[Archived] Why Do We Have No Money

[Steve Moss]

^ No complaints here. Thanks.

[OscarRaven]

The way I see it is the wages (+bonusses) are not justified by the performances we have seen for the past 2 to 3 seasons - they are biting us on the bottom

Agreed. But I doubt there is anything the club can do about it. Wages will continue to rise whislt fresh money is being pumped into the system. Our 90% of turnover will buy/retain less and less talent each year.

[Hughesy]

The way I see it is the wages (+bonusses) are not justified by the performances we have seen for the past 2 to 3 seasons - they are biting us on the bottom, howwever, the club I feel is very aware and is trying to do something about it something we are now seeing the beginnings of and will do more over the next 1 or 2 seasons.

We will survive and questions need to be asked and answered - however we win together and we lose together - we must also stand together and get behind the team and the club.

ARTE LABORE

Correct - fans need to get behind the club. I sometimes wonder on here who is actually a Rovers fan and who just comes on here for a good old moan.

As for the wages - yes they dont justify it. Think we have been paying the likes of Reid & Dunn for the last couple of years just to sit on the injury table. We have also been paying the likes of Gallagher £20k a week.

[CAPT KAYOS]

Agreed. But I doubt there is anything the club can do about it. Wages will continue to rise whislt fresh money is being pumped into the system. Our 90% of turnover will buy/retain less and less talent each year.

maybe and maybe not OR - there has got to come a time when the wages will level out and the players (♣) will have to realise it - only x11 players can play at any one time and the mindset of wanting to play football and as part of a first eleven needs to be driven, it might be through natural progression or via ruling / or directives but it will have to happen for the future of the game. Will this be sooner or later I do not know , but I feel Rovers are ahead in their thinking and giving our circumstances realise this.

There shouldn't be all this clambering to get top name players on top earnings and their should be more parallel drawn to bonuses from performances and not both togtether. The failings of our Academy is well known but the gamble has to be taken to some extent with youngsters / homegrown players.

This maybe naive in thinking but I sense Rovers are thinking along similar lines - even if a benefactor/ or investor pops up along the way.

[TimmyJimmy]

Looks like all the 'A List' posters hit this thread. Good variety of opinion but all well stated and interesting points of view.

Just read back on my earlier postings and was surprised to see how angry I was with the club and the funds policy in general (or lack thereof). On reflection I think this is a better representation of my views and hopefully the situation.

When we say 'the club' we are talking three parts, the Trustees, the Board and the Management. Taking these in reverse order :

- Sam is to be treated like a genius, not because he is one or even approximates to one but because, as with a genius, it is worth putting up with their bad behaviour because they add something to our lives. He's a very effective manager yet has an impulsive almost childish streak, trying to blackmail the board in press conferences and the like to get more cash for transfers, it's very juvenile. He is on the other hand calculating and calm enough to bull up the image of a player who we 'desperately want to hold on to' and that he 'doesn't want to sell' (because he's our best defender) all for the benefit of driving a better sale price. Sam after all was the one to fall out with Warnock, no one's forcing him to sell. Conclusion, Sam's a spender and will spend all the money he's given and then come back for more. He's also adept at laying the groundwork for his own potential failures by raising to everyones attention the fact that he can't run things the way he wants. I like him, but like a naughty kid I sometimes want to give him the back of my hand.

- The Board. Little say here because I don't know all of them personally but I am absolutely convinced we have the best board in the country bar none. I'm basing this on Williams and assuming that the rest of the board think like him and support him. They are as frustrated as we are at the hamstringing effects of a lack of money. What can they do apart from falling on bended knee and begging for more, they have no levers to pull and can only offer 'best advice' to the owners. Given the responses they get from that quarter it is admirable that we have got this far with our signings/sales. They really deserve praise not brickbats. Williams has made only one error IMO and that was Ince - yet - hands up - I would have made the same appointment, it was right at the time and was supported/advocated by some of the big names in football, not least by King Kenny. That aside, the Board hasn't put a foot wrong and I don't think they are to blame for any lack of funds.

- The Trustees. Nothing new to add, I've said it all before. Sh!t or get off the pot. I understand they don't want to be here. I understand that they are between a rock and hard place with Jack's will and the conditions it lays down for a sale, but at the end of the day you can't live with an impass forever. At some stage someone has to be brave and take a step. They will always be reluctant investors, end of story. But, before others say it, yes I am eternally grateful to them for keeping us afloat and in good financial condition and fighting off the shark asset strippers.

In summary if all these three keep working in the same way and keep us in the EPL then I'll embrace my frustration. According to some philosophies survival is about investing just enough, but if we go down then the Trustees will have misjudged that calculation. Perhaps they are smarter than I give them credit far

[Craigman]

So will we be almost debt free by the end of the transfer window ?

[Hughesy]

Outs - RSC (18M), Gally (900K), Derbs (3M), Warnock (7m+) = £29m

Ins - Kalinic (6m), NZonzi (400k), Chimbonda (1.5m), Givet (3.5m), Greek keeper (50k) – £11.4m

Now Sam said half of the RSC & Derbs money went to Bank (10.5m)

So we should still have around £7m left to play with……..

I think the problem we simply have now, is not funds for transfers - but space on the wage budget!

Putting this is here as its probably the best place to talk about it................

[G Somerset Rover]

So we should still have around £7m left to play with……..

Hughesy I think we all know that even if we could get a few off the wage bill that we wouldn't be given £7 million in a million years.

[Bobby G]

How much of our debts are covered now, with the theory that we wont spend another penny?

[Jan]

How much of our debts are covered now, with the theory that we wont spend another penny?

That depends on too many variables for anyone to assess with any certainty.

It sounds a cop out, but "a good proportion" is about as close as I'd like to estimate.

[Bobby G]

Would that mean if these debts are covered, although I doubt they will be, then we could return to at least spending what we generate?

[CAPT KAYOS]

maybe and maybe not OR - there has got to come a time when the wages will level out and the players (♣) will have to realise it - only x11 players can play at any one time and the mindset of wanting to play football and as part of a first eleven needs to be driven, it might be through natural progression or via ruling / or directives but it will have to happen for the future of the game. Will this be sooner or later I do not know , but I feel Rovers are ahead in their thinking and giving our circumstances realise this.

There shouldn't be all this clambering to get top name players on top earnings and their should be more parallel drawn to bonuses from performances and not both togtether. The failings of our Academy is well known but the gamble has to be taken to some extent with youngsters / homegrown players.

This maybe naive in thinking but I sense Rovers are thinking along similar lines - even if a benefactor/ or investor pops up along the way.

I have also posted this on the Transfer thread

UEFA PLANS

[Jan]

Would that mean if these debts are covered, although I doubt they will be, then we could return to at least spending what we generate?

Given that we run at an operating loss and it's unlikely that the wage bill will have gone down much, I'd say all we've done is allow space for borrowing in the future. Unless we do well in the league.

Last year cost us a lot. We gave contracts out in the hope we'd solidify the previous year's position then threw it all away by hiring that dolt Ince. Thus we lost the place money AND had to pay up a contract on the 4th division gang. Personally I thought it would just have been cheaper to TAKE a contract out on them.

[LeChuck]

How much money are we likely to be saving on interest payments by removing these debts?

Is it likely to be more/less than prize money for finishing a couple of places higher?

[stuwilky]

Signing on fees.

Agents fees.

[Ozz]

Not too sure where to post this, but the comment below is from Sam regarding the signing of Pascal.

"So we made a quick choice based on the players that were available to us in the short space of time."

So it looks like we HAD to sell Warnock, and Sam had to replace him with a right back at very short notice.

So the question is, why did we have to sell Warnock? For the Money, or other reason?

If it wasn't money, then surely Sam should just say NO SALE to Villa.

Face it-we are absolutely desperate for money, and it looks like Sam will truly earn his salary if he keeps us up in the current environment.

[Hughesy]

How much of our debts are covered now, with the theory that we wont spend another penny?

According to the accounts – Loan of £11.5m was due within 1 year (Possibly been paid off with that 50% cut of money from RSC & Derbs)

Debts of £16.9m in 07-08 - however this was prior to last season were we finished about 4 places lower than planned and sacked Ince and his Muppets etc.... probably losing us a further £5m.

How much money are we likely to be saving on interest payments by removing these debts?

Is it likely to be more/less than prize money for finishing a couple of places higher?

£1.6m was payable in interest in 07-08

This year we wont of planned for anything higher than probably 15th (after last season you wouldnt think so anyway), so really we need a good finish and a good cup run to boost our coffers.

[stuwilky]

So the question is, why did we have to sell Warnock? For the Money, or other reason?

If it wasn't money, then surely Sam should just say NO SALE to Villa.

Player power is king.

Warnock obviously wanted to go and at that point we have to get the best deal for the club.

[Ozz]

Should have sold him two months ago then, so we don't have to rush into buying Pascal the Right Back before the weekend.

And why would he want to leave Rovers? Baffles me!

[Hughesy]

European Football - challenge for Honours................See Bentley.......See Warnock.....See many money

The rovers curse will continue...

[Al]

According to the accounts – Loan of £11.5m was due within 1 year (Possibly been paid off with that 50% cut of money from RSC & Derbs)

Debts of £16.9m in 07-08 - however this was prior to last season were we finished about 4 places lower than planned and sacked Ince and his Muppets etc.... probably losing us a further £5m.

£1.6m was payable in interest in 07-08

This year we wont of planned for anything higher than probably 15th (after last season you wouldnt think so anyway), so really we need a good finish and a good cup run to boost our coffers.

You are probably making the picture look worse than it really was.

The loan of £11.5mil is the bank overdraft which is always shown in the accounts as payable within 1 year when in actual fact it is only repayable if the bank demand it.

There are £6mil of debtors to offset against the creditors (Debts) and the only thing I can think of as income received in advance is season ticket money which of course is not repayable.

Still not brilliant but perhaps not as bad as at first it appears.

[philipl]

Arsenal - Total Revenue: 256.3 M €; Salaries: 116.8 M €; Debt Total: 479.8 M €; Annual Interest: 29.9 M

Aston Villa - Total Revenue: € 87.1 M; Salary: € 58.1 M, Total Debt: 84.1 M €; Annual Interest: 6,6 M €

Blackburn - Total Revenue: € 65.0 M; Salary: € 45.7 M, Total Debt: 19,6 M €; Annual Interest: 1,7 M €

Bolton - Total Revenue: € 68.2 M; Salary: € 45.0 M, Total Debt: 60.0 M €; Annual Interest: 3,4 M €

Chelsea - Total Revenue: 246.6 M €; Salaries: 172.0 M €; Debt Total: 809.0 M €; Interest Annual 0.0 M € - Owner: Roman Abramovich 100%, the creditor is the owner of debt the club.

Everton - Total Revenue: € 87.6 M; Salary: € 51.3 M, Total Debt: 44.9 M €; Interest Annual 4.4 M €

Fulham - Total Revenue: € 61.9 M; Wages: 45.3 M €; Debt Total: 227.1 M €; Interest Annual 2.0 M €

Hull City - Total revenues: 10.3 M €; Salary: 7.9 M €; Total Debt: € 1.1 M, 0.05 M € annual interest - Note: Figures for the Report and Accounts 2007 (club acted in Championship)

Liverpool - Total Revenue: 183.3 M €; Wages: - M €; Total debt: € 322.9 M, 24.2 M € annual interest

Manchester City - Total Revenue: € 94.9 M; Salary: € 62.5 M, Total Debt: € 169.5 M, 12.3 M € annual interest - Owners: 90

Manchester United - Total Revenue: 295.7 M €; Salaries: 139.7 M €; Total debt: € 806.7 M, 79.6 M € annual interest

Middlesbrough - Total Revenue: € 55.3 M; Wages: 40.1 M €; Debt Total: 107.3 M €; Interest Annual 8.3 M €

Newcastle United - Total Revenue: 116.3 M €; Salary: € 86.0 M, Total Debt: 122.5 M €; Interest Annual 7.6 M €

Portsmouth - Total Revenue: € 81.3 M; Salary: € 63.1 M, Total Debt: 66.5 M €; Interest Annual 7.6 M €

Stoke City - Total revenues: 12.9 M €; Salary: € 12.9 M, Total Debt: € 2.6 M, 0.05 M € annual interest Note: Figures for the Report and Accounts 2008 (club acted in Championship)

Sunderland - Total Revenue: € 73.4 M; Salary: € 42.8 M, Total Debt: 79.8 M €; Interest Annual 4.5 M €

Tottenham Hotspur - Total Revenue: 132.5 M €; Wages: 61.1 M €; Debt Total: 75.0 M €; Interest Annual 4.5 M €

West Bromwich Albion - Total Revenue: € 31.4 M; Salary: € 25.1 M, Total Debt: 10.2 M €; Interest Annual 1.0 M € - Note: Figures for the Report and Accounts 2008 (club acted in Championship)

West Ham United - Total Revenue: € 65.7 M; Salary: € 51.0 M, Total Debt: 41.5 M €; Interest Annual 2.3 M €

Wigan Athletic - Total revenues: 49.6 M €; Wages: 44.3 M €; Debt Total: 76.6 M €;

Thanks for this.

These are actually 2006/7 accounts converted into Euros at the going rate (the give away is West Brom having a Prem level income).

NOTE how low the numbers are for Stoke and Hull. They pretty well kept their wage costs down last season but took a Premier League income- anybody asking why Hull and Stoke can afford lots of new signings this summer has their answer.

BURNLEY WILL HAVE ABOUT £30m TO PLAY WITH NEXT SUMMER IF THEY STAY UP FOR EXACTLY THE SAME REASON, so get ready for it....

By play with I mean TRANSFER FEES AND WAGES.

If you moved forwards to 2007/8 (7th place) and the new Sky deal then indeed Rovers were the 35th richest club in Europe in terms of INCOME, not profit.

The Premier League is so rich in relation to all other leagues that one of its poorest brethren comfortably made it to that exalted position. Just look at the Hull and Stoke numbers again- unlike Burnley, they were big clubs in the Championship which is the 4th most supported league in Europe.

The issue for Rovers is that as an extremely established Premier League club (even the two years outside the Prem saw Rovers operating as though we were still in the Prem) we have an accumulation of 18 years of Premier League cost base, 80%+ of which is the wages for the first team squad and manager.

There are moves to restore some sort of sanity to football but Platini's proposals are simply another attempt to lock in the position of the existing elite and nothing to do with fairness, sport or financial good sense.

In fact if you read that, Jack Walker would have been banned from football.

The reality is Rovers have slipped back to being a selling club as John Williams forecast in his Chairman's report 18 months ago. We need and have outstanding management to keep us in the Prem but make no mistake, a second Ince would destroy us completely.

[unluckymorton]

Not too sure where to post this, but the comment below is from Sam regarding the signing of Pascal.

"So we made a quick choice based on the players that were available to us in the short space of time."

So it looks like we HAD to sell Warnock, and Sam had to replace him with a right back at very short notice.

So the question is, why did we have to sell Warnock? For the Money, or other reason?

If it wasn't money, then surely Sam should just say NO SALE to Villa.

Face it-we are absolutely desperate for money, and it looks like Sam will truly earn his salary if he keeps us up in the current environment.

1. We HAD to sell Warnock because Warnock wanted to leave, play in Europe (ha!) and obviously earn more money. We can not keep a player who no longer wants to play for us, it's as simple as that. I don't like it as much as anyone else but that's life.

2. We are a business that needs money coming in like all other businesses. What is going on in the boardroom is kept behind closed doors, the board have the best interests of the club as priority. We don't want to end up like Leeds, Charlton or Southampton. We will stay in the flight this season then build next season. It will take a long time to expect top 7 or 8 finishes like we did under Hughes.

All we can do is help by following the team and getting behind the lads week in week out.

[joey_big_nose]

Looking at those accounts I would speculate that the thought process is this:

1) The trustees want to sell

2) Clubs with no or low levels of debt are attractive even if they are in unfashionable areas - see Stoke, Derby, Hull.

3) Massively reducing the debt makes us more saleable.

4) We have had the opportunity to make large sums of money from player sales to reduce debt.

5) The trustees have grabbed this opportunity to get out.

Only my opinion but that is what it seems like. They have been trying to sell the club for two years now. I guess they are moving to a more radical stance.

Makes sense to me. It will be an extremely attractive proposition to a lot of people if we are actaully in the black this time next year.

The issue is we could lose Sam over this approach if I am correct, even if it could potentially attract someone to invest in the future.

[den]

Looking at those accounts I would speculate that the thought process is this:

1) The trustees want to sell

2) Clubs with no or low levels of debt are attractive even if they are in unfashionable areas - see Stoke, Derby, Hull.

3) Massively reducing the debt makes us more saleable.

4) We have had the opportunity to make large sums of money from player sales to reduce debt.

5) The trustees have grabbed this opportunity to get out.

Only my opinion but that is what it seems like. They have been trying to sell the club for two years now. I guess they are moving to a more radical stance.

Makes sense to me. It will be an extremely attractive proposition to a lot of people if we are actaully in the black this time next year.

The issue is we could lose Sam over this approach if I am correct, even if it could potentially attract someone to invest in the future.

The issue is also that such a huge grab back of cash could take us down. How would that sit with the trustees?