I think the subject of the clubs finances is worth a thread of its own (just a suggestion). There seems to have been a fair bit of scaremongering on this subject just lately. Also it seems to keep rearing it's head in all sorts of other threads and is often lumped in as part of the name change debate. I see no comparison in our current position to the one we found our self in under the last regime. I think the finances and business side are all good but I could be wrong. We do have qualified people who post on here who know their stuff, some of them CTWD members/supporters. They would be able to help answer any concerns that some people may have. I have no worries over the financial position myself but if certain other posters said I should, I probably would. I would base this on their previous postings on the financial melt down last time. This is not a personal dig at you Obi, you may be very well informed or you may just be guessing and posting from a pro CTWD stance and pointing out worst case scenarios . I simply do not know and would not make an assumption either way. You do often raise points about the clubs finances that I would like to see answered, but a lot of debate has ended up getting stifled lately. A sensible debate on this subject would be good as far as I am concerned.
I am as sure as I can be that the club is in rude health financially but I am not an expert. I would be prepared to listen to other points of view. The cheques that were signed this week would lead me to suspect we are not minutes from meltdown, just a wild guess.
Oh go on then, I'll stick my neck out. I think we will get through to the end of the season without going into liquidation.
I don't take it as a personal dig. I just feel a sense of deja vu. I have seen no evidence that our income from Hull and East Yorkshire has increased massively since Assem Allam took over. Most of our spending has been backed by loans from Allamhouse. If the money came from money stuffed down the sofa then fine but there are indications he has increased the loans on Allam Marine to put money into City. These loans will have to be repaid from Allam Marine's profits. I can't be certain whether he can afford to continue doing this until the accounts are published. All I have to go on are his statements, repeated a number of times, that we were £11 million in the red before we bought Jelavic and Long. Yes we've sold some players but I could see our deficit this season going over £20 million. If Allam Marine is making those sorts of profits we'll be ok, if not he'll need to find the money from somewhere. Assem Allam says the money will come from changing the name to Hull Tigers. Yes I have an emotional attachment to Hull City, the name, but I can see us repeating the same mistakes we made under Bartlett. Some people may see it as scaremongering but I have tried not to jump to conclusions just ask questions I think are important. Whatever the outcome of the application to the FA, having a potential debt of over £100 million is worrying.
We seemed to have ruled out minutes from meltdown, we're off to a good start. If someone can see a meltdown on the horizon, perhaps they would like to explain it to those of us who can't.
So do I. I don't think the threat of liquidation is a worry. Most of the debt is to Allamhouse. The threat is what happens if Allamhouse want some of that money back, for whatever reason.
No company that has debts bigger than it's annual income could possibly be considered to be in 'rude health'. How big an issue it is depends entirely on circumstances. If AA pegged it tomorrow, we'd be in trouble. If we get relegated, our income drops, our gates drop, but our costs remain massive and Allam Marine would have to carry more debt, which AA has said he's not prepared to do. Assuming AA stays with us and we don't get relegated, I don't anticipate any meltdown. Possibly a good idea to keep your fingers crossed, just in case.
I do understand were you are coming from, I was one of the first to shout there is a financial meltdown coming last time. I was of course accused of scaremongering. Being an idiot etc. It turns out I was correct. I am not seeing it the same way this time round for many and various reasons. One thing we all learnt from last time was that some people who post on this board do know what they are talking about. I see some of the figures from last time being comparable to the current ones, but I have a lot more confidence in the current regime and their ability to keep it in shape and sustainable going forward then the last regime. I would be worried if the debt to Allamhouse went north of £100 million but as far as I know it hasn't yet. I think we would be all right up until that point, but as I said I'm not an expert.
Our debts are currently at least £85m, probably over £90m, I don't think you'll have long to wait before they hit nine figures, which I'm pretty sure is where AA has decided to draw the line.
I sort of see £100 million as an upper limit, I am just wondering if there is any reason to take it from where it is now, to that point. Would there be any reason to increase the debt. Is there any reason to put more money in from this point on other than a desire to do so on the owners part. I didn't think there was a need to increase the debt by buying two strikers this month, but the owner chose to. The debt to annual income is not that bad and there are no stipulated dates or schedule for the repayment of the capital sum? If the revenues rise and the annual income goes up, would anyone expect that we would let the debt burden we are carrying rise in tandem?
