looking at the accounts the first thing I noticed was that the board have not depreciated anfield this year, although they do put a note in that states
Quote:
The Directors consider the useful economic life of the existing stadium to be 4 years including the current year. The difference between the current carrying value and the expected residual value as at 31 July 2008 will be fully provided for over this period.
They've extended the date of residual value by a year and not put through a depreciation, possibly because it was put through last year.
There were also additions of £1m in charges over the year relating to the new stadium. There have been £7m of costs incurred to date and have yet to be depreciated (this will happen once the new stadium is built and opened).
Transfers]
The value of transfers added in the year were £46m, original cost of sales of players was £18.5m. (so net £27.5m spent in the year)
Amortisation of players transfers was £22.8m (up by £5.5m from last year). There was also an impairment on a players registration within the year of £1.4m. This was an exceptional item (not sure who it related to though).
During the year £26.2m was paid out on players transfers, with £8.1m being received. Leaving a net spend of £18m. The club were still due to receive money from, probably, the owen transfer.
There are contingent liabilities of £6.214m on transfer fees if certain conditions are met (I suspect that £2.5m of this has now been paid after Alonso's 60th match)
We are potentially owed £1.7m in transfer fees if birmingham stay up this season. We received an extra £1.6m for the heskey transfer through last year.
Fees still to pay on transfers are as such:
Within the current financial year upto £18.7m. Note that this figure may include things other than transfers as it is trade creditors.
Fees due greater than 1 year are £18m. These will be fees that will be spread over the life of the contracts. So Cisse's transfer will have some in this. Possibly Crouch, Reina and Sissoko's too. For the same players part of their fees will be included in the above figure for due within the year.
Sponsorship Issues]
The club have made a provision of £2.5m relating to potential costs because of the delay to complete shirt sponsorship deal. This will be under review as they argue who is right and who is wrong.
The amount owed by reebok looks to be upto £10m, although some of the £10m increase in debtors maybe due to transfer fees owed.
Wage bill]
The wage bill of £64.2m DOES include bonuses for the european cup win. If we win it again this season the wage bill will remain at a similar level. If we don't win it again we will see it reduced by approx £10m. These bonuses will be paid over the current financial year as part of players salaries, this has resulted in Accruals and Other tax and social security to remain at relatively high levels. Assuming we don't win the european cup again this year creditors should decrease by approx £10m.
The wage bill was 53% of turnover, however if you strip out bonuses due to the european cup win the ratio is closer to 45%. The club are on target to have a 50% wage to turnover ratio.
Debt]
Long term borrowing has fallen to £9.8m from £11.7m. It has been the overdraft facility that has increased net debt. The overdraft stands at £7.5m (increase of £4.5m) which is likely to be as a result of the reebok stuff. £6m of loans were repaid over the year but the club took out a further £5m loan to help fund player transfers in october. This would have been to bring forward money owed by UEFA/Premier League.
The debt is repayable as such
£4.467m due within the financial year.
£4.467m is due between 1 and two years time.
The overdraft is generally on demand, however this will always get cleared down from time to time as the club sells tickets and brings in cash receipts.
.tv
The online profit (before rights amortisation) increased by a factor 11,000 to £658k.
There are now over 36,000 e-season ticket holders.
Prospects for FY2006]
There are a number of factors that will effect this. I will try to cover a best case scenario (well when I say best case I mean we win the european cup again but don't win the league due to the current points gap) and a "worst case" scenario (ie finishing 4th and going out to benfica)
Winning the european cup and finishing 2nd.
Premier League television revenue - £30m. (extra £1.5m for finishing 3 places higher)
Premiership match related turnover - £24m (increase in ticket prices)
Cup competitions - £33m (similar to last season, although a run in the FA Cup could add to this. We have also earned about an extra £0.5m from win bonuses in the group stage of the european cup)
Sponsorship - £20m similar to last season.
Retail merchandise - £15m (due to the new away shirt falling in this financial year, the increased merchandise sales due to the cup win and the european shirt sales)
Museum and Supporters club - £1.3m (I've used a modest increase although this could be alot higher)
Japan Trip - £3m from match fees etc (using an estimate as I can't remember what the total prize fund was)
Turnover - around the £127m
Wages - £64m (these would remain similar to last season, these include bonuses for winning the cup)
Other admin charges - £16m (these seem to remain relatively static.
Cost of sales - £15.4m (using a similar increase to what occured between the last two financial years)
Amortisation of players registrations - £26m (these will increase due to investment in playing squad, but also no exceptional charge of impairment of a players registration)
Profit on disposal of players transfers - £12m
Interest Payable - £1.7m
Profit before tax - £15.9m
Tax - £3.8m
Profit after tax - £12.1m
This will leave net assets of about £53m
Cashflow from operating activities (assuming we get all money on time and in full, plus the money owed to us by reebok, I'll assume £5m since I don't know the actual figure) - £38.6m
Finishing 4th and out to Benfica
Premier League television revenue - £29m. (extra £0.5m for finishing 1 place higher)
Premiership match related turnover - £24m (increase in ticket prices)
Cup competitions - £23m (There is an approx £10m drop in revenue for going out at the last 16)
Sponsorship - £17m
Retail merchandise - £15m (due to the new away shirt falling in this financial year, the increased merchandise sales due to the cup win and the european shirt sales)
Museum and Supporters club - £1.3m (I've used a modest increase although this could be alot higher)
Japan Trip - £3m from match fees etc (using an estimate as I can't remember what the total prize fund was)
Turnover - around the £112.3m
Wages - £54m (there would be no bonus payments)
Other admin charges - £16m (these seem to remain relatively static.
Cost of sales - £15.4m (using a similar increase to what occured between the last two financial years)
Amortisation of players registrations - £26m (these will increase due to investment in playing squad, but also no exceptional charge of impairment of a players registration)
Profit on disposal of players transfers - £12m
Interest Payable - £1.7m
Profit before tax - £11.2m
Tax - £2m
Profit after tax - £9.2m
This will leave net assets of about £51m
Cashflow from operating activities (assuming we get all money on time and in full, plus the money owed to us by reebok) - £25.7m
....................................................................................
I won't try and forecast net debt and the detail of the balance sheet as they all depend on too many variables.
Once again this financial year we are looking towards having a profit. We also managed to make a profit, technically, on Josemi of around £3m since it was a straight swap. Due to the requirements of the accounts both Krompkamp and Josemi had to be valued so I guess they used the value of krompkamps transfer to villareal.
Now here is something that may interest you a little. Financially we could be better off by finishing 2nd in the league and losing the european cup final. This is because the losers get about £1.7m less than the winners, while sponsorship revenues will be down by about £2.5m. However there would not be bonuses to be paid out to players and management for winning the cup, thus saving the club upto £10m.
So if you look at it that way Rafa's half time team talk and tactical changes cost the club potentially £5m.
