[Archived] Financial Weekly

[PAFELL]

Blyth's normal support is 400 so the police and stewards told me. So as there were about 3000 of them last night they have their share of glory hunters too!

Of course they do - last night possible most the town came to support them - a one off match against a prem team - well reserve team.

No we dont Paul,its quite good considering the size of the town.

FFS!

You are right - for the size of the town Rovers have a very good following - it is just sad that when rovers stuggle they don't keep coming. But at the moment it is good and so reason to be positive.

[Iceman]

Does anybody know, what Rovers lose on low crowd attendances every season? Is this a big problem in terms of our finances, as i know we reduced the prices of tickets just recently.

[Jan]

Does anybody know, what Rovers lose on low crowd attendances every season? Is this a big problem in terms of our finances, as i know we reduced the prices of tickets just recently.

Approximately ((75,000-20,000)* (45-16))*19

The above equation is Manchester United's average gate minus our average gate times Manure's average ticket price minus our average ticket price times the number of games a season. The ticket prices are guesses. Ours is probably a bit high, theirs a bit low

Approximately £30 million.

[philipl]

Even more striking- Arsenal take £3m per home game so they take through the gates in two games what we take in a season roughly.

Been looking at the last published West Ham accounts today.

It is amazing that apart from an additionalo £10m gate revenue, their income was very similar to our's for the 2006/7 season. That goes to show that our oft maligned commercial department has been doing a cracking job compared with the club which boasts its ground is the closest to the City of London.

The West Ham expenses are a hoot- their wages exploded by £13m in one season, their transfer amortisation costs by £10m and there is a little matter of £6.5m for the Tevez issue- the fine plus their own costs plus the Premier League's costs.

No doubt their costs got a lot worse which is why they are delaying publishing their accounts.

[Iceman]

Ive asked this before, but wouldnt it make more sense to some how reduce the overall capacity of Ewood to 25000? I know you will get near capacity when the big teams arrive, but on average we normally 22000 or am i way off the mark?

[cn174]

Ive asked this before, but wouldnt it make more sense to some how reduce the overall capacity of Ewood to 25000? I know you will get near capacity when the big teams arrive, but on average we normally 22000 or am i way off the mark?

In hindsight Ewood as it is now is a bit too big and a 25,000 stadium would be about right. The only feasible way of reducing the capacity would be to knock down the Riverside, which is unlikely to happen. To remodel any of the existing stands would be very costly I would've thought.

[stuwilky]

In hindsight Ewood as it is now is a bit too big and a 25,000 stadium would be about right. The only feasible way of reducing the capacity would be to knock down the Riverside, which is unlikely to happen. To remodel any of the existing stands would be very costly I would've thought.

And ultimately pointless.

Spending what little money we have on reducing our ability to maximise the odd bigger gate.

[philipl]

25,000 would not have been big enough for quite a few games last season- there were two 30,000+ gates.

[Stuart]

25,000 would not have been big enough for quite a few games last season- there were two 30,000+ gates.

Quite so. I remember Liverpool game being 33,003.

[Paul]

No we dont Paul,its quite good considering the size of the town.

FFS!

Yes, yes I know all that percentage of population stuff and agree with you. However sheer numbers of bums on seats is what counts for an investor. 30,000 at Derby against 20-22000 at Ewood. That's around £240000 per game.

[iamarover]

http://www.dofonline.co.uk/strategic-finan...ent-010906.html

This is a stunningly interesting article for all followers of the bottom line. Equifax have credit rated all 20 Prem clubs 1 - 100. 100 is good. 1 or 2 is very bad - ie insolvent. 11 out of the 20 are technically insolvent scoring less than 2. Arsenal and Man U weigh in at the high 90s. Rovers a creditable 45 and qualify for Europe.

If we stay up red roses could bloom again by the banks of the Riverside.

[tony gale's mic]

http://www.dofonline.co.uk/strategic-finan...ent-010906.html

This is a stunningly interesting article for all followers of the bottom line. Equifax have credit rated all 20 Prem clubs 1 - 100. 100 is good. 1 or 2 is very bad - ie insolvent. 11 out of the 20 are technically insolvent scoring less than 2. Arsenal and Man U weigh in at the high 90s. Rovers a creditable 45 and qualify for Europe.

If we stay up red roses could bloom again by the banks of the Riverside.

True but Chelsea are insolvent in that table. And Bolton have a much, much lower rating than us, surely our financial positions arent that different?

[iamarover]

True but Chelsea are insolvent in that table. And Bolton have a much, much lower rating than us, surely our financial positions arent that different?

Chelsea by any business rating ARE insolvent. Their debts are higher than their assets and only continue to trade because of Roman's largesse. Similarly Bolton are being bankrolled by their benefactor. And their debt is considerably higher ( so was ours until the trustees wrote it off. No sign of that from Bolton's backers). Both may eventually want some or all of the money out which is why they are rocky from an investment perspective. Equifax take a hard headed view and say that these businesses are not operating as businesses should - ie linking expenditure to income. In the days of plenty that didnt matter much as banks were lenient and self indulgent millionaires aplenty. Now no more. That is why the Trustees should be lauded and not pillioried as most of the numpties on here like to do.

[philipl]

I agree with iamarover in that view.

Rovers' position is stronger as those figures are based on last published accounts and the 06/7 accounts included the impact of the club spending on players (particularly wages) AHEAD of the new Sky deal.

I don't know the Hull set-up; there must be an anomaly linked to the KC Stadium where there is some very soft local authority finance involved.

Newcastle, Boro, Wigan, Bolton, Fulham, Chelsea, Villa are all in the insolvent list as iamarover explained because the owner stuck his money in as loans and does not need anyone else to provide finance. If any of those owners hit hard times like the West Ham and Pompey owners have, those clubs go out of business almost over-night.

West Ham are not in the insolvent list because their owner was using other finance so like the Walker Trust, the holding company DID (I was wrong in my earlier speculation) turn £110m of debt into equity in September 2007.

The key points now are:

- Everton look really sick. They are considered insolvent and much of that is third party lending.

- Liverpool must now have dropped into insolvent with the problem they have of rolling the £325m of debt. I understand they are struggling to pay certain large debts when they fall due.

- Man U look wonderful but if you consolidate them into their Red Football parent, they would look very sick. Red Football tried and failed to shift £300m of debt down onto Man U during 2008 but got caught by a technical hitch.

- Despite shifting the £110m into equity, my guess is West Ham are technically insolvent at the moment and their Directors must be looking at whether they are trading illegally and coming up with weasel words weekly about why they are not in for a massive hit from the Tevez arbitrators' adjudication. They are playing a very high risk game in the transfer market at the moment.

- Pompey who have bitten the bullet and shifted Defoe and Diarra to meet immediate debts have solved an immediate cash crisis but their running costs are still way too high so another cash crisis is on its way if they don't carry on selling their players off.

[iamarover]

I agree with iamarover in that view.

Rovers' position is stronger as those figures are based on last published accounts and the 06/7 accounts included the impact of the club spending on players (particularly wages) AHEAD of the new Sky deal.

I don't know the Hull set-up; there must be an anomaly linked to the KC Stadium where there is some very soft local authority finance involved.

Newcastle, Boro, Wigan, Bolton, Fulham, Chelsea, Villa are all in the insolvent list as iamarover explained because the owner stuck his money in as loans and does not need anyone else to provide finance. If any of those owners hit hard times like the West Ham and Pompey owners have, those clubs go out of business almost over-night.

West Ham are not in the insolvent list because their owner was using other finance so like the Walker Trust, the holding company DID (I was wrong in my earlier speculation) turn £110m of debt into equity in September 2007.

The key points now are:

- Everton look really sick. They are considered insolvent and much of that is third party lending.

- Liverpool must now have dropped into insolvent with the problem they have of rolling the £325m of debt. I understand they are struggling to pay certain large debts when they fall due.

- Man U look wonderful but if you consolidate them into their Red Football parent, they would look very sick. Red Football tried and failed to shift £300m of debt down onto Man U during 2008 but got caught by a technical hitch.

- Despite shifting the £110m into equity, my guess is West Ham are technically insolvent at the moment and their Directors must be looking at whether they are trading illegally and coming up with weasel words weekly about why they are not in for a massive hit from the Tevez arbitrators' adjudication. They are playing a very high risk game in the transfer market at the moment.

- Pompey who have bitten the bullet and shifted Defoe and Diarra to meet immediate debts have solved an immediate cash crisis but their running costs are still way too high so another cash crisis is on its way if they don't carry on selling their players off.

Didnt spot the Everton thing. They look in real trouble, and may need to start making some payments. And Portsmouth..Jesus. They didnt file accounts! The Premier League 'fit and proper' rule surely has to play soon Pompey are cheating the rest of the League. There is a massive tsunami building about 10 weeks off the Premier League shore, and not many fans seem ready for its huge backwash. Rovers have dodged this particular bullet and seem set fair to sail into calmer waters if the Cape of Relegation Horn is successfully navigated. All hands on deck.

[philipl]

Didnt spot the Everton thing. They look in real trouble, and may need to start making some payments. And Portsmouth..Jesus. They didnt file accounts! The Premier League 'fit and proper' rule surely has to play soon Pompey are cheating the rest of the League. There is a massive tsunami building about 10 weeks off the Premier League shore, and not many fans seem ready for its huge backwash. Rovers have dodged this particular bullet and seem set fair to sail into calmer waters if the Cape of Relegation Horn is successfully navigated. All hands on deck.

Ten weeks from now?

The Court case in Rejkyavik?

Or something else?

[tony gale's mic]

I don't doubt what you're saying as it seems to make sense, but why have more papers not picked up on these sorts of stories? Just that the threats to West Ham and Pompey's financial future seems to be a side issue compared to the players theyre selling, when you'd think the very real prospect of clubs going into administration would be huge news.

[philipl]

I don't doubt what you're saying as it seems to make sense, but why have more papers not picked up on these sorts of stories? Just that the threats to West Ham and Pompey's financial future seems to be a side issue compared to the players theyre selling, when you'd think the very real prospect of clubs going into administration would be huge news.

First of all the press are massively biased in West Ham's favour (the reaction to the Sheff U arbitration was scary in its one-sidedness, intensity and plain mis-reporting of the facts- I read the arbitration judgement and more than 50% of the press clearly hadn't) and secondly the Gaydamaks are not necessarilly the sort of people you'd want to print a story about and find out you got it wrong.

The press are not reporting on what the Premier League are doing at present- Defoe went from nowhere in particular on Spurs' wish list to a done deal in very short order. Might that have been because Spurs could have found themselves in position to serve a winding up order on Pompey before the next window opens?

And where would the Premier League be- effectively a co-operative of twenty members, if members started winding up petitions on each other?

I guess that with Platini watching the Prem from UEFA with a malevolant eye, the Olympics coming along meaning English sports financial bad news stories will get magnified, the great the good the bad and the downright ugly all feel this is not a time for exposee financial stories. If the dam breaks, the press will rush to make up for lost time though.

[iamarover]

I don't doubt what you're saying as it seems to make sense, but why have more papers not picked up on these sorts of stories? Just that the threats to West Ham and Pompey's financial future seems to be a side issue compared to the players theyre selling, when you'd think the very real prospect of clubs going into administration would be huge news.

They have. The table i just posted is a press release. There is no conspiracy here. Two reasons why it isnt a raging topic on football journo world

1. Red top and mid market journos in the sports sections are pretty challenged intellectually. Ever watched Sunday Supplement? How many outside of Patrick Barclay are you really impressed by? they dont really understand business and so dont really see why they should comment on it. Business journalists just see football as a joke. Rovers turn over less than one Tesco Extra store in Preston. So not really that interesting for them and little real analysis is done apart from Deloitte's and now Equifax.

2. These businesses - unlike those in the public eye - are private concerns, there is no obligation on them for disclosure on finance, just as if you ran a shop or a pub you would be under no obligation to disclose to the Telegraph the extent of your problems. Woolworths et all have to publish their results as they have asked for outside investment as public companies. Chelsea are under no such obligation. Nor are Portsmouth. They usually do regularly for business probity - if you want investment later you should be showing your underskirts now - but ultimately they prompt more questions than answers Questions that as a private concern, unlike a public one, they are under no obligation to answer honestly, or answer at all. So journalists, if they are to avoid expensive legal action, have to report on facts alone. Of which there are few.

The tsunami nestled just off the Premier league shore is the end of the financial year for some major banks and the Government demands linked to the bail out. Banks are short of money bizarrely. and have to get debt off their balance sheets before they can start lending again. If they can shut down Woolworth's they can shut down Portsmouth.

you owe money now? You may well be called in. 12 months ago lending made balance sheet sense. Now debt is a corporate banking disaster. And football has lots of it.

Ive said it before...but one day you will get down on your knees and believe the Arthurian legend. Jack's legacy with the Trustees has saved the club. Big time. At the time of threat Arthur is said to rise from his Camelot sleep to save England. Believe me now, Jack is walking among us. We are saved.

[thenodrog]

Yes, yes I know all that percentage of population stuff and agree with you. However sheer numbers of bums on seats is what counts for an investor. 30,000 at Derby against 20-22000 at Ewood. That's around £240000 per game.

Didn't we discover from Lee a couple of seasons ago that the average ticket price at Ewood was just £13.00? Have you taken that and the probability that Derby's average is similarly low?

[philipl]

Didn't we discover from Lee a couple of seasons ago that the average ticket price at Ewood was just £13.00? Have you taken that and the probability that Derby's average is similarly low?

The Derby debate is pretty academic because the potential buyers are no longer around.

Nor are any other buyers for anybody according to Keith Harris of Seymour Pearce

The Boro numbers look horrific! They owe the bank £93m and managed to make a loss last season despite the Sky/Setanta boost. Add another hospital case to iamarover's tsunami. No wonder Gareth Southgate was talking in such pessimistic terms- he needs the rest of the Prem to be in the same soup as he is or else he's going down too.

At this rate, if Sam can steer us to 10th (let's not forget each place is worth the best part of £1m now), Rovers are going to be swimming in a sea of player bargains in the summer transfer window.

PS To the guys who have been sharing PMs about West Ham with me- Harris says West Ham's current debt is £50m. That does NOT include the Sheffield United settlement nor the other 18 pending law suits against them. They either know things we don't know or the Board there is being reckless in the extreme. The Court in Rejkyavik is not going to be best impressed that Hansa had told them West Ham could be sold for £250m either!

[RibbleValleyRover]

I don't know if this is the right place for this but the four four two magazine have published their latest football rich list. Of course we don't know how accurate their info is but the link is:

http://fourfourtwo.com/news/england/23107/default.aspx

and the BBC have an article about this:

http://news.bbc.co.uk/sport1/hi/football/7813483.stm

For those that can't access the links, view them at work etc:

The Top 20 on the Football Rich List are:

1. Shekh Mansour bin Zayed al-Nayan (Manchester City) £15bn


2. Lakshmi Mittal & family (QPR) £12.5bn

3. Roman Abramovich (Chelsea) £7bn 


4. Joe Lewis (Tottenham Hotspur) £2.5bn


5. Bernie & Slavica Ecclestone (QPR) £2.4bn

6. Stanley Kroenke (Arsenal) £2.245bn


7. Alisher Usmanov (Arsenal) £1.5bn


8= Lord Grantchester & The Moores Family (Everton) £1.2bn


8= Dermot Desmond (Celtic) £1.2bn


10= Lord Ashcroft (Watford) £1.1bn


10= Malcolm Glazer & family (Manchester United) £1.1bn


12. Simon Keswick (Cheltenham Town) £966m 


13. Trevor Hemmings (Preston North End) £900m


14. Mike Ashley (Newcastle United) £800m


15. Randy Lerner (Aston Villa) £750m


16. Tom Hicks (Liverpool) £700m

17. The Walker Family (Blackburn Rovers) £660m

18. Mohammed al-Fayed (Fulham) £650m


19. Sir David Murray (Glasgow Rangers) £600m


20. Steve Morgan (Wolves) £400m


[only2garners]

First of all the press are massively biased in West Ham's favour (the reaction to the Sheff U arbitration was scary in its one-sidedness, intensity and plain mis-reporting of the facts- I read the arbitration judgement and more than 50% of the press clearly hadn't)

For an up to date example have a look at Jason Burt's article in today's Independent - he's one of the Boleyn Ground's house scribes. (Sorry I don't know how to put a link in). Reading this you wold have no idea there are any money issues at West Ham. The gist of the article is that impending sales of Matthew Etherington to Stoke for £4m and Callum Davenport to Bolton for £3m will allow West Ham to hold off all the other bids for their "star" players. Apparently West Ham are "well run and a viable concern, not in need of funding from Gudmundsson" and "have been angered by suggestions that they will conduct a fire sale this month to stave off a suspected financial shortfall".

I don't know if this is the right place for this but the four four two magazine have published their latest football rich list. Of course we don't know how accurate their info is but the link is:

http://fourfourtwo.com/news/england/23107/default.aspx

and the BBC have an article about this:

http://news.bbc.co.uk/sport1/hi/football/7813483.stm

For those that can't access the links, view them at work etc:

The Top 20 on the Football Rich List are:

1. Shekh Mansour bin Zayed al-Nayan (Manchester City) £15bn


2. Lakshmi Mittal & family (QPR) £12.5bn

3. Roman Abramovich (Chelsea) £7bn 


4. Joe Lewis (Tottenham Hotspur) £2.5bn


5. Bernie & Slavica Ecclestone (QPR) £2.4bn

6. Stanley Kroenke (Arsenal) £2.245bn


7. Alisher Usmanov (Arsenal) £1.5bn


8= Lord Grantchester & The Moores Family (Everton) £1.2bn


8= Dermot Desmond (Celtic) £1.2bn


10= Lord Ashcroft (Watford) £1.1bn


10= Malcolm Glazer & family (Manchester United) £1.1bn


12. Simon Keswick (Cheltenham Town) £966m 


13. Trevor Hemmings (Preston North End) £900m


14. Mike Ashley (Newcastle United) £800m


15. Randy Lerner (Aston Villa) £750m


16. Tom Hicks (Liverpool) £700m

17. The Walker Family (Blackburn Rovers) £660m

18. Mohammed al-Fayed (Fulham) £650m


19. Sir David Murray (Glasgow Rangers) £600m


20. Steve Morgan (Wolves) £400m


Hidden down at joint 69 is one Robbie Fowler, late of this parish. He is worth £28m, down from £30m last year, so clearly he didn't make a bundle from Rovers. Presumably his decline reflects a reduction in the value of his property empire and will likely reduce further yet.

[Bobby G]

Didnt know the Walkers were that high up.

Makes me depressed that they arent continuing Uncle Jack's legacy in a more firm manner.

[broadsword]

I think Jack sold WalkerSteel for £330 million, and that was 1991 I think.

so they've done a good job of managing the money.