BFC cash injection

Yes, you'd think that at least some of the new money was intended for (a) transfer fee(s).

 

Otherwise you keep the 3 million in your own bank account earning interest until the summer.

 

Thank you for doing that.
And thank you for not using tapatalk.

 

The club probably needs some of it to meet day to day spend but we're not losing £1m+ a month and season ticket sales (!) would normally be bringing cash in by end of March / start of April. So unless there was some big one off bill due during January like a loan repayment the only other explanation seems to be that they were providing a transfer kitty of some level that went largely unused.

 

There's nothing left to pay wages?

I'm not suggesting that is the case, but that would be a reason to do it.

If you have a budget deficit of £8 million, as we were told we had, your cashflow will dry up.

 

The £3m will be needed to plug the hole from plummeting ST sales come March/April.

 

If you had a budget deficit to pay wages, I’d expect a series of more frequent, lower values. There’s no benefit to an owner putting lump sums into the club. (Although it might benefit the club)

 

Well £3m is equivalent to about 6500 full price season tickets. I reckon we don’t sell 6500 full price tickets every season, so they must be assuming no one is going to renew…

 

I suspect that amount is for working capital. Loss isn’t the same as cash, we don’t know what our liquidity is like, and given we didn’t bring in any significant revenue from player sales, my expectation is the share issue is straight up working capital.

I have another theory in mind. We’ll see how the next round of ‘investment’ goes but I think there are going to be 3 or 4 more rounds of these share issues before the true picture materialises.

 

Deoends on his and his fellow shareholders liquidity and when and how much capital they can free up at a time.

 

ooh go on, nail your colours to the mast and then bookmark this thread to point back to it in the years to come…
In all seriousness, not being a business owner or investor, I’d love to know your theory!

 

I’ll keep it myself for now. If there are at least two more share issues, that will give more insight.

But I have a feeling, and I don’t think they are gearing for sale… even though they should if they had any sense.

 

I’ll respect your position, but if you’d like to PM me to give me an insight into your thoughts I’d keep it to myself, but fair enough if you don’t want to.
I’ve had a quick google and found this, but don’t see the scenarios playing out at Oakwell, and I assume there are other things to consider when related to a football club. https://fundingguru.com/blog/when-s...d a cash injection,the running of the company.

 

It’s a feeling I’ve got based on instinct. May well not pan out, but I’ll wait and see what happens next year if the world still exists then! ;-)

 

It’s looking decidedly unlikely! At least not as we know it. I’d look to move abroad, but not sure where will be immune from the impact. Maybe North Korea.

 

Accepting completely that you don't have any obligation to share, I'm sure loads of people would love to hear your views. Because understanding the motives of the owners - whether that's short, medium or long term, is beyond what the majority of us can interpret.

I try really hard to place everything in a financial context and fully accept this is what limits the club, but at the same time really struggle to see how or why we're haemorrhaging cash so much more than other L1 clubs.

Putting £3m in to support running costs in January certainly looks from the outside like trouble. If there's an alternative perspective, it'd be really useful to hear.

 

Don’t we have Covid loans to pay back to HMRC and also the EFL?

But other than that, timings of capital injections can be linked to other HMRC activities - such as PAYE and VAT demands to be settled. If we’re running at a loss, CT won’t really be applicable.

Right now, our income levels are low. Small away followings, minimal kit purchases and minimal streams of additional income. Always a tough time after Xmas for most businesses.

 

I don't think we are haemorrhaging more than other league one clubs are we, mate? Obviously compared to Crawley etc, but in general. I was looking at Derby's finances a couple of months ago and they were horrific viewing.

 

I think, along with meeting loses, there is also the need to meet salary cost management protocol, (SCMP). My understanding is that these cash injections are needed for the club to inflate turnover to meet the 60% of turnover spent on player wages/ transfer fees rule.

This will become tougher next season when only 60% of the cash injection can be counted towards player costs.

In terms of turnover, BFC in 2022/23 generated £3.4m from matchday revenue with a total turnover of £9.5m.

Total Director gross cash in to the club now stands at £18.62m, with £6m coming in this financial year. All of this cash coming in the last two years but spread over three financial years.

The only debts the club was carrying at the end of May 2023 was a soft loan to Oakwell Holdings of £3m (the result of the legal case around the purchase of the club) and around £2m in Covid loans that were being repaid at £800k pa.

 

Hopefully there's an element set aside to pay off Gilet Boy.