We can't afford to be a Championship club? (6 Viewers)

[stupot07]

We will never know until we get there! Until then speculation. If/when we are on the up some consortia/individual may come in for us. Wasps if they stay at Ricoh may do us a good deal. Sisu may build another stadia etc etc


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Wasps have £35m plus interest to pay back. We won't be getting a good deal from them and we won't get access to additional revenues we need.


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[lifeskyblue]

Depends how long till we get a realistic sniff of the championship


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[Specs WT-R75]

It's believed to be £2m - £2.5m however with the way the stadium costs are being funded it is said to be effectively rent free.

http://www.bbc.co.uk/sport/0/football/33780720

I watched the iplayer program. Right at the end they go into some of the specifics of the deal. Whilst the rent is allegedly 2.5m, it includes a bunch of costs that most other clubs have to pay on top of rent, effectively making it peppercorn. If you take into account they are probably not getting all the pie money and naming rights etc its still a bloody good deal for them.

Talk of state aid investigations and the like, nothing new there then.

Difference between WH and us is that WH were the only team in town that would move in with the restrictions that it had to remain a track stadium part of the year... so basically WH have been in the driving seat from the offset.

We are unlikely to get much loving from Wasps in the long run as has been mentioned, they have bonds to pay back. That said... Wasps gonna get nothing from anyone else but there could be a payday if the club got back into the PL, so if I was them I would give CCFC a peppercorn rent except when in the Premier League. Win-win situation imho.

 

[Astute]

Wasps have £35m plus interest to pay back. We won't be getting a good deal from them and we won't get access to additional revenues we need.

Are you stating this as a fact or is it your guess Stu?

We keep hearing on here how much Wasps make out of us playing at the Ricoh. They get some of the pie money. Then there is the parking. And then there is everything that keeps getting repeated. From what some would like you to believe they make a lot of money out of us. To me and many others it is debatable because of costs incurred. But if it is right are you now saying that they would risk it all so they can offer only a massive rent increase?

It will be down to negotiations. As long as SISU negotiate for once that is.

 

[Deleted member 5849]

Are you stating this as a fact or is it your guess Stu?

We keep hearing on here how much Wasps make out of us playing at the Ricoh. They get some of the pie money. Then there is the parking. And then there is everything that keeps getting repeated. From what some would like you to believe they make a lot of money out of us. To me and many others it is debatable because of costs incurred. But if it is right are you now saying that they would risk it all so they can offer only a massive rent increase?

It will be down to negotiations. As long as SISU negotiate for once that is.

If they were making nothing to very little out of us at present, it'd make a rent increase almost inevitable if they had any good business sense.

 

[Astute]

If they were making nothing to very little out of us at present, it'd make a rent increase almost inevitable if they had any good business sense.

I agree. But that would make a joke of the normal debates on here. We hardly know anything of what is going on. But some state a guess as a fact.

 

[lifeskyblue]

Would they jeopardise the potential of the goose laying the golden egg?


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[chiefdave]

Are you stating this as a fact or is it your guess Stu?

They have at least that much to pay back. That is just what they owe on the bond issue.

We keep hearing on here how much Wasps make out of us playing at the Ricoh. They get some of the pie money. Then there is the parking. And then there is everything that keeps getting repeated. From what some would like you to believe they make a lot of money out of us. To me and many others it is debatable because of costs incurred. But if it is right are you now saying that they would risk it all so they can offer only a massive rent increase?

The Ricoh should be a profitable venue. Under the ownership of Higgs and CCC it was poorly run. I would speculate having the football club covering a large chunk of ACL's annual expenditure contributed to this. When we moved out there was a shake up and some new people came in. They have turned things around fairly well, the events running now that Wasps have taken credit for are actually a result of the work done by that team before Wasps came in. From what I'm told by my contact in ACL things have taken a step back since the Wasps takeover. They have brought some of their own people in and the phrase used to describe it to me was 'old boys network' rather than those right for the job. Apparently morale has taken a bit of a hit but of course nobody knows where things will go from here.

It will be down to negotiations. As long as SISU negotiate for once that is.

To an extent but, to take an extreme case, if ACL say £5m a year or we're not interested what do SISU do? Would the FL let them move again back to Sixfields?

 

[stupot07]

Are you stating this as a fact or is it your guess Stu?

We keep hearing on here how much Wasps make out of us playing at the Ricoh. They get some of the pie money. Then there is the parking. And then there is everything that keeps getting repeated. From what some would like you to believe they make a lot of money out of us. To me and many others it is debatable because of costs incurred. But if it is right are you now saying that they would risk it all so they can offer only a massive rent increase?

It will be down to negotiations. As long as SISU negotiate for once that is.

it is an educated guess. As NW says, if they are making very little from us at present, then with their repayment commitments it is pretty much a certainty rent will go up, and it is unlikely we will squeeze anymore revenue from them. What have we got as a bargaining chip? threaten to move out? Wasps are in the box seat here, and they have shown they are just as ruthless as sisu when it comes to business. tbh, i'm not sure why you're even trying to pick fault with what i said, seems to be the most logical outcome.

 

[skybluetony176]

To an extent but, to take an extreme case, if ACL say £5m a year or we're not interested what do SISU do? Would the FL let them move again back to Sixfields?

I would imagine the FL would have a difficult job not to given that they've very publicly declared not only from our move to Northampton but also from our move back to the Ricoh we are in temporary accommodation until SISU build our own ground.

There's the real problem. They've had trouble convincing anyone but the FL that this is anything but a bluff, they're now trying to tie the Ricoh's new owners into a long running costly court case with the potential of direct ramifications for them.

I wasn't the only person who said we have a window of opportunity to strike while the iron is hot and negotiate a longer deal at the Ricoh. I now fear (although for the benefit of some I'd like to point out in the first instance that I hope this proves to be wrong due to the damage it could do to our club) that the window of opportunity has now passed. We're not exactly holding all the ace cards here and we don't even have control of the 2 year option at the end of this season.

 

[Astute]

it is an educated guess. As NW says, if they are making very little from us at present, then with their repayment commitments it is pretty much a certainty rent will go up, and it is unlikely we will squeeze anymore revenue from them. What have we got as a bargaining chip? threaten to move out? Wasps are in the box seat here, and they have shown they are just as ruthless as sisu when it comes to business. tbh, i'm not sure why you're even trying to pick fault with what i said, seems to be the most logical outcome.

I agree with all of this. What I don't agree with is people that say that Wasps make a lot of money that we should be making, but when it comes to the rent they hardly make anything so it means nothing to put the rent up a very large amount as they have nothing to lose. You either think that they make a lot out of us so the rent is a bonus and it isn't worth the risk or it will all be about the rent. They are not in a position to gamble.

Or they could be after naming rights where us being there is worth more than any rent they know that they would get from us. And this is why I say that we know hardly anything.

 

[Astute]

They have at least that much to pay back. That is just what they owe on the bond issue.



The Ricoh should be a profitable venue. Under the ownership of Higgs and CCC it was poorly run. I would speculate having the football club covering a large chunk of ACL's annual expenditure contributed to this. When we moved out there was a shake up and some new people came in. They have turned things around fairly well, the events running now that Wasps have taken credit for are actually a result of the work done by that team before Wasps came in. From what I'm told by my contact in ACL things have taken a step back since the Wasps takeover. They have brought some of their own people in and the phrase used to describe it to me was 'old boys network' rather than those right for the job. Apparently morale has taken a bit of a hit but of course nobody knows where things will go from here.



To an extent but, to take an extreme case, if ACL say £5m a year or we're not interested what do SISU do? Would the FL let them move again back to Sixfields?

We all know that the FL make up the rules as they go along. They know that SISU love litigation. So would they be prepared to force us into a rental agreement which is considered to be too much?

 

[stupot07]

I agree with all of this. What I don't agree with is people that say that Wasps make a lot of money that we should be making, but when it comes to the rent they hardly make anything so it means nothing to put the rent up a very large amount as they have nothing to lose. You either think that they make a lot out of us so the rent is a bonus and it isn't worth the risk or it will all be about the rent. They are not in a position to gamble.

Or they could be after naming rights where us being there is worth more than any rent they know that they would get from us. And this is why I say that we know hardly anything.

of course they are in a position to gamble, whats the worst that will happen? We move out go back to sixfields our crowds drop back to 2k, the likely consequence would be increase to the wasps gate as the people of coventry blame sisu for moving us out again and look for something else to spend their hard earned on, on a saturday afternoon.

 

[SkyBlue_Bear83]

http://www.watfordobserver.co.uk/sp...ve_invested_around___20_million_into_Watford/

So 5 million over 3 years to get into the premier league, like I say one of the better run clubs.

 

[wingy]

It's believed to be £2m - £2.5m however with the way the stadium costs are being funded it is said to be effectively rent free.

http://www.bbc.co.uk/sport/0/football/33780720

That's quite lengthy piece six I've only skim read It and It seems correct that It balances out.
There are some staggering responses to questions on how future use by a football Club wasn't envisaged.

 

[Grendel]

We all know that the FL make up the rules as they go along. They know that SISU love litigation. So would they be prepared to force us into a rental agreement which is considered to be too much?

They can't force a rental agreement - that would be illegal.

 

[Grendel]

I agree with all of this. What I don't agree with is people that say that Wasps make a lot of money that we should be making, but when it comes to the rent they hardly make anything so it means nothing to put the rent up a very large amount as they have nothing to lose. You either think that they make a lot out of us so the rent is a bonus and it isn't worth the risk or it will all be about the rent. They are not in a position to gamble.

Or they could be after naming rights where us being there is worth more than any rent they know that they would get from us. And this is why I say that we know hardly anything.

The first paragraph genuinely makes no sense whatsoever.

 

[chiefdave]

I would imagine the FL would have a difficult job not to given that they've very publicly declared not only from our move to Northampton but also from our move back to the Ricoh we are in temporary accommodation until SISU build our own ground.

If anything that means there's less chance of them allowing it to happen. We're now in year 3 of what SISU told the FL would be a 3-5 year project to build a new ground. As far as I can tell there's little indication that there has been any significant progress since the day we packed up and moved to Northampton.

They can't force a rental agreement - that would be illegal.

Indeed but if the FL say we won't sanction Coventry City playing outside of Coventry would that get around the legalities? FL could claim they weren't forcing any particular deal.

 

[Astute]

of course they are in a position to gamble, whats the worst that will happen? We move out go back to sixfields our crowds drop back to 2k, the likely consequence would be increase to the wasps gate as the people of coventry blame sisu for moving us out again and look for something else to spend their hard earned on, on a saturday afternoon.

Or lose the money they get from us being there as well as the rent? They have 50m to pay back in 7 years. They are like us. Every penny counts.

 

[Astute]

The first paragraph genuinely makes no sense whatsoever.

Of course it doesn't. You are one of those that says they make a lot of money out of us. But when it comes to the rent that they will put it up by too much as they have nothing to lose.

 

[Astute]

If anything that means there's less chance of them allowing it to happen. We're now in year 3 of what SISU told the FL would be a 3-5 year project to build a new ground. As far as I can tell there's little indication that there has been any significant progress since the day we packed up and moved to Northampton.



Indeed but if the FL say we won't sanction Coventry City playing outside of Coventry would that get around the legalities? FL could claim they weren't forcing any particular deal.

But going on the past events who would be surprised if they did allow it?

 

[chiefdave]

I agree with all of this. What I don't agree with is people that say that Wasps make a lot of money that we should be making, but when it comes to the rent they hardly make anything so it means nothing to put the rent up a very large amount as they have nothing to lose. You either think that they make a lot out of us so the rent is a bonus and it isn't worth the risk or it will all be about the rent. They are not in a position to gamble.

There's more than one way to look at this.

You can look at it from a CCFC point of view. Only one other club has been in the position we are in, Stockport County, and it led to freefall for them. Where most other clubs have the ability to use their grounds 365 days a year and generate turnover we don't.

From an ACL viewpoint they should be more profitable than they are and seem to, since our move to Northampton, have improved so future accounts may well show a greater profit.

From a Wasps point of view they will want to maximise the revenue they receive from ACL. We have already seen restricted use of corporate facilities for our games as Wasps can make more money hiring those facilities out to others. What if they decide us being at the Ricoh is impeding them getting other events in? What if the FL enforce primacy rules, as they should, and ACL can't say we can't play when the games festival is on? What makes them more money, would they kick us out or the gamers? Wasps now have £35m to pay back, that means there needs to be a significant increase in the profitability of ACL, one option for them is to charge us more knowing we have very limited alternatives.

 

[Astute]

There's more than one way to look at this.

You can look at it from a CCFC point of view. Only one other club has been in the position we are in, Stockport County, and it led to freefall for them. Where most other clubs have the ability to use their grounds 365 days a year and generate turnover we don't.

From an ACL viewpoint they should be more profitable than they are and seem to, since our move to Northampton, have improved so future accounts may well show a greater profit.

From a Wasps point of view they will want to maximise the revenue they receive from ACL. We have already seen restricted use of corporate facilities for our games as Wasps can make more money hiring those facilities out to others. What if they decide us being at the Ricoh is impeding them getting other events in? What if the FL enforce primacy rules, as they should, and ACL can't say we can't play when the games festival is on? What makes them more money, would they kick us out or the gamers? Wasps now have £35m to pay back, that means there needs to be a significant increase in the profitability of ACL, one option for them is to charge us more knowing we have very limited alternatives.

Contracts were signed for the use of the stadium when we were not there and Tim was saying we would never go back renting.

ACL will be more profitable with just Wasps there to it not being used for sport. We are just a bonus on top.

They have 50m to pay back in 7 years and not 35m.

 

[stupot07]

So 5 million over 3 years to get into the premier league, like I say one of the better run clubs.

to be fair their revenue has been a lot higher than ours, in the last 2 sets of accounts (£18m and £16m, against our £10.8m last time we were there)

 

[stupot07]

Contracts were signed for the use of the stadium when we were not there and Tim was saying we would never go back renting.

ACL will be more profitable with just Wasps there to it not being used for sport. We are just a bonus on top.

They have 50m to pay back in 7 years and not 35m.

so what are you trying to say? Wasp will keep up there on a peppercorn rent and allow us to keep getting 50% of the 12% they make on F&B's? which still isnt enough for us in the championship anyway??

 

[Astute]

so what are you trying to say? Wasp will keep up there on a peppercorn rent and allow us to keep getting 50% of the 12% they make on F&B's? which still isnt enough for us in the championship anyway??

I am not saying anything other than it is all guesswork. It wasn't me that said the rent will go up by a massive amount because of an educated guess. I also said that we don't know most of the facts, and that is if we know any at all.

 

[Godiva]

ACL will be more profitable with just Wasps there to it not being used for sport. We are just a bonus on top.

They have 50m to pay back in 7 years and not 35m.

I not convinced ACL are profitable. They have struggled just about every year to be cash-flow positive even if they have posted overall profit. Especially from 2012 when we stopped paying rent. Note how they had to borrow more from the council that they paid back to Yorkshire Bank. Note how they went after Robinson and McGinnity for £300K when the club dragged out repaying the £400k FL ruled Otium should pay to allow the transfer of the Golden Share.

Since Wasp took over the debt and interest payments has increased.
We are back but only pay a peppercorn rent.

In any case, someone asked what bargaining chip the club has when negotiations on the rent starts. Well, how about the JR 2.0? The appeal courts finding that the original ruling was based on wrong premisses suddenly makes the JR a potent factor.

Then there's the existing rent contract. There may well be a clause that define just how much the rent can increase yearly. And there may be an exit clause that requires certain events to trigger so even if the length is 2+2 years it may require special circumstances to end the contract. We don't know.

 

[SkyBlue_Bear83]

to be fair their revenue has been a lot higher than ours, in the last 2 sets of accounts (£18m and £16m, against our £10.8m last time we were there)

8 million pounds in commercial revenue apparently, what did we generate for commercial income during our relegation season?

 

[Grendel]

I am not saying anything

Well that's a fact we can all agree on

 

[stupot07]

8 million pounds in commercial revenue apparently, what did we generate for commercial income during our relegation season?

About £7.25m I think. I think it relates to FL payments, TV revenues, etc. not necessary commercial activity the club undertook.


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[SkyBlue_Bear83]

About £7.25m I think. I think it relates to FL payments, TV revenues, etc. not necessary commercial activity the club undertook.


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In the Watford set of accounts commercial relates to sponsorship income, merchandising, conference and banqueting and other sundry income.

There breakdown of revenue was
Match day 4 million
Media 5 million (TV money, football league funding, cup competitions)
Commercial 8 million

Commercial revenues increased by about 4.5 million when the Italian family took over Watford.

http://www.watfordfc.com/documents/2014-report-and-financial-statements286-2102314.pdf
http://www.watfordobserver.co.uk/sport/watfordfc/watfordfcnews/10816471._/

 

[Astute]

I not convinced ACL are profitable. They have struggled just about every year to be cash-flow positive even if they have posted overall profit. Especially from 2012 when we stopped paying rent. Note how they had to borrow more from the council that they paid back to Yorkshire Bank. Note how they went after Robinson and McGinnity for £300K when the club dragged out repaying the £400k FL ruled Otium should pay to allow the transfer of the Golden Share.

Since Wasp took over the debt and interest payments has increased.
We are back but only pay a peppercorn rent.

In any case, someone asked what bargaining chip the club has when negotiations on the rent starts. Well, how about the JR 2.0? The appeal courts finding that the original ruling was based on wrong premisses suddenly makes the JR a potent factor.

Then there's the existing rent contract. There may well be a clause that define just how much the rent can increase yearly. And there may be an exit clause that requires certain events to trigger so even if the length is 2+2 years it may require special circumstances to end the contract. We don't know.

Like I said all we can do is guess.

Would you be happy to say this to anyone that says our short term future isn't as bad as they say in respect of us not having the revenue that the Ricoh generates?

 

[skybluetony176]

I not convinced ACL are profitable. They have struggled just about every year to be cash-flow positive even if they have posted overall profit. Especially from 2012 when we stopped paying rent. Note how they had to borrow more from the council that they paid back to Yorkshire Bank. Note how they went after Robinson and McGinnity for £300K when the club dragged out repaying the £400k FL ruled Otium should pay to allow the transfer of the Golden Share.

Since Wasp took over the debt and interest payments has increased.
We are back but only pay a peppercorn rent.

In any case, someone asked what bargaining chip the club has when negotiations on the rent starts. Well, how about the JR 2.0? The appeal courts finding that the original ruling was based on wrong premisses suddenly makes the JR a potent factor.

Then there's the existing rent contract. There may well be a clause that define just how much the rent can increase yearly. And there may be an exit clause that requires certain events to trigger so even if the length is 2+2 years it may require special circumstances to end the contract. We don't know.

Ooo. Using JR2 as a bargaining chip to gain something what could possibly go wrong. I can't wait for that to happen especially following the successful bargaining chip that was JR1.

 

[Limey]

So are we currently better off with or without the Ricoh and its associated debt? Very confused now.

 

[stupot07]

In the Watford set of accounts commercial relates to sponsorship income, merchandising, conference and banqueting and other sundry income.

There breakdown of revenue was
Match day 4 million
Media 5 million (TV money, football league funding, cup competitions)
Commercial 8 million

Commercial revenues increased by about 4.5 million when the Italian family took over Watford.

http://www.watfordfc.com/documents/2014-report-and-financial-statements286-2102314.pdf
http://www.watfordobserver.co.uk/sport/watfordfc/watfordfcnews/10816471._/

Just goes to show how important having control of your revenues are. In our accounts, the revenue is broken down into matchday ticket revenue and commercial revenue which also includes TV money and FL payments.

http://www.skybluestalk.co.uk/showthread.php?t=42971

So Watford are making £6m more commercial than us, and as you say includes a lot of stadium centred income.


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