Can anyone explain why the club is in financial difficulty?

Elm Park Kid
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Can anyone explain why the club is in financial difficulty?

by Elm Park Kid » 24 Dec 2014 14:07

I know that you basically need a masters degree in accounting to understand football finances; and that only limited information is released, but does anyone have a broad understanding of the problems at RFC?

As far as I can tell the headline figures are:

- We receive £15m a year in parachute payments

- Total wage bill for players and staff is £13.7m*

- The club consistently makes a profit from transfers*

So are we saying that the other costs to the club are greater than sponsorship, tv money, gate revenues, match day takings, merchandising and other income combined?

Am I missing something?

*Source (http://www.getreading.co.uk/sport/football/football-news/reading-football-club-holdings-debt-8260591)

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Re: Can anyone explain why the club is in financial difficul

by Stranded » 24 Dec 2014 14:16

Anton Zingarevich

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Re: Can anyone explain why the club is in financial difficul

by strap » 24 Dec 2014 15:03

^
^
^
This. End of thread.

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Re: Can anyone explain why the club is in financial difficul

by glass half full » 24 Dec 2014 15:25

Stranded Anton Zingarevich


Too much trust placed in one individual, who left the club in the lurch. Bless!

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Re: Can anyone explain why the club is in financial difficul

by Man Friday » 24 Dec 2014 15:35

Please be more specific re our previous Russian owner. Did he take money out of the club? How? Is he allowed to do that or is it fraud? How much did he take? etc etc. If you don't know (like me) then please don't respond. If you do then I can't wait to read your insightful post...


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Re: Can anyone explain why the club is in financial difficul

by glass half full » 24 Dec 2014 15:43

Man Friday Please be more specific re our previous Russian owner. Did he take money out of the club? How? Is he allowed to do that or is it fraud? How much did he take? etc etc. If you don't know (like me) then please don't respond. If you do then I can't wait to read your insightful post...


By leaving the club in the lurch, I mean that he took a few precipitate and foolhardy decisions and then did not hang about when his 'chickens came to roost'. I would not be so incautious as to allege fraud.

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Re: Can anyone explain why the club is in financial difficul

by Pseud O'Nym » 24 Dec 2014 16:01

The club is not in financial difficulties. Those figures, as the article clearly explains, aren't for the club but for the holding company, some six months ago. They were the result of the holding company taking back the club and its debts from TSI and include money owed to directors (including JM) and Vibrac.

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Re: Can anyone explain why the club is in financial difficul

by handbags_harris » 24 Dec 2014 16:06

Started off with a £26 million wage bill on promotion from the Championship, increased with the signing of Pogrebnyak , then got immediately relegated and signed Drenthe on sky high wages. Anton Zingarevich playing real life Championship Manager basically, when he had no money.

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Re: Can anyone explain why the club is in financial difficul

by blueroyals » 24 Dec 2014 16:41

We're not. The Thai's "cleared" the debts.


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Re: Can anyone explain why the club is in financial difficul

by SCIAG » 24 Dec 2014 16:50

Elm Park Kid I know that you basically need a masters degree in accounting to understand football finances; and that only limited information is released, but does anyone have a broad understanding of the problems at RFC?

As far as I can tell the headline figures are:

- We receive £15m a year in parachute payments

- Total wage bill for players and staff is £13.7m*

- The club consistently makes a profit from transfers*

So are we saying that the other costs to the club are greater than sponsorship, tv money, gate revenues, match day takings, merchandising and other income combined?

Am I missing something?

*Source (http://www.getreading.co.uk/sport/football/football-news/reading-football-club-holdings-debt-8260591)

So there are a few things to take into account:

1) The wage bill might not include PAYE and National Insurance, which are significant costs for the club

2) The parachute payments are paid in installments. Because of this, there was a period where we couldn't pay our wage bill. Zingarevich took a loan secured against future parachute payments to cover it (this is why people mention Vibrac). Obviously he didn't think about the interest payments.

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Re: Can anyone explain why the club is in financial difficul

by DaddyKuhl » 24 Dec 2014 23:31

Elm Park Kid I know that you basically need a masters degree in accounting to understand football finances; and that only limited information is released, but does anyone have a broad understanding of the problems at RFC?

As far as I can tell the headline figures are:

- We receive £15m a year in parachute payments

- Total wage bill for players and staff is £13.7m*

- The club consistently makes a profit from transfers*

So are we saying that the other costs to the club are greater than sponsorship, tv money, gate revenues, match day takings, merchandising and other income combined?

Am I missing something?

*Source (http://www.getreading.co.uk/sport/football/football-news/reading-football-club-holdings-debt-8260591)

Didn't RFC Holdings acquire the club from TSI mid-year so the wages in those accounts would be post acquisition (ie from December onwards)? I read somewhere that the losses were 7.3million for the year (excluding academy costs which are exempted from FFP). So just squeaked under the FFP limit.

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Re: Can anyone explain why the club is in financial difficul

by JIM » 25 Dec 2014 08:47

ONE " JIMMY (fu_king ex fulham) HILL "who got the players freedom of wage contract,

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Re: Can anyone explain why the club is in financial difficul

by westendgirl » 25 Dec 2014 10:19

Elm Park Kid I know that you basically need a masters degree in accounting to understand football finances; and that only limited information is released, but does anyone have a broad understanding of the problems at RFC?

As far as I can tell the headline figures are:

- We receive £15m a year in parachute payments

- Total wage bill for players and staff is £13.7m*

- The club consistently makes a profit from transfers*

So are we saying that the other costs to the club are greater than sponsorship, tv money, gate revenues, match day takings, merchandising and other income combined?

Am I missing something?

*Source (http://www.getreading.co.uk/sport/football/football-news/reading-football-club-holdings-debt-8260591)


The thing you are missing is the rest of the seasons costs. The wages are several times the figure you quote as that is only the period after RFCHoldings bought back the football club from TSI.

If you really think the wages for a Championship club recently in the Prem could be that low you have no idea how much players are taking from the game.


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Re: Can anyone explain why the club is in financial difficul

by Sutekh » 25 Dec 2014 13:11

westendgirl
Elm Park Kid I know that you basically need a masters degree in accounting to understand football finances; and that only limited information is released, but does anyone have a broad understanding of the problems at RFC?

As far as I can tell the headline figures are:

- We receive £15m a year in parachute payments

- Total wage bill for players and staff is £13.7m*

- The club consistently makes a profit from transfers*

So are we saying that the other costs to the club are greater than sponsorship, tv money, gate revenues, match day takings, merchandising and other income combined?

Am I missing something?

*Source (http://www.getreading.co.uk/sport/football/football-news/reading-football-club-holdings-debt-8260591)


The thing you are missing is the rest of the seasons costs. The wages are several times the figure you quote as that is only the period after RFCHoldings bought back the football club from TSI.

If you really think the wages for a Championship club recently in the Prem could be that low you have no idea how much players are taking from the game.


Players only take it as idiot clubs offer it.

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blueroyals
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Re: Can anyone explain why the club is in financial difficul

by blueroyals » 25 Dec 2014 15:20

Sutekh
westendgirl
Elm Park Kid I know that you basically need a masters degree in accounting to understand football finances; and that only limited information is released, but does anyone have a broad understanding of the problems at RFC?

As far as I can tell the headline figures are:

- We receive £15m a year in parachute payments

- Total wage bill for players and staff is £13.7m*

- The club consistently makes a profit from transfers*

So are we saying that the other costs to the club are greater than sponsorship, tv money, gate revenues, match day takings, merchandising and other income combined?

Am I missing something?

*Source (http://www.getreading.co.uk/sport/football/football-news/reading-football-club-holdings-debt-8260591)


The thing you are missing is the rest of the seasons costs. The wages are several times the figure you quote as that is only the period after RFCHoldings bought back the football club from TSI.

If you really think the wages for a Championship club recently in the Prem could be that low you have no idea how much players are taking from the game.


Players only take it as idiot clubs offer it.


And idiot clubs can only offer it thanks to Sky/BT.

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Re: Can anyone explain why the club is in financial difficul

by West Stand Man » 25 Dec 2014 21:28

blueroyals
And idiot clubs can only offer it thanks to Sky/BT.


And Sky /BT can only offer it thanks to idiot viewers prepared to pay over the odds for their services.

It is incredibly naive to think that Sky and BT pay all that money for the benefit of the clubs or out of a sense of evil and the desire to corrupt football. They pay it because they can get enough punters to fund it and leave them with a hefty profit. So, it all comes down to the fans!

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Re: Can anyone explain why the club is in financial difficul

by From Despair To Where? » 25 Dec 2014 21:41

West Stand Man
blueroyals
And idiot clubs can only offer it thanks to Sky/BT.


And Sky /BT can only offer it thanks to idiot viewers prepared to pay over the odds for their services.

It is incredibly naive to think that Sky and BT pay all that money for the benefit of the clubs or out of a sense of evil and the desire to corrupt football. They pay it because they can get enough punters to fund it and leave them with a hefty profit. So, it all comes down to the fans!


Simplistic way of putting it but true. I do think money has ruined football and Sky/BY fund the gravy train but it if wasn't profitable for them, they wouldn't touch it.

The football deal basically saved Sky back in 1992 and the BBC/ITV hegemony only had themselves to blame for leaving free to air broadcasting.

But, in response to the OP, were in financial difficulty due to two years of basketcase financial management by TSI, coupled with the introduction of FFP which has imposed a timescale for getting our affairs in order.

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Re: Can anyone explain why the club is in financial difficul

by melonhead » 25 Dec 2014 23:28

Sutekh
westendgirl
Elm Park Kid I know that you basically need a masters degree in accounting to understand football finances; and that only limited information is released, but does anyone have a broad understanding of the problems at RFC?

As far as I can tell the headline figures are:

- We receive £15m a year in parachute payments

- Total wage bill for players and staff is £13.7m*

- The club consistently makes a profit from transfers*

So are we saying that the other costs to the club are greater than sponsorship, tv money, gate revenues, match day takings, merchandising and other income combined?

Am I missing something?

*Source (http://www.getreading.co.uk/sport/football/football-news/reading-football-club-holdings-debt-8260591)


The thing you are missing is the rest of the seasons costs. The wages are several times the figure you quote as that is only the period after RFCHoldings bought back the football club from TSI.

If you really think the wages for a Championship club recently in the Prem could be that low you have no idea how much players are taking from the game.


Players only take it as idiot clubs offer it.

if we paid em less Who would Ever come here?!

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Re: Can anyone explain why the club is in financial difficul

by Stevie G » 26 Dec 2014 11:22

One swallow doth not a season make, or to put it in context, the Anton activity is not the whole reason. In my opinion it started with the 2nd season in the Prem for the 106 side. Madejski didn't invest, saw the 106 side as liable to repay their debt in our investment in them, they then expected big time wages and we needed to draft in some higher calibre competition to keep them on their toes. We didn't, slumped out of the Prem and then caused the break-up of that side as those players did not desire to be back in the Champ and further saw the lack of investment as the limiting factor. You could even see the disbelief in SSC's most experienced eyes. We have been on a downwards slump since. The 106 team was built on team spirit, we had a brief foray of that spirit by promoting from within under McDermott in both the manager and some players, but that was undermined by the Anton purchases. For JM, a classic case of all your hard work undone by your eagerness to close in the last 10% of your time, but bigger fish have been wholly fried in the last recession. Don't hear much talk about a 2nd tier now do we.

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Re: Can anyone explain why the club is in financial difficul

by Man Friday » 26 Dec 2014 12:09

I don't necessarily disagree with you but on the other hand I literally don't understand some of the points you're making...

"Madejski...saw the 106 side as liable to repay their debt in our investment in them, they then expected big time wages"

"and we needed to draft in some higher calibre competition to keep them on their toes" (It wasn't about keeping them on their toes - they just weren't good enough without reinforcements, surely?)

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