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The 2018/19 accounts - the Grumpy take

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Guinness Guzzler said:
Definitely something Donald could do with being asked like. Why did another company in the group need £10m, what's it been used for, why was it paid from the football club and when do we get it back? I might be totally misreading it, but that £10m could have been pretty useful this season!
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That's what I thought too, but surely it can't be that.
 
Guinness Guzzler said:
Definitely something Donald could do with being asked like. Why did another company in the group need £10m, what's it been used for, why was it paid from the football club and when do we get it back? I might be totally misreading it, but that £10m could have been pretty useful this season!
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tweet him and ask
 
Abu Dhabi Red and White said:
What's your view on @sproates33's comments -
disappointingly #SAFC's new owners have opted to take numerous exemptions when publishing the accounts, including the decision not to produce a cash flow statement. Within their rights to do so but jars with the idea of being transparent.
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My view as an accountant is I don't care who's looking at my accounts I'm going to take every exemption that I can so I spend the minimal amount of time working on stats and trying to improve the business instead.

I don't recall ever seeing a cashflow in previous accounts so this isn't making the accounts any more opaque but nor is it increasing transparency. And to be honest, I don't think we can criticise the owners lack of transparency even if this is how they've decided to do their accounting. It's probably their accountants who've decided this company structure and disclosure anyway.
 
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Grumpy Old Man said:
What is says -another company in the same group of companies. By a process of elimination, it's either Madrox Partners Ltd or SJD Leisure Holdings Ltd.
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Guinness Guzzler said:
Definitely something Donald could do with being asked like. Why did another company in the group need £10m, what's it been used for, why was it paid from the football club and when do we get it back? I might be totally misreading it, but that £10m could have been pretty useful this season!
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Not unreasonable for someone to ask him the question.
 
Grumpy Old Man said:
This, hopefully, is the nadir, the final emptying of the cesspit of declining finances. We live in hope.

What can we say from the numbers, and what does it really mean going forward?

First, this year's figures

Income
Obviously, way down on 2016/17. TV income halved as expected. Gate receipts went down by £2.4m, a drop of just under 25%. That's the cost of PL fanboys and stayaways. Sponsorship fell off a cliff, down 80%, while commercial and retail were down about 35%. Depressing, but pretty much what you might expect. Looking at 2018/19 gates, everything but TV income will probably have bottomed out. However, we're looking at another £15m or so drop in TV income in the 2018/19 accounts. That's why the new owners needed, and still need, tocut costs.

Expenses
Staff costs dropped by £35m (around 42%), lower than the fall in income. so staff costs were 73.4% of turnover (2017 - 67.5%). Bain got a £1m payoff (looking at his total pay, that's probably a contractual one year notice). On staff numbers, it looks as though redundancies affected 1 in 6 admin staff. It appeared that we still managed to spend around £2om on other operating costs. This is where Donald is really going to have to wield the axe to get the books balanced.

Other points to note from the P&L: a further £12m was written off player contract values, we made an £8m profit on the sale of the Charlie Hurley centre, and the lawyers and merchant bankers trousered £6.5m for the share issue.

Turning to the balance sheet, transfer debtors were £16.2m (£4.4m receivable next season), while transfer creditors were £19.6m (£3.5m payable next season). Other debtors include £9.6m due from another group company (not Sunderland Ltd). It's unclear who owes this, or why the debt is there. As expected, there arer no external debts, and there was a positive cash balance of £11.1m at the year end.

Looking forward, there are grounds for optimism, although we may continue to make smaller losses while the position the owners inherited unwinds. Clearly, there is much more work to be done on the cost base, particularly player wages, but it's a far brighter picture than when I was writing this time last year.
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Thanks for taking the time to inform us GOM, I certainly learn a lot from your analysis
 
Guinness Guzzler said:
I'm anxious that I'm reading it wrong and I don't know what I'm talking about! I'm sure someone will tweet him, I'll wait until someone with a vague grasp of accounting does it!
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:lol: Apart from Grumps, no-one knows what we’re talking about marra! ;) Go ahead and tweet him....nothing to lose!
 
Grumpy Old Man said:
This, hopefully, is the nadir, the final emptying of the cesspit of declining finances. We live in hope.

What can we say from the numbers, and what does it really mean going forward?

First, this year's figures

Income
Obviously, way down on 2016/17. TV income halved as expected. Gate receipts went down by £2.4m, a drop of just under 25%. That's the cost of PL fanboys and stayaways. Sponsorship fell off a cliff, down 80%, while commercial and retail were down about 35%. Depressing, but pretty much what you might expect. Looking at 2018/19 gates, everything but TV income will probably have bottomed out. However, we're looking at another £15m or so drop in TV income in the 2018/19 accounts. That's why the new owners needed, and still need, tocut costs.

Expenses
Staff costs dropped by £35m (around 42%), lower than the fall in income. so staff costs were 73.4% of turnover (2017 - 67.5%). Bain got a £1m payoff (looking at his total pay, that's probably a contractual one year notice). On staff numbers, it looks as though redundancies affected 1 in 6 admin staff. It appeared that we still managed to spend around £2om on other operating costs. This is where Donald is really going to have to wield the axe to get the books balanced.

Other points to note from the P&L: a further £12m was written off player contract values, we made an £8m profit on the sale of the Charlie Hurley centre, and the lawyers and merchant bankers trousered £6.5m for the share issue.

Turning to the balance sheet, transfer debtors were £16.2m (£4.4m receivable next season), while transfer creditors were £19.6m (£3.5m payable next season). Other debtors include £9.6m due from another group company (not Sunderland Ltd). It's unclear who owes this, or why the debt is there. As expected, there arer no external debts, and there was a positive cash balance of £11.1m at the year end.

Looking forward, there are grounds for optimism, although we may continue to make smaller losses while the position the owners inherited unwinds. Clearly, there is much more work to be done on the cost base, particularly player wages, but it's a far brighter picture than when I was writing this time last year.
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From one accountant to presumably another, good analysis marra.

Fancy writing my monthly management accounts commentary?
 
Guinness Guzzler said:
Definitely something Donald could do with being asked like. Why did another company in the group need £10m, what's it been used for, why was it paid from the football club and when do we get it back? I might be totally misreading it, but that £10m could have been pretty useful this season!
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Get used to this Leeds spring to mind many owners taking a bit here and a bit there then selling it on to the next owners.
 
Guinness Guzzler said:
Definitely something Donald could do with being asked like. Why did another company in the group need £10m, what's it been used for, why was it paid from the football club and when do we get it back? I might be totally misreading it, but that £10m could have been pretty useful this season!
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It's entirely possible it was repaid months ago. A balance sheet is a snapshot at the year end date. Anything paid or received on 1 August would show as a creditor or debtor on 31 July.
 
mikemanc said:
Are there any odd movements in ppe? Transferring a property to a different company for instance?
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Nope

Sidewinder2 said:
From one accountant to presumably another, good analysis marra.

Fancy writing my monthly management accounts commentary?
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Having had to do that for accounts going to Lord Weinstock when he was in charge at GEC, no :). God, that man's bullshit detector was the finest ever.
 
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