Original - http://www.theglobeandmail.com/spor...les-in-english-premier-league/article9258959/ There are many other reports you can find by a quick google news search. Before you get all alarmed, this doesn't mean much for us at the moment. The fiscal year ends in July, which means the following: 1. It does not include the departures of Aurelio, Kuyt, Maxi, Aquilani, Bellamy, Adam, Cole, Sahin, Doni, Amoo, Darby, Silva, Eccleston, Carroll & Spearing (loan). 2. It does not include the sponsorships with Black & Decker, Chevrolet, & Garuda + many more this season. 3. It does take into account the transfers up until that point by FSG. 4. The debt is owed to ourselves! John Henry controls this debt, as he is the principal investor with FSG. This is his money that we "lost" and that's been the plan all along. Reading last year's plans and reports, this is in line with their expectations and isn't an accurate representation of our financial situation. JH and TW will write it off as an expected loss until next years report comes out (which will probably show a great profit from the wage reduction and sponsorships). EDIT: 5. This does NOT include the Warrior sponsorship deal of 25m pounds per annum. In other words, all quiet on the western front, nothing to declare, business as usual. Don't be alarmed. These aren't unhealthy numbers. I expect a ton of you to go the "FSG = satanic demons intent on destroying us" route with your posts, but it really isn't anything to be concerned with. Of course, the media and journalists will have a field day reporting this, sensationalising what they want and ignoring other facts.
Yet another 'story' presented by an agency sports hack with little financial understanding but a requirement to find an angle with which to sell the copy. Sad but true.
another thing to also note is that FSG are not being paid a dividend this year (and they will not be expected to pay themselves one any other year as they do not pay dividends on sports investments)
"these aren't unhealthy numbers" - what are they then? A loss of £40.5M & an increase in debt of £21.8M is hardly "healthy" is it? They're a **** set of numbers, the next set should be better, but whether there'll be a £60M swing is highly unlikely. p.s. The Warrior deal isn't all incremental revenue.
lol, I should hope not, given that there's a £40M loss! There's nothing to pay a dividend on is there?
If that 'debt' has been put in by FSG it will be in the form of a loan note (most likely with rolled-up interest, rather than paid interest from day one). That is not debt, it is equity. Why? Because FSG will not call in their loan-not and put their own business into administration, like a bank would. So if all it is is FSG investing more into LFC by way of Loan (v common way of financing your own business) then this is absolute none news. As for the loss, what else did we expect, our wage bill was obscene and we have no CL
This article only serves to worry those who have no idea about Accounting and Finance. Roughly £20m of that debt is a non-interest loan from FSG themselves. Hence, it's not even worth taking into account because its long term (non immediate) debt. Losses are always going to be accrued if you're purchasing long term assets . When you first start up a business and buy a vehicle, stock and a workplace you are not expected to make a profit in the first financial report thats for sure. The players are assets who go through Depreciation like any other asset. FSG most likely took out a loan to buy these players, then credited Liverpool with the debt to balance out their own sheets and keep everything in order. It's simple accounting practice.
I don't know why anyone would be bothered. These figures, whilst not great for you, are so old they're obsolete.
lol, I assume based on that comment that you're an expert in that field then? It's the second set of numbers they've released, that show exactly the same loss run rate as the first set. They're crap numbers & there's no amount of flannel that will alter that fact. Ayre has got a job on reducing the cost base, keeping tight control of capital expenditure, whilst increasing revenues, whilst at the same time placating the fanbase & the football manager.
Not an expert at all, but I'm studying Accounting and Finance, and I looked over the financial report.
Does this all mean that the club is in over £300m debt as that's what FSG paid for it? No, didn't think so. I'd LOVE to stick the knife in FSG, but unlike H&G days we're not living above our means and servicing a mountain of debt. Not really sure how we'll move on from here, or if we'll ever be able to compete again with the sugar-daddy clubs (especially if Arsenal join them) and United, but we're not even remotely going down the same plughole as 2010. Maybe FSG are stabilising us for a sale (fingers crossed) or maybe we're just entering a further phase of stagnation and mediocrity. Ah well, supose the books will look better when we sell Suarez, so long as we don't buy another Carroll.
Now now Tobes, don't forget that you set yourself up as a legal/financial expert to give us a running commentary over the 2010 H&G High Court case, and you got everything wrong (including that assertion that the court of Dallas had precedence over the English High court, as that's where Hicks was based... ). From your scribblings we can assume that you work in some arm of finance in some business, but my sister is/was (part time now) a financial comptroller in a major utility, and her husband - a bluenose - (another accountant who met her in work) tells dark, dark tales of the finances of yourselves, including the still ticking time bomb of the residue of the Bear Sterns loan you took out @ 10 years ago, and which you've been remorgatging and selling off assets to service ever since. And your commercial sales and turnover are not even close to Liverpool's earning power, even nowadays when still in the doldrums. Perhaps you could offer your considerable expertise to a cause that really needs it?
Didn't H&G try something similar - but DID charge the club interest on the 'loan' they arranged for them? Way to **** your assets up, i suppose, and they probably got their just desserts when they lost £100m's on the club. ****s.
Remember that the first set (I assume you mean 10/11?) included around £40 million profit from the sale of Torres. That's the problem with football accounts - the money from selling players is recognised in one big bang, whilst the cost of buying them drags on the accounts for years. Everything's far from rosy for pool, but underlying costs have come down by around £20 million and revenues are up by £5 million so they're moving in the right direction, and that's without any European football last season. As long as they don't sack Rodgers or buy another Carroll this summer they should be close to break for this season. Tho' missing out on Europe again won't help in the long term. The debt thing is also a bit of a red herring - whilst it's not good to have debt rising, the actual level of bank debt has fallen thanks to the money FSG put in. It's just an accounting treatment to make it easier for FSG to get their money back if they want to invest in the Red Sox - Abramovich has a £760 million 'debt' from Chelsea which makes **** all difference to their accounts.
This whole thread is just so funny. Tobe's (as is his will) is trying desperately to prove that both the figures and statements define some form of on-going collapse. Ayre's explanation of the figures put the best gloss possible on the situation - he tells no lies but at the same time does reveal the full truth (so situation normal for any Chief Exec.). Sure the incomes could have been higher and 2 seasons of no CL football have not helped but all in all a reasonable commercial performance. For me the strategic importance is the FSG commitment to the club. Not only are they investing in their own asset with their own money but they are forgoing dividend. If this point was made more firmly to some of the anti-FSG brigade then we may see them finally acknowledge that they are not the devil incarnate! But Tobes, it's B- for this "They're crap numbers & there's no amount of flannel that will alter that fact. Ayre has got a job on reducing the cost base, keeping tight control of capital expenditure, whilst increasing revenues, whilst at the same time placating the fanbase & the football manager." They are crap numbers in what terms and in comparison to what? Also, what else would you expect a Chief Exec's job description to look like?
Donga - I'm not an expert in commercial law, same as you're not & I have never professed to be. Neither am I a bean counter, albeit I know my way around a set of accounts. Stop waffling on about Bear Sterns mate, I've squared you up on that one before, you're flogging a dead horse & talking out of your hoop. Our accounts are bloody awful though & under Kenwright & Co are going nowhere, so I'll never deny that fact or even say that they bare a favourable comparsion with LFC's. The difference is I can admit they're ****e, it seems that there's a desire to flower yours up & convince yourselves that it's all good news, when of course it's not.
Football isn't like any other business though is it? He has to control revenues whilst placating the demands of the fanbase & his manager, who both will demand large capital outlay. Not many businesses have their customer base demanding massive capital investment, (with no guarantee of any financial return), every 6 months, do they Dave? What makes them crap? A £40.5M loss. Spin that into a positive Dave.
