Alright all you clever clog accountants out there. Explain to this dunce what's good & bad about these numbers .... http://www.leedsunited.com/news/20121227/report-on-financial-statements_2247585_3018589 REPORT ON FINANCIAL STATEMENTS 27 Dec 2012 Financial report... Leeds United Football Club Limited ('Leeds United') is the primary wholly owned subsidiary of Leeds City Holdings Limited ('Holdings'). The financial year end for both companies is 30th June 2012. Leeds United Football Club Limited Headlines 2012 2011 Turnover: £31,080,000 £32,678,000 Operating Profit: (£3,348,000) £939,000 Overall Profit: £317,000 £3,504,000 ⢠Turnover decreased by 4.9% in the period. ⢠Gate receipts decreased by 10.6% in the period to £11,368,000 which represents 36.6% of turnover. ⢠First Team Squad and Management costs were £12,869,000 compared to £11,614,000 in the previous period in the Championship and represents 41.4% of turnover. ⢠Leeds United employed an average of 213 full time employees during the period compared to 207 in the previous period. In addition, 667 casual part time people were employed. Leeds City Holdings Limited (Consolidated) Headlines 2012 2011 Turnover: £33,097,000 £34,475,000 Operating Profit: (£4,193,000) £509,000 Overall Profit: (£536,000) £2,988,000 ⢠These figures include the accounts for Leeds United Media Limited, Yorkshire Radio Limited, Leeds United Centenary Pavilion Limited and Leeds United Football Club Limited.
Basically says that last season was the 1st under Bates that you have made a loss (would have been more if you had not sold some key players). Also more worrying is the fact that your attendances are down 12% more this season and more money has been spent - struggling to see how GFH are going to make a return on their investment as the money needed to get you into and stay in the Premiership will be massive numbers Seems you need 28k gates to break even!! The plus point is that you are spending less than half of your turnover on team and management costs - which is good for when the FFP rules kick in.
The operating loss is accounted for entirely by the white elephant of an East Stand, which for some reason the club is still paying for. If GFH have any sense they'll cut the loss making entities, including Yorkshire Radio, and start from the basics.
Why make a loss on yorkshire radio when we could make a profit selling the broadcast rights to say bbc radio Leeds or whatever is beyond me
Have you acknowledged that GFH has actually taken over the club now? Not so long ago you were doubting it was real.
As I worte on another forum: Confirms what many of us already knew: 1) Gate receipts significantly down (>10%), 2) The football club did not earn profit from operations, relied on player sales to be profitable (again), 3) Non-football operations - catering, broadcasting, etc., was a drain on the holding company and overall results. Now let's see the balance sheet and what the debt position was at June 30, 2012. Bates could see the writing on the wall and needed to bail out. Timing was very good for him. What can GFH do to turn the tide? 1) Already offered half season tickets, 2) Showing good intent by signing Hall, 3) Need a youth ticket incentive scheme. Any other ideas?
Couldn't care less what the accounts show from last year. Thankfully new owners can worry about that now. They will have to produce profitable figures for their investors. The only guaranteed way of doing that will be promotion to the premiership. They seem to have already figured that out whereas our former dictator was in denial
If a large chunk of our cost of sales included the development of the East Stand (which I suspect it will), then they are not a bad set of results, as that would be classed as an exceptional item. Yes T/O is down a little but an increase in gates to something along the Middlesbrough figures will sort out gate receipts, plus we've had a decent Carling Cup run which will be worth a few bob. And we've already seen a fair few TV games as well this season. We must have some really good merchandise sales included in this too, which I reckon will be the best in the league. As TC also pointed out, whether our wage bill is high or not, we a very well set up for the new rules next season. These rules are made for a club with a Turnover figure as high as ours.
Many of us think it is quite easily done for Leeds United to be profitable in the Championship with some prudent management and creative ticketing schemes to increase attendance at games. Remember, revenue from every ticket sold goes straight to the bottom line, most costs are fixed and thus very few variable costs that rise with increases in attendance.
Simplest way of filling the stadium is promotion. Probably a full house most games. It's actually laughable how often a piss poor Liverpool team get screened live almost every week. That revenue alone is worth a fortune
Liverpool are probably a very bad example to use, as that piss poor team's losses, despite massive revenue streams from the Middle East, rose £30M last season - they are in debt to the tune of £49.4M as a result
Like JLA says, the non-football expenditure is what's dragged our profits down so low. The Bates Boxes and cream cladding in the East Stand deprived our recent managers of millions which could have been spent on the team, and would have meant Elland Road had a bigger capacity and cheaper seats. Having to prop up a failing radio station, restaurant and 'other expenses' totalling millions doesn't help either. If GFH manage the club with a semblance of sanity, our wages:turnover ratio will be within the UEFA guideline of 50-60% (15-20m in real terms, which is what most promotion/playoff teams spend). Maybe 3-4m on transfers. 3m for ER and TA (ideally buying them back though, rather than continuing the rental). If they knocked a fiver off tickets across the board, made programmes, food, drink and merchandise a little bit cheaper, and adjusted ST and membership prices appropriately, the worst case scenario would be losing a couple of million from the surplus in the turnover. Best case: making a couple of million from the increased engagement from fans. And that still leaves 2-5m for repairs, FA fines, better advertizing, paying the Police to be dickheads, that sort of thing. It's really not a hard club to manage and get to be profitable, truly a big and financially fertile fish in a small pond, so as long as they don't listen to Bates where the day-to-day operations are concerned, they should be fine and be able to mount a promotion challenge with bigger crowds and happier fans.
I'm a bit puzzled by that. I thought we borrowed money to develop the East Stand, and would only expect only one years' repayments to show on this particular balance sheet. The thing that puzzles this non-accountant is what our costs were apart from the playing staff wage bill - i.e. the other £18m or so of the LUFC turnover. The rental costs of TA & ER should be fixed, and added to the salaries of the remaining staff, it should not get close to £18m. WTF are these costs? Am I just terribly naive?
Actually costs incurred to develop/improve the East Stand is most likely classified as a capital improvement and thus added to the leasehold improvements component of fixed assets on the balance sheet. It would only affect profits when completed and amortization over the shorter of its useful life or the remainder of the lease term begins. Money borrowed shows up as debt. Repayments are a reduction of debt and thus no impact on the profits. See response above. Other costs include: - salaries and wages of non-footballing management and staff, e.g., ticket sales, marketing, physios, catering staff, laundry team, tea ladies, etc. - office costs, e.g., supplies, equipment expenses, repairs and maintenance, etc. - professional fees, e.g., accountants, lawyers, etc. - repairs and maintenance, - game day costs, e.g., turnstile operators, stewards, programme sellers, food and drink staff, etc. - grounds crew and maintenance costs, - utilities, e.g., water and light, telephones, electronic communication costs. Many others also. More to it than meets the eye.
impossible to comment on the detail. As there isn't any. And without detail, we tedious accountants can't survive. Its pretty clear that revenues are down (which we did not need the accounts, to guess would be the case) and it appears the business was not able to break even on ordinary trading - but, as we don't know what expenses are being charged and why and if the new owners would continue to incur the same expenses...... etc etc........... we can't really comment much more, other than to join the wild, unfounded speculations of our non accountant friends. Have to say, it has the feeling of a business that could be moderately profitable in the Championship, as it ought to be possible to revserse that decline in revenues. But thats just a gut feeling.
Clearly gfh have had seven months to analyse every aspect of Leeds and its financial potential. They are not football men or die hard Leeds fans so unlikely to be blinded by a passion to simply own a football club. They must believe they can turn a profit or they wouldn't have shelled out 52 million. One thing is clear from those figures, we wouldn't have survived long term
