New Owners - Redwood Watch

[Clyde1998]

Reading FC owner Rob Couhig has revealed that the shareholders have been paying £1 million nearly every month to bolster the club.

After a busy start to the January transfer window, and with Reading FC making a permanent signing in the winter transfer window for the first time in years, the Royals chairman has revealed that players isn't the only department receiving financial backing.

When asked about the financial position of the club following his takeover alongside investor and co-owner Todd Troslcair, he told The Reading Chronicle: "Strong.

"Todd and I put in a million pounds almost every month because we haven't drawn the crowds that we've expected to.

"We're limited in what we can spend on our players by SCMP."

He added: "We're not going to miss a bill. We're going to pay our bills."

Redwood Holdings, Couhig and Trosclair's consortium, completed the long-awaited takeover from former owner Dai Yongge in May last year.

During Yongge’s tenure the club fell from the brink of the Premier League to the brink of League Two, mired in financial difficulties for the last three years – including restrictions on Reading’s transfer budget and Salary Cost Management Protocol.

Whetting supporters' appetite by labelling the summer as 'potentially spectacular', Couhig and co-CEO Joe Jacobson explained to supporters how the club's Spending Cap Management Protocol work.

During their explanation, Couhig admitted that he and business partner Trosclair injected more money into the club to improve their financial muscle.

However, he also revealed that more money had exited the club than first anticipated, with the balance between incomings and outgoings needing a re-alignment.

He said at the time: "I thought it would be different, in the sense of what we were told.

"I want to be careful how I describe it because of some other things going on. I had a basic understanding of what our probably SCMP would be from published figures but what we were not aware of was some of the things that would diminish that figure."

So for absolute clarity - 'we put in £1M almost every month' means the club is losing around £12M/annum at the current rate of income vs expenditure...

Please correct me if I have misinterpreted the statement

That's how I interpret that statement. Worth noting our previous accounts (2023-24) showed a £15.6m annual loss - so it's an improvement on that, by perhaps £300k per month.

[Linden Jones' Tash]

So for absolute clarity - 'we put in £1M almost every month' means the club is losing around £12M/annum at the current rate of income vs expenditure...

Please correct me if I have misinterpreted the statement[/quote]
That's how I interpret that statement. Worth noting our previous accounts (2023-24) showed a £15.6m annual loss - so it's an improvement on that, by perhaps £300k per month.[/quote]

Fair point, but there are a few on here who fail to grasp the sheer scale of funds needed to just keep things ticking over....

Sustainability was mentioned a lot during the sale process...

£10/12M a season just to be mid table is a big ask of owners who aren't sugar daddies...

[Brogue]

They mention they were expecting bigger attendances. I think they didn’t realise just how battered and bruised the fan base was after all the shit we’ve had to deal with.

Compound that with shooting his mouth off - over promising and underdelivering in the transfer market - that didn’t help. If we had a competitive team, challenging at the top of the table right from the off there is no reason why we wouldn’t be having 16-18k crowds on the regs (currently 12k) . Hunt’s slow start, and poor window just kept the fans away.

An extra 5k fans through the turnstiles each week paying 25 quid a game plus the additional match day income we wouldn’t be far off a self Sustaining model (relatively speaking ) we’d be close to halving the monthly loses Rob and Todd are incurring.

But no-one is failing to grasp the amount of money it costs to run a football club it’s pretty well documented. It’s totally naive to think a league one club will be turning a profit or even close to breaking even. If the quoted 1 million a month they are putting in shrank by, say 500k - with that increased attendance you’d be talking only a 6 million loss. Which is inline with the average loss of a league one club last season

https://www.matchdayfinance.com/post/ef ... on-2023-24

Overall, League One recorded a combined loss of £125 million, up from £117 million in 2022/23 — the worst in the league’s history — averaging £5.1 million per club.

Welcome to football Rob and Todd! it’s an expensive sport, not for the faint hearted, or cheapskates. Not unrealistic to assume you’re going to lose a few million quid a season.

[Linden Jones' Tash]

They mention they were expecting bigger attendances. I think they didn’t realise just how battered and bruised the fan base was after all the shit we’ve had to deal with.

Compound that with shooting his mouth off - over promising and underdelivering in the transfer market - that didn’t help. If we had a competitive team, challenging at the top of the table right from the off there is no reason why we wouldn’t be having 16-18k crowds on the regs (currently 12k) . Hunt’s slow start, and poor window just kept the fans away.

An extra 5k fans through the turnstiles each week paying 25 quid a game plus the additional match day income we wouldn’t be far off a self Sustaining model (relatively speaking ) we’d be close to halving the monthly loses Rob and Todd are incurring.

But no-one is failing to grasp the amount of money it costs to run a football club it’s pretty well documented. It’s totally naive to think a league one club will be turning a profit or even close to breaking even. If the quoted 1 million a month they are putting in shrank by, say 500k - with that increased attendance you’d be talking only a 6 million loss. Which is inline with the average loss of a league one club last season

https://www.matchdayfinance.com/post/ef ... on-2023-24

Overall, League One recorded a combined loss of £125 million, up from £117 million in 2022/23 — the worst in the league’s history — averaging £5.1 million per club.

Welcome to football Rob and Todd! it’s an expensive sport, not for the faint hearted, or cheapskates. Not unrealistic to assume you’re going to lose a few million quid a season.

Fair dos - I do feel you are being generous with many fans....

I think I've been fairly consistent - I'm grateful the club is still around....

However, the scale of the investment needed was pretty clear upfront....

Planning to turn a profit from a quick flip always seemed like a big ask unless a near immediate return to the Championship was achieved...

With a significantly higher profile...

[WestYorksRoyal]

Attendances can't bridge £1m a month. And extra 5k a game will include kids, plus you need to deduct VAT. Let's estimate £15 a ticket, that's £75k a game. 23 games plus perhaps an FA Cup draw and that's £1.8m, allegedly what they're putting in every 2 months. Perhaps extra food, merchandise etc., can get them up to £2.5m. It's a useful start in a £12m deficit, but still leaves plenty to bridge.

Let's hope a lot of it is "clean up" money due to the mess previous owners have made, and they can see a path to sustainability.

[Stranded]

Reading FC owner Rob Couhig has revealed that the shareholders have been paying £1 million nearly every month to bolster the club.

After a busy start to the January transfer window, and with Reading FC making a permanent signing in the winter transfer window for the first time in years, the Royals chairman has revealed that players isn't the only department receiving financial backing.

When asked about the financial position of the club following his takeover alongside investor and co-owner Todd Troslcair, he told The Reading Chronicle: "Strong.

"Todd and I put in a million pounds almost every month because we haven't drawn the crowds that we've expected to.

"We're limited in what we can spend on our players by SCMP."

He added: "We're not going to miss a bill. We're going to pay our bills."

Redwood Holdings, Couhig and Trosclair's consortium, completed the long-awaited takeover from former owner Dai Yongge in May last year.

During Yongge’s tenure the club fell from the brink of the Premier League to the brink of League Two, mired in financial difficulties for the last three years – including restrictions on Reading’s transfer budget and Salary Cost Management Protocol.

Whetting supporters' appetite by labelling the summer as 'potentially spectacular', Couhig and co-CEO Joe Jacobson explained to supporters how the club's Spending Cap Management Protocol work.

During their explanation, Couhig admitted that he and business partner Trosclair injected more money into the club to improve their financial muscle.

However, he also revealed that more money had exited the club than first anticipated, with the balance between incomings and outgoings needing a re-alignment.

He said at the time: "I thought it would be different, in the sense of what we were told.

"I want to be careful how I describe it because of some other things going on. I had a basic understanding of what our probably SCMP would be from published figures but what we were not aware of was some of the things that would diminish that figure."

So for absolute clarity - 'we put in £1M almost every month' means the club is losing around £12M/annum at the current rate of income vs expenditure...

Please correct me if I have misinterpreted the statement

I'm not sure that will be the picture - the club is losing money each month as most clubs do but the 1m per month will be to more than cover the day to day, it will also allow the club to make the sort of moves we have seen this month - you could of course argue that these represent a loss as well but the money they are putting in is clearly to cover costs and allow the club to spend.

So yes, losses will be big esp as crowds are not recovering yet but they won't be 7 figures a month.

[Brogue]

Attendances can't bridge £1m a month. And extra 5k a game will include kids, plus you need to deduct VAT. Let's estimate £15 a ticket, that's £75k a game. 23 games plus perhaps an FA Cup draw and that's £1.8m, allegedly what they're putting in every 2 months. Perhaps extra food, merchandise etc., can get them up to £2.5m. It's a useful start in a £12m deficit, but still leaves plenty to bridge.

Let's hope a lot of it is "clean up" money due to the mess previous owners have made, and they can see a path to sustainability.

Match day revenue in the 23/24 season was 4million according to the accounts. Average attendance was 13000. Similar to this season.

4 million divided by 23 home games is £173k per game.

173k divided by 13,000 is £13 per person - that’s how much a fan spends on a match day

Increase the attendance by 5k per home game and that’s an extra £63000 per home game in match day revenue

Increase the attendance by 6k per game and it’s 78k…

But let’s go with the smaller figure 2 home games a month 126k extra a month

You suggest reducing the ticket sales to include kids and say £15 - 75k a game

Two home games a month 150k

126k + 150k = 276k a month extra.

That’s not including inflation so let’s say 300k a month extra.

Then you have things like increased hospitality

Increased car parking.

Increased spend in club shop

It’s all back of fag packet maths but the point im trying to make is get a good team on the pitch start mounting a serious bid for promotion and fans will return. Fans returning = our loses being inline with the rest of the league.

[WestYorksRoyal]

Yes, of course it helps and also adds to the feeling of momentum. On the rare occasions I can make it, it just looks a bit sad compared to what it used to be. And I'm not just comparing to PL days, even the few seasons before 05/06 we were averaging 17k or so (though in a higher division away fans helped).

There still not has been the sense of optimism and excitement to bring people back. My WYR name could become redundant in the summer as I move closer to ageing parents, and I can't wait to start going regularly again if it happens. But I've chosen a good decade to be away. If I'd given up my money and Saturday's to go through Stam ball, Clement ball, Ince ball etc., I can totally see why a bad start to this season would have made me say "fcuk it".

It could get worse. They had a season ticket rush after the takeover that won't automatically happen again. This team needs to convince the fans over the remainder of the season that they're worth investing in.

[Greatwesternline]

Attendances can't bridge £1m a month. And extra 5k a game will include kids, plus you need to deduct VAT. Let's estimate £15 a ticket, that's £75k a game. 23 games plus perhaps an FA Cup draw and that's £1.8m, allegedly what they're putting in every 2 months. Perhaps extra food, merchandise etc., can get them up to £2.5m. It's a useful start in a £12m deficit, but still leaves plenty to bridge.

Let's hope a lot of it is "clean up" money due to the mess previous owners have made, and they can see a path to sustainability.

Match day revenue in the 23/24 season was 4million according to the accounts. Average attendance was 13000. Similar to this season.

4 million divided by 23 home games is £173k per game.

173k divided by 13,000 is £13 per person - that’s how much a fan spends on a match day

Increase the attendance by 5k per home game and that’s an extra £63000 per home game in match day revenue

Increase the attendance by 6k per game and it’s 78k…

But let’s go with the smaller figure 2 home games a month 126k extra a month

You suggest reducing the ticket sales to include kids and say £15 - 75k a game

Two home games a month 150k

126k + 150k = 276k a month extra.

That’s not including inflation so let’s say 300k a month extra.

Then you have things like increased hospitality

Increased car parking.

Increased spend in club shop

It’s all back of fag packet maths but the point im trying to make is get a good team on the pitch start mounting a serious bid for promotion and fans will return. Fans returning = our loses being inline with the rest of the league.

I was with you until you added the £150k to the £126k.

I thought they were 2 different estimates of per month increase, but you added them together?

5k tickets @ £13 = £65,000. 23 home games, so extra £1.5m a season if you can increase ticket sales that much. Or per month....£124k.

[rabidbee]

Attendances can't bridge £1m a month. And extra 5k a game will include kids, plus you need to deduct VAT. Let's estimate £15 a ticket, that's £75k a game. 23 games plus perhaps an FA Cup draw and that's £1.8m, allegedly what they're putting in every 2 months. Perhaps extra food, merchandise etc., can get them up to £2.5m. It's a useful start in a £12m deficit, but still leaves plenty to bridge.

Let's hope a lot of it is "clean up" money due to the mess previous owners have made, and they can see a path to sustainability.

Match day revenue in the 23/24 season was 4million according to the accounts. Average attendance was 13000. Similar to this season.

4 million divided by 23 home games is £173k per game.

173k divided by 13,000 is £13 per person - that’s how much a fan spends on a match day

Increase the attendance by 5k per home game and that’s an extra £63000 per home game in match day revenue

Increase the attendance by 6k per game and it’s 78k…

But let’s go with the smaller figure 2 home games a month 126k extra a month

You suggest reducing the ticket sales to include kids and say £15 - 75k a game

Two home games a month 150k

126k + 150k = 276k a month extra.

That’s not including inflation so let’s say 300k a month extra.

Then you have things like increased hospitality

Increased car parking.

Increased spend in club shop

It’s all back of fag packet maths but the point im trying to make is get a good team on the pitch start mounting a serious bid for promotion and fans will return. Fans returning = our loses being inline with the rest of the league.

I was with you until you added the £150k to the £126k.

I thought they were 2 different estimates of per month increase, but you added them together?

5k tickets @ £13 = £65,000. 23 home games, so extra £1.5m a season if you can increase ticket sales that much. Or per month....£124k.

One is a hypothecated average ticket revenue per fan - £15, one is a hypothecated amount of extra spending at the stadium per fan, £13. So he's saying increase the average gate by 5,000, you'd increase ticket sales by £75k a game, and other match-day revenues by £65k (£13 x 5,000 is £65k, not £63k) a game. An extra 5,000 fans a game equals an extra £140,000 per home game, and an extra £3,220,000 per season.

If the guesswork is correct, of course.

[rabidbee]

Of course, this is only looking at the revenue side, right? Higher crowds means more costs for staffing and policing, and presumably other costs too, so that's a gross not a net figure, right?

[Brogue]

Of course, this is only looking at the revenue side, right? Higher crowds means more costs for staffing and policing, and presumably other costs too, so that's a gross not a net figure, right?

yep agreed, bigger crowds = higher costs for sure.

[WestYorksRoyal]

Of course, this is only looking at the revenue side, right? Higher crowds means more costs for staffing and policing, and presumably other costs too, so that's a gross not a net figure, right?

yep agreed, bigger crowds = higher costs for sure.

Pretty marginal I think. We're not a difficult bunch of fans, and you need a decent police and stewarding level for 10k+ anyway.

When the club was struggling, STAR said extra tickets is basically pure profit margin for the club, compared with merchandise where the majority goes to suppliers.

[RG30]

One area which is noticeable in L1 is the away support generally is pretty crap aside from a handful of a few teams. Realistically between now and the end of the season only Cardiff and Plymouth are likely to sell out 3k (assuming both remain 3pm KO's).

[Greatwesternline]

Match day revenue in the 23/24 season was 4million according to the accounts. Average attendance was 13000. Similar to this season.

4 million divided by 23 home games is £173k per game.

173k divided by 13,000 is £13 per person - that’s how much a fan spends on a match day

Increase the attendance by 5k per home game and that’s an extra £63000 per home game in match day revenue

Increase the attendance by 6k per game and it’s 78k…

But let’s go with the smaller figure 2 home games a month 126k extra a month

You suggest reducing the ticket sales to include kids and say £15 - 75k a game

Two home games a month 150k

126k + 150k = 276k a month extra.

That’s not including inflation so let’s say 300k a month extra.

Then you have things like increased hospitality

Increased car parking.

Increased spend in club shop

It’s all back of fag packet maths but the point im trying to make is get a good team on the pitch start mounting a serious bid for promotion and fans will return. Fans returning = our loses being inline with the rest of the league.

I was with you until you added the £150k to the £126k.

I thought they were 2 different estimates of per month increase, but you added them together?

5k tickets @ £13 = £65,000. 23 home games, so extra £1.5m a season if you can increase ticket sales that much. Or per month....£124k.

One is a hypothecated average ticket revenue per fan - £15, one is a hypothecated amount of extra spending at the stadium per fan, £13. So he's saying increase the average gate by 5,000, you'd increase ticket sales by £75k a game, and other match-day revenues by £65k (£13 x 5,000 is £65k, not £63k) a game. An extra 5,000 fans a game equals an extra £140,000 per home game, and an extra £3,220,000 per season.

If the guesswork is correct, of course.

Matchday income includes tickets and food etc.

RFC has 4 income streams in 2024:

TV and Media = £2.6m
Matchday = £4m
Commercial = £3m (i'm gussing this is sponsorship)
other = £320k.

[Sutekh]

They mention they were expecting bigger attendances. I think they didn’t realise just how battered and bruised the fan base was after all the shit we’ve had to deal with.

Compound that with shooting his mouth off - over promising and underdelivering in the transfer market - that didn’t help. If we had a competitive team, challenging at the top of the table right from the off there is no reason why we wouldn’t be having 16-18k crowds on the regs (currently 12k) . Hunt’s slow start, and poor window just kept the fans away.

An extra 5k fans through the turnstiles each week paying 25 quid a game plus the additional match day income we wouldn’t be far off a self Sustaining model (relatively speaking ) we’d be close to halving the monthly loses Rob and Todd are incurring.

But no-one is failing to grasp the amount of money it costs to run a football club it’s pretty well documented. It’s totally naive to think a league one club will be turning a profit or even close to breaking even. If the quoted 1 million a month they are putting in shrank by, say 500k - with that increased attendance you’d be talking only a 6 million loss. Which is inline with the average loss of a league one club last season

https://www.matchdayfinance.com/post/ef ... on-2023-24

Overall, League One recorded a combined loss of £125 million, up from £117 million in 2022/23 — the worst in the league’s history — averaging £5.1 million per club.

Welcome to football Rob and Todd! it’s an expensive sport, not for the faint hearted, or cheapskates. Not unrealistic to assume you’re going to lose a few million quid a season.

Football is so catch-22, win and you’ll get the fans back but to win you have to seriously invest wisely and to seriously invest wisely you need good revenue streams of which the paying supporter is just one.

[rabidbee]

One is a hypothecated average ticket revenue per fan - £15, one is a hypothecated amount of extra spending at the stadium per fan, £13. So he's saying increase the average gate by 5,000, you'd increase ticket sales by £75k a game, and other match-day revenues by £65k (£13 x 5,000 is £65k, not £63k) a game. An extra 5,000 fans a game equals an extra £140,000 per home game, and an extra £3,220,000 per season.

If the guesswork is correct, of course.

Matchday income includes tickets and food etc.

Well, that's what I would have assumed, but I haven't read the accounts, and Brogue seemed to be treating them as distinct from ticket revenues.

[WestYorksRoyal]

One area which is noticeable in L1 is the away support generally is pretty crap aside from a handful of a few teams. Realistically between now and the end of the season only Cardiff and Plymouth are likely to sell out 3k (assuming both remain 3pm KO's).

Assuming 3pm KOs is also a key point - they keep moving us to Thursday night! I would presume Sky are paying us enough to make up for lost ticket revenue.

[RG30]

It's not just the moved KO's, it's the fact it's never been more accessible to watch matches through firesticks or Sky red button etc.

[WestYorksRoyal]

Fair to say these guys have put their money where their mouth is in January if we get Ward over the line.

Even the summer in hindsight looks like a lack of strategy rather than a lack of ambition.