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lucky green trainers

i think we'll see a 15% s/ticket price hike next time???

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the board must know they need to invest more in the squad, but clearly player wage inflation is ripping ahead - there''s loadsa dosh flying around the prem and champs.  sure, i''m not happy with sky money and billionaire investors economically distorting our game, and pricing out less wealthy punters, (and old traditional profit making clubs like ours) but if you can''t stand the heat, there''s plenty of other ambitous clubs willing to take our place.  i want to see city challenging for the top, not fearing relegation to league 1.its time the board (and some supporters) got real- we''ve flirted/flirting with relegation, and surely roeder needs a decent spend in the jan window to buy the quality we need to stay up and provide a platform for next season.so as well as investing extra into the squad, i think the board will look to get some back from season ticket holders - expect a decent spend by roeder in jan, but also a big inflation busting hike in ticket prices for next season.  the board will risk losing some supporters, but know a stronger squad and hopefully better performances will see full houses, comprised of a greater percentage of lucrative members/casuals.in short its win/win to bump up the ticket prices - its gotta happen imo if we want better players here.  oh - and i''m not dripping with dosh either - the missus had to jack her season ticket in this year.  its time to ditch the little naaarwich B/S and get upto speed with whats going on around us.

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[quote user="lucky green trainers"]

so as well as investing extra into the squad, i think the board will look to get some back from season ticket holders - expect a decent spend by roeder in jan, but also a big inflation busting hike in ticket prices for next season.  the board will risk losing some supporters, but know a stronger squad and hopefully better performances will see full houses, comprised of a greater percentage of lucrative members/casuals.

[/quote]

Given the dire football we have had to endure for two and quarter seasons, I think the fans would want to SEE our form continue to the end of the season first and some quality signings such as Taylor and Ameobi (or similar) first.  Delivery before spin!

Secondly the board has had the money but have decided to spend it on non critical fixed assets rather than the team, so I dont think a 15% rise would go down very well! 

Anyway OTBC!

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[quote user="Canary Nut"]

[quote user="lucky green trainers"]

so as well as investing extra into the squad, i think the board will look to get some back from season ticket holders - expect a decent spend by roeder in jan, but also a big inflation busting hike in ticket prices for next season.  the board will risk losing some supporters, but know a stronger squad and hopefully better performances will see full houses, comprised of a greater percentage of lucrative members/casuals.[/quote]

Given the dire football we have had to endure for two and quarter seasons, I think the fans would want to SEE our form continue to the end of the season first and some quality signings such as Taylor and Ameobi (or similar) first.  Delivery before spin!

Secondly the board has had the money but have decided to spend it on non critical fixed assets rather than the team, so I dont think a 15% rise would go down very well! 

Anyway OTBC!

[/quote]i think therein lies the problem - the board have lost credibility and trust with their ''cleverer'' strategies.  how many fans would stump up to buy shares now??? i hoping CN that there is extra investment and that this will become clear in the jan window - but if so, we could see a double digit s/ticket price hike, but clearly for people to stand it, roeder would need to spend the right amount.  only another 4 weeks to see who we get - (we never buy first week!!!)

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On the subject of non-critical capital expenditure, last year the main expense was GBP1.2m for a new road which was required to meet planning obligations and therefore was critical. GBP0.5m was spent on a  sport project but this was mainly funded by a grant. GBP0.4m was spent on offices but generates rental income of GBP0.15m which appears to be a very good return.

In previous years I understand the main capex has been the replacement of the South Stand which I understand was necessary and the conrner infill - given the crowds the corner infill would appear to be paying for itself.

Incidentally the catering business made a net contribution of GBP0.6m.

Clearly the club has underperformed where it matters but the recurring argument about money being wasted on non critical fixed assets does not appear to stand up to scrutiny.

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[quote user="T"]

On the subject of non-critical capital expenditure, last year the main expense was GBP1.2m for a new road which was required to meet planning obligations and therefore was critical. GBP0.5m was spent on a  sport project but this was mainly funded by a grant. GBP0.4m was spent on offices but generates rental income of GBP0.15m which appears to be a very good return.

In previous years I understand the main capex has been the replacement of the South Stand which I understand was necessary and the conrner infill - given the crowds the corner infill would appear to be paying for itself.

Incidentally the catering business made a net contribution of GBP0.6m.

Clearly the club has underperformed where it matters but the recurring argument about money being wasted on non critical fixed assets does not appear to stand up to scrutiny.

[/quote]

As you stated: Clearly the club has underperformed where it matters but the recurring argument about money being wasted on non critical fixed assets does not appear to stand up to scrutiny.

YIPEE![<:o)] So that''s alright then......The club''s only underperformed where it matters... Phew, I thought they they only underperformed where it didn''t really matter. I can rest easy now.......So they can perform without scrutiny  - on the non critical fixed assets, and therefore, shouldn''t  be scrutinised for them, as they''ve performed ''admirably'' with those?[:|] 

So, in that case, let''s stop bashin'' the board with a big bat.....They''re doin'' awreeet!.......as long as only under-performing where it matters doesn''t appear to stand up to scrutiny either.........Terrific![8-)]

 

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[quote user="T"]

On the subject of non-critical capital expenditure, last year the main expense was GBP1.2m for a new road which was required to meet planning obligations and therefore was critical. GBP0.5m was spent on a  sport project but this was mainly funded by a grant. GBP0.4m was spent on offices but generates rental income of GBP0.15m which appears to be a very good return.

In previous years I understand the main capex has been the replacement of the South Stand which I understand was necessary and the conrner infill - given the crowds the corner infill would appear to be paying for itself.

Incidentally the catering business made a net contribution of GBP0.6m.

Clearly the club has underperformed where it matters but the recurring argument about money being wasted on non critical fixed assets does not appear to stand up to scrutiny.

[/quote]

"GBP1.2m for a new road which was required to meet planning obligations and therefore was critical."

A new road to where? to the pitch or another off the pitch investment?

"Incidentally the catering business made a net contribution of GBP0.6m"

The catering made a good profit before the millions spent on refurbishments.

Ambition off the pitch and prudence on the pitch stands out a mile.

But then lots of nice none football investments at Carrow Rd bumps up NCPLC share price  for when the board sell their shares.

 

FOOTBALL MUST COME FIRST

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....are those yellow boxers getting in a bit of a twist?....

I''d say the key decisions that the Board make which contribute to performance are the allocation of funds and the appointment of the manager.

It has been repeatedly suggested that a key reason for the underperformance are the Board''s decisions to allocate fund to non-essential fixed assets but this does not appear to be the case.

In respect of the manager, they do appear to have hung onto Worthington too long which is understandable given his previous success in the championship and the appointment of PG did not work out. I''d suggest that these are the main reasons for the underperformance. Those decisions can not not be changed but the last key decision to appoint GR appears to be good so far despite initial reservations.

Reality is that financially we are now a mid-table championship club given that TV/parachute money and personal wealth have such a significant impact compared with attendances. I think the best way to outperform that position is ensure that you have the best football manager possible, a decision that the Board have hopefully got right this time.

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The current ''real world'' economic climate would not stand a price hike of 15%.

Sadly football lives in another world to the real world!

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[quote user="T"]

On the subject of non-critical capital expenditure, last year the main expense was GBP1.2m for a new road which was required to meet planning obligations and therefore was critical. GBP0.5m was spent on a  sport project but this was mainly funded by a grant. GBP0.4m was spent on offices but generates rental income of GBP0.15m which appears to be a very good return.

In previous years I understand the main capex has been the replacement of the South Stand which I understand was necessary and the conrner infill - given the crowds the corner infill would appear to be paying for itself.

Incidentally the catering business made a net contribution of GBP0.6m.

Clearly the club has underperformed where it matters but the recurring argument about money being wasted on non critical fixed assets does not appear to stand up to scrutiny.

[/quote]

You have misunderstood what I have defined as critical and non critical fixed assets.

Critical fixed assets includes: The Jarrold stand, the pitch replacement, the boiler house, the ex LSE land, the ex City Council land and the spine road.

The sports project as you correctly point out is mainly externally funded so can be put to one side within this discussion.

 

T stated:

''GBP0.4m was spent on offices but generates rental income of GBP0.15m which appears to be a very good return.''

The cost is approx. £1.2m!  Its more than the £0.4m in the 06/07 Accounts.

I hope the period of the rental agreements cover the time it will take to pay off the related loan. 

 

T stated:

''the conrner infill - given the crowds the corner infill would appear to be paying for itself.''

The financial payback is long (6.6 years excluding interest etc) assuming that the revunue from the stand can be maintained at £500k (a figure quoted by N Doncaster in the local media) per season. 

 

T stated:

''argument about money being wasted on non critical fixed assets does not appear to stand up to scrutiny. ''

May I suggest you have another look at what the non critical asset spend was actually spent on, the costs and the long financial payback periods in the context of a squad getting weaker and the debt level. 

 

 

 

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the board could of course try and win the fans back over by freezing (or god forbid) reducing Ticket prices next time out....

theyd hike them up if we went down, to "cover the loss of not being in the championship" meaning we''d pay more than any other side... theyd hike them up if we went up as we "are now in the premiershiup and prices reflect this accordingly" and they''d hike them up if we stay in the division as "we no longer have parachute payments" im willing to bet

 

jas :)

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CN - thank you for coming back with some  informed arguments as opposed to a rant. I''ve had another look at the capex using the accounts and the benefit of your helpful additional information. 

On a simplistic basis if the offices generate 0.15m on a 1.2m investment then that is a 12.5% yield which is more than the interest cost of the loan (2% above base) which was specifically taken out to finance the investment and is therefore generating net income.

Similarly, if the corner infill has a 6.6 year return that suggests a 15% yield which is again more than the cost of the loans which are around 7.5% or 2% above base rate.

The loans for both these assets were made available on the basis that they are secured on the related revenue/assets i.e. would not have been available to purchase players as the banks would not have had any security.

Consequently, the offices and corner infill are actually generating additional income which would otherwise not be available and therefore provide additional income to finance the football side. Ergo, these decisions are not only good commercial decisions but also good football decisions and help the squad to be stronger than it otherwise would be. 

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If you want better then you had better be prepared to stump up.

There are plenty of concessions at Carrow Road, yes, the prices to watch football are ridiculous anyway but for a bigger and more capable squad 15% is tolerable.

I would like to see the Club have a good look at these concessions too. It is perfectly possible for an adult who can only get to the odd game to buy his child a season ticket and simply pay the extra when able to go themselves (or not as I suspect some do) thus guaranteeing themselves the opportunity for a seat.

I suggest the Club have a good look at their concessions and cap season tickets at 19000 which should be acheivable through pricing. There needs to be a good look at seat allocations with flexible seating areas being re-introduced, probably in the family areas.

In prime cost areas, season tickets should carry the names of two persons so they can be transferable (aren''t they already) between those who like to game-share.

There is plenty of scope here - the average fan seems to be a forty-something male who would like the flexibility to sit with friends or share the seat(s) with a group - depending on who can and cannot make it. Remember, at any home game there are 1000 to 2000 season ticket holders who are not there.

Yes, a price hike is needed - but there needs to be a commitment to the playing squad, a review of season ticket strategy plus an upgrade of facilities/matchday freebies to make the whole experience better. For what they pay the lower barclay get good facilities whereas the N & P get a dungeon with a jazz club slapped on the side.

I would like to see more distinct areas based upon names of prominent players thus block C of the Lower Barclay might be the Huckerby section with spin off themes.

These are pretty random ideas I know but I do believe there is plenty of scope to look at the whole ticketing situation.

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[quote user="RUDOLPH HUCKER"]

If you want better then you had better be prepared to stump up.

There are plenty of concessions at Carrow Road, yes, the prices to watch football are ridiculous anyway but for a bigger and more capable squad 15% is tolerable.

I would like to see the Club have a good look at these concessions too. It is perfectly possible for an adult who can only get to the odd game to buy his child a season ticket and simply pay the extra when able to go themselves (or not as I suspect some do) thus guaranteeing themselves the opportunity for a seat.

I suggest the Club have a good look at their concessions and cap season tickets at 19000 which should be acheivable through pricing. There needs to be a good look at seat allocations with flexible seating areas being re-introduced, probably in the family areas.

In prime cost areas, season tickets should carry the names of two persons so they can be transferable (aren''t they already) between those who like to game-share.

There is plenty of scope here - the average fan seems to be a forty-something male who would like the flexibility to sit with friends or share the seat(s) with a group - depending on who can and cannot make it. Remember, at any home game there are 1000 to 2000 season ticket holders who are not there.

Yes, a price hike is needed - but there needs to be a commitment to the playing squad, a review of season ticket strategy plus an upgrade of facilities/matchday freebies to make the whole experience better. For what they pay the lower barclay get good facilities whereas the N & P get a dungeon with a jazz club slapped on the side.

I would like to see more distinct areas based upon names of prominent players thus block C of the Lower Barclay might be the Huckerby section with spin off themes.

These are pretty random ideas I know but I do believe there is plenty of scope to look at the whole ticketing situation.

[/quote]some interesting points raised rude old.  like the idea of 2 people named on the season ticket.  maybe 15% is too high in one season, but maybe over 2 or 20 over 3.  either way, if the board does back roeder properly in the jan window, i wouldn''t be surprised to see our ticket policy overhauled, and price hikes above inflation - until a sensible level of season ticket holders is reached.  say 15,000 to 17000

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[quote user="T"]

On a simplistic basis if the offices generate 0.15m on a 1.2m investment then that is a 12.5% yield which is more than the interest cost of the loan (2% above base) which was specifically taken out to finance the investment and is therefore generating net income.

[/quote]

 

Using your figures:

Interest 7.5% on £1.2m = £90k / 2 -> average interest £45k pa. (as interest highest in year1 and lowest during the last year)

Rental £150k - average interest £45k --> £105k towards capital repayment

£1.2m / £105k --> 11.4 years in payback terms

So contribution towards the team would start after 11.4 years

 

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[quote user="T"]

The loans for both these assets were made available on the basis that they are secured on the related revenue/assets i.e. would not have been available to purchase players as the banks would not have had any security.

[/quote]

If I remember correctly the loan for the Community (corner) stand is secured against a specific tangible asset. Whereas the loan related to the Jarrold stand (and working capital) was a securitised loan secured against future revenues rather than a specific tangible asset.

As for securitised loans, I thought some clubs have used part of these loans  to finance the purchase of players e.g., Ipswich.  Finidi George £3m. and Sereni £4m.

 

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CN - I agree that a price hike may actually be counter-productive, not only in terms of revenue but atmosphere if they don''t get full houses. You can only find out by testing the market though.

Good analysis CN. I did a quick annual cash flow for the offices and the community stand based on the accounts and your figures.

The Stand appears is be cash flow positive after interest and loan repayments from year 1 so was a good decision.

The offices make economic sense because the yield is higher than the interest costs but you are right there is some nagative cash impacts. Year 1 they contribute 50k because of the repayment holiday, then negative 68k in year 2 with the negative cash flow reducing each year as the loan is repaid and the interest reduces until cash flow neutral at year 9 after which time it is cash positive. So although I wish I could get a yield of 12.5% I agree that the offices are long term rather than short term but the cash impact would not make much difference to the squad.

In respect of loans it is good business practice to only take on long term liabilities (i.e.loans) to fund long term assets i.e. revenue generating infrastrucure rather than short term player expenditure. Furthermore, we do not have the cashflows or headroom to take on loans to expense it on players and the club and the banks would be foolhardy to do so.

Overall, the evidence to date indicates that the club''s investment and commercial activities have made a positive contribution to the money available for the squad.

More, interesting is how much cash is available in January. I have not run the figures in detail but reckon we could cope with spending about 2m.

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