m so far
- if we haven't been cashflow positive in 15 years why the cashflow statements for the SBS&L group showed an increase in cash for the year in 2010 & 2008 and in the CCFCH group in 2000.
- If we are cashflow positive have all costs such as interest due to ARVO & SBS&L been paid out? or was any interest rolled in to the debt or exchanged for equity?
If you think about it in 2014 there have been huge reductions in overheads & wages set against positive cashflows from the Ricoh return, player sales (Christie & Wilson - yes some might be stage payments but even so) the cup incomes from Arsenal etc, the up front payments on Season Tickets etc. Cashflow positive could be by a couple of quid and his statement would still be true but not sure that would be very impressive - but it is what lies behind the statement that matters
I am also going to take a guess that yes we may be cashflow positive but that none of that positive cashflow is made up of any extra funds from SISU or ARVO - but we wont know that for 18 months or so when the 2015 accounts figures get published
Also interesting they have started emphasising the finances again ......
If things are so positive can we expect to be active in the transfer market in January? we apparently should have cash that could be used :thinking about:
Of course the problem he has is that most fans do not care about clever financial statements what they care about is what takes place on the pitch and that's not going so well is it. To remain cash flow positive they will need to keep tight control over costs which must mean it is unlikely that we will be going out to buy players or to even pay top salaries - that will feed in to what can be achieved on the pitch.
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fernandopartridge
Well-Known Member
Fisher is greeted with incredulity but you hang on his every word on here. I can't be arsed reading his interviews or listening to them. I suggest others do the same.
fernandopartridge
Well-Known Member
He's not employed as a PR man is he
fernandopartridge
Well-Known Member
Huh, say it again
And don't worry if he gets pushed we have SW!!!!!!!!!!!!,, but hold on lots like Steve as he seems a nice guy,, FFS they are all in it they are all singing off the same sheet. And they are all trying to state positives when i have not seen 1 positive in 7 years with these in control. Even the return to the ricoh was forced because the fear Wasps were close to a deal, the interest of most is wearing thin and if i were sisu, i might take it as a sign even at the Ricoh most do not follow the plan of our owners..
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Warwickhunt
Well-Known Member
I still ask myself why are SISU so quiet about all this goings on?
shy_tall_knight
Well-Known Member
Its l;ike a war / thriller film when it goes "too" quiet, have SISU a cunning plan or have they been caught out that they have yet to formulate a reasonable response