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The FFP thread


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5 hours ago, ender4 said:

The whole point of FFP and the new incoming FFP is to stop new challengers like Villa, Leicester, etc ever breaking into the elite group of clubs.

Yep

At its very worst FFP inflates the market, man Citys owners give them a £50m a year shirt sponsor, a £100m stadium sponsor blah blah all they've done is artificially inflated the market value for Ed Woodward to say to team viewer "we're bigger than man City so our deal starts at £75m per year" exponential growth 

You can't even back door cheat and compete with what FFP is, it's clever, it's the brain child of a man utd director, says it all

Edit - and that is an interesting thing with new owners, we have different sponsors different partners, not one of them yet has any ties to NSWE, they're not using us as an advertising board 

Edited by villa4europe
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36 minutes ago, Vive_La_Villa said:

99m pound loss with 68m the previous year  sounds really bad to me. But I have no idea how FFP or football club finances work. I guess it’s not a for profit organisation. 

At our stage of development we definitely aren't for profit. They're losses they expect to recoup when we make the champions league.

But they could recoup all those losses now , by selling just some of the assets they bought, for substantially more than they paid for them.  And still leave us with a better training ground,  brighter youth team talent prospects and a refreshed parachute payment allowance if they did so (assuming we also then got relegated)

They won't do that, it's short term and our owners see the potential. This club will make more than it costs now that it is well run and doesn't need to buy an entire new starting 11 over the course of two seasons. 

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7 minutes ago, MrBlack said:

At our stage of development we definitely aren't for profit. They're losses they expect to recoup when we make the champions league.

But they could recoup all those losses now , by selling just some of the assets they bought, for substantially more than they paid for them.  And still leave us with a better training ground,  brighter youth team talent prospects and a refreshed parachute payment allowance if they did so (assuming we also then got relegated)

They won't do that, it's short term and our owners see the potential. This club will make more than it costs now that it is well run and doesn't need to buy an entire new starting 11 over the course of two seasons. 

Yeh fair points mate. I just don’t get how it all works with FFP. I guess the fact there is no debt is what works in the clubs favour?

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42 minutes ago, Vive_La_Villa said:

Yeh fair points mate. I just don’t get how it all works with FFP. I guess the fact there is no debt is what works in the clubs favour?

In fact, I don't think it does. Not an oracle on the subject, but its net losses over a period of years that ffp cares about.

However, we can offset any costs that relate to the youth team, our infrastructure  or training grounds  which actually probably makes up a fair chunk of our losses.

The costs of player signings we've paid will be spread out over the term of their contracts, so not all the money we paid for a player will show in our accounts that year. Although, the effect is that some costs from previous signings will be showing.

Ultimately,  In the Premier League rules we can lose 105m over 3 years. 

Let's assume half of the 175m losses we sustained over the last 2 years can be written off based on the rules I stated above, we'd be sitting at 87.5m over 2 years. Probably an ambitious ratio but bear with me... this would allow us to lose a further 20m or so this season.

Covid has complicated this calculation, so the above isn't strictly true...although With covid contributing directly to 36m of those, we may find we can write off even more of our losses than normal, allowing us to spend more this season.

This is all fine as far as the Premier League are concerned, and they only care about losses.

Where debt comes into it is is when your owners have loaned money to the club (a la the glazers and man utd) and then go bankrupt. If they call in the loans to the club, that sends the club under.  What our owners have done is funded the money as capital investments,  rather than loans, so will only get the money back if they sell the club or make a profit. As such, the fact we're not in debt to our owners just means we're not going under,  and we're a safer prospect to someone else looking to buy us although, our owners would expect a higher price as a consequence

Edited by MrBlack
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Debt is probably the single best indicator of a football clubs financial health, you can make a loss, but if you have no debt then you're still on a firm foundation.

Unfortunately, the three biggest clubs in world football; Real Madrid, Barcelona and Manchester United have three of the largest debts in football - so it was therefore excluded from FFP.

 

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51 minutes ago, OutByEaster? said:

Debt is probably the single best indicator of a football clubs financial health, you can make a loss, but if you have no debt then you're still on a firm foundation.

Unfortunately, the three biggest clubs in world football; Real Madrid, Barcelona and Manchester United have three of the largest debts in football - so it was therefore excluded from FFP.

 

Personally I would add wage commitments to revenue ratio to that statement of health.

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6 minutes ago, paul514 said:

Personally I would add wage commitments to revenue ratio to that statement of health.

Absolutely, but if those are out of sync, what they'll eventually mean is that a club will need to borrow and that'll show as debt.

 

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2 hours ago, OutByEaster? said:

Absolutely, but if those are out of sync, what they'll eventually mean is that a club will need to borrow and that'll show as debt.

 

Yea I get that it’s just if you truly want to make sure a club doesn’t get it up the arse it’s wages that kill clubs and they are committed to pay them until the end of the contracts. Player fees although spread out over time pale into comparison 

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I do not know what the panic is on the reported loss, it has also been said despite the loss Villa remain debt free and the loss was covered by shareholder Equity..

Isn't there also a rule that while this pandemic was going off that any losses by clubs wouldn't be taken into account towards FFP..

It really seems there's nothing to worry about..

Also has anyone looked at other clubs reported losses, especially the top five, it would be interesting to compare would it not??

Edited by Dave-R
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There's a delay while we wait for companies house to publish - the club filed the accounts on Thursday so they've released their summary statement, but the actual accounts won't be available for viewing until they're published on the companies house website, once they're on there, I'd imagine that the Swiss ramble, smart people on here and idiots like me will all have a good root through the detail and draw conclusions ranging from the sensible to the wildly speculative.

 

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Got this chart from a Price of Football tweet. Other than the top 6 clubs, seems clubs revenues basically corelate to their league position. Shows we have quite the challenge in trying to break-away from the other 14 PL clubs. It will probably require quite a few years of sustained success that positions us to attract bigger commercial partners.  Have to give Spurs credit - they were able to bridge that divide.

Edited by nepal_villan
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8 minutes ago, nepal_villan said:

Image

Got this chart from a Price of Football tweet. Other than the top 6 clubs, seems clubs revenues basically corelate to their league position. Shows we have quite the challenge in trying to break-away from the other 14 PL clubs. It will probably require quite a few years of sustained success that positions us to attract bigger commercial partners.  Have to give Spurs credit - they were able to bridge that gap.

blimey, even Sheff Utd, Watford, Burnley, Norwich & Brighton have/had more revenue than us!, amazing.

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5 minutes ago, MaVilla said:

blimey, even Sheff Utd, Watford, Burnley, Norwich & Brighton have/had more revenue than us!, amazing.

I think Sheffield United have chosen a different date range for their accounts, so they've included all of the revenues for the 2019-20 season, where we've moved £36.1m from 2019-20 to 2020-21. 

I'm not sure how true that is for other teams on that list, but I have a feeling those figures aren't all like-for-like.

 

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