Liverpool FC Forum

The Hustler » Sun Sep 16, 2012 1:08 pm wrote:I'm 100% sure that the owners will provide funds when the time is right IE: January. There is no indication that the owners are skint or tight fisted!

More crucial, is that the money is not wasted.

The Hustler » Sun Sep 16, 2012 1:08 pm wrote:I'm 100% sure that the owners will provide funds when the time is right IE: January. There is no indication that the owners are skint or tight fisted!

More crucial, is that the money is not wasted.

The Hustler » Sun Sep 16, 2012 1:08 pm wrote:I'm 100% sure that the owners will provide funds when the time is right IE: January. There is no indication that the owners are skint or tight fisted!

More crucial, is that the money is not wasted.

heimdall » Tue Sep 18, 2012 3:24 pm wrote:

The Hustler » Sun Sep 16, 2012 1:08 pm wrote:I'm 100% sure that the owners will provide funds when the time is right IE: January. There is no indication that the owners are skint or tight fisted!

More crucial, is that the money is not wasted.

No indication?? well how about them not upping their £4 million bid for Dempsey to £6 million, I'd call that a pretty fecking good indication of them being skint tight fisted or just complete fecking morons.

heimdall » Tue Sep 18, 2012 2:24 pm wrote:

The Hustler » Sun Sep 16, 2012 1:08 pm wrote:I'm 100% sure that the owners will provide funds when the time is right IE: January. There is no indication that the owners are skint or tight fisted!

More crucial, is that the money is not wasted.

No indication?? well how about them not upping their £4 million bid for Dempsey to £6 million, I'd call that a pretty fecking good indication of them being skint tight fisted or just complete fecking morons.

Is LFC likely to comply with its break-even obligations?

It is a very tricky answer to give without having in-depth access to the club’s accounts. Swiss Ramble has explained that had it not been for the current owners having to write off £59m in stadium development expenses, LFC would have made a £10m profit in its last published set of accounts. However, excluding the Torres sale would have realised a £20m loss. Remember, the break-even calculation in the first monitoring period is based on two, and then in subsequent monitoring periods (usually) three sets of accounts. So long as LFC makes a loss of no more than €45m in the first monitoring period (as you can see from the table at the beginning of this article) and the owners are willing to cover that loss, LFC will not breach the break-even criteria. The only individuals that know for certain whether LFC will break-even under the UEFA regulations are likely to be the board and LFC’s accountants. This is because certain cost deductibles (Annex XI, youth and training development costs for example) will be difficult to extrapolate from the club’s accounts.

That said, here are a few reasons why LFC may be in a healthier position to comply with the regulations than other clubs across Europe.

Champions League Shortfall. Over the last three seasons, and I believe set out in the two previous sets of the most recent accounts, LFC has lost out on significant Champions League revenues. Last season Chelsea made €60m, Manchester United €35m, Arsenal €28m and Manchester City €27m. The Europa League is very much small change. Even without the golden prize of Champions League revenues, LFC has not been making astronomical losses (taking away exceptional items). Indeed, LFC continues to feature in the Deloitte Football Club Money list. Most recently in 9th position earning €203m for revenues generated in the troubled ’10-11 season. Should LFC achieve Champions League status once more, this should provide the club with greater revenues to offset against costs.

Premier League TV Deals. The latest £3bn domestic PL TV deal that was announced recently (which was a 64% increase on the previous deal) will significantly increase the revenues of all PL clubs participating in the league come the ’13-14 season. Those that finish higher in the PL (hopefully including LFC) will benefit from higher placed payments whilst there being a greater likelihood of more frequent TV appearances, thus benefiting from larger facility fees. Under the current distribution system and factoring in an increased foreign TV rights deal, Swiss Ramble believes there may be an additional £30m per season on offer for the PL’s top clubs. Manchester City received £60m from the PL for winning the title. That could rise to over £90m from the 2013-14 season. This additional revenue, so long as it does not spark another round of transfer and wage inflation, will assist PL clubs, including LFC, in complying with the FFP rules.

Stadium Redevelopment. As explained above, the cost of refurbishing Anfield, which appears the preferred option, is excluded from the break-even cost calculation. This is to LFC’s benefit. UEFA is keen to incentivise long-term revenue-generating projects like stadium construction and/or improvements. The net result of an improved capacity and a higher proportion of corporate seats will certainly dwarf current home match day revenues. By way of brief comparison, Manchester United makes £3.7m per home game, Arsenal £3.3m, Chelsea £2.5m, Spurs £1.6 and LFC £1.5m. The potential revenue growth is obvious.

Stadium Naming Rights. Linked to stadium revenue growth is the underlying issue of how to raise money to fund the stadium. Until recently it was unclear whether Fenway would consider a naming rights deal for Anfield. In answering questions posed by Tomkins Times members, John Henry did not rule out such a move. While I am a firm believer in Anfield remaining as Anfield, I challenge any LFC fan to argue against the value of giving a naming rights deal serious consideration if it halves the construction costs for the stadium and consequently allows LFC to continue to compete in the transfer market during the high financing construction phase of the project.

Commercial sponsorship arrangements. With reference specifically to shirt sponsorship, LFC have the 5th largest deal behind Manchester United, Barcelona, Bayern Munich and Real Madrid. Manchester United recently announced a jaw-dropping £45m new shirt deal with Chevrolet starting in time for the ’14-15 season. Their innovative approach to sponsorship has also lead to a £10m per season DHL training kit deal. Where once LFC was on par with United, our neighbours have soared ahead. It does however open up the possibility in the future that a sponsor may wish to pay similar amounts for a club with such global appeal (if not the recent success that United has enjoyed). Similarly, LFC’s kit deal with Warrior has boosted the club’s coffers significantly. The deal is over double the amount of the previous Adidas deal. Importantly, LFC is also able to have control over non-branded merchandising. LFC believe this will significantly boost club revenues (see here).

Lastly, and a somewhat more tenuous point, the FFP rules may just provide opportunities for clubs like LFC who are more likely to comply with the break-even criteria to take advantage of any difficulties large spending PL clubs may face should they breach the break-even criteria by a large margin. If so, the next best placed club in the PL would take their place. That may be LFC.

Conclusion

As you can see, FFP is in force and UEFA is not afraid to sanction clubs accordingly. Liverpool FC – so long as they can regain their place in the Champions League and move forward with stadium issues (two big ifs!) – should be in good shape to comply with the regulations, in part because of the emphasis the owners have placed on the club’s compliance. The most important question however is not whether UEFA will sanction clubs, but what the sanction will be. Clubs that breach the rules by small margins will be less likely to be expelled from UEFA competition. The proportionality or reasonableness of the sanction will then have to weighted against the severity of the breach. Although that may not sit too well with some, it is likely to be the way that the sanctions will be applied.

Benny The Noon » Wed Sep 19, 2012 3:14 pm wrote:It will mean nothing because FFP will not stop the big clubs from spending over what they earn because they punishments will be minimal .

parchpea » Wed Sep 19, 2012 4:43 pm wrote:The big hitters in Europe will crush FIFA if they start meddling in their affairs too much.

Its all posturing and probably not worth the paper its written on however its fantastic vehicle
to jump on for tight fisted or potless owners who are ***** a hoop with this meaningless
legislation.

heimdall » Wed Sep 19, 2012 5:51 pm wrote:

parchpea » Wed Sep 19, 2012 4:43 pm wrote:The big hitters in Europe will crush FIFA if they start meddling in their affairs too much.

Its all posturing and probably not worth the paper its written on however its fantastic vehicle
to jump on for tight fisted or potless owners who are ***** a hoop with this meaningless
legislation.

Sorry but how would they crush Fifa?

heimdall » Wed Sep 19, 2012 5:42 pm wrote:

Benny The Noon » Wed Sep 19, 2012 3:14 pm wrote:It will mean nothing because FFP will not stop the big clubs from spending over what they earn because they punishments will be minimal .

How do you know this? I actually think Platini has a real bee in his bonnet about this and clubs will be severely punished for breeches.

Benny The Noon » Wed Sep 19, 2012 5:07 pm wrote:

heimdall » Wed Sep 19, 2012 5:51 pm wrote:

parchpea » Wed Sep 19, 2012 4:43 pm wrote:The big hitters in Europe will crush FIFA if they start meddling in their affairs too much.

Its all posturing and probably not worth the paper its written on however its fantastic vehicle
to jump on for tight fisted or potless owners who are ***** a hoop with this meaningless
legislation.

Sorry but how would they crush Fifa?

Well for one it will be UEFA and the big clubs will just go and create their own super league. The big clubs hold the cards - it was them that forced the creation of the CL. UEFA won't kick out the big clubs.

heimdall » Wed Sep 19, 2012 4:42 pm wrote:

Benny The Noon » Wed Sep 19, 2012 3:14 pm wrote:It will mean nothing because FFP will not stop the big clubs from spending over what they earn because they punishments will be minimal .

How do you know this? I actually think Platini has a real bee in his bonnet about this and clubs will be severely punished for breeches.