City & FFP | 2020/21 Accounts released | Revenues of £569.8m, £2.4m profit (p 2395)

[Mr Ed (The Stables)]

Re: City & FFP (continued)

They were always going to see us break the rules by hook or by crook.

I won't bet against them moving the goal posts again, they are a set of cheating scum bags.

I hope that Du Pont fella wins his case next spring and this whole house of cards come tumbling down around Twattini's and Co's heads.

Anyroads I wouldn't piss on them if they were on fire and I just hope they come and savour a game or two at our place next season and we fans let him know what we think!!!

 

[jrb]

Re: City & FFP (continued)

Manchester Evening News article.

United pip City to top revenue league

Both Manchester football clubs were driving forces behind record breaking revenues for Premier League clubs in the 2012/13 season - but the news wasn't so good in the Championship

Premier League clubs’ revenue reached a record £2.5bn in 2012/13, with Manchester United and Manchester City topping the financial table.

That’s according to the 23rd Annual Review of Football Finance from the Sports Business Group at Deloitte.

In total, the revenue of the top 92 clubs in English football reached almost £3.2bn, with north west clubs generating £1.1bn.

The Premier League clubs’ £2.5bn revenues was the highest of any league in Europe in 2012/13, followed by Germany £1.7bn, Spain £1.6bn, Italy £1.4 bn, and France £1.1bn.

But the Bundesliga recorded operating profits of £226m, compared with the Premier League’s £82m.

Experts at Deloitte said United topped the Premier League finance table with revenues of £363.2m, ahead of City’s £272m and Liverpool’s £206m.

Dan Jones, partner in the Sports Business Group at Deloitte, expects United to remain leaders in England for the forseeable future despite the club not qualifying for this season’s UEFA Champions League.

He also thinks City are in a good position to deal with the £50m financial fair play fine imposed on the club due to them securing the club’s second Premier League in three seasons and entry into the Champions League.

He said: “For United it will be disappointing for them not to be in the Champions League. But they have got a very large scale resilient business.

“The Champions League is only around about 10pc of the club’s overall business, if that. They will certainly hope that this upcoming season, with them not being in the Champions League is just a blip, a one off.

“But despite that they are and will continue to be the biggest most profitable club in the country.

“City have been hit with the fine but they are in a position of strength to address it. They are Premier League champions and will be in next season’s Champions League again so they will generate more revenues than they ever have before. But in terms of revenues and profitability I don’t see City overtaking United in the foreseeable future.”

Jones, who said Premier League clubs will receive another significant increase in revenue in 2013/14, added: “Once again the global appeal of the Premier League has continued to drive commercial revenue growth, particularly at the highest ranked Premier League clubs. Matchday revenue also increased by 6pc with fewer unsold seats at Premier League games than ever before.

“We estimate that Premier League clubs’ revenue will have increased by almost 30pc to £3.2bn in 2013/14.

“This growth will be driven by the revenue from the first season of the Premier League’s new broadcast deals and further commercial revenue growth at the biggest clubs.”

The review found that more than 75pc of the Premier League clubs’ revenue increase in 2012/13 was spent on wages, which rose by £125m (8pc) to £1.8bn and resulted in wages to revenue ratio reaching a record high of 71pc.

This led to the aggregate operating profit falling by £2m to £82m, an operating margin of just 3pc of revenue.

However, 13 of the Premier League clubs made an operating profit in 2012/13 compared with 10 in the previous year.

Adam Bull, senior consultant in the Sports Business Group at Deloitte, said wage costs are forecast to increase again in 2013/14, to a record level of around £2.2bn.

He said the 2012/13 season was a particularly bleak year for the finances of Championship clubs.

A revenue reduction of £39m was compounded by a £40m increase in wage costs, leading to record operating losses of £241m.

Pre-tax losses also increased by £170m, equivalent to an additional £7m per club, to £323m.

Bull added: “The 2012/13 wages to revenue ratio for Championship clubs of 106pc is the highest ever recorded by an English division and is clearly unsustainable without ongoing owner support.

“The introduction of the Championship Financial Fair Play Rules was widely seen, and advocated by the clubs who voted it in, as a necessary step to change clubs’ behaviour.

“The severity of the punishments applied to those who have not complied with the rules in the 2013/14 season and the eventual result of efforts to change the rules, will determine the extent to which they present an effective deterrent to widespread overspending.”

Link to the PDF scaled down version of the report below quotes.(from the report)

A premium blend
Annual Review of
Football Finance
– Highlights

Premier League clubs’ net losses (after player trading
and finance costs) for 2012/13 were £316m
(2011/12: £245m). Five clubs made pre-tax losses in
excess of £50m. This included Liverpool, the most
severe at £70m, as well as two other clubs, Chelsea
and Manchester City, who finished in the top four in
the Premier League in 2013/14.

Total Premier League wages rose by £125m to
£1,783m in 2012/13, an 8% rise on 2011/12.
Wages ranged from £233m (Manchester City) to
£45m (Wigan Athletic).

A significant (£71m) reduction in net debt by
Manchester United was the most notable of eight
Premier League clubs that improved their net debt
position across the 2012/13 season; although at
summer 2013 only two clubs – Norwich City and
Swansea City – recorded an overall net funds position.

Soft loans of £1.6 billion (2012: £1.4 billion)
represented almost two-thirds of total net debt at
summer 2013, over 90% of which was attributable to
four of the most indebted Premier League clubs –
Chelsea, Newcastle United, Aston Villa and Queens
Park Rangers, who together paid less than £1m of the
total £118m in net finance costs.

<a class="postlink" href="http://www.deloitte.com/assets/Dcom-UnitedKingdom/Local%20Assets/Documents/Industries/Sports%20Business%20Group/uk-sbg-annual-review-of-football-finance-2014.pdf" onclick="window.open(this.href);return false;">http://www.deloitte.com/assets/Dcom-Uni ... e-2014.pdf</a>

 

[roaminblue]

Re: City & FFP (continued)

In fact cashflow is the key in my opinion. Football is mostly a straightforward cash business but in football club accounts, one of the biggest items is amortisation, which is the write-down of player contracts. It will probably be just over £70m in the 2014 financial year which ended last week. But it's not cash.

So in FY2013, we lost £52m but amortisation was over £80m. So being very simplistic, we should have brought in £30m spare cash from normal operations. That's healthy as it's money we can use to buy players. It's not going to pay back debt and clubs that get into trouble either can't pay back debt or other liabilities. The issue should be "Can the club pay it's way in their day-to-day operations?"

I've dipped in and out of this thread so apologies, but does that mean FFP takes into account the bottom line, rather than cash from operating activities. Does it consider CFO at all?

Anyone whose done any accounting recognises that Net income is subject to accruals and can be "massaged" to an extent, it'd be foolish if its overlooked. There's a reason why bankers use FCF as a valuation tool, rather than net income.

 

[LoveCity]

Re: City & FFP (continued)

Some reports in the press that Platini, with the backing of the cartel of course, wants to outright ban repeat offenders in 12 months. Probably more of a concern to PSG than us unless they move the goal posts on us again, and I wonder if PSG will be able to launch a credible court case if Qatar's World Cup is taken away from them because of corruption.

 

[Kompany is King]

Re: City & FFP (continued)

Some reports in the press that Platini, with the backing of the cartel of course, wants to outright ban repeat offenders in 12 months. Probably more of a concern to PSG than us unless they move the goal posts on us again, and I wonder if PSG will be able to launch a credible court case if Qatar's World Cup is taken away from them because of corruption.

Will PSG now be looking at a reduced prices for outgoing sales?

Or PSG to carry on regardless.

 

[Kompany is King]

Re: City & FFP (continued)

Within FFP how do Real Madrid keep on spending vast amounts?

Sorry if covered before.

 

[ChicagoBlue]

Re: City & FFP (continued)

Premier League clubs’ net losses (after player trading
and finance costs) for 2012/13 were £316m
(2011/12: £245m). Five clubs made pre-tax losses in
excess of £50m. This included Liverpool, the most
severe at £70m, as well as two other clubs, Chelsea
and Manchester City, who finished in the top four in
the Premier League in 2013/14.

This is the joke! We have to compete against this club in the Champs League with four less players, even though they made much larger losses!

Maybe, this is exactly what United will do now? Don't have to worry about FFP and can spend a mint next year without worry!

 

[Balti]

Re: City & FFP (continued)

Premier League clubs’ net losses (after player trading
and finance costs) for 2012/13 were £316m
(2011/12: £245m). Five clubs made pre-tax losses in
excess of £50m. This included Liverpool, the most
severe at £70m, as well as two other clubs, Chelsea
and Manchester City, who finished in the top four in
the Premier League in 2013/14.

This is the joke! We have to compete against this club in the Champs League with four less players, even though they made much larger losses!

Maybe, this is exactly what United will do now? Don't have to worry about FFP and can spend a mint next year without worry!

debt is good

 

[EalingBlue2]

Re: City & FFP (continued)

Utd could spend mentally and be FFP immune next year but for the fact they brought in to try and stop City the Premier League FFP.

They can only spend on wages an increase in line with their increased commercial and European money, now whilst they lose about 50m from Europe they have made this up elsewhere but are fairly limited on what they can increase wages by. Obviously they save rio, vidic, giggs etc and have some scope but they can't go completely mental

 

[Centurions]

Re: City & FFP (continued)

Utd could spend mentally and be FFP immune next year but for the fact they brought in to try and stop City the Premier League FFP.

They can only spend on wages an increase in line with their increased commercial and European money, now whilst they lose about 50m from Europe they have made this up elsewhere but are fairly limited on what they can increase wages by. Obviously they save rio, vidic, giggs etc and have some scope but they can't go completely mental

FFP is based on the 2 previous seasons (I think) so even though the rags aren't in it this season coming are they still not subject to it? That said they've got massive revenue streams and it shouldn't really affect them unfortunately. With the released and retired wages they also got a hell of a lot of wriggle room.
In answer to 'Kompany is King' regarding Real Madrid, they have the same massive (arf) revenue incoming plus of course they're bent as fuck.