Embargos, HMRC Payment defaults, non payment of wages, the usual under Dai Wrongge

[Stranded]

What is the current figure of our debt, and how did we arrive at it?

May well be reading it wrong but in the last accounts (up to JUne 22) - net liabilities were GBP 62.858m. The club had just over GBP 1m in the bank.

Around the time those accounts came out Kieran Maguire tweeted our total losses (not the same thing as debt, but the only other thing I can find) was £191m. Over what period, not sure.

191m are the gross losses up to 30th June last year - correct.

The 62.8m is the net so the 191.5m total losses less 117m in Share Capital and 11.5m in Share Premium Account - not going to pretend I know what that last term means.

[Snowflake Royal]

So Dai is making a minimum loss on sale (should that actually happen) of about £160m, but probably closer to £175m.

What a great business man.

[Stranded]

So Dai is making a minimum loss on sale (should that actually happen) of about £160m, but probably closer to £175m.

What a great business man.

Well those figures are nearly 18months old, so could be higher than that but that is probably the bare minimum he'll have to write off, if he does choose to sell the club.

Interesting* that the weekly meeting that was meant to happen between STAR and Howe yesterday regarding updates on the sale process has been postponed to "early next week".

You can look at that one of 2 ways - there is absolutely nothing to update and he is trying to push it out in the hope something changes or there is an expectation that a bid will be accepted shortly and the delay is to allow him to make that clear. Probably the former.

[tmesis]

So Dai is making a minimum loss on sale (should that actually happen) of about £160m, but probably closer to £175m.

What a great business man.

Still a better investment than his Evergrande shares

[skipper]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

[YorkshireRoyal99]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

[Brogue]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

easy, the training ground and Liam Moore. I'm being facetious with Moore of course, just placating Ian. but the training ground did cost over 50 mill

[Snowflake Royal]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

[Stranded]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

[Sutekh]

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

This is the sort of thing the FL should be cracking down on at the time it happens. If a club is racking up debts to its owners and/or directors the FL should immediately sanction and embargo that club pending a review of its accounts. Not wait for a 3 year rolling period to complete so everything gets more expensive, muddier and even more complicated to sort out and the club concerned gets time to find and exploit any financial loopholes that the FL may not have closed off.

[rabidbee]

As I've posted before, when Rick Parry was before the Commons committee, he said the EFL's preference was to move to a squad-cost ratio (I think he said the costs of the squad should be pegged at a maximum of 70% of turnover), instead of the current system, so that the EFL could intervene pretty much immediately (by not registering a player who would push a club over the threshold) rather than waiting to sanction a club for a decision made three years earlier. All of this is part of the on-going negotiations with the PL, though.

[bcubed]

As I've posted before, when Rick Parry was before the Commons committee, he said the EFL's preference was to move to a squad-cost ratio (I think he said the costs of the squad should be pegged at a maximum of 70% of turnover), instead of the current system, so that the EFL could intervene pretty much immediately (by not registering a player who would push a club over the threshold) rather than waiting to sanction a club for a decision made three years earlier. All of this is part of the on-going negotiations with the PL, though.

And I doubt PL clubs would manage this requirement based on the current losses of many PL clubs

[rabidbee]

He discussed it in detail at the hearing, if you want to look back at the video. IIRC, the teams involved in Europe may already be aiming for this level, because of UEFA rules. His other point, besides reforming FFP, was that the parachute clubs have a massive advantage over everyone else. Think the PL wanted a higher squad-ratio for those clubs than for everyone else.

[Sutekh]

He discussed it in detail at the hearing, if you want to look back at the video. IIRC, the teams involved in Europe may already be aiming for this level, because of UEFA rules. His other point, besides reforming FFP, was that the parachute clubs have a massive advantage over everyone else. Think the PL wanted a higher squad-ratio for those clubs than for everyone else.

As part of any changes ALL clubs should be forced to put clauses into ALL their player contracts so that relegation means non-negotiable % wage reductions as well as any associated bonus payments being removed or significantly reduced. Likewise clubs would also include % wage increases etc. should a club be promoted.

[3points]

relating to the accounts ending in June 2022 so we've had a further 18 months of losses racking up but summarises the broad position. If you look at how much Renhe Sports Management owes Great Shine, it was at £220m at that point in time. Hence figures of £250m now being banded around. That figure will, most likely, include his original outlay to buy the club (which I think was about £25m).

As already noted over £50m spent on the training ground.

https://star-reading.org/wp-content/upl ... counts.pdf

[Wycombe Royal]

As I've posted before, when Rick Parry was before the Commons committee, he said the EFL's preference was to move to a squad-cost ratio (I think he said the costs of the squad should be pegged at a maximum of 70% of turnover), instead of the current system, so that the EFL could intervene pretty much immediately (by not registering a player who would push a club over the threshold) rather than waiting to sanction a club for a decision made three years earlier. All of this is part of the on-going negotiations with the PL, though.

Isn't that what is already in place in L1 and L2? It's only the Championship that has the £39m loss over 3 years....

[Hound]

Including all his businesses - understand his core business in China was massively hit by Covid, wonder how much the clown has lost in the last 5 years. Pretty special effort whatever it is

[Snowflake Royal]

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

This is the sort of thing the FL should be cracking down on at the time it happens. If a club is racking up debts to its owners and/or directors the FL should immediately sanction and embargo that club pending a review of its accounts. Not wait for a 3 year rolling period to complete so everything gets more expensive, muddier and even more complicated to sort out and the club concerned gets time to find and exploit any financial loopholes that the FL may not have closed off.

a majority of the FL clubs run by those owners would have to agree to that.

Seems unlikely.

[Snowflake Royal]

Including all his businesses - understand his core business in China was massively hit by Covid, wonder how much the clown has lost in the last 5 years. Pretty special effort whatever it is

I suspect, at best, he's worth half the £950m he was when he bought us.

[YorkshireRoyal99]

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

This is the sort of thing the FL should be cracking down on at the time it happens. If a club is racking up debts to its owners and/or directors the FL should immediately sanction and embargo that club pending a review of its accounts. Not wait for a 3 year rolling period to complete so everything gets more expensive, muddier and even more complicated to sort out and the club concerned gets time to find and exploit any financial loopholes that the FL may not have closed off.

a majority of the FL clubs run by those owners would have to agree to that.

Seems unlikely.

Yeah that won't happen because as far as the owners' are concerned, they are no worse off, they've still got the money.