SUFC Accounts 19/20

[norfolkblade]

Forget the Price of Football guy who tries his best, Swiss Ramble has done his thing on Twitter and it’s an interesting read...

 

[TJB.]

So the mortgage we took out to buy the grounds etc comes in at £38mil, but our Y1 parachute payment (set to cover the mortgage apparently) is £42mil.

£4mill left over? Raise a decent wedge from selling Berge, shift out the deadwood and we might not be as skint as we think?

That's obviously a layman's/oversimplified way of looking at it. Doesn't take into account how much we'll have lost in next year's accounts or any cash flow problems caused by Covid etc.

 

[PaulHalfway]

What does the player impairment cost of £2.6 million refer too ?

 

[JPBrods]

We might not be as skint as we think?

We've never had more cash sloshing around.

 

[Scarebus]

So the mortgage we took out to buy the grounds etc comes in at £38mil, but our Y1 parachute payment (set to cover the mortgage apparently) is £42mil.

£4mill left over? Raise a decent wedge from selling Berge, shift out the deadwood and we might not be as skint as we think?

That's obviously a layman's/oversimplified way of looking at it. Doesn't take into account how much we'll have lost in next year's accounts or any cash flow problems caused by Covid etc.

The £38m is over a few years though isn't it? Will have surely been budgeted with 1 eye on relegation.

Agree with the part of the tweet about income to wage ratio being only 55% and that we played it too safe. The wages arguement will linger on but there was never any guarantees better paid players would have helped, but we'll never know.

We go down looking healthy in the short to medium term, great for the club, not so entertaining for the fans.

 

[bladesince64]

Sure I read that the mortgage repayments are £1.2 million per annum.

 

[Balham]

What does the player impairment cost of £2.6 million refer too ?

At the close of the accounting period the only players on the books we'd paid more than £2.6m for were McBurnie, Berge, Freeman, Burke, Mousset, Osborn and Egan. From those, the smart money is on Freeman or Mousset, more likely the latter as the former went to Forest on loan in August with an option for them to make it permanent for £5m: more than we paid QPR for him.

The only other option is Robinson who we sold two weeks before the year close. We may have written his value down to £3-4m and effectively paid nothing for Burke.

So the mortgage we took out to buy the grounds etc comes in at £38mil, but our Y1 parachute payment (set to cover the mortgage apparently) is £42mil.

£4mill left over? Raise a decent wedge from selling Berge, shift out the deadwood and we might not be as skint as we think?

That's obviously a layman's/oversimplified way of looking at it. Doesn't take into account how much we'll have lost in next year's accounts or any cash flow problems caused by Covid etc.

Far too simplistic I'm afraid. The mortgage repayments will have to come out of the same pot as player wages and staged transfer fees due as well as the club's tax obligations and that's why it'll be over a number of years.

We've never had more cash sloshing around.

At July 31st we had £6m in the bank. Only Brighton had less in the PL.

 

[Champagneblade]

What does the player impairment cost of £2.6 million refer too ?

As I read elsewhere it's when you've bought a player who is so bad that you have to write down some of this value. Not sure who it relates to. With 24 defeats from 30 matches, there must ba a few candidates!

 

[Balham]

As I read elsewhere it's when you've bought a player who is so bad that you have to write down some of this value. Not sure who it relates to. With 24 defeats from 30 matches, there must ba a few candidates!

That write down was last season. Only Mousset, Robinson and Freeman really fit the bill.

 

[Champagneblade]

Perhaps we'd already agreed to loan out Freeman with the expectation Forest take his wages of around 1.4m but he could go for say 3.4m instead of the 6m we paid for him? Net we lost 1.2m but transfer fee we'd be down 2.6m and know that Forest can take him at that price which would realise that loss for us.

Possible?

 

[Houston_Blade]

So the mortgage we took out to buy the grounds etc comes in at £38mil, but our Y1 parachute payment (set to cover the mortgage apparently) is £42mil.

£4mill left over? Raise a decent wedge from selling Berge, shift out the deadwood and we might not be as skint as we think?

That's obviously a layman's/oversimplified way of looking at it. Doesn't take into account how much we'll have lost in next year's accounts or any cash flow problems caused by Covid etc.

Yes it’s oversimplified, we repay the mortgage over a number of years and £42m comes in next year.

 

[gordoncharles]

Agree with the part of the tweet about income to wage ratio being only 55% and that we played it too safe. The wages arguement will linger on but there was never any guarantees better paid players would have helped, but we'll never know.

We go down looking healthy in the short to medium term, great for the club, not so entertaining for the fans.

But that was last season and we didn't play it too safe, we almost made a European qualification place.

£110m has been spent on transfer fees alone during the last two summers, and all this really does is divide us again into whether that money would have been better spent on smarter targets from other leagues with lower transfer values and more reasonable wage demands - not that we were set up for it and I imagine there was some hubris involved as well. Plus our style of play did not evolve etc, but let's not go there.

Remember that "wages have grown £59m in the last two years, while revenue has increased £123m in the same period" And yet we only made a £19m profit. Whilst that included the costs of writing down transfer and signing-on fees, that has to be taken into consideration as there's no guarantee you can realise the sales value of the players if you're running down their contracts and not looking to sell them.

After this year, lord knows how much the "impairment" provision is going to be.

My view is that it's not too cautious at all, last season was prudent. This year's probably going to be a loss (unless player sales kick in) and we'll still have a wage bill, by now in excess of £80m that will have to be drastically reduced, either by those sales, or contractually which is not going to be great for motivation.

We had the lowest wage bill in the league and that was a huge handicap - this season if not last - but it's right that the club was being prudent. Relegation was always a distinct possibility and we had to attempt to put ourselves in a West Brom-like position where when you go down you have the resources to compete to go back up.

Financially, we're in a hugely beneficial position to where we were in the summer of 2018.

 

[MiserableBlader]

So the mortgage we took out to buy the grounds etc comes in at £38mil, but our Y1 parachute payment (set to cover the mortgage apparently) is £42mil.

£4mill left over? Raise a decent wedge from selling Berge, shift out the deadwood and we might not be as skint as we think?

That's obviously a layman's/oversimplified way of looking at it. Doesn't take into account how much we'll have lost in next year's accounts or any cash flow problems caused by Covid etc.

The Prince has said HE is personally liable for this if United are relegated.