Financial worries

[laukat]

Some questions for someone more familiar with accounts than me

Would we expect to see the income from groundsharing with Queens Park clearly stated on the accounts and if so who's accounts? Partick Thistle Football Club or 3BC?

I assume it won't see anything until we see statements for financial year 21/22?

 

[Norgethistle]

26 minutes ago, laukat said:

Some questions for someone more familiar with accounts than me

Would we expect to see the income from groundsharing with Queens Park clearly stated on the accounts and if so who's accounts? Partick Thistle Football Club or 3BC?

I assume it won't see anything until we see statements for financial year 21/22?

 

It should or would appear on one set of accounts. As 50% of the ground is owned by 3BC and 50% by PTFC(With 55% owned by 3BC) it would depend on who actually controls the assets (Firhill) and who the contract was with

[Fawlty Towers]

I am not an accountant (which will become obvious).

My question is would we know if 3BC had said to the club prior to the start of the season "we will be giving you £500K" and the club then budgeted for that? And then 3BC come along and say "we can only give you £300K" next season so the club budget for that before being told "nothing left to give" and budget accordingly?

The way things have been presented it has been the club spending £500K more than they budgeted for and 3BC plugging that hole. Could it have been 3BC told the club "over the next couple of years we have x to use which will be spread out as follows" and the club planning accordingly?

[jaf]

2 hours ago, Fawlty Towers said:

I am not an accountant (which will become obvious).

My question is would we know if 3BC had said to the club prior to the start of the season "we will be giving you £500K" and the club then budgeted for that? And then 3BC come along and say "we can only give you £300K" next season so the club budget for that before being told "nothing left to give" and budget accordingly?

The way things have been presented it has been the club spending £500K more than they budgeted for and 3BC plugging that hole. Could it have been 3BC told the club "over the next couple of years we have x to use which will be spread out as follows" and the club planning accordingly?

Absolutely correct that could have been the case. Or another variant thereof.

However, whether that makes the club sustainable is another question, as is why every other club who have published accounts so far seem to have a 'covid dividend' increasing cash reserves by six figure sums, whilst we have not, despite having a £500k injection from a source other clubs do not have.

You know - as you were on call with me - that the basis of fan ownership is that the club is trading at a sustainable breakeven position - this is so fans money can be spent on what they choose. If the starting position is minus £500k, or minus £300k plus a ground share, then thats a big hole to fill, so we need to accept costs being trimmed, fans money not being spent on what they want it to as being needed for general budget, other clubs with the Covid dividend still on their Balance sheet having better war chests than us, and maintenance costs potentially high (who knows?).  

We might be debt free but if we are handed the club debt free but with a budget hole to fill in future, that's not a great starting position really, nor what was expected. To be honest transparent and realistic TJF need to communicate, and reset expectations if required.

 

Edited March 23, 2022 by jaf

[jaf]

8 hours ago, Yellow & Redneck said:

Don't mean to be a pain Jaf. Was wondering if I could have a wee look at the analysis you've done. Have a friend who worked accounts for a sports club (not football related), so would be interested. 

Yes, all in public domain, no secrets!!

[javeajag]

1 minute ago, jaf said:

Absolutely correct that could have been the case. Or another variant thereof.

However, whether that makes the club sustainable is another question, as is why every other club who have published accounts so far seem to have a 'covid dividend' increasing cash reserves by six figure sums, whilst we have not, despite having a £500k injection from a source other clubs do not have.

You know - as you were on call with me - that the basis of fan ownership is that the club is trading at a sustainable breakeven position - this is so fans money can be spent on what they choose. If the starting position is minus £500k, or minus £300k plus a ground share, then thats a big hole to fill, so we need to accept costs being trimmed, fans money not being spent on what they want it to as being needed for general budget, other clubs with the Covid dividend still on their Balance sheet having better war chests than us, and maintenance costs potentially high (who knows?).  

We might be debt free but if we are handed the club debt free but with a budget hole to fill in future, that's not a great starting position really, nor what was expected.

 

However , if the clubs turnover over is currently around £2.2m that means we are either spending £2.2m plus £500k or £300k at break even or income in really around £1.7m to £1.9m ….which just seems too low

[jaf]

10 minutes ago, javeajag said:

However , if the clubs turnover over is currently around £2.2m that means we are either spending £2.2m plus £500k or £300k at break even or income in really around £1.7m to £1.9m ….which just seems too low

Turnover is not £2.2m,  it was a little under £1.5m in year ended 31 May 2021 (per accounts)

[Norgethistle]

1 minute ago, jaf said:

Turnover is not £2.2m,  it was a little under £1.5m in year ended 31 May 2021 (per accounts)

Would that “turnover” include the £500k 

[jaf]

 

2 minutes ago, Norgethistle said:

Would that “turnover” include the £500k 

Unlikely - it is more likely to be contained within the other operating income

But the accounts are not detailed enough to determine that definitively - which is normal for a company of that size

[Dick Dastardly]

Smoke and mirrors 

[sandy]

What is clear is that the Club has been operating with 3BC subsidy to appear to break even or still make a small profit.

Lose that subsidy under fan ownership and we will be quickly in debt.

Edited March 23, 2022 by sandy

[Norgethistle]

3 hours ago, jaf said:

Absolutely correct that could have been the case. Or another variant thereof.

However, whether that makes the club sustainable is another question, as is why every other club who have published accounts so far seem to have a 'covid dividend' increasing cash reserves by six figure sums, whilst we have not, despite having a £500k injection from a source other clubs do not have.

You know - as you were on call with me - that the basis of fan ownership is that the club is trading at a sustainable breakeven position - this is so fans money can be spent on what they choose. If the starting position is minus £500k, or minus £300k plus a ground share, then thats a big hole to fill, so we need to accept costs being trimmed, fans money not being spent on what they want it to as being needed for general budget, other clubs with the Covid dividend still on their Balance sheet having better war chests than us, and maintenance costs potentially high (who knows?).  

We might be debt free but if we are handed the club debt free but with a budget hole to fill in future, that's not a great starting position really, nor what was expected. To be honest transparent and realistic TJF need to communicate, and reset expectations if required.

 

The fact the club doesn’t appear to have made a significant spend (pitch relay, major maintenance, buying property etc) in that period would signify that the same spend would be in this years accounts as it wouldn’t be a one off spend (CAPEX). 
Wages I’d imagine would have risen this season (going up a league) but ST’s will be not much more. Sponsorship and hospitality will have helped along with the (reported) £45k from Queens Park, but revenue will also have been lost due to postponements.

On the face of it I can’t see how we’d have removed that deficit possibly reduced but not removed it. With a full pitch re-lay on the cards, the previous promotion bounce feel good gone, and so many games being rearranged  I could see next years ST’s dropping especially with the cost of living increases (This would also adversely affect the club playing more games under lights than planned and at a substantially higher Kw/hr rate than a year ago.

We won’t find out properly till October, or when Due Diligence happens or the shares are handed over, whichever comes first. I just hope the later option isn’t first

[Lenziejag]

10 hours ago, Norgethistle said:

Would that “turnover” include the £500k 

No - the 518k was in other operating income

[javeajag]

19 hours ago, Norgethistle said:

ST’s will be not much more.

There are currently 2300 season ticket holders I was told , which must be at least 25%-30% up in the previous season 

[laukat]

As previously stated I don't know much about accounts so there's a fair old chance I've got the wrong end of the stick.

When looking at our finances relative to other championship clubs I would have thought our income was towards the upper end of the championship so really what we want to establish is why our spend is so high

If so is the answer to above not the wage bill on page 20 of the accounts? If the wages listed there are correct for season 20/21 were we spending 98% of turnover on wages in 21/22? 20/21 also looks high at 77%.

Is the transfer of money from 3BC a way of disguising how out of control the wages have gotten by making it seem that we made a small profit?

 

 

[Norgethistle]

6 hours ago, laukat said:

As previously stated I don't know much about accounts so there's a fair old chance I've got the wrong end of the stick.

When looking at our finances relative to other championship clubs I would have thought our income was towards the upper end of the championship so really what we want to establish is why our spend is so high

If so is the answer to above not the wage bill on page 20 of the accounts? If the wages listed there are correct for season 20/21 were we spending 98% of turnover on wages in 21/22? 20/21 also looks high at 77%.

Is the transfer of money from 3BC a way of disguising how out of control the wages have gotten by making it seem that we made a small profit?

 

 

I see someone has posted on P&B (Yes I Know) that Holt is on £1200 a week, if true it’s a ridiculous wage for a championship team.

[Lenziejag]

6 hours ago, laukat said:

As previously stated I don't know much about accounts so there's a fair old chance I've got the wrong end of the stick.

When looking at our finances relative to other championship clubs I would have thought our income was towards the upper end of the championship so really what we want to establish is why our spend is so high

If so is the answer to above not the wage bill on page 20 of the accounts? If the wages listed there are correct for season 20/21 were we spending 98% of turnover on wages in 21/22? 20/21 also looks high at 77%.

Is the transfer of money from 3BC a way of disguising how out of control the wages have gotten by making it seem that we made a small profit?

 

 

I think the 2021 figures relate to league 1, where we kept the full time squad and only income from streaming games.(is that right?). If that is right, at £12 per game compared to £20 for physical attendance, the results are probably not as gloomy as some are making out, although I am not sure where or how much the furlough money shows.As I said previously, taking theses past 2 published accounts as typical years is not going to help draw the right conclusions.

[jaf]

1 hour ago, Lenziejag said:

I think the 2021 figures relate to league 1, where we kept the full time squad and only income from streaming games.(is that right?). If that is right, at £12 per game compared to £20 for physical attendance, the results are probably not as gloomy as some are making out, although I am not sure where or how much the furlough money shows.As I said previously, taking theses past 2 published accounts as typical years is not going to help draw the right conclusions.

But if you compare them to other clubs, we  seem to have wasted the covid dividend others have enjoyed.  That much is clear.?  
falkirk were full time in the division and made a profit without a £500k subsidy from 3bc. 
I am not making any inference on the financial position of the club simply providing context as to how they have performed.  We should surely be allowed to talk about context and performance off the field as much as on it?

There could be lots of conjecture and grey areas, excuses and spin put forward.  That’s why the absolute facts of us compared to other similar clubs is contextually important.  No hijacked narrative, no speculation - facts. 

But to speculate for a moment (!) ,  what if the current (2022 season / accounting year) contained a further £500k or so of non recurring exceptional income, would you be equally  relaxed (given your excuses / reasons have ceased to exist this year)?  What’s the number at which you personally cease to relax in that regard? (It will be different for all of us but with the 3bc money tree beginning to look close to bare per their accounts,  and fan ownership off to a stuttering start and players on contracts which extend beyond this season, I do think given our history we should be sensitive to ensuring we are sustainable). 

Edited March 25, 2022 by jaf

[jaggy]

1 hour ago, Norgethistle said:

I see someone has posted on P&B (Yes I Know) that Holt is on £1200 a week, if true it’s a ridiculous wage for a championship team.

Maybe that includes bonuses? I also heard that at least one player at Arbroath, O’Brien I think, is on £900 as a part timer!

[Third Lanark]

10 minutes ago, jaggy said:

Maybe that includes bonuses? I also heard that at least one player at Arbroath, O’Brien I think, is on £900 as a part timer!

I can top that even- as allegedly League one team Falkirk are paying a player £1500 a week 

[laukat]

Again not an expert so this could very well be the equivalent of taking 2+2 and making 22.

I had a we look back at the accounts to try and see what our wage bill looked like under previous boards. The format of the accounts change to current format from 2013 so its only really possible to compare accounts from 2013 to current.

The table below is what I got to

Leage Status	Year	Turnover	Wages	%	No of employees	No of playing staff	No Non playing staff
League 1	2021	1477825	1453888	98%	87	22	65
Championship	2020	2660597	2043372	77%	86	26	60
Championship	2019	3040329	1954075	64%	83	24	59
Premier league	2018	4552558	2788507	61%	95	35	60
Premier league	2017	4101609	2605326	64%	83	35	48
Premier league	2016	3281221	2095796	64%	77	34	43
Premier league	2015	3035398	2046315	67%	75	30	45
Premier league	2014	2852295	1672749	59%	76	22	54
Championship	2013	1647457	899328	55%	78	22	56

I think this implies a few things:
1. The last 2 years have shown a lack of control on the wage bill relative to turnover

2. The lack of control on wages relates to the increase in no of employees

3. The rise in no of employees is in non playing staff. 

4. If we assume the football management team are in the non-playing numbers they are unlikely to be the reason why staff numbers have risen as we have at best 2 extra coaches than previous years.

5. Non playing staff appears to have increased by 5 when we got relegated to league 1. Surely the opposite would be expected ? relegation =less income=downsize= redundancies. Why does a league 1 club need 65 non-playing staff when a premier league club could operate on as little as 43?

6. Our non playing staff compliment was higher last season than at any point when we in the premier league. Why did we not downsize non-playing staff when we got relegated from the premier? Does JLow want to transfer to the fans so they do the dirty work of making the required redundancies on the non-playing side?

 

 

 

[Lenziejag]

6 hours ago, jaf said:

But if you compare them to other clubs, we  seem to have wasted the covid dividend others have enjoyed.  That much is clear.?  
falkirk were full time in the division and made a profit without a £500k subsidy from 3bc. 
I am not making any inference on the financial position of the club simply providing context as to how they have performed.  We should surely be allowed to talk about context and performance off the field as much as on it?

There could be lots of conjecture and grey areas, excuses and spin put forward.  That’s why the absolute facts of us compared to other similar clubs is contextually important.  No hijacked narrative, no speculation - facts. 

But to speculate for a moment (!) ,  what if the current (2022 season / accounting year) contained a further £500k or so of non recurring exceptional income, would you be equally  relaxed (given your excuses / reasons have ceased to exist this year)?  What’s the number at which you personally cease to relax in that regard? (It will be different for all of us but with the 3bc money tree beginning to look close to bare per their accounts,  and fan ownership off to a stuttering start and players on contracts which extend beyond this season, I do think given our history we should be sensitive to ensuring we are sustainable). 

Sorry Jaf, I haven’t looked at Falkirk’s accounts and even if I did they probably wouldn’t show what is really going on. Business’publish as little as they can get away with. I am not trying to spin anything, and I don’t recall saying I was relaxed particularly.

[jags on tour]

I really hope Queens Park are groundsharing with us again next year so we can actually say it for real!

https://www.bbc.co.uk/sport/football/60763899

Edited March 25, 2022 by jags on tour

[Lenziejag]

7 hours ago, jaf said:

But if you compare them to other clubs, we  seem to have wasted the covid dividend others have enjoyed.  That much is clear.?  
falkirk were full time in the division and made a profit without a £500k subsidy from 3bc. 
I am not making any inference on the financial position of the club simply providing context as to how they have performed.  We should surely be allowed to talk about context and performance off the field as much as on it?

There could be lots of conjecture and grey areas, excuses and spin put forward.  That’s why the absolute facts of us compared to other similar clubs is contextually important.  No hijacked narrative, no speculation - facts. 

But to speculate for a moment (!) ,  what if the current (2022 season / accounting year) contained a further £500k or so of non recurring exceptional income, would you be equally  relaxed (given your excuses / reasons have ceased to exist this year)?  What’s the number at which you personally cease to relax in that regard? (It will be different for all of us but with the 3bc money tree beginning to look close to bare per their accounts,  and fan ownership off to a stuttering start and players on contracts which extend beyond this season, I do think given our history we should be sensitive to ensuring we are sustainable). 

I have just had a look at Falkirk. Their accounts don’t have a profit and loss - only a balance sheet, and unless I am missing something had retained earnings of 142K in 2020 to  retained loss of £111K in 2021 - so a loss of £250 K.

Their cash balance has increased, but it looks like they have issued nearly £275K shares.

[Lenziejag]

1 hour ago, laukat said:

Again not an expert so this could very well be the equivalent of taking 2+2 and making 22.

I had a we look back at the accounts to try and see what our wage bill looked like under previous boards. The format of the accounts change to current format from 2013 so its only really possible to compare accounts from 2013 to current.

The table below is what I got to

Leage Status	Year	Turnover	Wages	%	No of employees	No of playing staff	No Non playing staff
League 1	2021	1477825	1453888	98%	87	22	65
Championship	2020	2660597	2043372	77%	86	26	60
Championship	2019	3040329	1954075	64%	83	24	59
Premier league	2018	4552558	2788507	61%	95	35	60
Premier league	2017	4101609	2605326	64%	83	35	48
Premier league	2016	3281221	2095796	64%	77	34	43
Premier league	2015	3035398	2046315	67%	75	30	45
Premier league	2014	2852295	1672749	59%	76	22	54
Championship	2013	1647457	899328	55%	78	22	56

I think this implies a few things:
1. The last 2 years have shown a lack of control on the wage bill relative to turnover

2. The lack of control on wages relates to the increase in no of employees

3. The rise in no of employees is in non playing staff. 

4. If we assume the football management team are in the non-playing numbers they are unlikely to be the reason why staff numbers have risen as we have at best 2 extra coaches than previous years.

5. Non playing staff appears to have increased by 5 when we got relegated to league 1. Surely the opposite would be expected ? relegation =less income=downsize= redundancies. Why does a league 1 club need 65 non-playing staff when a premier league club could operate on as little as 43?

6. Our non playing staff compliment was higher last season than at any point when we in the premier league. Why did we not downsize non-playing staff when we got relegated from the premier? Does JLow want to transfer to the fans so they do the dirty work of making the required redundancies on the non-playing side?

 

 

 

You may well be right on the numbers, although it doesn’t necessarily mean full time. 
Regards 2020 wages to turnover, there wasn’t really much that could have been done, given how late the season was curtailed. 
I guess 2021 was a concious decision, so not out of control, particularly. I guess it depends on how turnover matched forecast.