Finance question

If Archerfields figures are correct or ball park
We are facing a inevitable huge loss this season
And there’s no way round it.

We haven’t got enough saleable assets to get anywhere near those figures

And if we do manage to offload our so called biggest assets to bring it down probably by around 2 or 3 million
We basically then have no saleable assets of any meaningful value left to bring it down any further in the future

The people at the club have decisions to make and probably sharpish

Find new investor/s to add to there number
Incredibly unlikely for many reasons

inject a huge amount of capital
a minimum of 5 to possibly 10 million ?
Have they even got that sort of money or available money to actually be able to do that.

Put the club up for sale
If it isn’t already being marketed on the quiet

i guess also put the club into admin and then some of them buy it back out of admin.

 

It's pretty damn **** but as @troff has posted I'm sounding like a cracked record.

 

The only way is down if that's the case. Once we've sold our prize assets which may or may not sort out the shortfall, then we're left with the latest batch of overpaid players who we have to try and sell to balance the books next year. Each season sees us replacing better players with mediocre freebies. When do we start turning the corner? I doubt that any team in Lg1 is self sufficient, which means we're playing with one hand tied behind our backs before we kick a ball. There must be at least 16 teams in our league yielding less revenue (a guess) so how do they survive? It sounds like we're in for a very bleak period in the clubs history.

 

Tesco, Lidl, Aldi, Asda take your pick.

 

The other problem as well is the cost of living crisis that is coming. At the moment, there will be less casual attendees at home games - and fewer season tickets sold next season. Football is a non-essential spend, and people that can't afford their electricity bill aren't going to stand out in the cold for 2 hours watching football...

 

It's just me but other than away fans and season ticket holders I can't see why anyone would want to go right now?

 

We didn't rely on overdrafts under John Dennis, we relied on trading solvently. We had an arranged overdraft but the first time we needed to use it HSBC revoked that facility at which point we applied for administration.

I dare say we will have an overdraft agreed now, like most people with personal accounts, but it will be small.

The finer points of our finances don't need to be understood to understand our current situation. We have bills to pay each month. Very large bills due to footballers being paid huge wages. Our income streams do not cover our monthly liabilities. This is largely due to the loss in income from TV money after relegation. If we can't pay our bills we will go out of business. We therefore have to sell players. This is doubly beneficial as it is both a source of income from the transfer fee received and it reduces our liabilities by getting a wage off the monthly outgoings.

We may not be in debt now but we know our future liabilities and we can estimate our future income. We will run out of money if players aren't sold.

 

The only thing I'd add to that is that we were losing money each season when in the Championship when our income was much higher than it is now. We could afford to do that as we had money in the bank. But those season on season losses have used up our savings. There's nothing left, income has been reduced considerably, but we still have to pay the wages of the contracted players, still have to pay the rent and the bills and have to repay the Covid loan.