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Norfolk Mustard

Championship Clubs nearly £1bn in Debt

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Not sure whether this article has been shared anywhere on this forum? Forgive me if it has, however I''m amazed at the precarious finances of most clubs we''ll be playing next season.

If Norwich are debt-free, we appear to be rather unusual; according to this info from Companies House, Ipswich Town remain over £82m in debt!...

http://www.theguardian.com/football/2014/may/22/club-by-club-guide-championship-finances-2012-2013

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Can be very missleading as in most cases the "debt" is with the owners of the club in question.

Hardly likely to call it in as they would be the main losers as most clubs do not have the "easily obtainable" collateral to cover the debt.

As most of the debt that WAS at NCFC was owed to financial institutions we had to repay ours (Not a bad thing but left the transfer budget 20mil light)

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We are debt free yet if you listen to some Delia has been pocketing money or not put it in in the first place.

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TIL1010 posted:

We are debt free yet if you listen to some Delia has been pocketing money or not put it in in the first place.

Light travels faster than the speed of sound. That is why some people appear to be bright until they speak.

Rather like yourself Tilly, eh. We can be debt free without Delia paying money in as the £20 million odd didn''t come from her pockets. Equally Delia could withdraw money from the club as repayment of Dirctors'' loans if she wished and stil allow the club to clear it''s external debts.

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So Leicester are over 100 mill in debt and say they spend 50 mill on new players. If they stay in the prem for 2-3 years they will have paid off all those debts to their owner and made a healthy profit

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Graham Paddon''s Beard wrote

"Debt is only a problem when you have to pay it back." True but it does act as a deterrent to expansion and expenditure for clubs of a lesser stature than Manchester Utd. such as our beloved rivals and even more so  since FFP which includes interest payments in general expenditure 

 

"Man Utd are in huge debt. But I doubt it will be an issue to them."  Not picking on you GPB but that example compares with owing a £1/4m on a home worth £1m. The Manchester United brand is worth many millions more than their debt.

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Personally, I am not surprised. British football in general is financially shocking for the most part, and then you can throw up examples further abroad as well. FIFA seems relatively uninterested apart from FFP which in my mind could go further. Man City''s sanctions are more of an annoyance to them more than anything else.I have found this site to be helpful in regards to FFP: http://www.financialfairplay.co.uk/[img]http://www.nufcblog.com/wp-content/uploads/2013/12/New-loss-per-ticket.jpg.opt580x528o00s580x528.jpg[/img]It''s shocking that at the end of the 2011/2012 season there were just six teams in the Premier League that recorded a profit. We made the fourth highest profit of £9million.

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[quote user="chicken"]Personally, I am not surprised. British football in general is financially shocking for the most part, and then you can throw up examples further abroad as well. FIFA seems relatively uninterested apart from FFP which in my mind could go further. Man City''s sanctions are more of an annoyance to them more than anything else.I have found this site to be helpful in regards to FFP: http://www.financialfairplay.co.uk/[img]http://www.nufcblog.com/wp-content/uploads/2013/12/New-loss-per-ticket.jpg.opt580x528o00s580x528.jpg[/img]It''s shocking that at the end of the 2011/2012 season there were just six teams in the Premier League that recorded a profit. We made the fourth highest profit of £9million.[/quote]

That is out of date.

12/13 & 13/14

Is what people should really being looking at to understand financing.

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That was an interesting list and somewhat dispels the doom-mongering about us being skint.

 

Any extrapolation relevant to the season just gone has to take in account the vastly increased TV money, but by the same token the wages bill would have been increased

 

 

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[quote user="BroadstairsR"]Graham Paddon''s Beard wrote

"Debt is only a problem when you have to pay it back." True but it does act as a deterrent to expansion and expenditure for clubs of a lesser stature than Manchester Utd. such as our beloved rivals and even more so  since FFP which includes interest payments in general expenditure 

 

"Man Utd are in huge debt. But I doubt it will be an issue to them."  Not picking on you GPB but that example compares with owing a £1/4m on a home worth £1m. The Manchester United brand is worth many millions more than their debt.

[/quote]

 

Agree with both points broadstairs, but the specific point seemed to be that Debt is bad. We found oursleves having to pay back £20m because of a trigger clause in re scheduling with Axa. So immediately £20m straight off the bottom line. Our chums down the road have £80 million debt, but probably wont pay anything like that much back in a year. So in short, there is debt and DEBT.

 

The Man Utd example isnt quite like your house , as you can''t realise your brand value to quite the same extent. If , for some reason, someone  called in the debt at Man Utd tomorrow, in full, they would have to sell the assets . Of course it isnt going to happen, but I think peoples inherent fear of debt is a bit misunderstood.

 

Ask Peter Cullum about debt. An extremely wealthy individual with an enormous busines empire. But the whole thing is based around Debt. And when (if ) he floats , the debt will float with it.

 

Don''t get me wrong, I wouldn''t change places with the binners!

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The fact that £10m in debt was paid off during the year mentioned (and presumably some interest had been involved) throws another healthy factor into the equation. Wages increases would not impact this plus for the last season.

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[quote user="worsethandeath"]So Leicester are over 100 mill in debt and say they spend 50 mill on new players. If they stay in the prem for 2-3 years they will have paid off all those debts to their owner and made a healthy profit[/quote]They would make a nice profit if it didn''t cost anything to run the club for those two or three years.Unfortunately it doesn''t.

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Che''s rhm wrote - "That is out of date.

12/13 & 13/14

Is what people should really being looking at to understand financing."

Sadly it doesn''t work quite like that.

The data for a 2013/14 comparison will probably not be available yet due to most clubs not releasing their annual reports.

2012/13 should be doable. In fact:

http://www.theguardian.com/news/datablog/2014/may/01/premier-league-club-accounts-debt-wages

http://www.theguardian.com/football/2014/may/01/premier-league-accounts-club-by-club-david-conn

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"Debt is only a problem when you have to pay it back. "

Not necessarily true unfortunately. If servicing the debt takes up too much of your income something else has to give, such as the wage budget.

And if interest rates were set at fixed levels say 10 or 15 years ago, when they might have looked quite generous, in the current climate they will be very expensive.

Many of the clubs that got into trouble did so because in order to pay their interest charges they withheld tax and VAT payments in desperation. 30 years ago that was common business practice and the authorities moved with the speed of a dopy tortoise in dealing with it. But now they have their act much more together (as they should).

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The reason the binners debt continually goes up is surely because even though the boy mucus takes a return from the club some of the repayments aren''t paid and so accrue more debt. If it was debt that didn''t have to be paid back it would be a gift. Does anybody seriously believe mucus really is a benevolent uncle to the binners?

I wish I had a benevolent uncle....

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One of the most curious aspects of the paupers precarious position is that of their training ground - which the ever generous Mr Evans has recently transfered over to an off shore company.Now if the paupers debt is around £80m, the one million or so that was consequently knocked off the club''s debt would be neither here nor there in the overall scheme of things, so why do it ? And from what I gather there was no new money, merely that what they owed him was a bit less .. (equivilant to the supposed value of the training ground). Cynics might suggest that he is simply transfering out anything of any worth, before he pulls the plug.Whatever it is you would have thought that the suffolk simpletons might have challenged this, rather secretive, sleight of hand. But no, not a word. Which suggests many of these ''hinvestors'' well know that in certain cases they can simply bleed a club dry and not a finger will be lifted .... as long as he convinces the not too bright that he is this ''benevolent and kindly old uncle''.As to the debt not being of any concern to the paupers, as it is owed to the majority shareholder, there has to be the question raised of what would happen were Mr Evans to ''fall under a bus'' or that his company went bust.Still, in return he did manage to get them into the top half of the Championship - a splendid achievent for over six years of supposed ''hinvestment''.oh dear

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They reckon it doesn''t matter. Like some on here they seem to think its a debt that''s not a debt. At least when we had internal debt we had a superb stand to show for it. I can''t see what they''ve done with their 80m. Perhaps they owe it when they haven''t even had it.....

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They have got a new stand and a reburbished one as wellwhich must come in very handy when they have sellout games............ when we turn up, and err umm................when we turn upand that''s it

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They haven''t had a new stand out of that 80m. That''s all since administration. They owe 80m but have less assets than when the boy mucus began his "benevolence"......

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technically they did, as the money to build those two stands AND clear their debts was the £25m loan from Norwich Union, which the kindly Mr Evans supposedly bought for £6mit is that money and other debts that formed the £30 or so that was owed when the club was handed over to Evansbut you have only to look at the quality of the squad, the huge number of youths coming through and the way Mr Evans had rid them of the cost of owning their traing ground and you will see how well they have benefited(not to mention the saving on wear on the seats)if only we had an ''hinvestor''

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[quote user="nutty nigel"]Hope I find somewhere to borrow money where I don''t have to pay it back.....[/quote]

Like a mortgage?

Most of this debt can be offset by playing staff assets and other things like stadiums, land etc.

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You don''t have to pay your mortgage back Jimmy?

Which of these assets do the binners have? If it was a mortgage surely they''d have negative equity?

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"Most of this debt can be offset by playing staff assets and other things like stadiums, land etc."what !If you are refering to the paupers then you are well wide of the markThey rent the ground off the council. The one asset they did have, their training ground, has recently been taken from them and moved to the ownership of an offshore company.Even the players registrations are deemed a liability, NOT an asset as the liability is in the contract the club is obliged to pay. Their income has been steadily failling year on year, as have their attendances and season ticket sales.Basically, they are farked  - and with Evans pimping all he can out of them they are less and less attractive as an ''investment'' by the month.

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Are we actually debt free? I remember it being confimred we were free of all external debt but I can''t remember it being confirmed we were totally debt free..

QPR are a fine example, millions in debt but I believe the majority of that is owed to Fernandes, he''s loaned the club the money.

Do we actually register as "debt free"?

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check last years accounts - they are easy to find

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