£30m loss for Boro

An extract of what I posted on February 17th in black type, with update based on Published Accounts for June 2021 in red type:

2020-21 is not yet published. Turnover will not have changed substantially from £19.4m It fell to just £14.5m with just £65k from tickets
but Operating Costs will have been slashed with perhaps £10m saved from the £31m Wage bill. The wage bill fell just £4.0m to £27.0m and other Costs remained high
We will have still been stuck with high amortisation unless there was some impairment included in the 2019-20 numbers. (Stoke type behaviour)
Amortisation charge for the year reduced by £5.9m, but a £1.5m impairment/write off was taken
We didn't really sell anyone at profit above book value that I can think of. There was a £4.3m profit on player disposals within PBT
There was also £4.6m other income from PL grant, Insurances taken and Furlough scheme within PBT
I reckon the Pre Tax loss will be c-£25m minimum before (FFP) allowables. Profit Before Tax was -£30.8m
It is however reasonable to expect a continuation of £3.1m depreciation, £3m Academy plus U21 wages and modest Community spend. Academy, Womens and Community spends are invisible. Depreciation was £3.1m, but Covid allowance could have been as much as £5m.
Who knows whether there was another surplus from Fixed Asset valuation. There was another + £5.4m revaluation of Fixed Assets
I'd predict a FFP loss of c-£18m for 2020-21.
Given the bigger Pre Tax loss, revaluation of fixed assets and confirmation of the Covid allowance (£5m for 2020 and 2021 and £2.5m for 2022) I believe the FFP loss for 2020-21 will actually be smaller, perhaps nearer -£13m. Furthermore the 2020 FFP loss will be lower too perhaps at £24m because of the Covid £5m allowance for that season too.
2020-21 3 year period is the average of 2019-20 and 2020-21, plus 2018-19 and plus 2017-18.
The 3 year number would therefore be (-£29.0m -£18.0m)/2) +£6.7m +£8.6m. This equals -£8.2m, well within the lower limit of £15m exc Equity considerations.
Even if I have got the 2020-21 PBT loss wrong by £7m there is still no FFP exposure at all likely. I was wrong by £6m.
Even if there is, the amount of Group Undertaking GON would have to just commit to equity is extremely small.
Again absolutely nothing to worry about here.
The 3 Year number for June 2021 would now be more like (-£24.0m-£13.0m)/2 +£6.7m + £8.6m. for This equals -£3.2m. Absolutely nothing to worry about.

Furthermore now with the relief to come from further fall in amortisation charge for this season together with the return of ticket revenues and higher sponsorships, Gibson has the club FFP conforming comfortably.

It is worth noting however that this does not mean the Club is in good shape. Any business that actually loses so much on such low turnover is only kept afloat through equity injections, Undertakings (loans) from its owner, or other loans.
The Nett Shareholder Value of the Club is now a staggering -£117m. The Club owe the EFL £7.9m now from Covid relief loans and owe the Parent Group a whopping £121m.
Steve has injected no further equity and does not need to pledge so from an FFP perspective, but simply put, without his funding we are ****ed.

For what its worth I am personally deeply grateful for Gibson's finances and commitment and I am now increasingly confident he has his mojo back and is making good key footballing decisions again following the disasters of 2016-2020.
I am desperately hoping we can go up this season, or at latest next, so that Gibson can actually stop having to fund the club in this ever increasing way he does in the Championship.
 
indeedido said:
For what its worth I am personally deeply grateful for Gibson's finances and commitment and I am now increasingly confident he has his mojo back and is making good key footballing decisions again following the disasters of 2016-2020.
Click to expand...
Agree very much with this, I think it's easy from the outside to criticise some deceions, even more so with the benefit of hindsight, but every deceion he makes is in good faith and in the interests of MFC.

I hope he's overseeing the club for many years to come, we're very lucky to have him.
 
For the first time in LONG while, we actually have assets saleable above book Value. Fry, spence, tav, Jones, mcnair.

Either we get promoted and the filthy lucre of the prem sorts us out, or, we have assest we can sell to balance the books if need be.
 
BoroMart said:
they'll be having an absolute meltdown in the midlands about this
Click to expand...
They are. In replies to to the price of football twitter post there are loads of Derby fans calling it corruption and coming up with crazy maths to accuse Boro of failing FFP.

It's clearly not an ideal situation financially, and not sustainable. But that's why there has been so much financial support during Covid, because very few businesses were sustainable during the lockdowns!
 
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Any thoughts on the current liabilities ? In any normal business you’d have a hard time convincing the auditors with net liabilities as big as that , that you were a viable going concern ! Not read beyond the initial balance sheet though ….
 
Johnnyweetabix said:
Any thoughts on the current liabilities ? In any normal business you’d have a hard time convincing the auditors with net liabilities as big as that , that you were a viable going concern ! Not read beyond the initial balance sheet though ….
Click to expand...
There has been a note in the accounts in previous years saying the owners guarantee the losses and are content with the situation.
 
indeedido said:
An extract of what I posted on February 17th in black type, with update based on Published Accounts for June 2021 in red type:

2020-21 is not yet published. Turnover will not have changed substantially from £19.4m It fell to just £14.5m with just £65k from tickets
but Operating Costs will have been slashed with perhaps £10m saved from the £31m Wage bill. The wage bill fell just £4.0m to £27.0m and other Costs remained high
We will have still been stuck with high amortisation unless there was some impairment included in the 2019-20 numbers. (Stoke type behaviour)
Amortisation charge for the year reduced by £5.9m, but a £1.5m impairment/write off was taken
We didn't really sell anyone at profit above book value that I can think of. There was a £4.3m profit on player disposals within PBT
There was also £4.6m other income from PL grant, Insurances taken and Furlough scheme within PBT
I reckon the Pre Tax loss will be c-£25m minimum before (FFP) allowables. Profit Before Tax was -£30.8m
It is however reasonable to expect a continuation of £3.1m depreciation, £3m Academy plus U21 wages and modest Community spend. Academy, Womens and Community spends are invisible. Depreciation was £3.1m, but Covid allowance could have been as much as £5m.
Who knows whether there was another surplus from Fixed Asset valuation. There was another + £5.4m revaluation of Fixed Assets
I'd predict a FFP loss of c-£18m for 2020-21.
Given the bigger Pre Tax loss, revaluation of fixed assets and confirmation of the Covid allowance (£5m for 2020 and 2021 and £2.5m for 2022) I believe the FFP loss for 2020-21 will actually be smaller, perhaps nearer -£13m. Furthermore the 2020 FFP loss will be lower too perhaps at £24m because of the Covid £5m allowance for that season too.
2020-21 3 year period is the average of 2019-20 and 2020-21, plus 2018-19 and plus 2017-18.
The 3 year number would therefore be (-£29.0m -£18.0m)/2) +£6.7m +£8.6m. This equals -£8.2m, well within the lower limit of £15m exc Equity considerations.
Even if I have got the 2020-21 PBT loss wrong by £7m there is still no FFP exposure at all likely. I was wrong by £6m.
Even if there is, the amount of Group Undertaking GON would have to just commit to equity is extremely small.
Again absolutely nothing to worry about here.
The 3 Year number for June 2021 would now be more like (-£24.0m-£13.0m)/2 +£6.7m + £8.6m. for This equals -£3.2m. Absolutely nothing to worry about.

Furthermore now with the relief to come from further fall in amortisation charge for this season together with the return of ticket revenues and higher sponsorships, Gibson has the club FFP conforming comfortably.

It is worth noting however that this does not mean the Club is in good shape. Any business that actually loses so much on such low turnover is only kept afloat through equity injections, Undertakings (loans) from its owner, or other loans.
The Nett Shareholder Value of the Club is now a staggering -£117m. The Club owe the EFL £7.9m now from Covid relief loans and owe the Parent Group a whopping £121m.
Steve has injected no further equity and does not need to pledge so from an FFP perspective, but simply put, without his funding we are ****ed.

For what its worth I am personally deeply grateful for Gibson's finances and commitment and I am now increasingly confident he has his mojo back and is making good key footballing decisions again following the disasters of 2016-2020.
I am desperately hoping we can go up this season, or at latest next, so that Gibson can actually stop having to fund the club in this ever increasing way he does in the Championship.
Click to expand...
Great summary - thanks
One day, of course, we will not be able to rely on SG.
I guess that means, without someone similar, the club as we know it could be very different.
For those younguns around (1990’s onwards that might be a big issue for them.
 
1finny said:
Great summary - thanks
One day, of course, we will not be able to rely on SG.
I guess that means, without someone similar, the club as we know it could be very different.
For those younguns around (1990’s onwards that might be a big issue for them.
Click to expand...
Cheers 1finny.
The Club could operate without Gibson's finance in the PL, but not in the Championship, there simply isn't the revenue.
If we had to rely on Gibson for financing step change huge PL losses, then he simply couldn't do it, GO'N isn't big enough.
We could operate in the PL, keep head above water and not need additional GO'N funding.

I answer to another queryOur current liabilities are mainly in the form of Group Undertakings (loans) that cover the losses the club makes every season outside the top flight. If the Parent GO'N pledge not to recall these loans within 12 months then the Club can continue to trade as a Going Concern. This is what Steve does.
We need a healthy Bulkhaul outside the Championship and promotion to the PL to give Gibson a break.
 
There's a well established FFP thread on Bristol City's forum that is pretty interesting for anyone financially-minded.
Brizzle view
They have commented on our results saying 'no issue' with regards to our latest accounts (y)

The Championship really is a basket case but at least Gibbo's action with Derby and the Covid crisis might get Clubs to be a bit more sensible?
At least we are now on an upwards trajectory with a lower wage bill and a few decent FA Cup pay days under our belt.
We've also got the Djed Spence fortune incoming (hopefully).

UTB
 
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