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Tangible Fixed Assets anyone?

Worthless shares eh?

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Re: Heart FM tomorrow morning between 6 and 9

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 Barry Brockes wrote:

I haven''t spoken to him for a couple of months as he has been up to his eyeballs sorting out his day to day business but my feeling is that it will only happen if NCFC make the running the next time. Unless they''ve changed their tune from the time of ''Cullumgate'' I think that''s very unlikely. He''s been turned away twice and knowing him as I do I think it unlikely he will go back knocking for a third time. The guy who spoke up at the forum on Monday was also very getting very warm and made Munby and Doncaster look very uncomfortable, understandably so. My perception is that Delia wants investment but on her terms which includes keeping control and Munby and Doncaster want to preserve their jobs. They both know the score if Peter takes control so banging head against brick wall are words that come to mind.

 

A couple of points:

1) Somebody collated the Cullum info on a thread recently and may I remind people of part of note 3 (which was also reported in the media):

......'' At that point the question of VALUATION, over which Cullum said there had been "a friendly arm wrestle", might become more relevant.''

So we turn down £20m for the playing squad (and boy does it need it!) over valuation, now didn''t somebody on the board say they thought their shares are worthless or did I misunderstand this comment? If you thought your shares were worthless why were you arguing over valuation?

 

2) The gentleman who spoke at the Open day forum about the shares being worthless is correct if you value alot of the Tangible Fixed Assets at their realisable value. The cost of the stands in the NCFC Accounts have little value unless you use them to watch a sporting event or say a pop concert at Carrow Rd. Otherwise you have to look at the value of the land, the pitch and the stands currently occupy less the cost of demolishing the stands.

 

 

 


Where are the good experienced strikers?
----------------------------------------
DECLINE with Delia''s NCFC.

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Are you referring to comments I made in regards to Cullum.

Cullum told me that he felt Delia''s shares were virtually worthless they are his comments not mine.

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[quote user="Jim Kent"]Are you referring to comments I made in regards to Cullum. Cullum told me that he felt Delia''s shares were virtually worthless they are his comments not mine.[/quote]

Yes - I was going to clarify that in a later post about various comments made that day.

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[quote user="Jim Kent"]Are you referring to comments I made in regards to Cullum. Cullum told me that he felt Delia''s shares were virtually worthless they are his comments not mine.[/quote]

BTW. Dont you agree that from one perspective (realisable values for the assets) they are worthless?

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There is no doubt that no one will offer a lot for Delia shares. In my opinion she will never make back what she invested in the club.

The problem is I don''t think Delia will accept that. Therefore, the best we can hope for is more board members, but I think Delia is here for a while yet.

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[quote user="Jim Kent"]There is no doubt that no one will offer a lot for Delia shares. In my opinion she will never make back what she invested in the club. The problem is I don''t think Delia will accept that. Therefore, the best we can hope for is more board members, but I think Delia is here for a while yet.[/quote]

Spot on.

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[quote user="Tangible Fixed Assets anyone"]

If I remember correctly Delia & MWJ have £6.5m in ordinary shares, and £2m in loans and £0.3m approx in B Prefs. -> £8.8m. Theres a question mark as to whether Delia & MWJ will loan another £1m this season.

[/quote]

Thats subjective. My opinion, and by the looks of it Peter Cullums, is that they actually have:-

£1m ordinary shares

£2m loans

£0.05m B prefs.

Hence, a belief that Delias shares are worth £6.8m when in fact they are probably worth about £1m. 

She actually wanted approximately £8.5m I believe? AND her loan repayed?

If Cullum has to find £10m for a club with pretty much no cash assets, no playing squad and in the third tier of football...... I think we can all see why that deal didnt happen.

Any one of us could go to a stock broker right now and purchase a majority share in Millwall football club for a little over £1m.  They might be a smaller club, with big losses, but still...... any impartial investor would see more potential in a london club on the brink of promotion.

 

 

 

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Congratulations on finally working out that the cash flows of pretty much any football club are worth nearly nothing after all this time. Perhaps after another few years you will finally work out it is normal for any business including football clubs to spend money on fixed assets. The value of a football club is in owning a rare commodity. Would you give a unique desirable asset which you have spent millions on to a billionaire for free? 

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[quote user="T"]Congratulations on finally working out that the cash flows of pretty much any football club are worth nearly nothing after all this time. Perhaps after another few years you will finally work out it is normal for any business including football clubs to spend money on fixed assets. The value of a football club is in owning a rare commodity. Would you give a unique desirable asset which you have spent millions on to a billionaire for free? [/quote]

Congratulations on being a bitter miserable old bugger. Owning a football club is not a ''rare commodity'', it is actually ''pure stupidity''.

Millwall shares are up a lot at the minute, because of promotion, but if I had £400k in my bank account right now, I could buy a 5% share in millwall within 20 minutes no questions asked. A couple of months ago I could have bought 15% of the club for that (alas, silly people getting excited about a play off fixture)

What would be the best thing to do with that £400k? I could go and buy 5 repossessed houses with that money at auction tomorrow, and look forward to 5% rental yields year on year. Buying the property would be wise, buying a football club would be stupid.

Delia has been stupid to throw her money into a football club, and the fact that she expects it back after getting relegated makes her even more stupid. How much longer are people going to sympathise with Delias bank balance over the health of OUR football club?

Delia could have invested that money into property or bonds, its not our fault that she didnt, instead she looked upon her ''investment'' as exactly that. She ''invested'' into something that wasnt a good ''investment'' and 50,000+ norwich city supporters, and the local community, are the ones that pay the price for that.

Cullum made it clear that he wouldnt have expected his £20m back.  Thats because he made his real money through ''investments'' and knows that a football club is not a good ''investment''.

End of.

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[quote user="ryan85k"]

[quote user="T"]Congratulations on finally working out that the cash flows of pretty much any football club are worth nearly nothing after all this time. Perhaps after another few years you will finally work out it is normal for any business including football clubs to spend money on fixed assets. The value of a football club is in owning a rare commodity. Would you give a unique desirable asset which you have spent millions on to a billionaire for free? [/quote]

Congratulations on being a bitter miserable old bugger. Owning a football club is not a ''rare commodity'', it is actually ''pure stupidity''.

Millwall shares are up a lot at the minute, because of promotion, but if I had £400k in my bank account right now, I could buy a 5% share in millwall within 20 minutes no questions asked. A couple of months ago I could have bought 15% of the club for that (alas, silly people getting excited about a play off fixture)

What would be the best thing to do with that £400k? I could go and buy 5 repossessed houses with that money at auction tomorrow, and look forward to 5% rental yields year on year. Buying the property would be wise, buying a football club would be stupid.

Delia has been stupid to throw her money into a football club, and the fact that she expects it back after getting relegated makes her even more stupid. How much longer are people going to sympathise with Delias bank balance over the health of OUR football club?

Delia could have invested that money into property or bonds, its not our fault that she didnt, instead she looked upon her ''investment'' as exactly that. She ''invested'' into something that wasnt a good ''investment'' and 50,000+ norwich city supporters, and the local community, are the ones that pay the price for that.

Cullum made it clear that he wouldnt have expected his £20m back.  Thats because he made his real money through ''investments'' and knows that a football club is not a good ''investment''.

End of.

[/quote]

Of course I mean ''possible promotion''

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Would it not had made sense for Delia to have sold out to Peter Cullum for the good of the club? The guy is a billionaire and a boyhood fan. Norwich City needs a big cash investment - sounds like a match made in heaven.

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[quote user="jwtdawson"]Would it not had made sense for Delia to have sold out to Peter Cullum for the good of the club? The guy is a billionaire and a boyhood fan. Norwich City needs a big cash investment - sounds like a match made in heaven.[/quote]

Who are you asking the question to? The Board - who some say overvalued the Club, or Cullum - who did not want to buy the whole lot anyway.  Of course it would have made sense for him to buy the Club to us fans...

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[quote user="T"]Congratulations on finally working out that the cash flows of pretty much any football club are worth nearly nothing after all this time.  [/quote]

But the cashflows do have value....pity NCFC  couldn''t be run on Prestons cost base (adjusted for the catering operation and certain costs based on our bigger gates). We would be throwing off cash to reduce the debt or spend on new players. BTW. just look where Preston are in The Championship and where are we?

Anyway bye bye T....I dont expect we will be hearing from you any longer now that you have departed the scene.

 

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Preston is a good example of good use of resources and, as you say, they have done well this year.  But if you look at what their Chairman has had to say they are seriously worried about their future.  At the moment they are losing somewhere around £130k a month and, at the beginning of the season, asked two directors to put in £1m (between them).  The boss has put in around about £5m since he started his association with them but he has also said that even if they reached the Promised Land of the Premier he has no idea how to sustain a place in it, almost exactly mirroring what the WBA chairman said before they kicked a ball in the Premier League this season.  The WBA chairman said he did not have the wealth to sustain a place in the League and in fact said he would be more than willing to exit if any wealthy investors could be found.  In effect up for sale. No investors came forward and WBA are now at serious risk of being straight back down.

Preston probably have on paper directors worth far more than your Board but they are not beating about the bush - they are concerned (as are many other clubs) that even if they get to the Premier League how on earth can they compete with the serious mega spending that is going on.  Yes, they have definitely done far better than Norwich but appear to be extremely worried about where they are going to find the financial resources to compete in the Big League if they make it.  Some of those remarks were made before Britain plunged into recession.

I think you will find these are very, very troubled times for football at all levels.

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Cam,

The saddest thing about our club is that we have wasted the resources that go with 25,000 gates and two years prem parachute. As TFAA has alluded to, our overheads are shockingly high and we have had to compromise investment in the squad as a result of diversionary spending trying to develop a commercial housing project. I fully agree that we should aim to live within our means, and this means that we settle into our natural position in the football food chain, I would not be unhappy. We really should be doing better and we should not require a sugar daddy or mummy to keep us competitive with the likes of Plymouth and Barnsley. This can be achieved by cutting overheads and cocentrating on our core product - football. If we do this, ultimately everything else can fall into place.

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The value of a normal business is the cash flows that it generates for its ordinary shareholders. Irrespective of the division football clubs do not make money for their ordinary shareholders so they do not have an economic value. They actually have a negative economic value because the owners generally keep putting money into the business. This is why PC as a business man was not willing to pay any money for the existing shares. However, the value is in owning a rare asset so you would have to look at what similar clubs are bought and sold for to come up with a value, the net assets of 30 pounds a share is also a good proxy. Hull were valued at anout 10m when they were in the championship.

Understanding business and finance does not make someone an employee or adviser of the club and quite frankly working for a football club if you are not a player or manager is not financially attractive as even the CEO is earning much less than you would make in business or the professions for less responsibilty and hassle.

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Surely there is a contradiction here.

If Hull were valued at £10m with zero debt why would Norwich be valued at c£16m?

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So, is it mere coincidence that the three clubs relegated from the Championship, Norwich, Southampton and Charlton, have all recently been relegated from the Premiership and have money problems.

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Gazza,

I finally admit defeat, as even Doomy surely would not post on here after leaving the club, which we are lead to believe he has.

However, I am still very curious to undertstand the motives of T as he/she is always very quick to intervene in any debate reagrdinbg the calamity of our off the field activities. I simply refuse to believe that any City fan would care so passionately about this in a a favourable way and he/she cleary knows more about these schemes than has been published in the public arena.

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[quote user="Posh Yella"]

Surely there is a contradiction here.

If Hull were valued at £10m with zero debt why would Norwich be valued at c£16m?

[/quote]

Because valuation is based upon the worth of the clubs net assets as signed off by the clubs auditors. However, whether anyone is willing to pay ''book'' value for these assets in this current climate appears debatable.

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[quote user="Desert Fox"]

However, I am still very curious to undertstand the motives of T as he/she is always very quick to intervene in any debate reagrdinbg the calamity of our off the field activities. I simply refuse to believe that any City fan would care so passionately about this in a a favourable way and he/she cleary knows more about these schemes than has been published in the public arena.

[/quote]

Exactly!

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[quote user="Yellow Wall"]

So, is it mere coincidence that the three clubs relegated from the Championship, Norwich, Southampton and Charlton, have all recently been relegated from the Premiership and have money problems.

[/quote]

The common theme is mismanagement not spending time in the prem - nearly half the CCC has been in the prem in the last five years, but only three of these teams have been relegated. The key is how each team used its prem status and associated income - we frittered ours.

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[quote user="Tangible Fixed Assets anyone"][quote user="Desert Fox"]

However, I am still very curious to undertstand the motives of T as he/she is always very quick to intervene in any debate reagrdinbg the calamity of our off the field activities. I simply refuse to believe that any City fan would care so passionately about this in a a favourable way and he/she cleary knows more about these schemes than has been published in the public arena.

[/quote]

Exactly!

[/quote]

 

The irony is that I based my analysis on downloading the accounts but also mainly on  figures helpfully dug out  by TFA which showed that the off-field activities make sense! I think I set my motives out honestly to DF a while back. As PC said some of the criticisms are unfair and unkind but they are also illogical which is my angle. As I''ve admitted previously the reason that I know some more about these things and know some of the criticisms don''t make sense is because I looked at the acquisition of a championship/premiership football club and have seen some of the stuff from the Deloitte report on football finance.

I agree that there may well be scope to reduce overheads which we all know means advocating redundancies in practice.

I also agree that a car park is unlikely to be financially viable but then NCFC having planning permission does not mean the club ever had any intention of building or operating a car park.

I also agree money has clearly been poorly spent on managers and players as the fact that we had an average championship player budget but got relegated demonstrates.

DF is also correct that I have already deducted the debt in arriving at the net assets value  of the club. It is those kind of points that demonstate that some people criticise anything and everything based on false premises. 

Strangly in DF''s excellent note on new ideas for the club he suggested some more off-field activities!

 

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Very illuminating thread with (mostly) serious debate based on facts as far as they are known.Why is it that anyone who tries to argue a point of view logically and objectively using knowledge they have acquired in their professional life, is accused of being a club stooge?It strikes me that, if the Directors had actually considered harnessing the knowledge and expertise of some people on here, they might have made a better fist of running the club.

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YY,

Did you see the letter from two of the Associate Director''s complaining about the inability of the Boar to welcome or listen to the views of senior members of the local bsuiness community, which as I undertsand, was one of the main reasons for creating the AD role in the first place. For me, this was the most stinging piece of criticism of the Board that I have seen, it was extremely well written. If the club are unwilling to take counsel from the AD''s what hope have we ordinary fans got?

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DF,Was the typo (Boar) a Freudian slip?!!Yes I did see the letter and I agree with you that the criticism was well founded.Amidst all the turmoil at the moment, I think the current Board members have lost their ability to think rationally and are stuck in a siege mentality.I did write a post yesterday with some constructive suggestions for a way forward but I guess, with the current attitude the Board is displaying, we are all wasting our time.The sad thing is that amongst the supporters there are some very switched on and successful people who would be prepared to offer counsel either free or for much reduced fees to see the club prosper but I can''t see anyone in the current hierarchy being prepared to open up and ask for/ accept their services.

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