Both Portsmouth and Rangers have gone into administration for various reasons of tax evasion. Both seem to have fallen foul of poor Chairmen. It's been moated that there have been a few Premier clubs who have been investigated and are in the process of dealing with their own Tax problems. Fulham seem from the outside to be run very well, but there is also a HMRC investigation into Football Holding companies in Tax havens, of which MAF has one in the Bahamas called Fulham Holdings I think. At some stage the Premier will have to look at the debts that clubs are incurring. The amount of mediocre players who are getting overpaid has to be looked into, before clubs follow the route of Pompey and Rangers into administration when times get tough.
As a follower of Southampton, I know all too well what administration can do to a club. Although for every Southampton, Bournemouth, MK Dons there will be a Plymouth and Portsmouth. Southampton had the potential to be great again. Stadium, fan base, academy etc. What does an investor see when he looks at Portsmouth? A small stadium that they can't fill and a crippling wage bill. It is hard to see someone coming forward offering a huge sum to buy Portsmouth. I hope they do survive as they are the only true south coast rival to the saints despite what Bournemouth fans like to think. As for Rangers, it's a tricky one. They do seem an attractive proposition having European football and a genuine chance of silverware each season, but they are stuck in a league that makes next to no money, and they don't take advantage of the European money on offer with dismal performances each season in the competition. It is at times like this that Arsene Wenger deserves a lot of credit, they are one of the few clubs in the Premier League to become self sufficient. If you take the chairman's cash out of a lot of clubs (including ours) then the club would crumble.
The top UK company is Fulham Football Leisure Limited. This is held by AIT Leisure Limited which is registered in the British Virgin Islands and the ultimate top company is Mafco Holdings Limited which is registered in Bermuda. It's a fairly standard structure and I think HMRC would have trouble challenging football clubs on that basis. The much bigger case will be image rights and amounts paid off-shore. Someone will come a cropper there, I think. For us, I think our biggest risk is the loans from MAF. The club has debt of around £200m in total, of which the majority is longterm debt repayable at least five years from now. However, most of that is payable to the estate of MAF and a large chunk of it (at least £45m) is secured against the clubs assets. If MAF dies and his estate calls in the various loans... we could be in big trouble.
I can see MAF selling up before too long. Out of all the sides in the PL whom have not been taken over by billionaires, I think we are the most attractive opposition. We are in a great location (West London) both club wise and stadium (who doesn't love the walk through BP), we have a decent sized stadium that has potential to expand, or even move to a bigger area, we are now looking at building a young team where we don't have to rely on 32 year old's week in week out, and we have a wage cap at the club which gives us enormous stability. I'm not saying I want us to be the next Man City, but if the choice is go bust or go rich, then it's a no brainer.
In addition to the above, some interesting numbers to think about: 2011 income: Gate receipts - £11,240k Europa League - £498k (this was £12,483k in the prior year due to our run) Sponsors - £4,372k Central awards (e.g. Premiership monies) - £44,822 Broadcasting - £5,747k Other commercial activity - £9,726k 2011 expenses: Staff costs (inc. player wages) - £57,672k (this was £49,825k in the prior year) Audit costs - £65k Other admin expenses charges - £14,112k Interest paid - £135k Financing charges - £461k If we faced relegation, we would certainly need to slash that wage bill to stay afloat. However, I suspect if we did go down our big earners (I would guess these to be people like Deuce, Dembele & Ruiz) to leave anyway! With regards to being run like a business - Fulham are improving, but a real business would not survive on interest free loans!
Without seeing books, Fulham would appear to me to be one of the more frugally run teams in the league. We have no superstar players making 80k plus a week, like so many clubs. Our earnings are modest based on the size of the stadium and our expenses appear to be modest as well. I'm sure Chairman Mo loses a few million every year, but the upside is that he's the proud owner of an EPL franchise. I'd be shocked if the words "Fulham" and "administration" are uttered in the same sentence by anyone in the league.
I think the clubs profit last year of around £4 million I think it was, was a huge step forward. I think it was the first profit posted in quite some time, this was probably due to player sales, European money etc
Hmm? We were taken over by a millionaire (or was he a billionaire back then too?) in 1997 I echo DR's thoughts, there are many clubs in the PL alone who I can see going into administration before us. Everton, anyone?
You know what I mean Bidley, a billionaire who has a blank chequebook then. I think all PL chairmen are millionaires aren't they?
Well if our profit was up to £4m last year like you say, then I can't see old Mo flogging us any time soon.
Yes but on the whole MAF has made a huge loss with FFC. That profit also mostly came around from one time circumstances.
For what its worth, I think the Directors run as tight a ship as possible. It's not the best, is it sustainable - I don;t think so but the club are investing money in the right areas. Youth development, ground development etc. Bandits comment about Arsenal - I would beg to differ. They make a profit but I believe it's purely on player sales. They have developed land nearby that is going to be sold next year I think and so they will again look to have a good book of accounts but after that you may see some falterings. Certainly the Arsenal Supporters Trust are very worried. They have 71 players on their books and have just offered one of the worst defenders in the league Djourou, £50k a week! DOH! MAF knew exactly what he was doing, he knew he'd have to sink some money into the club with the prospect of getting nothing back at least for a while but I don't believe he will sell out anytime soon.
We are fine. It's important not to confuse revenue with capital. HMRC ar chasing the revenue dodgers. A couple of examples - * one of Glasgow Ranger's problems is they used revenue as if it was capital and didn't declare it in their acounts * transfer fees are capital but commission is revenue. 'Arry's "problem" was that if he received money as part of a transfer deal he should have declared it as revenue * Portsmouth's problems are that they didn't have enough income to pay running costs Salyc's figures for 2011 show that the percentage of player's wages to income is below the magical threshold of 70%. That is the true benchmark to measure viability. We have been transparent in relation to fees paid to Agents - I posted something about this at the end of last year and if I remember correctly it was about £900k ie 5% of tranfers which is good business. The £4m profit was mainly because of increased gate money and new sponsorship deals. Again all good business. We are vulnerable (as are all clubs outside of the top four) to premiership performance (ie league position) and TV money but at present that is not a threat to our day to day survival. So we are healthy and have nothing to fear from HMRC. The holding accounts are a red herring in this context. Capital is potentially a different kettle of fish. It has to be a concern that of the money loaned by MAF, £169m is interest free. However on the plus side it is an unsecured loan so if he does pull the plug we do not lose our assets (the ground, the players etc). Unlike, for instance, ManU where the owners bought the club on the back of loans secured against the club's assets. None of us knows how it will pan out when MAF goes but, jeez, compared to Clay, Bilstrode, Marland et al days back in the 80s, I'll sleep easy.
