Cash reserves & Operating loss

[Spudulike]

Some interesting figures complied by the BBC.

 

Slightly concerning that LCFC cash reserves were the 4th lowest in the Premier League, and operating profit/loss 3rd worst, in 2019.

 

Cash reserves and operating loss

[davieG]

 

[yorkie1999]

7 minutes ago, davieG said:

 

Pointless, Without fans at the stadium it's no longer professional football, it's okay for a couple of games to see the season out but no sport would be professional sport without spectators, and it doesn't matter how exciting the commentators would try to make it, it's the fans that Sky actually sell.  Sky would be better off televising Sunday league because at least we'd get a few tasty challenges.  "Fantastic goal from Maddison" so what!, i can see that on a playstation 

[Ric Flair]

Finishing in the top 4 for us will be massive given the current financial crisis, as long as UEFA are able to figure out how to actually allow European football to take place next season.

[Bayfox]

Chasing the dream, but at what cost. Ok you couldn't really have foreseen this situation. But our wage to turnover % has been to high for a number of seasons now.

 

CL income and the spike in shirt sales and merchandise etc from the intrigue of us winning the title was great, but we need that on a regular basis to keep up those sorts of numbers, or we will have to continue the selling of one player for huge sums each year, how easy that will be once things settle down, no one knows.

 

The longer the game is shut down and not accessible to fans, the harder the clubs will be hit.

 

Also, has anyone considered we loaned the training ground cash against the TV income. That loss is expected to be total 50 million for our club according to some reports if we cant get the show back on.

 

McLaren's will want paying. Top may have to dig deep, whilst he watches his other business flounder as well at this time.

 

Not life or death, but shows how much football has come to rely on TV income and how much of that just goes straight in players pockets.

 

Long term this could see the game change for the better in terms of contracts and business model but right now some clubs are gonna end up in the shit 

[Ric Flair]

2 minutes ago, Bayfox said:

Chasing the dream, but at what cost. Ok you couldn't really have foreseen this situation. But our wage to turnover % has been to high for a number of seasons now.

 

CL income and the spike in shirt sales and merchandise etc from the intrigue of us winning the title was great, but we need that on a regular basis to keep up those sorts of numbers, or we will have to continue the selling of one player for huge sums each year, how easy that will be once things settle down, no one knows.

 

The longer the game is shut down and not accessible to fans, the harder the clubs will be hit.

 

Also, has anyone considered we loaned the training ground cash against the TV income. That loss is expected to be total 50 million for our club according to some reports if we cant get the show back on.

 

McLaren's will want paying. Top may have to dig deep, whilst he watches his other business flounder as well at this time.

 

Not life or death, but shows how much football has come to rely on TV income and how much of that just goes straight in players pockets.

 

Long term this could see the game change for the better in terms of contracts and business model but right now some clubs are gonna end up in the shit 

What's the alternative? We spend within our means but if we were operating cash surplus's year on year and finishing mid table then there'd be a real question of ambition. One thing we cannot really question is our owners ambition or handling of the club, it has been exceptional and I've ever faith of them navigating their way through this.

[Poznan34]

That article looks at 18-19 accounts. You'd think our next accounts should be looking a lot healthier with the £80m up front payment we got for Maguire. 

[Bayfox]

47 minutes ago, Ric Flair said:

What's the alternative? We spend within our means but if we were operating cash surplus's year on year and finishing mid table then there'd be a real question of ambition. One thing we cannot really question is our owners ambition or handling of the club, it has been exceptional and I've ever faith of them navigating their way through this.

The alternative is all clubs need to look at things.

 

I was in no way crtitsing the owners and and ambition. The last decade as a supporter has been great.

 

But football in general maybe needed something like this as a reality check.

 

It probably wont happen, but these clubs are at the mercy of tv deals, they have put all their eggs in one basket for too long now.

[Ric Flair]

47 minutes ago, Bayfox said:

The alternative is all clubs need to look at things.

 

I was in no way crtitsing the owners and and ambition. The last decade as a supporter has been great.

 

But football in general maybe needed something like this as a reality check.

 

It probably wont happen, but these clubs are at the mercy of tv deals, they have put all their eggs in one basket for too long now.

Yeah, I agree it's just with the sheer popularity of football I don't see how teams won't try and compete by spending every ounce they can on trying to keep up with the demands. I do feel like prior to this pandemic, PL clubs have been way more stable than they were 10+ years ago but that's because there's almost a monopoly on the income being generated by Premier League teams and FFP has at least curbed the ability of clubs to spend way above their means and ultimately risk going bust. That said, the wealth of PL teams has at times been a hinderence as it has a blessing as they all just get stung for stupid fees and then wages for players so the outcome might not actually be worth the luxury afforded to them.

 

I think there'll be a bit of a shake up and the quality might suffer, football without fans is going to make it a weird period. I can honestly see some players struggling for motivation and slip through the cracks in the game. I've recently been reading a book on Euro 96 and the subsequent years in English football and there was a lot said about Gascoigne's mental and physical health as well as a few other players and how easy it is to forget as fans and media about how this impacts on their ability to play football. We just see a player has hit a bad patch and that might see them fall out of favour and never recover and leave the club etc but there's often way more to it and it's such a shame that off the field stuff cannot be rectified.

 

Imagine trying to get excited about moving clubs in the next year if there's no fans to create any atmosphere or buzz, the players are going to have to be so mentally strong to keep focused and progress. Again, it's likely to be driven by money, what else is there to really look for in a move in the near future?

[Stadt]

We've been guilty of some poor squad building. The summer of 16 was a big mistake, we spent heavily on Silva and Slimani who have played a combined 68 times in the 4 years since we signed them. We've learned from it to some degree but we make some unnecessary choices. Ward is a good GK but £12m for a back up? Not necessary. I'm a huge fan of Barnes but he's had a new contract every year for the last three seasons, again, is that necessary? We've had Jakupovic collecting dust ever since we signed him, he's made 4 appearances in 3 years. Maybe there were plenty of valid reasons but giving Matty James a sizeable extension? Is that an efficient allocation of resources. Kapustka and Diabate we're not going to make a profit on you'd have thought so why not sell them before their values depreciate even further?

 

We've done plenty of good business in selling Drinkwater, Kante, Mahrez and Maguire for big profits but maybe we wouldn't have to sell one big player every two seasons if we were a little bit shrewder. No doubt most of us would think Everton are mugs when looking at their business but our wages to turnover % is similar. 

 

 

 

Champions League income is starting to look like a necessity rather than a bonus which isn't a situation we wan't to be in. Fortunately, Top is very committed so I'd imagine very low interest loans from KP would get us out of immediate bother but long term we need keep our costs a bit lower.

[leicesterseddon]

Bottom line is basically the same for all PL clubs at the end of the day.

 

If they can keep the TV money coming in alongside some sponsorship, there will be constraints but they will survive.

 

But if they have to go for an extended period without televised games then they won’t survive for long without players having to take massive cuts. 

[Corky]

I think (and hope) that this pandemic and subsequent issue around finances will be giving the game the chance to seriously think about how it operates and where the money goes. Clubs have to be better run and not just giving out wages, huge transfer fees, agent fees any more, it's unsustainable. The Football League is just as bad, if not worse, in plenty of cases.

 

There needs to be a salary cap relevant to the club's income. Yes, there will be a disparity due to the individual size of clubs but there always has been- clubs need to be healthy going forward at all levels.

[Ric Flair]

2 hours ago, Stadt said:

We've been guilty of some poor squad building. The summer of 16 was a big mistake, we spent heavily on Silva and Slimani who have played a combined 68 times in the 4 years since we signed them. We've learned from it to some degree but we make some unnecessary choices. Ward is a good GK but £12m for a back up? Not necessary. I'm a huge fan of Barnes but he's had a new contract every year for the last three seasons, again, is that necessary? We've had Jakupovic collecting dust ever since we signed him, he's made 4 appearances in 3 years. Maybe there were plenty of valid reasons but giving Matty James a sizeable extension? Is that an efficient allocation of resources. Kapustka and Diabate we're not going to make a profit on you'd have thought so why not sell them before their values depreciate even further?

 

We've done plenty of good business in selling Drinkwater, Kante, Mahrez and Maguire for big profits but maybe we wouldn't have to sell one big player every two seasons if we were a little bit shrewder. No doubt most of us would think Everton are mugs when looking at their business but our wages to turnover % is similar. 

 

 

 

Champions League income is starting to look like a necessity rather than a bonus which isn't a situation we wan't to be in. Fortunately, Top is very committed so I'd imagine very low interest loans from KP would get us out of immediate bother but long term we need keep our costs a bit lower.

Probably no different to clauses within his contract that award him with pay rises after a certain amount of games/milestones etc. It's very common for this to happen with young academy players also happened with Chilwell and Choudhury.

[Ric Flair]

45 minutes ago, Corky said:

I think (and hope) that this pandemic and subsequent issue around finances will be giving the game the chance to seriously think about how it operates and where the money goes. Clubs have to be better run and not just giving out wages, huge transfer fees, agent fees any more, it's unsustainable. The Football League is just as bad, if not worse, in plenty of cases.

 

There needs to be a salary cap relevant to the club's income. Yes, there will be a disparity due to the individual size of clubs but there always has been- clubs need to be healthy going forward at all levels.

The issue is though if players weren't paid as much as they are or transfers weren't as high as they are, fans would be asking where all the revenue is going, i.e. it would be taken by the owners if they wanted or kept as cash surplus. The sheer popularity, demand and obsession with football makes clubs spend to within their maximum, rightly or wrongly.

[ealingfox]

We do have a bad habit of chucking contracts out like confetti, I've thought that for years.

[Fox92]

3 hours ago, Stadt said:

We've been guilty of some poor squad building. The summer of 16 was a big mistake, we spent heavily on Silva and Slimani who have played a combined 68 times in the 4 years since we signed them. We've learned from it to some degree but we make some unnecessary choices. Ward is a good GK but £12m for a back up? Not necessary. I'm a huge fan of Barnes but he's had a new contract every year for the last three seasons, again, is that necessary? We've had Jakupovic collecting dust ever since we signed him, he's made 4 appearances in 3 years. Maybe there were plenty of valid reasons but giving Matty James a sizeable extension? Is that an efficient allocation of resources. Kapustka and Diabate we're not going to make a profit on you'd have thought so why not sell them before their values depreciate even further?

 

We've done plenty of good business in selling Drinkwater, Kante, Mahrez and Maguire for big profits but maybe we wouldn't have to sell one big player every two seasons if we were a little bit shrewder. No doubt most of us would think Everton are mugs when looking at their business but our wages to turnover % is similar. 

 

 

 

Champions League income is starting to look like a necessity rather than a bonus which isn't a situation we wan't to be in. Fortunately, Top is very committed so I'd imagine very low interest loans from KP would get us out of immediate bother but long term we need keep our costs a bit lower.

I've always thought some of our business seemed stupid. James 4 year deal as an example, a player that spends more time out injured. Shakespeare, an un proven manager, was given a 3 year deal on the back of a decent couple of months. Even now Brendan has had 75% of a season and signed a new contract already.

[Ric Flair]

1 hour ago, ealingfox said:

We do have a bad habit of chucking contracts out like confetti, I've thought that for years.

We've also not lost a player for free or a reduced fee that we didn't want to for running their contract down for years to counter balance this. 

 

I've no issue with certain progressive or influentual players getting new deals every year or so if they deserve it.

[Danizen]

1 hour ago, ealingfox said:

We do have a bad habit of chucking contracts out like confetti, I've thought that for years.

We're not alone in this though. Player power is out of control and if we won't give one of our best players a pay rise, someone else will.

 

Hopefully this situation will shine a light on how irresponsible almost every single club has been and collectively reduce player wages.

[Bayfox]

35 minutes ago, Ric Flair said:

We've also not lost a player for free or a reduced fee that we didn't want to for running their contract down for years to counter balance this. 

 

I've no issue with certain progressive or influentual players getting new deals every year or so if they deserve it.

No but we handed huge rises across the board after 2016, that I don't as such have an issue with, but extending them all for basically 4 years almost across the board was a little reckless, they could have just said to the likes of Fuchs, who at the time had suggested he wasnt staying, kingy, god love him, wes, Simpson etc we will bump your wages for the remainder of your contract and sot and talk then.

 

On the subject of summer 16 transfer business, I know slim and silva have been mentioned in terms of still being here but not playing, but then we have kapustka, chuck in musa, RRZ I know you cant get everything right, but that summer not 1 player came in and improved the 1st 11, infact theres a case to say we spent 70 million and barely improved the squad, shakey instantly went back to the old guard to save us.

 

Looking back 4 years on, there's not a lot left, other than Vardy and Kasper that were here anyway and wes, still being here for experience. That shows a real lack of planning that summer.

 

Sorry to go off on a tangent, but whatever went on that summer, thank good we have corrected it and have assets that others want now.

[VLC86]

We could do with getting rid of a fair bit of dead wood no doubt about it but considering the wealth of young talent we have in our squad I’m not worried.

 

Will we have to sell 1 player every summer in order to move forward if we aren’t in the Champions League every year? Yes but you look at a team like Dortmund and that’s how they operate and they have been outstanding for a number years.

 

It would obviously help no end should we not spunk ridiculous transfer fees and wages at some of the dross we have.

[mozartfox]

11 hours ago, ealingfox said:

We do have a bad habit of chucking contracts out like confetti, I've thought that for years.

I suspect the dishing out of sentimental contract extensions will be curtailed come summer.  We simply cannot afford to pay out millions to bench warmers any longer.  

[snoopy87]

I'm not overly concerned about this yet myself. The club haven't been forced to ask the playing staff, or anyone for that matter to take a pay cut during this time. When they start doing an Arsenal or Spurs then I'd start to worry about our sustainability.

[Footballwipe]

We desperately need to work on getting that ratio down. Champions League might help, but if we drop out at some point then we're spending £85 of every £100 through the door even before we've started paying any other bills.

 

When you're up in the echelons of Everton (£110m loss) and Bournemouth (where about 80% of their turnover is TV money alone) in terms of ratio it's something to be concerned about.

 

Not crapping the bed just yet, but it's unsustainable, especially when player wages (before the pandemic at least) are only going one way. Let's hope European Football provides the platform for better investment than our last attempt.

[sacreblueits442]

21 hours ago, Bayfox said:

Chasing the dream, but at what cost. Ok you couldn't really have foreseen this situation. But our wage to turnover % has been to high for a number of seasons now.

 

CL income and the spike in shirt sales and merchandise etc from the intrigue of us winning the title was great, but we need that on a regular basis to keep up those sorts of numbers, or we will have to continue the selling of one player for huge sums each year, how easy that will be once things settle down, no one knows.

 

The longer the game is shut down and not accessible to fans, the harder the clubs will be hit.

 

Also, has anyone considered we loaned the training ground cash against the TV income. That loss is expected to be total 50 million for our club according to some reports if we cant get the show back on.

 

McLaren's will want paying. Top may have to dig deep, whilst he watches his other business flounder as well at this time.

 

Not life or death, but shows how much football has come to rely on TV income and how much of that just goes straight in players pockets.

 

Long term this could see the game change for the better in terms of contracts and business model but right now some clubs are gonna end up in the shit 

...exactly how would these new contracts look!!!!

[Ric Flair]

20 minutes ago, Footballwipe said:

We desperately need to work on getting that ratio down. Champions League might help, but if we drop out at some point then we're spending £85 of every £100 through the door even before we've started paying any other bills.

 

When you're up in the echelons of Everton (£110m loss) and Bournemouth (where about 80% of their turnover is TV money alone) in terms of ratio it's something to be concerned about.

 

Not crapping the bed just yet, but it's unsustainable, especially when player wages (before the pandemic at least) are only going one way. Let's hope European Football provides the platform for better investment than our last attempt.

There's an argument though that running a cash surplus is a lack of ambition, so we either fine tune our model to follow teams like Dortmund and Ajax with heavier investment in the academy and look to sell a couple of players for big fees every few years and a conveyor belt of in's and out's to generate profit as well as limiting the significant wage increases for successful players who are coveted by other clubs and you want to keep (we've done this time and time again with Vardy, Schmeichel, Drinkwater, Mahrez, Maguire etc) or we continue to utilize our revenue to the maximum.

 

We definitely need to get smarter and I see a real missed opportunity in our reluctance to invest hugely in our academy to mirror the intentions of providing the best training facilities in Europe. We have some of the most lauded coaches operating our first team and yet the same dinosaurs in the academy that we've had since our league one and championship days.