On 29 January 2008 Norwich had a 850,000 bid rejected by Scunthorpe

[blahblahblah 2]

[quote user="Mello Yello"]

You''re doing it again.....If you or any other posters for that matter, find what I type ''disturbing''.....Tell the mods and I''m sure that they''ll sort it out.

Although, it''s ok for you to dish it out.....but, when it''s flung at you....Boo Hoo...Miss! Miss![:''(] Gerrover it!

[/quote]Ok Mello, what time will you be getting there ?  Which gate will you be going through ?  What pie will you be eating at half time ?  What time will you fall asleep in your own drool ?  And how long after the game will people nudge you to wake you up ?More to the point, what business is it of mine ?

[Mello Yello 2,294]

[quote user="blahblahblah"][quote user="Mello Yello"]

You''re doing it again.....If you or any other posters for that matter, find what I type ''disturbing''.....Tell the mods and I''m sure that they''ll sort it out.

Although, it''s ok for you to dish it out.....but, when it''s flung at you....Boo Hoo...Miss! Miss![:''(] Gerrover it!

[/quote]

Ok Mello, what time will you be getting there ?  Which gate will you be going through ?  What pie will you be eating at half time ?  What time will you fall asleep in your own drool ?  And how long after the game will people nudge you to wake you up ?

More to the point, what business is it of mine ?
[/quote]

7:24 and 19 seconds pm, Cathedral Lounge, No pies, my body is a temple, comatose 97% of the time, impervious nosebag catches drool, if anyone dare to wake me up? I pour my ''drool bag'' contents over them....

I''m still youngish you know....don''t stereotype the Cathedralists...See you there?

[norfolkbroadslim 223]

Some very interesting points raised, I especially gained some entertainment from the blah & mello show.............

It is a very valid point to make that our defence has been woeful this season.  Had we had even a couple of half decent strikers, would this not have eased the pressure on the defence?  Holding the ball up, scoring goals, tracking back.

Is it any wonder the number of goals we have conceded, with the defence and midfield out of poistion trying to score the goals they know the strik....people who play up front won''t score.[:^)]

[blahblahblah 2]

[quote]I''m still youngish you know....don''t stereotype the Cathedralists...See you there?[/quote]After a brief conversation with the ticket office I''ve come to the conclusion that I''m not a very good fan.  27 quid for a ticket at the back of the stand, or a night in the pub with a couple of orange juices ?  That''s what Rupert Murdoch has brought me to. I know I know, I''m a terrible fan, but I can do a lot with that cash.  Sorry !  Enjoy the game.

[blahblahblah 2]

[quote]It is a very valid point to make that our defence has been woeful this

season.  Had we had even a couple of half decent strikers, would this

not have eased the pressure on the defence?  Holding the ball up,

scoring goals, tracking back.[/quote]We have been crying out for a striker in the Iwan Roberts mould, that is for sure.  Mind you, if Cureton had put half of his chances away, we''d probably be mid-table now, how many of our 10 draws could have been wins ?  It''s a fine line.

[T 190]

[quote user="Tangible Fixed Assets anyone"][quote user="T"]

 The one that is open to question is the property development which is costing the club 300k p.a.At the time the decision was made it had a projected profit of 3m which is clearly not the case now.

[/quote]

The acquisition of the ex LSE land and ex Norwich City Council indicates a failure to recognise how far we were up the up part of the cycle. Furthermore to fund the purchase, £2.75m, of the ex land LSE land with a £2.5m loan has not helped the playing side of the business.

[/quote]

 

Agreed. There was clearly warning signings of a bubble but given the IMF has estimated the problem this week at 4 trillion, the club was hardly alone in misjudging the market. Basically anyone owning property or shares has made a mistake if they did not sell up by August 2008 so the Board made a mistake but so have the majority. I suspect the property will not be great but ok longer term. Also you could argue given the potential profits it was worth the risk as not taking the chance would have shown a lack of ambition for the club.

[T 190]

[quote user="Tangible Fixed Assets anyone"][quote user="T"]

 So for instance if you look at the cashflows for the offices, you take a loan out which would only be made available for property and not for players and the rents exceeds the loan repayments and interest payments then the transaction increases the cash available to spend on players. [/quote]

But you need a rental contract(s) that is long enough to provide sufficient residual cash (i.e. after servicing the related debt) to cover the cost of providing the offices in the first place, i.e., breakeven (payback).

Otherwise you may have an initial negative cashflow due to servicing costs plus section 106 planning obligations, then some years  of positive cashflow followed by years of negative cashflow if there is no rental but a loan to service.

[/quote]

I agree that you should make an allowance for vacant periods in making a property investment decision but you do not necessarily need a long term contract as , as I know myself, you can have a series of short term contracts which makes an investment equally viable providing you have the right property in the right location.

To be honest I suspect that the heart of our debate is that you are more risk adverse than I am. There is no right or wrong about attitude to risk - it is just a different view.

[T 190]

[quote user="Tangible Fixed Assets anyone"][quote user="T"]

Of course paybacks and cash flows are related. However, paybacks are too simplistic to show the whole story though as they ignore the cash profile and risk element as TFA has mentioned. Having a long payback period is not necessarily a good or bad thing e.g. a house, may have along payback period but has usually been a good long term investment in the UK. I just happen to have an issue with the use of over simplistic rules of thumb such as paybacks for making decisions as one the causes of the current financial crisis is the over use of overly simplified decision rules such as banks lending to businesses based on EBITDA multiples rather than looking at the cash flows and risks e.g. a discounted cash flow approach. [/quote]

You seem to miss the point that the payback method is a back of the envelope type calculation. You can then get a feel as to whether to spend time preparing a discounted cashflow. Both methods will indicate some feel as to when the project will breakeven. Even cashflows are subject to variation,  e.g.due to empty seats in the Community stand this season.

[/quote]

I totally agree that the payback is a back of an envelope calculation which is why I''ve such an aversion to it. It is ok for one class of asset with regular cash flows and as a sense check. The banks lend based on EBITDA multiples basically because it is quick and easy and because as one seasoned private equity investor pointed out a lot of them are really too thick to understand a set of financial projections so I really don''t like such methods as they helped casued the current financial crisis. The cash projections I did using your figures showed the comunity stand and offices made sense and the property investment is currently loss making. The club also did projections for a corner infill between the Barclay and jarrold and the figures did not make sense, hence the hotel. 

I agree that there might be potential to reduce overheads even though I dislike the idea of making low paid staff redundant to provide more money for already overpaid footballers.

[Mello Yello 2,294]

[quote user="blahblahblah"][quote]I''m still youngish you know....don''t stereotype the Cathedralists...See you there?[/quote]

After a brief conversation with the ticket office I''ve come to the conclusion that I''m not a very good fan.  27 quid for a ticket at the back of the stand, or a night in the pub with a couple of orange juices ?  That''s what Rupert Murdoch has brought me to. I know I know, I''m a terrible fan, but I can do a lot with that cash.  Sorry !  Enjoy the game.
[/quote]

....And you enjoy the orange juice...

[Mr.Carrow 376]

[quote user="T"][quote user="Tangible Fixed Assets anyone"][quote user="T"]

 The one that is open to question is the property development which is costing the club 300k p.a.At the time the decision was made it had a projected profit of 3m which is clearly not the case now.

[/quote]

The acquisition of the ex LSE land and ex Norwich City Council indicates a failure to recognise how far we were up the up part of the cycle. Furthermore to fund the purchase, £2.75m, of the ex land LSE land with a £2.5m loan has not helped the playing side of the business.

[/quote]

 

Agreed. There was clearly warning signings of a bubble but given the IMF has estimated the problem this week at 4 trillion, the club was hardly alone in misjudging the market. Basically anyone owning property or shares has made a mistake if they did not sell up by August 2008 so the Board made a mistake but so have the majority. I suspect the property will not be great but ok longer term. Also you could argue given the potential profits it was worth the risk as not taking the chance would have shown a lack of ambition for the club.

[/quote]

So T, do you think it would indicate ambition by the board if they flogged off any players worth any money, cutting player wages to the bone and invested in more land?  Methinks you don`t understand football......

[T 190]

Mr C, Having not played football professionally I would not clain to know anymore or less than the average punter in the street about football. I have though professionally reviewed the finances of a premiership football club for an acquisition and happen to agree with the views of Deloittes who have reviewed the finances of all football clubs and Peter Cullum in his assessment of the finances of football clubs who you  seem to disagree with. So by the same token do you really understand the finances of football or do you just think you do as you  seek to support your long held emotional views which run contrary to the rationale views of informed commentators?  

[Mr.Carrow 376]

I understand that in `02 we could afford to spend £5.2m on the most important thing at the club- the team- out of £15m income but having spent £30m on infrastructure since then we could only afford £1.9m out of £19m income in 2008.  So much for "other revenue streams"......

I understand that Preston cost £10m less to run than us, have 25 non-football staff compared to our 180-odd, but can afford to spend £5m out of ordinary income of £8.5m on their team.  I was chatting to a well-known local journalist last night who stated that he could not believe City employed five full-time staff in the press office when virtually everything goes through Doncaster anyway.

I understand that you think it is "ambitious" to have £6m of the clubs money tied up in land, a good deal of which came out of ordinary cashflow and could have been used to boost an ailing team- and that`s not to mention the impact of having a £2.5m loan repayment hanging over our heads for most of the season.

T`s response "footballs finances are in a mess".  What a lazy, catch-all, cop-out, meaningless platitude.  Give my regards to Niel T.....

[Mr.Carrow 376]

By the way T, you don`t appear to have answered my question.  If it`s "ambitious" for a football club to spend millions on land, do you think its a good move to realise the value in our intangible fixed asset players and re-invest that into good, solid fixed assets such as land?

[T 190]

The actual wage budget is 8.5m.

The Preston cash flows show they are reliant on player sales and investor input.

The land deal was specifically funded by an external loan which would not be available for players.

However, I do appreciate that you have argued this line for so long you will naturally want to deny the big picture financial reality of football finance highlighted by Deloittes and Peter Cullum.

[nutty nigel 7,535]

While I agree  that the land deal was specifically funded by a loan that couldn''t have been available to buy players I also see Mr Carrows and Tangies point (I think) in that this loan has to be paid back with money that could be used for players. No problem if the land deal in the end makes more money available but in the short term it certainly hasn''t. Although it could be said that the board would have to make up the shortfall with further investment so it could be said they have already paid for their mistake?

 

 

[T 190]

The loan has been rolled over. It is absolutely correct though that the loan is costing 300k a year interest which would otherwise be potentially available for players. I suspect you are right that the Board was hoping the prperty deal was done in which case they may not have put in another 2m this year themselves.

The financial crisis has certainly hit the club hard. Without the financial crisis then I suspect that the Turners would have put 2m in and the land could have made a 3m profit and the situation could have been very different given the thin line between success and failure. Irrespective the club has still woefully underperformed.

[gazzathegreat 0]

T, yes, the example you give could well have happened, but the current financial crisis didn''t happen four or five years ago did it? Since our season in the sun and the following relegation how do you account for serious underfunding of the squad? Buying lower quality than selling, until we reach the point we can but loan players.

Maybe the land deal will make a profit one day, but for a board whose very mantra is caution, it can''t be just me wondering what were they thinking of?

IMO the board''s philosophy hasn''t changed though the economic climate has. For all our advantages, size of season ticket base and the gains from promotion, their overall performance has been woeful. Yet they remain.

If Delia is at all concerned about having to continue to contribute so much of her own money perhaps she would do well to monitor the performance of the board and admit they have got it seriously wrong, then make steps to implement some changes which could help the club move forwards.

[ron obvious 1,502]

[quote user="T"]

The loan has been rolled over. It is absolutely correct though that the loan is costing 300k a year interest which would otherwise be potentially available for players. I suspect you are right that the Board was hoping the prperty deal was done in which case they may not have put in another 2m this year themselves.

The financial crisis has certainly hit the club hard. Without the financial crisis then I suspect that the Turners would have put 2m in and the land could have made a 3m profit and the situation could have been very different given the thin line between success and failure. Irrespective the club has still woefully underperformed.

[/quote]Absolutely. For example, PNE have been in or about the play-offs for the last few years, but last year they were 4 points off relegation.What you really need is a top class manager with CONSISTENTLY good results - & they''re as rare as rocking horse droppings; even then things can go pear-shaped, but by then you''re normally with a rich club & you can buy your way out of trouble. That''s what made Clough such an amazing manager, although he was the bright spark in an age of dinosaurs. I''m not sure he could do it today. Naah, he could, he really was a fecking genius.So much luck in football. It''s always easier with hindsight.Actually, I don''t believe in luck. It''s down to the impossibility of forming statistically significant predictive models given a googolplex of variables, each having many degrees of freedom.So let''s call it luck.

[T 190]

[quote user="gazzathegreat"]T, yes, the example you give could well have happened, but the current financial crisis didn''t happen four or five years ago did it? Since our season in the sun and the following relegation how do you account for serious underfunding of the squad? Buying lower quality than selling, until we reach the point we can but loan players. Maybe the land deal will make a profit one day, but for a board whose very mantra is caution, it can''t be just me wondering what were they thinking of? IMO the board''s philosophy hasn''t changed though the economic climate has. For all our advantages, size of season ticket base and the gains from promotion, their overall performance has been woeful. Yet they remain. If Delia is at all concerned about having to continue to contribute so much of her own money perhaps she would do well to monitor the performance of the board and admit they have got it seriously wrong, then make steps to implement some changes which could help the club move forwards.[/quote]

I agree we have underperformed for the last few seasons. Basically the club, like nearly all clubs, does not generate enough funds so is dependant on selling players or cash injections to meet the fans aspirations. On the land deal I suspect the Board saw an opportunity to break out of the cycle of decline and reduce their own contributions so I can understand the attraction. Unfortunately, ticket prices are so low and the money is going to finance the loans on the stands so the club doesn''t generate dramatically additional funds from the fan base and the gains on promotion have long since disappeared into the pockets of players, agents and managers as Peter Cullum pointed out. I would also like to see new input but as so many including PC has pointed out, football is great way to enrich players, managers and agents at one''s personal expense so it is difficult to find someone with the wealth and the inclination. I agree with PC that it is about time some financial rationality was brought into football which may happen in the current climate and that would give the club to leverage its fan base compared to other clubs.

[T 190]

[quote user="ron obvious"][quote user="T"]

The loan has been rolled over. It is absolutely correct though that the loan is costing 300k a year interest which would otherwise be potentially available for players. I suspect you are right that the Board was hoping the prperty deal was done in which case they may not have put in another 2m this year themselves.

The financial crisis has certainly hit the club hard. Without the financial crisis then I suspect that the Turners would have put 2m in and the land could have made a 3m profit and the situation could have been very different given the thin line between success and failure. Irrespective the club has still woefully underperformed.

[/quote]

Absolutely. For example, PNE have been in or about the play-offs for the last few years, but last year they were 4 points off relegation.
What you really need is a top class manager with CONSISTENTLY good results - & they''re as rare as rocking horse droppings; even then things can go pear-shaped, but by then you''re normally with a rich club & you can buy your way out of trouble. That''s what made Clough such an amazing manager, although he was the bright spark in an age of dinosaurs. I''m not sure he could do it today.
Naah, he could, he really was a fecking genius.
So much luck in football. It''s always easier with hindsight.
Actually, I don''t believe in luck. It''s down to the impossibility of forming statistically significant predictive models given a googolplex of variables, each having many degrees of freedom.
So let''s call it luck.



[/quote]

So true. Unfortunately, as studies always show people have a very poor understanding of the complexities of risk as the current market situation testifies. Far easier and more comprehensible to endulge in simple blame physchology. However, I would say that as we have consistently underperformed in recent seasons and therefore bad decision making does come into play as well as chance. In particular, I totally agree the manager selction is absolutely critical and as the Board have admitted they have got their choices wrong.

[lucky green trainers 0]

[quote user="gazzathegreat"]T, yes, the example you give could well have happened, but the current financial crisis didn''t happen four or five years ago did it? Since our season in the sun and the following relegation how do you account for serious underfunding of the squad? Buying lower quality than selling, until we reach the point we can but loan players.

Maybe the land deal will make a profit one day, but for a board whose very mantra is caution, it can''t be just me wondering what were they thinking of?

IMO the board''s philosophy hasn''t changed though the economic climate has. For all our advantages, size of season ticket base and the gains from promotion, their overall performance has been woeful. Yet they remain.

If Delia is at all concerned about having to continue to contribute so much of her own money perhaps she would do well to monitor the performance of the board and admit they have got it seriously wrong, then make steps to implement some changes which could help the club move forwards.[/quote]no - since they took over - and then sacked walker for a cruddy season even though we were showing credible signs of serious improvement that spring...its been disappointing ever since,,,rather than getting proper managers in with a credible budget to get the players in to do the job in hand - they have gambled time and time again with cleverer wheezes...having ditched mikey boy - hamilton was allowed to take a massive punt on free euro transfers,,,then worthy tired ex-league 1 players of the season,,,and thereafter mostly shite loanees...in my opinion therefore - the first priority of the board next season - will be as usual to balance the books and return to profitability...

[Mello Yello 2,294]

[quote user="T"][quote user="ron obvious"][quote user="T"]

The loan has been rolled over. It is absolutely correct though that the loan is costing 300k a year interest which would otherwise be potentially available for players. I suspect you are right that the Board was hoping the prperty deal was done in which case they may not have put in another 2m this year themselves.

The financial crisis has certainly hit the club hard. Without the financial crisis then I suspect that the Turners would have put 2m in and the land could have made a 3m profit and the situation could have been very different given the thin line between success and failure. Irrespective the club has still woefully underperformed.

[/quote]

Absolutely. For example, PNE have been in or about the play-offs for the last few years, but last year they were 4 points off relegation.
What you really need is a top class manager with CONSISTENTLY good results - & they''re as rare as rocking horse droppings; even then things can go pear-shaped, but by then you''re normally with a rich club & you can buy your way out of trouble. That''s what made Clough such an amazing manager, although he was the bright spark in an age of dinosaurs. I''m not sure he could do it today.
Naah, he could, he really was a fecking genius.
So much luck in football. It''s always easier with hindsight.
Actually, I don''t believe in luck. It''s down to the impossibility of forming statistically significant predictive models given a googolplex of variables, each having many degrees of freedom.
So let''s call it luck.



[/quote]

So true. Unfortunately, as studies always show people have a very poor understanding of the complexities of risk as the current market situation testifies. Far easier and more comprehensible to endulge in simple blame physchology. However, I would say that as we have consistently underperformed in recent seasons and therefore bad decision making does come into play as well as chance. In particular, I totally agree the manager selction is absolutely critical and as the Board have admitted they have got their choices wrong.

[/quote]

So, is it just the choice of manager selection that the board have got wrong?.....I don''t think that is the only ''thing'' the board have got wrong......

Please, you do seem to be an intelligent individual, but I cannot understand why your spelling is poor for someone who writes with such an articulate air.....

Is it to throw people off the scent?

I do still think you''re connected to the club - in some aspect.... 

[Mr.Carrow 376]

[quote user="T"]

The actual wage budget is 8.5m.

The Preston cash flows show they are reliant on player sales and investor input.

The land deal was specifically funded by an external loan which would not be available for players.

However, I do appreciate that you have argued this line for so long you will naturally want to deny the big picture financial reality of football finance highlighted by Deloittes and Peter Cullum.

[/quote]

No the "player budget" is £8.5m (according to Doncaster....[:^)]), so that includes transfer/loan/signing fees etc.  Do you honestly think next years accounts will show player wages at £8.5m, when they were £6.8m last year when we sold £6m worth of players?!

Preston can afford a much higher player budget than us out of a much lower ordinary income, FACT.  That has nothing to do with exceptional income such as player sales and investment.  I`m starting to think you can`t understand the difference.

The initial cost of the land was funded by loans.  Other related costs such as the spine road, surveys, planning applications etc., came out of normal income which could have been spent on players.  Having a £2.5m loan repayment on the land due halfway through a season in which the team are fighting against relegation would have seriously impacted our ability to strengthen the squad at a vital time.

 

[Mr.Carrow 376]

[quote user="Mr.Carrow"]By the way T, you don`t appear to have answered my question.  If it`s "ambitious" for a football club to spend millions on land, do you think its a good move to realise the value in our intangible fixed asset players and re-invest that into good, solid fixed assets such as land?[/quote]

Can you answer this question T?

[Tangible Fixed Assets anyone? 0]

[quote user="Mr.Carrow"]

[quote user="Mr.Carrow"]By the way T, you don`t appear to have answered my question.  If it`s "ambitious" for a football club to spend millions on land, do you think its a good move to realise the value in our intangible fixed asset players and re-invest that into good, solid fixed assets such as land?[/quote]

Can you answer this question T?

[/quote]

The bb. awaits T''s answer.......