| Audited Accounts are now out 12:04 - Mar 13 with 28484 views | Shaky |
For club: https://beta.companieshouse.gov.uk/company/00123414/filing-history
For holding company: https://beta.companieshouse.gov.uk/company/04305508/filing-history
Will try to find time to crunch the numbers later, but quick glimpse shows the huge increase in operating costs is all substantially down to staff costs.
As I said previously, it is hard to imagine how even the lions share can be attibutable to the playing staff given the departures.
What is certain is the for example Peralman' s salary is lumped in there, and potentally also some kind of remuneration for the US property developer on the board of the parent company. How much is attributable to this remains unclear, however.
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| Audited Accounts are now out on 17:12 - Mar 14 with 3130 views | Oldjack |
Quote .......... In summary the club remains in urgent need of new fianancing and is seriously strapped for cash.
so does this mean our 27 owners will not be getting a bean in the near future ? |  |
| Prosser the Tosser dwells on Phil's bum hole like a rusty old hemorrhoid ,fact
You Greedy Bastards Get Out Of OUR Club!
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| Audited Accounts are now out on 17:18 - Mar 14 with 3124 views | Shaky |
| Audited Accounts are now out on 16:59 - Mar 14 by swanforthemoney |
"The negative working capital of £66m means that over the next 12 months or so the club have to pay out more than £66 million punds more than they have coming in. This is money that has to be found. "
Might that explain, partially, why weve gone back for old players like Wilf and Ayew, so we dont have to find any real money ?
That Mindy Kaling needs to be out shaking a bucket outside the Liberty on Saturday. Ill look down the back of the sofa in readiness.
PS thanks for the analysis Shaky. [Post edited 14 Mar 2018 17:03]
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"Might that explain, partially, why weve gone back for old players like Wilf and Ayew, so we dont have to find any real money ? "
i wouldn't have thought so directly , but there may be some indirect benefits.
The notes mention financial income of £ 583K from "unwinding of discount of player receivables".
I don't really know what that means, but it sounds like it could be some sort of benefit from unwinding an existing factoring agreement.
Furthermore, although i don't really understand trade financing/factoring in any detail, financing providers often extend lines of credit for agreed amounts, and so it might be with all the receivables pulled forward they are bumping into agreed limits, in which case you might need to unwind existing facilities to free up new capacity. That's somewhat speculative though. | |
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| Audited Accounts are now out on 17:22 - Mar 14 with 3107 views | Shaky |
| Audited Accounts are now out on 17:06 - Mar 14 by longlostjack |
Just a question Shaky. Pearlman and Chaudhari - would they be included in the intangible assets or current liabilities? |
I can't remember who is who now, but it is possible that the new director(s?) with a background in property are billing the club for services in connection with the stadium deal.
If that is the case the costs could conceivably appear under a number of different headings. | |
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| Audited Accounts are now out on 17:42 - Mar 14 with 3080 views | londonlisa2001 |
| Audited Accounts are now out on 13:01 - Mar 14 by Shaky |
Good question.
Let me try to quickly explain the technical terms and do a quick back of the envelope.
The negative working capital of £66m means that over the next 12 months or so the club have to pay out more than £66 million punds more than they have coming in. This is money that has to be found.
In addition they have the borrowings of £9m that more than cancels out any cash on hand.
There is then a profit on player sales of perhaps £52m that is partially offset by signings of around £36m by my estimate for a net of positive £16m on player ins and outs (less costs of converting that to cash).
And that is all before before anything can be invested in the stadium.
In summary the club remains in urgent need of new fianancing and is seriously strapped for cash. |
Shaky - I haven't had chance yo have a full look, but after a quick skim, some of the points you make are not entirely correct.
Firstly, on the working capital point, £47m of the £66m 'hole' you refer to is actually deferred income. In other words it's the Sky monies received that can't be recognised until the start of the season. So in August, that disappears and gets treated as income, and the 'hole' becomes £19m not £66m.
Secondly, the player sales / purchases & new contract costs (including all fees) that happened as post balance sheet events (so after 31 July but before 31 October when these accounts were signed) shows total sales of £47m and total purchases plus registration fees (so including new contracts costs) of £29m. That's a surplus of £18m, so your working capital deficit was wiped out by October.
In response to some other points you've made. The total director's costs is the same as that paid to the highest Director, so no fees are being paid to anyone else (you mentioned one of the US directors).
On the operating costs, based on what is said in these accounts, I suspect (I don't know) that impairments have been taken against players that have gone out on loan (Baston for example). Also, if you look at the note on players leaving after the balance sheet date, it says that where they've left for less than the carrying value, we've taken that as an impairment charge through these accounts. You can't see the amounts involved, but Baston alone may have been significantly written down.
I'm not attempting by the way to say that the cashflow position is great, just to say that it is nowhere near what you have said here. [Post edited 14 Mar 2018 17:44]
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| Audited Accounts are now out on 18:11 - Mar 14 with 3040 views | Shaky |
| Audited Accounts are now out on 17:42 - Mar 14 by londonlisa2001 |
Shaky - I haven't had chance yo have a full look, but after a quick skim, some of the points you make are not entirely correct.
Firstly, on the working capital point, £47m of the £66m 'hole' you refer to is actually deferred income. In other words it's the Sky monies received that can't be recognised until the start of the season. So in August, that disappears and gets treated as income, and the 'hole' becomes £19m not £66m.
Secondly, the player sales / purchases & new contract costs (including all fees) that happened as post balance sheet events (so after 31 July but before 31 October when these accounts were signed) shows total sales of £47m and total purchases plus registration fees (so including new contracts costs) of £29m. That's a surplus of £18m, so your working capital deficit was wiped out by October.
In response to some other points you've made. The total director's costs is the same as that paid to the highest Director, so no fees are being paid to anyone else (you mentioned one of the US directors).
On the operating costs, based on what is said in these accounts, I suspect (I don't know) that impairments have been taken against players that have gone out on loan (Baston for example). Also, if you look at the note on players leaving after the balance sheet date, it says that where they've left for less than the carrying value, we've taken that as an impairment charge through these accounts. You can't see the amounts involved, but Baston alone may have been significantly written down.
I'm not attempting by the way to say that the cashflow position is great, just to say that it is nowhere near what you have said here. [Post edited 14 Mar 2018 17:44]
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1. With respect Lisa you don't understand the impact of working capital on cash-flow.
Let's say at year end there was £40m of deferred income (some of it must have been real accruals).
What that means is an advance payment in respect of the following year's revenue (from TV) had already been received. When that year is complete around £110m of sales will have been recognised. But only £ (110-40)=£70m cash received in respect of **that accounting year**.
Therefore when reconciling the P&L to cash-flow it is already down by £40m before any out-flows due to losses for the year.
The Premier League is in effect provoffering a pre-financing line to clubs and Swansea has decided to take maximum advantage.
When does that go wrong? On relegation or if TV revenues start to decline.
2. No, the WC deficit is £65m as I stated.
3. Fees for services in connection with the stadium could easily have been invoiced from a company rather than personally.
4. I haven's seen anything on impairments since '14
5. I'm heading out! [Post edited 14 Mar 2018 18:13]
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| Audited Accounts are now out on 18:31 - Mar 14 with 3000 views | londonlisa2001 |
| Audited Accounts are now out on 18:11 - Mar 14 by Shaky |
1. With respect Lisa you don't understand the impact of working capital on cash-flow.
Let's say at year end there was £40m of deferred income (some of it must have been real accruals).
What that means is an advance payment in respect of the following year's revenue (from TV) had already been received. When that year is complete around £110m of sales will have been recognised. But only £ (110-40)=£70m cash received in respect of **that accounting year**.
Therefore when reconciling the P&L to cash-flow it is already down by £40m before any out-flows due to losses for the year.
The Premier League is in effect provoffering a pre-financing line to clubs and Swansea has decided to take maximum advantage.
When does that go wrong? On relegation or if TV revenues start to decline.
2. No, the WC deficit is £65m as I stated.
3. Fees for services in connection with the stadium could easily have been invoiced from a company rather than personally.
4. I haven's seen anything on impairments since '14
5. I'm heading out! [Post edited 14 Mar 2018 18:13]
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Yup Shaky, I do.
There will be some amount of accruals, but tiny.
The premier league pays a few weeks earlier than they used to to match the transfer window.
If the club was relegated, the players bought in anticipation of the new premier league season wouldn't be bought and the cash wouldn't be used to finance those purchases.
Your analysis doesn't take that into consideration as it'd only be 'down' in the event of a relegation if they for some reason didn't realise they'd been relegated and bought players in next year's summer window before realising they wouldn't receive the Sky money.
So, no, the deficit isn't as you stated.
If fees were invoiced from a company it'd be shown as a related party transaction, which it's not.
You can't see impairments separately. [Post edited 14 Mar 2018 18:32]
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| Audited Accounts are now out on 18:48 - Mar 14 with 2969 views | Shaky |
| Audited Accounts are now out on 18:31 - Mar 14 by londonlisa2001 |
Yup Shaky, I do.
There will be some amount of accruals, but tiny.
The premier league pays a few weeks earlier than they used to to match the transfer window.
If the club was relegated, the players bought in anticipation of the new premier league season wouldn't be bought and the cash wouldn't be used to finance those purchases.
Your analysis doesn't take that into consideration as it'd only be 'down' in the event of a relegation if they for some reason didn't realise they'd been relegated and bought players in next year's summer window before realising they wouldn't receive the Sky money.
So, no, the deficit isn't as you stated.
If fees were invoiced from a company it'd be shown as a related party transaction, which it's not.
You can't see impairments separately. [Post edited 14 Mar 2018 18:32]
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It's not a question of future investments, but how existign operating assets have been financed.
Imagine the club was relegated last season. How would the closing '17 balance sheet look adjusted for the loss of the TV prepayment?
Gotta run | |
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| Audited Accounts are now out on 18:56 - Mar 14 with 2962 views | londonlisa2001 |
| Audited Accounts are now out on 18:48 - Mar 14 by Shaky |
It's not a question of future investments, but how existign operating assets have been financed.
Imagine the club was relegated last season. How would the closing '17 balance sheet look adjusted for the loss of the TV prepayment?
Gotta run |
They wouldn't have bought the players in the summer they bought Shaky.
That's why it shouldn't be included in the 'hole'.
If the purchase of players were fixed and committed without knowing whether the money was going to be received, I'd agree (in other words if the advance was paying a cashflow deficit on our operating costs). But it's not.
It's just an anomaly between the start of the season (when income is recognised) and when players are bought for that season.
It's the same as buying a machine from which you'll make an income. You are, in effect, saying that if you lose the income you've still got to finance the machine. But in this situation, you will know in advance whether that income will be made or not, and if it's not going to be there, you simply won't buy the machine. | | | |
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| Audited Accounts are now out on 19:34 - Mar 14 with 2891 views | Loyal |
| Audited Accounts are now out on 13:50 - Mar 14 by QJumpingJack |
Oprah is worth $2.8 bn.
Surely she can help out. |
She actually has the biggest clout in Wyoming. |  |
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| Audited Accounts are now out on 19:44 - Mar 14 with 2876 views | PozuelosSideys |
| Audited Accounts are now out on 18:56 - Mar 14 by londonlisa2001 |
They wouldn't have bought the players in the summer they bought Shaky.
That's why it shouldn't be included in the 'hole'.
If the purchase of players were fixed and committed without knowing whether the money was going to be received, I'd agree (in other words if the advance was paying a cashflow deficit on our operating costs). But it's not.
It's just an anomaly between the start of the season (when income is recognised) and when players are bought for that season.
It's the same as buying a machine from which you'll make an income. You are, in effect, saying that if you lose the income you've still got to finance the machine. But in this situation, you will know in advance whether that income will be made or not, and if it's not going to be there, you simply won't buy the machine. |
So whats the underlying position in your opinion?
Is it an improvement YoY? Much of the same or are the club going backwards financially and digging a deeper hole? |  |
| "Michu, Britton and Williams could have won 3-0 on their own. They wouldn't have required a keeper." | | Poll: | Hattricks |
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| Audited Accounts are now out on 20:18 - Mar 14 with 2849 views | QJumpingJack |
I am assuming the Trust would have seen these accounts and raised any concerns before they were published. | | | |
| Audited Accounts are now out on 20:21 - Mar 14 with 2843 views | londonlisa2001 |
| Audited Accounts are now out on 19:44 - Mar 14 by PozuelosSideys |
So whats the underlying position in your opinion?
Is it an improvement YoY? Much of the same or are the club going backwards financially and digging a deeper hole? |
Firstly, I can only comment on publicly available information.
In my opinion, the cash flow position is the biggest risk. It's not as bad as Shaky's post suggested, but as I said to him, that doesn't mean I believe it to be strong.
We have done some good work in removing some big costs from the books, and we have done well to realise assets at significant levels of profit. We have had mixed success in investments in players with some notable failures (Baston, Mesa), but some notable successes as well (Jordan Ayew, Mawson). Some we have bought that we would make smaller profits on in my opinion, (Olsson, Carroll) and for some, the jury's out (Clucas). These are not exhaustive by the way, I'm just talking examples. I also think we'll see significant profits on the younger players, over time (Oli as an example, but Byers, Dan James etc as well).
Our salaries remain very high compared to our income, but I believe we are working on that, and the salaries don't present quite as high a risk at it may appear, as I believe we have widespread relegation clauses in place. Also, this period now published, contains 2 lots of management teams being booted, which is significant. This year will also have that of course, but at least only one change.
The stadium deal may or may not be positive financially. It really depends on our league position. If we remain in the PL I suspect we'll do well out of it. If we don't, it's a bigger exposure to costs than we would have had under the previous arrangement.
Commercially things appear to be moving in the right direction, albeit I note that these accounts show a sizeable decrease in merchandise, which may be more than made up for in the Commercial revenue figure, it's impossible to see. (In other words, people don't buy the stuff but we're paid more to wear it).
I believe that the new owners run the club in the same way as the old owners - only spend what the club generates, and without injection of further funds. But they do have access to funding that wasn't there previously, albeit, it's impossible to tell whether they will ever use it.
All in all, the cash flow is the key. But I think that they do everything possible to manage that. If we can stay up for another few seasons, I think we'll be in a far stronger position as I think that the previous regime would have lost control.
One of the things that's key, is we can't afford too many more mistakes in players, or managers. We don't have the headroom for it. A couple of years of stability and it's brighter. | | | |
| Audited Accounts are now out on 21:01 - Mar 14 with 2767 views | MoscowJack |
Lisa, thanks for the breakdown.....it really helps.
If my memory's correct, hasn't cashflow always been an issue since the entered the PL?
Also, do you know how much we're borrowing from banks or other lenders please? I'm just wondering as it might give us an indication of the owners' intention (or lack of it) to inject cheaper cash. | |
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| Audited Accounts are now out on 21:44 - Mar 14 with 2702 views | Shaky |
| Audited Accounts are now out on 18:56 - Mar 14 by londonlisa2001 |
They wouldn't have bought the players in the summer they bought Shaky.
That's why it shouldn't be included in the 'hole'.
If the purchase of players were fixed and committed without knowing whether the money was going to be received, I'd agree (in other words if the advance was paying a cashflow deficit on our operating costs). But it's not.
It's just an anomaly between the start of the season (when income is recognised) and when players are bought for that season.
It's the same as buying a machine from which you'll make an income. You are, in effect, saying that if you lose the income you've still got to finance the machine. But in this situation, you will know in advance whether that income will be made or not, and if it's not going to be there, you simply won't buy the machine. |
"They wouldn't have bought the players in the summer they bought Shaky. "
**player** in the singular.
The only only player bought at the back end of the financial year was Mesa at a reported cost of £11m
Let me do the balance sheet adjustment for you had Swansea been relegated and the Sky advance payment fallen away:
1) Reduce deferred income by £45m on the debt and equity side
2) Reduce cash by £45m on the asset side
That would have produced an overdraft of £38m + other debt of £9m add back Mesa fee @£11m =net debt of £36m
With an adjusted working capital deficit of a further £21 million
Plus some other LT liabilities.
Equals deep, deep in the shit. Notwithstanding any parachute payment. | |
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| Audited Accounts are now out on 21:44 - Mar 14 with 2700 views | jasper_T |
| Audited Accounts are now out on 16:59 - Mar 14 by swanforthemoney |
"The negative working capital of £66m means that over the next 12 months or so the club have to pay out more than £66 million punds more than they have coming in. This is money that has to be found. "
Might that explain, partially, why weve gone back for old players like Wilf and Ayew, so we dont have to find any real money ?
That Mindy Kaling needs to be out shaking a bucket outside the Liberty on Saturday. Ill look down the back of the sofa in readiness.
PS thanks for the analysis Shaky. [Post edited 14 Mar 2018 17:03]
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We cashed out the Ayew sale yonks before signing him back. The cash had to be found same as any other deal. | | | |
| Audited Accounts are now out on 21:56 - Mar 14 with 2672 views | Shaky |
| Audited Accounts are now out on 18:56 - Mar 14 by londonlisa2001 |
They wouldn't have bought the players in the summer they bought Shaky.
That's why it shouldn't be included in the 'hole'.
If the purchase of players were fixed and committed without knowing whether the money was going to be received, I'd agree (in other words if the advance was paying a cashflow deficit on our operating costs). But it's not.
It's just an anomaly between the start of the season (when income is recognised) and when players are bought for that season.
It's the same as buying a machine from which you'll make an income. You are, in effect, saying that if you lose the income you've still got to finance the machine. But in this situation, you will know in advance whether that income will be made or not, and if it's not going to be there, you simply won't buy the machine. |
. . .And I have to tell you I am a little shocked by your analogy of comparing this business to buying a machine that will produce steady profits.
This is nothing like selling say toothpaste, because each year there is a material risk that your revenue wlll collapse catastrophically on relegation. Whereas toothpaste sales just keep chugging along come rain or shine.
And your incredibly expensive operating assets (players) are written off over a couple of years compared to maybe 10-20 years for manufacturing equipment that is typically orders of magnitude cheaper relative to sales, profit, etc. | |
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| Audited Accounts are now out on 22:56 - Mar 14 with 2577 views | londonlisa2001 |
| Audited Accounts are now out on 21:44 - Mar 14 by Shaky |
"They wouldn't have bought the players in the summer they bought Shaky. "
**player** in the singular.
The only only player bought at the back end of the financial year was Mesa at a reported cost of £11m
Let me do the balance sheet adjustment for you had Swansea been relegated and the Sky advance payment fallen away:
1) Reduce deferred income by £45m on the debt and equity side
2) Reduce cash by £45m on the asset side
That would have produced an overdraft of £38m + other debt of £9m add back Mesa fee @£11m =net debt of £36m
With an adjusted working capital deficit of a further £21 million
Plus some other LT liabilities.
Equals deep, deep in the shit. Notwithstanding any parachute payment. |
Shaky. The transfer window has to be seen as a whole. The accounting date is neither here nor there.
We sold players for £46m after the accounting date but in that same window and bought and recontracted for £28m as I've already said.
The sale would happen, not the purchases and renegotiation of contracts.
Neither would the purchase of Mesa.
It's not difficult. | | | |
| Audited Accounts are now out on 22:56 - Mar 14 with 2573 views | TheResurrection |
For the records I'd disregard all of Shaky's analysis based on the fact he's facking humiliated himself...
'gotta run '
😂😂😂 |  |
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| Audited Accounts are now out on 22:59 - Mar 14 with 2572 views | londonlisa2001 |
| Audited Accounts are now out on 21:56 - Mar 14 by Shaky |
. . .And I have to tell you I am a little shocked by your analogy of comparing this business to buying a machine that will produce steady profits.
This is nothing like selling say toothpaste, because each year there is a material risk that your revenue wlll collapse catastrophically on relegation. Whereas toothpaste sales just keep chugging along come rain or shine.
And your incredibly expensive operating assets (players) are written off over a couple of years compared to maybe 10-20 years for manufacturing equipment that is typically orders of magnitude cheaper relative to sales, profit, etc. |
It was a simple analogy so you'd understand what the hell is going on as you don't appear to.
It doesn't matter what you time you write players off over. It's just accounting. What matters is the contract term and value on sale. | | | |
| Audited Accounts are now out on 23:18 - Mar 14 with 2534 views | max936 |
| Audited Accounts are now out on 22:59 - Mar 14 by londonlisa2001 |
It was a simple analogy so you'd understand what the hell is going on as you don't appear to.
It doesn't matter what you time you write players off over. It's just accounting. What matters is the contract term and value on sale. |
So looking at the playing side of things or the overall picture, we'll have around £3.50 to spend this summer unless we can off load a player or three for 10mill or more apiece, so unless I'm being negative or a drama queen we'll have another battle on our hands to stave off relegation next season as well? |  |
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| Audited Accounts are now out on 04:40 - Mar 15 with 2468 views | E20Jack |
| Audited Accounts are now out on 22:56 - Mar 14 by TheResurrection |
For the records I'd disregard all of Shaky's analysis based on the fact he's facking humiliated himself...
'gotta run '
😂😂😂 |
Before I even clicked on this thread I knew exactly what it's contents would be and the pattern it would take and was proven 100% right, to my amusement.
Why anyone bothers to read it before he submits it to Lisa for marking is beyond me. |  |
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| Audited Accounts are now out on 09:32 - Mar 15 with 2371 views | Shaky |
| Audited Accounts are now out on 22:56 - Mar 14 by londonlisa2001 |
Shaky. The transfer window has to be seen as a whole. The accounting date is neither here nor there.
We sold players for £46m after the accounting date but in that same window and bought and recontracted for £28m as I've already said.
The sale would happen, not the purchases and renegotiation of contracts.
Neither would the purchase of Mesa.
It's not difficult. |
I really don't know what to say, Lisa.
The balance sheet is a complete snapshot at a moment in time. From which it is possible to project various scenarios, if you know what you're doing.
I precisely outlined the financial impact of scenario at the last balance sheet date had no player (Mesa) been purchased and the club relegated.
Of course you are right to a certain extent that relegation or not determines the outlook for player movements, but with less than £20m in equity plus a £65m working capital hole, as Awayjack correctly surmised the only realistic option is a firesale of the club's only reasonably liquid asset; the playing staff.
With a book value of £70m at the end of last year (+£22m in fixed assets also needing to be financed)
And the right approach to analysing post balace sheet events is to look at them as a continuum. Here my preliminary numbers are suggesting a profit on sales of £52m (basically Siggy & Llorente) vs incoming transfers of £59m including agents (total cash out).
I need to do a little more work on depreciation when i find time but back of the envelope that suggests the carrying value of player registrations will increase from £70m to perhaps £85-90m by next financial year end (all other things being equal).
What is happening is the management geniuses running the club are in effect gearing up significantly at a time where TV revenues appear to have peaked, and with that likely also transfer market values.
I urge you to think very carefully about this, and ask any questions you may have. It is particulary important you understand this, since it has direct bearing on the desirability of selling the Trust's stake in the club. [Post edited 15 Mar 2018 9:40]
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| Audited Accounts are now out on 09:38 - Mar 15 with 2367 views | Shaky |
. . And by the way looking at the squad, there are clearly huge holes that need to be filled at the end of this season; 1x striker, 1x AM, 1x CDM and the rest.
In a perverse sense it is almost better to go down than have to fork out going rates to buy competitive players to fill those roles, and then suffer the significant further increase in balance sheet risk that would entail (obviously assuming no new equity financing). | |
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| Audited Accounts are now out on 11:44 - Mar 15 with 2285 views | londonlisa2001 |
| Audited Accounts are now out on 09:32 - Mar 15 by Shaky |
I really don't know what to say, Lisa.
The balance sheet is a complete snapshot at a moment in time. From which it is possible to project various scenarios, if you know what you're doing.
I precisely outlined the financial impact of scenario at the last balance sheet date had no player (Mesa) been purchased and the club relegated.
Of course you are right to a certain extent that relegation or not determines the outlook for player movements, but with less than £20m in equity plus a £65m working capital hole, as Awayjack correctly surmised the only realistic option is a firesale of the club's only reasonably liquid asset; the playing staff.
With a book value of £70m at the end of last year (+£22m in fixed assets also needing to be financed)
And the right approach to analysing post balace sheet events is to look at them as a continuum. Here my preliminary numbers are suggesting a profit on sales of £52m (basically Siggy & Llorente) vs incoming transfers of £59m including agents (total cash out).
I need to do a little more work on depreciation when i find time but back of the envelope that suggests the carrying value of player registrations will increase from £70m to perhaps £85-90m by next financial year end (all other things being equal).
What is happening is the management geniuses running the club are in effect gearing up significantly at a time where TV revenues appear to have peaked, and with that likely also transfer market values.
I urge you to think very carefully about this, and ask any questions you may have. It is particulary important you understand this, since it has direct bearing on the desirability of selling the Trust's stake in the club. [Post edited 15 Mar 2018 9:40]
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Shaky, I know what a balance sheet is mun, I'm an accountant!
You are missing my point.
Player purchases, new contracts, sales etc are within the remit of the club. They can turn them on or off depending on league position. They can only do this largely (as contracts can be done as and when), during the transfer windows. The largest window overlaps the balance sheet date and runs on for a few weeks, but information on that is seen as a post balance sheet event in the accounts which were signed on 31 October, and, therefore, gives the information for the rest of that window. It doesn't get muddied by the January window as those movements would not be included due to the signing date.
So, if we assume for a moment that we had been relegated last season. The purchases of players prior to the balance sheet date would not have happened (as you say, Mesa was the big one, from memory I think we brought in Tammy prior to the end of July as well and there may have been others, I can't remember). The sales that happened (including those after the balance sheet date) would have gone ahead, and we wouldn't have bought or loaned players in August (Clucas, Sanches, again I can't remember who joined and when off the top of my head).
So the working capital (if we'd gone down), would have seen the inflow of the £46m shown as post balance sheet, but would not have seen the outflows of £28m mentioned, and also would not have seen outflows for Mesa / Abraham that are included in the balance sheet (as a mixture of cash out and creditors).
So at least a £40m 'improvement' in working capital. Obviously with a corresponding decrease in the assets we have and in the quality of playing staff.
What you are saying, is that any further funds needed would have had to come from other player sales. Well no sh*t Sherlock. That's what relegation does. It means you have to sell some players.
For a club like us, selling players at a profit is part of how we finance ourselves. You can't dismiss it. It's the same for most smaller clubs.
The book value of players being £70m isn't particularly relevant. The problem with football club accounts is that they don't mark players to market and yet they do take impairment adjustments. It's because players are treated as intangibles. Included in that figure, for example, will be maybe £4m or so for Mawson (we bought him at £5m ish and there will have been some depreciation over life of contract in these accounts). And yet, Mawson's value is, say £25m, maybe more. Same with Jordan Ayew (in these accounts at whatever we paid, was it £7m or so, some of which was financed by Taylor, less depreciation to give, say £5m) and worth probably £15m -£20m.
As I said previously, in my first response, cashflow is very tight and has to be very tightly monitored and controlled, but the analysis you've presented is not accurate in terms of 'holes that need to be financed'.
On the Trust's stake bit, legal action or otherwise is not intended as a compensation for value loss in after the deal events. I believe that legal action should have been taken and should be taken. I made that clear at the time and I continue to do so. I believe that as I believe that the Trust was unfairly prejudiced by the sale. Nothing in a set of accounts will alter that view, whether good, bad or indifferent. The Trust is not in the business of investing to make a return. It's in the business of protecting the long term interest of the football club. My view is that it can only do that in one of two ways. Either a genuine influence and voice in the running of the club, or if that can't be achieved, maximising the money available to step in at a future date. [Post edited 15 Mar 2018 11:51]
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| Audited Accounts are now out on 12:11 - Mar 15 with 2250 views | Shaky |
Your argument effectively boils down to this, Lisa; before the start of the season, the club could have sold Siggy and Llorente, not replaced them with anybody and everything would have been great!
And do you really think if Swansea had bene relegated they would have got anywere near the prices obtained for those two?
What is true, however, is that the sale of Siggy in particular was a get out of jail card for the club, that will significantly help profits this year.
It was a one off, but it certainly repaired the extreme undercapitalisation issue and generally put a big plaster on the worst shortcomings of the balance sheet.
Or rather it could have done, if the DofMeister hadn't taken the proceeds from that sale + Llorente's, added a little extra on top and splashed out £70 million on:
Mesa (£12m)
Bony (£13m)
Clucas (£16m)
Sanches (£7m loan fee)
Ayew (£22m)
What's that lot worth, firesale or not? | |
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