Club loan taken out

[ighty seven]

It's to pay for Granit's statue outside of the ground

I’ve heard Xhaka is going to stand on a plinth himself and give directions to everyone who doesn’t know where to be on a match-day.

 

[Safc98]

They aren’t mind. Spending money in January means less to spend in the summer - both in cash and in the bigger psr loss for the season. To be fair it may also mean bigger prize money earned this season. Those figures may net off or it may work out better for us. Personally I’d rather we didn’t if I’m honest. I’m not worried about the finances, I just don’t think January is a particularly good month to do business in.

The bit about gambling with loans was garbage

Spending money you do not yet have, even if guaranteed income is always going to mean less money available in the future.

Lots of words, but it doesn't deal with the fact you are spending this season money that you would otherwise have had to spend next season. Thus leaving you even more short next season and having to borrow more next season

As for saying there is no gamble? Its exactly what the club are doing. Spending money it doesn't have yet is always a gamble

You talk about club making a profit - in 2023/4 only 7 clubs made a profit in Premier League - and over the whole 92 only 14 clubs reported a profit, and that is after player sales are taken into account. Seems like a huge gamble to rely on making a profit when by far the vast majority of clubs do not. Indeed only 1/3 in Premier League did

You better tell the accountancy profession that their teachings are wrong and you have discovered a way to spend money several times over

You are right it is bringoing forward a payment - which means in April you will not have the money as its already been spent.

Spending money you do not yet have, even if guaranteed income is always going to mean less money available in the future.

This is the reality of the situation. Its how debts spiral because you are spending money you have not yet received, good for today, but leaving you even shorter in the future, not to mention the loan arrangement and interest charged

You do realise that if we stay up we get money for being in the league next season right? So where’s this “spending it twice” nonsense coming in? We’re spending this season’s money this season and then we receive PL or Parachute money next season to spend next season.

 

[JL1985]

Lots of words, but it doesn't deal with the fact you are spending this season money that you would otherwise have had to spend next season. Thus leaving you even more short next season and having to borrow more next season

As for saying there is no gamble? Its exactly what the club are doing. Spending money it doesn't have yet is always a gamble

You talk about club making a profit - in 2023/4 only 7 clubs made a profit in Premier League - and over the whole 92 only 14 clubs reported a profit, and that is after player sales are taken into account. Seems like a huge gamble to rely on making a profit when by far the vast majority of clubs do not. Indeed only 1/3 in Premier League did

You better tell the accountancy profession that their teachings are wrong and you have discovered a way to spend money several times over

You are right it is bringoing forward a payment - which means in April you will not have the money as its already been spent.

Spending money you do not yet have, even if guaranteed income is always going to mean less money available in the future.

This is the reality of the situation. Its how debts spiral because you are spending money you have not yet received, good for today, but leaving you even shorter in the future, not to mention the loan arrangement and interest charged

We haven't paid out £160m in transfer fees this summer, clubs don't pay it all upfront, it over 4/5 years. We've probably paid out £40/50m in fees/wages/agents fees/bonuses whilst also making sales. We are far from spending money we don't have.

 

[Charmless Man]

So, now its borrowing money to gamble with. That is normally the way to financial ruin

Gambling is dangerous enough without borrowing the money to gamble.

Your scenario may mean that the extra 3 places higher ( if it happens) pays off the cost of the loan, it doesn't however replace the money you have spent now, so you do not have it for next season. The club will not earn enough money to pay the cost of the loan and to replace the funds it has taken early

You can't spend the same pot of money twice. If it is spent this season, then there is a shortfall in the money for next season

It’s not gambling when you have direct influence over the outcome through your own decisions and have a track record of getting those decisions right.

It’s strategic business and financial planning

 

[KittenMittens]

Lots of words, but it doesn't deal with the fact you are spending this season money that you would otherwise have had to spend next season. Thus leaving you even more short next season and having to borrow more next season

As for saying there is no gamble? Its exactly what the club are doing. Spending money it doesn't have yet is always a gamble

You talk about club making a profit - in 2023/4 only 7 clubs made a profit in Premier League - and over the whole 92 only 14 clubs reported a profit, and that is after player sales are taken into account. Seems like a huge gamble to rely on making a profit when by far the vast majority of clubs do not. Indeed only 1/3 in Premier League did

You better tell the accountancy profession that their teachings are wrong and you have discovered a way to spend money several times over

You are right it is bringoing forward a payment - which means in April you will not have the money as its already been spent.

Spending money you do not yet have, even if guaranteed income is always going to mean less money available in the future.

This is the reality of the situation. Its how debts spiral because you are spending money you have not yet received, good for today, but leaving you even shorter in the future, not to mention the loan arrangement and interest charged

I apologise for using too many words.

I think you should remember a few things:

1: You keep saying 'this season's money'. That's the only part of your post that is correct. That money is for 25-26. It'll have been accounted for since day one as part of the expenditure between now and May, not for next season.

2: This is not 'bringing forward a payment'. When the club budgets for the season, they have total figures for each cost line that they expect to spend between now and May when our accounting period ends, some need paying earlier than others, some things (matchday costs, player acquisition for example) by definition happen only at certain times of year., and sporadically If they've budgeted X amount for January, they can't wait until May to spend it, any more than they could have waited in the Summer until this money began to pile up, to upgrade the squad.

3: This is not a loan, it's a rolling credit facility, which means they could easily spend less (and likely will). It's to make sure they aren't having to make formal cash flow moves (investments etc) to cover payments that will be covered by future income anyway.

4: The owners can also now foresee two reasonable forecasts - player trading profit, and PL prize money - that are working in their favour in a way they wouldn't have known 2 months ago. They will likely make significantly more on both than they would have budgeted for in September. That makes any risk now calculated, and offset by the likelihood that even if they do spend more than they originally planned, it's because they forecast that their assets and revenue streams are performing better.

You have me and Chris, two people who spotted the wrongdoing in 2018-19 earlier than pretty much everyone, and hammered SD and CM for their mismanagement, saying the exact same thing. If we didn't believe it, we'd be the first ones agreeing with you. Just relax, this is ok.

 

[RedandWhiteRebel]

Lots of words, but it doesn't deal with the fact you are spending this season money that you would otherwise have had to spend next season. Thus leaving you even more short next season and having to borrow more next season

As for saying there is no gamble? Its exactly what the club are doing. Spending money it doesn't have yet is always a gamble

You talk about club making a profit - in 2023/4 only 7 clubs made a profit in Premier League - and over the whole 92 only 14 clubs reported a profit, and that is after player sales are taken into account. Seems like a huge gamble to rely on making a profit when by far the vast majority of clubs do not. Indeed only 1/3 in Premier League did

You better tell the accountancy profession that their teachings are wrong and you have discovered a way to spend money several times over

You are right it is bringoing forward a payment - which means in April you will not have the money as its already been spent.

Spending money you do not yet have, even if guaranteed income is always going to mean less money available in the future.

This is the reality of the situation. Its how debts spiral because you are spending money you have not yet received, good for today, but leaving you even shorter in the future, not to mention the loan arrangement and interest charged

Worrying times.

 

[cluffy]

This is the problem with the internet. People think they know everything and have the right to. Then get their knickers in a twist about nowt.

Imagine bitd people in pubs around Wearside debating “I heard Tom Cowie has taken out a new loan! What does it mean?”

 

[Jabberwocky]

So, now its borrowing money to gamble with. That is normally the way to financial ruin

Gambling is dangerous enough without borrowing the money to gamble.

Your scenario may mean that the extra 3 places higher ( if it happens) pays off the cost of the loan, it doesn't however replace the money you have spent now, so you do not have it for next season. The club will not earn enough money to pay the cost of the loan and to replace the funds it has taken early

You can't spend the same pot of money twice. If it is spent this season, then there is a shortfall in the money for next season

You're applying regular person logic to a business with a revenue in the hundreds of millions owned by billionaires with the support of highly paid financial professionals.

Borrowing money is part and parcel of daily business, even hugely profitable stable companies use credit facilities

 

[DR CHEESE]

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Get that plane watch out the freezer to defrost

How much TV money will we get ?

 

[DonaldDownTheWing]

How much TV money will we get ?

It depends on how often you’re on, which pretty much correlated to league position.

Last season Liverpool got the most (27m) & Southampton got the least (10m).

 

[Pantomime Mackem]

Kyril Louis Dreyfus estimated personal nett worth £2bn.

Louis Dreyfus Group estimated nett worth £18.2bn.

Just saying...

I don't want to fall out but this is irrelevant to the question of this new loan.

Let me say, for the fifth time and before anyone starts, I'm not saying there's an issue here.

 

[Dirge]

This is the problem with the internet. People think they know everything and have the right to. Then get their knickers in a twist about nowt.

Imagine bitd people in pubs around Wearside debating “I heard Tom Cowie has taken out a new loan! What does it mean?”

A winner
The usual know nowt bedwetters

 

[GBSAFC]

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Get that plane watch out the freezer to defrost

If we were pissing money away ( as we have done in the past ) then id worry. But these days it looks like we make informed thoughtful decisions .... ghisolfi is looking like different gravy from anything weve had since the bank of England days

 

[Eric gates hair]

Cash flow managment. Basically getting the PL money in earlier than it's actually paid to us. I'd interpret this as us being willing to push on a bit more in the January window.

Whereas other posters view as a crisis and we are doomed.

 

[SAFCftm1986]

The country has more millionaires than anyone thinks. Most of the people in London who own a house for a start.

A lot of them probably mortgaged to the hilt

 

[janey]

This is the problem with the internet. People think they know everything and have the right to. Then get their knickers in a twist about nowt.

Imagine bitd people in pubs around Wearside debating “I heard Tom Cowie has taken out a new loan! What does it mean?”

Said this for years I don’t understand the financials and so I don’t get involved in the debates.
And they never used to exist.
I do trust the opinions of those that do understand though.

 

[Pancho]

I don't want to fall out but this is irrelevant to the question of this new loan.

Let me say, for the fifth time and before anyone starts, I'm not saying there's an issue here.

Agreed about the falling out bit - but sorry the financial background of the Louis Dreyfus family is fundamental to this discussion and I'm a bit perplexed that you fail to see it.

Here's a clue - with his family's background, imagine the quality of financial expertise available at KLD's finger tips if required - and that's not to mention the sources of funding that would also be available to him if required.

 

[Geras]

Im no finance dude but this looks like were going for it . We've got a very good chance of top 8 and Europe with 2/3 more quality signings . That would set us up for years , a step change in the clubs status . Private Jets galore in Jan .

 

[phunboy]

Agreed about the falling out bit - but sorry the financial background of the Louis Dreyfus family is fundamental to this discussion and I'm a bit perplexed that you fail to see it.

Here's a clue - with his family's background, imagine the quality of financial expertise available at KLD's finger tips if required - and that's not to mention the sources of funding that would also be available to him if required.

Actually glad you mentioned funding sources. I've been increasingly speculating that we have a huge multi year shirt sponsor lined up for next year to mitigate next year's spending.

 

[Pancho]

Actually glad you mentioned funding sources. I've been increasingly speculating that we have a huge multi year shirt sponsor lined up for next year to mitigate next year's spending.

I was actually referring to sources of funding ie loans, but yes of course the sheer size of KLD's family business has got to open a few sponsorship doors.