Finances

[jamesmilner]

The debt is common knowledge . £276 million . It is serviceable . 

[Ginger_Filbert]

According to the Athletic we were never at risk with FFP. 
 

Who knows what to believe, we’ve heard so many conflicting theories. 

[VLC86]

14 minutes ago, Ginger_Filbert said:

According to the Athletic we were never at risk with FFP. 
 

Who knows what to believe, we’ve heard so many conflicting theories. 

Exactly. It’s in the clubs interest for this story to come out and it’s in journalists interest to help the club get the stories out that they want out. Take anything like that with a pinch of salt in my opinion.

[turlo]

20 minutes ago, Ginger_Filbert said:

According to the Athletic we were never at risk with FFP. 
 

Who knows what to believe, we’ve heard so many conflicting theories. 

What did they say the issue was? High wage bill/bloated squad?

[moore_94]

22 minutes ago, Ginger_Filbert said:

According to the Athletic we were never at risk with FFP. 
 

Who knows what to believe, we’ve heard so many conflicting theories. 

It does say that we would be at risk with UEFA FFP if we qualify.

[KFS]

It’s clear they’re fed up with Rodger’s signings after every one of them last year failed to make an impact. He can’t, because of brand Brendan, come out and say that they’ve not backed him because they don’t trust his signings, so he’s spinning it as we need to ‘balance the books’. All the while that Bertrand, Vestegaard, Soumare and Daka all sit there not contributing, he’s not getting any net new signings in. You know what, I don’t think I necessarily blame Top either. The shame is us fans getting the shitty end of the stick because this team NEEDS fresh blood else it could well get relegated. 

[st albans fox]

21 minutes ago, moore_94 said:

It does say that we would be at risk with UEFA FFP if we qualify.

At some point the club need to decide what’s more important then - qualifying for Europe or avoiding a relegation scrap - doing nothing is a huge risk 

[Beechey]

This post will bore the tits off you if you don't care for relatively meaningless, large numbers.

 

 

 

https://theathletic.com/3431533/2022/07/19/leicester-transfers-rodgers-premier-league/

 

The Athletic in a July article state that LCFC recorded losses of £120m (rolling 3 year) for the 2018/19-2020/21 period (by my calculations of our accounts, this is correct). This was allegedly offset as FFP rules were altered to allow the 2019/20-2020/21 years to be considered a single year, meaning we could then add the £1.6m profit made in 2017/18 to the 2020/21 figure. We then subtracted £50m losses from the 2020/21 figure as these were deemed to be caused by Covid. Finally, The Athletic estimate that LCFC subtracted £20m per year (£60m total) from the losses as this is their assessment of how much we spend on community outreach, the academy, the women's team, amortisation, depreciation of fixed assets, and infrastructure.

 

I've plugged all of this into a spreadsheet (below) and I come out at a figure adjusted for Covid allowances at -£9m for the 2017/18-2020/21 period - this is assuming that The Athletic's assessment of £20m spend per year on community, infrastructure etc is correct, which they don't back up in any meaningful way.

 

I've adjusted every 3 year period to "add back" £60m for the relevant spends (Form 3A Premier League Handbook). That's the big assumption that we have always spent £20m per year on this stuff, which we won't have.

 

We are expected to make a significant loss this year, mainly due to a lack of player trading, and a relatively large net transfer loss. If we make, say a £90m loss, we are teetering on the edge of a breach of FFP.

 

Clubs are allowed to make a loss of £105m for any 3 year period (£35m per year).

 

 

If, for the upcoming financial year, we don't treat the 2019/20-2020/21 years as a single year, then our loss over 3 years is reduced to £80m, which offers more wriggle room. I'm unsure how this is treated, though. For the purposes of the spreadsheet, for the 2021/22 accounts (estimated, who knows the real figure), I've added back £50m for Covid related losses for the 2019/20-2020/21 period, as well, as was allowed in the 2020/21 accounts. It's another assumption that we are allowed to do so.

 

It's largely a guessing game for the upcoming accounts, but it's obviously not good. Not selling a player last year for a reasonable fee is going to really hurt us. Not doing so this year won't be as bad, as we aren't buying anyone.

Edited 25 August 2022 by Beechey

[Terraloon]

1 hour ago, Ginger_Filbert said:

According to the Athletic we were never at risk with FFP. 
 

Who knows what to believe, we’ve heard so many conflicting theories. 

For years prior to 20/21 that was the case I respect of the PL version but not UEFAs  but as the article says the 21/22paints a different picture 

 

What is the club’s hierarchy thinking?

Leicester have made losses of £120million over the past three years after recording profits for the previous four years but were not actually that close to breaking the Premier League’s financial fair play (FFP) rules.

Clubs are allowed permissible losses, such as the money spent on COVID-19, community projects, the academy and infrastructure including the training ground and the women’s team, which meant that Leicester were inside the threshold of £105million of “losses” allowed over three years.

But they know what is coming in the next set of accounts to be published next year, which would cover 2021-22, and they are concerned to the point they have decided to act now. They want to protect the club’s financial situation and avoid the prospect of being unable to compete in Europe, if they qualify, because they have failed UEFA’s far stricter FFP rules, which stipulate a club’s total expenditure on transfers, wages and agent fees cannot exceed 70 per cent of its revenue.

The club’s wage to turnover ratio was 105 per cent in 2019-20 and 85 per cent in 2020-21, due mainly to improved contracts for the club’s best assets. Leicester know they have to reduce that, despite the revenue increase in their latest accounts.

In short, they have to balance the books and have put the brakes on now.

Edited 25 August 2022 by Terraloon

[Terraloon]

37 minutes ago, Beechey said:

This post will bore the tits off you if you don't care for relatively meaningless, large numbers.

 

 

 

https://theathletic.com/3431533/2022/07/19/leicester-transfers-rodgers-premier-league/

 

The Athletic in a July article state that LCFC recorded losses of £120m (rolling 3 year) for the 2018/19-2020/21 period (by my calculations of our accounts, this is correct). This was allegedly offset as FFP rules were altered to allow the 2019/20-2020/21 years to be considered a single year, meaning we could then add the £1.6m profit made in 2017/18 to the 2020/21 figure. We then subtracted £50m losses from the 2020/21 figure as these were deemed to be caused by Covid. Finally, The Athletic estimate that LCFC subtracted £20m per year (£60m total) from the losses as this is their assessment of how much we spend on community outreach, the academy, the women's team, amortisation, depreciation of fixed assets, and infrastructure.

 

I've plugged all of this into a spreadsheet (below) and I come out at a figure adjusted for Covid allowances at -£9m for the 2017/18-2020/21 period - this is assuming that The Athletic's assessment of £20m spend per year on community, infrastructure etc is correct, which they don't back up in any meaningful way.

 

I've adjusted every 3 year period to "add back" £60m for the relevant spends (Form 3A Premier League Handbook). That's the big assumption that we have always spent £20m per year on this stuff, which we won't have.

 

We are expected to make a significant loss this year, mainly due to a lack of player trading, and a relatively large net transfer loss. If we make, say a £90m loss, we are teetering on the edge of a breach of FFP.

 

Clubs are allowed to make a loss of £105m for any 3 year period (£35m per year).

 

 

If, for the upcoming financial year, we don't treat the 2019/20-2020/21 years as a single year, then our loss over 3 years is reduced to £80m, which offers more wriggle room. I'm unsure how this is treated, though. For the purposes of the spreadsheet, for the 2021/22 accounts (estimated, who knows the real figure), I've added back £50m for Covid related losses for the 2019/20-2020/21 period, as well, as was allowed in the 2020/21 accounts. It's another assumption that we are allowed to do so.

 

It's largely a guessing game for the upcoming accounts, but it's obviously not good. Not selling a player last year for a reasonable fee is going to really hurt us. Not doing so this year won't be as bad, as we aren't buying anyone.

Once the 21/22 numbers are added in the 2017/18 numbers drop off.

 

Year one will be 2018/19, year two will be 2019/20& 20/21 then a quite complex approach is taken in that the loss of those two years is divided by two and then reduced down further .

 

If that’s not complicated enough the £105 million allowable is the upper amount and normally only covered by injection of cash and not by way of loans

 

 

Edited 25 August 2022 by Terraloon

[Beechey]

8 minutes ago, Terraloon said:

Once the 21/22 numbers are added in the 2017/18 numbers drop off.

 

Year one will be 2018/19, year two will be 2019/20& 20/21 averaged and the as yet unknown 21/22 numbers

 

 

That's how I've already set the sheet up. In the spreadsheet, the 2021/22 are year 3, [2019/20 and 2020/21] are year 2, and 2018/19 is year 1. It comes out at a £100m adjusted loss. That is assuming our 2021/22 losses are that bad. I've added back the £50m in Covid losses, and £60m in spending allowed via Form 3A. The lack of sales in the 2020/21 season will ensure they're poor, though.

Edited 25 August 2022 by Beechey

[Stadt]

Other clubs don't seem to bothered by the new FFP rules. We have a higher wage/trunover ratio granted than most but Villa, Everton and Spurs must be well over the 70% figure for the period.

[foxinsocks]

No point in buying any player while Playing Rodgersball

[Terraloon]

11 minutes ago, Beechey said:

That's how I've already set the sheet up. In the spreadsheet, the 2021/22 are year 3, [2019/20 and 2020/21] are year 2, and 2018/19 is year 1. It comes out at a £100m adjusted loss. That is assuming our 2021/22 losses are that bad. I've added back the £50m in Covid losses, and £60m in spending allowed via Form 3A. The lack of sales in the 2020/21 season will ensure they're poor, though.

sorry I read my original post and have amended it slightly 

[Terraloon]

11 minutes ago, Stadt said:

Other clubs don't seem to bothered by the new FFP rules. We have a higher wage/trunover ratio granted than most but Villa, Everton and Spurs must be well over the 70% figure for the period.

Everton aren’t concerned because they aren’t close to UEFA football their concern was around the PL version, As for Spurs they will be well within but the 70% isn’t the ration that will be measured for 3 or so years 

[Ginger_Filbert]

16 minutes ago, Stadt said:

Other clubs don't seem to bothered by the new FFP rules. We have a higher wage/trunover ratio granted than most but Villa, Everton and Spurs must be well over the 70% figure for the period.

Don’t think Spurs actually pay that high wages. 

[Fear Of The Fox]

12 minutes ago, Stadt said:

Other clubs don't seem to bothered by the new FFP rules. We have a higher wage/trunover ratio granted than most but Villa, Everton and Spurs must be well over the 70% figure for the period.

They're not bothered because the new FFP rules are not very strict regarding transfer bans or other major punishment. 10 big European teams including Arsenal have broken the FFP and they will just receive fines by UEFA the next month. After they receive a fine they can even reach UEFA for a settlement/agreement. 

[ALC Fox]

The Uefa 70% rule doesn't half restrict clubs like Leicester who are trying to break through.

 

We've had to pay bigger wages to attract players and give some pay rises as rewards for their performances and as incentives to stay.

 

It's no wonder the moneyed clubs just stay at the top, and those from weaker leagues who get Champions League football can just dominate their divisions for decades while those below them have to cut their cloth.

 

It's also no wonder that the Super League almost came into existence with an almost limitless pot of money available to those permanent members. They wouldn't need to worry about Uefa competitions anymore.

 

I understand the well-meaning elements of FFP rules in their different guises but the side effects can be very frustrating.

Edited 25 August 2022 by ALC Fox

[An Sionnach]

Everton, Villa , Newcastle and West Ham probably receive 25- 40% more gate receipts . We have hit a wall because of our small stadium and poor commercial income. We cannot sustain a top ten status on transfer receipts alone , that is a myth. The club knew all this but have done precious little about it 

[filbertway]

2 minutes ago, ALC Fox said:

The Uefa 70% rule doesn't half restrict clubs like Leicester who are trying to break through.

 

We've had to pay bigger wages to attract players and give some pay rises as rewards for their performances and as incentives to stay.

 

It's no wonder the moneyed clubs just stay at the top, and those from weaker leagues who get Champions League football can just dominate their divisions for decades while those below them have to cut their cloth.

 

It's also no wonder that the Super League almost came into existence with an almost limitless pot of money available to those permanent members. They wouldn't need to worry about Uefa competitions anymore.

 

I understand the well-meaning elements of FFP rules in their different guises but the side effects can be very frustrating.

Yeah it's quite ironic that it's called Financial Fair Play, when it's skewed to favour the bigger clubs with bigger incomes

 

[ALC Fox]

3 minutes ago, An Sionnach said:

Everton, Villa , Newcastle and West Ham probably receive 25- 40% more gate receipts . We have hit a wall because of our small stadium and poor commercial income. We cannot sustain a top ten status on transfer receipts alone , that is a myth. The club knew all this but have done precious little about it 

I agree to an extent but the stadium expansion is ongoing. We couldn't just blindly start building from day one of KP's ownership.

 

We've also increased our shirt sponsorship deal and added several new commercial partners.

 

These changes take a long time to implement unless you get a fast-track like Man City and Newcastle in the form of oil-backed state ownership and fudged sponsorships (allegedly).

 

I can't remember what article it was but it seemed to imply that revenue increases are actively being worked on at Leicester. We have to show patience but also hope that we're still in the division when the new TV deal is agreed in a few seasons' time.

[An Sionnach]

9 minutes ago, ALC Fox said:

I agree to an extent but the stadium expansion is ongoing. We couldn't just blindly start building from day one of KP's ownership.

 

We've also increased our shirt sponsorship deal and added several new commercial partners.

 

These changes take a long time to implement unless you get a fast-track like Man City and Newcastle in the form of oil-backed state ownership and fudged sponsorships (allegedly).

 

I can't remember what article it was but it seemed to imply that revenue increases are actively being worked on at Leicester. We have to show patience but also hope that we're still in the division when the new TV deal is agreed in a few seasons' time.

We are six years along since we became world famous and for a while even sexy but that has faded and with the imminent departure of Vardy , our one internationally known player will be gone. This is going to be a very difficult transition and fans will have to be accepting of that.  But they won't be.

[weller54]

29 minutes ago, filbertway said:

Yeah it's quite ironic that it's called Financial Fair Play, when it's skewed to favour the bigger clubs with bigger incomes

 

Ffp my arse!!!..

Biggest load of bollo*ks since Brexit!!

[UHDrive]

2 hours ago, moore_94 said:

It does say that we would be at risk with UEFA FFP if we qualify.

What if we didn't? Any idea as to the current status quo with remaining spend/salary? 

[FoxesWalk]

36 minutes ago, ALC Fox said:

The Uefa 70% rule doesn't half restrict clubs like Leicester who are trying to break through.

 

We've had to pay bigger wages to attract players and give some pay rises as rewards for their performances and as incentives to stay.

 

It's no wonder the moneyed clubs just stay at the top, and those from weaker leagues who get Champions League football can just dominate their divisions for decades while those below them have to cut their cloth.

 

It's also no wonder that the Super League almost came into existence with an almost limitless pot of money available to those permanent members. They wouldn't need to worry about Uefa competitions anymore.

 

I understand the well-meaning elements of FFP rules in their different guises but the side effects can be very frustrating.

That is exactly what it is designed to do.