davek
Player Valuation: £150m
*shrugs*
- Status
*shrugs*
B
BlackToffee
Guest
Its not the best situation, but as I keep saying, even if the Board sold the club for 1p, a serious new owner would need to find a minimum of £355 (£45m debt, £250m stadia, £60m team building) if they hope to make money or gain some investment back. I don't know if there are investors who would want to spend that type of money on any team, let alone a team with a serious stadia issue.
We dont need a new Stadium, we just need the old 1 fixing, 100m, jobs done, wipe off the debt, saves us millions each year, increased revenue from increased capicity, more fans will go the game cos Kenwrong has gone, Moyes doesnt need 60m, he only needs 20m Net a window, that would come from having a new Board in place with a clue about running a football club.
B
BlackToffee
Guest
Let me just say that I disagree. You want GP to make money? Then you need a new build. That is around £200m (estimate). I'm not sure if you believe that the building of the stadia will (a) wipe out our debt and (b) create enough money to pay for player aquisitions. But if you just want to tart GP up, then I suspect you can do that for £100m - but it won't make money. But I suspect that its best to agree to disagree.
Chang Elephant
Forum God
So what if we're borrowing against income two years in advance. I find Bill has a compelling sexual magnetism, and agree with others who attempt to ludicrously explain/justify/divert from this further example of financial fukwittery.
Ihaters
Player Valuation: £35m
Can't see where they would get 20mil from, seems an optimistic figure for just having someone with better business acumen to be honest.
I reckon if the board cleared the debt they could get an extra 10mil tops and that would take a long time to pay back the 100mil you mention + any players he would have to buy to get us moving.
Its going to take a lot of money that the new buyer will simply not see again unless they are here for a long, long time making a profit in a game full of debt.
IMO we need a billionaire or I don't think we will make a dent in the top 4.
Archie
Player Valuation: £100k
This is longer than I wanted to make it but didn't have time to make it shorter. Apologies.
Making a dent in the top 4 from external investment still won't bring European football given FFP rules kicking in. And that's where the financial pay-off and return is, not to mention the kudos for an owner. So I'm going to discount any idea of some Sheikh popping up to buy us. Think that if Kenwright is ready to make himself look an utter fool by admitting to letting a couple of chancers lead him on, then the interest genuinely isn't out there right now. Blackburn got sold on the cheap and are being run on the cheap. Our lovely neighbours got sold because their new owners worship FFP and picked them up at a very low price.
Honestly not sure why the finances have hit the headlines or upset people. This has been the case for a good two decades. The increasing debt, the inability to control the wage bill, the lack of revenue generation bar Premier League tv rights money etc has been going on for a good two decades or more now. What Kenwright's done is to max the credit card out to try and get European football. Few lads pointed it out way back when, but they were laughed away and European football and getting into the top six is quite a buzz compared to scraping and scrapping to avoid relegation.
If the Kirkby Inquiry is anything to go by, a new build stadium won't solve the problems. Even assuming a 47k average attendance, the board was only predicting £6m a year more being made over Goodison's 36kish average attendances. That £6m also includes £4.5m a year from stadium sponsorship and the ultra-low cost of £78m for a 50k new and purpose built stadium. That £6m extra a year would stop the club having to go cap in hand round the banks for new loans every year but not a lot else changes. It stabilises things at roughly where the club is at now. Still selling players, still a transfer budget measured in bits of fluff from the chairman's pocket, but once the 25 year bond is paid off in 2027, and the cost of the stadium 15 - 20 years after moving in, there may be a bit of cash left over in the pot then to go shopping for whatever £10m or so will get every summer by then.
New stadium isn't the answer going by the Kirkby figures. Whether the Kirkby figures given by the board are accurate (one way or the other) is something else entirely. That said, it may be part of the answer in the medium or long term. And it has to be medium or long term because right now Kenwright can't sell or mortgage off anything else get a loan for anything - let alone tens or hundreds of millions for either a new stadium or a refurb/redevelopment of Goodison.
One way to help out with the club's finances is for ticket prices to be raised. In fact, one of the worries anyone calling for new owners should have is that it is such an obvious part of any solution - like the Glazers did at Manchester United. Course the downside is that everyone's broke right now, and even in the best of times raising ticket prices isn't going to be popular. And that assumes that there is the excess demand is there to pick up higher priced tickets. Goodison isn't selling out - there may not be that demand making it self-defeating from the very start. Take your pick on what that might raise - maybe £2m if prices went up 10%? Only part of a solution here though in combination with others it might be something to consider.
Anther way to do it is to radically cut players wages. Back in 02, the club were on about getting the club down to a wages to turnover ratio of 50% as that was the only financially viable way forward they saw. Currently that would give a wage bill of around £38m or so - that would be around what Wigan pays though most newly promoted sides would be able to offer better wages. Still possible to stay up, of course, but a radical rethink of expectations would be needed. Would save around £18m a year if we went down to that level. More than ample to start paying down debt and player sales could be reinvested back into the squad. Course, finding those £18m a year savings in wages won't be popular and it would mean player sales but we can trust this manager to find cheaper but adequate replacements which won't weaken the squad to the point that a relegation battle follows.
One can also point to the commercial operations of the club and how limited they have been in generating money. Though it may be the case that money needs to be spent to see a return there - whether from on the pitch success leading to higher profile in the Backendofnowhere and the club getting better sponsorship deals and selling more shirts etc or whatever money making opportunities clubs use to cash in on supporters' loyalties.
Really, the point of this post (also hello) is to say that there aren't any easy answers after two decades or so of racking up the debt. The only options involve some hard choices which Kenwright and the board have been kicking down the road just as much as Carter did.
There's no doubt in my mind that Kenwright loves the club. I also think he tries his best to do right by the fans. But the club does need to take the bull by the horns now, and I can't see him doing it. As it stands, the club is selling to meet the demands of the bank, not the manager of the team. That alone will ultimately put us in a very precarious position. Would much rather the board were proactive on this than continue a charade which will take us to the same point in the end but cost us a hell of a lot more getting there - whether that be in loan charges or whether that be disgruntlement within the football side of things or whether that be good blues sniping at each other because of a disagreement over which is the best way forward from here.
Club needs unity and leadership from the top which is willing to take tough decisions and carry the supporters forward through some rough times with them. Sad thing is that I don't think we'll get that and people will just continue to stick their fingers in their ears and hope for some blue knight to ride to the rescue, just like last time when we ended up with Kenwright and co.
Making a dent in the top 4 from external investment still won't bring European football given FFP rules kicking in. And that's where the financial pay-off and return is, not to mention the kudos for an owner. So I'm going to discount any idea of some Sheikh popping up to buy us. Think that if Kenwright is ready to make himself look an utter fool by admitting to letting a couple of chancers lead him on, then the interest genuinely isn't out there right now. Blackburn got sold on the cheap and are being run on the cheap. Our lovely neighbours got sold because their new owners worship FFP and picked them up at a very low price.
Honestly not sure why the finances have hit the headlines or upset people. This has been the case for a good two decades. The increasing debt, the inability to control the wage bill, the lack of revenue generation bar Premier League tv rights money etc has been going on for a good two decades or more now. What Kenwright's done is to max the credit card out to try and get European football. Few lads pointed it out way back when, but they were laughed away and European football and getting into the top six is quite a buzz compared to scraping and scrapping to avoid relegation.
If the Kirkby Inquiry is anything to go by, a new build stadium won't solve the problems. Even assuming a 47k average attendance, the board was only predicting £6m a year more being made over Goodison's 36kish average attendances. That £6m also includes £4.5m a year from stadium sponsorship and the ultra-low cost of £78m for a 50k new and purpose built stadium. That £6m extra a year would stop the club having to go cap in hand round the banks for new loans every year but not a lot else changes. It stabilises things at roughly where the club is at now. Still selling players, still a transfer budget measured in bits of fluff from the chairman's pocket, but once the 25 year bond is paid off in 2027, and the cost of the stadium 15 - 20 years after moving in, there may be a bit of cash left over in the pot then to go shopping for whatever £10m or so will get every summer by then.
New stadium isn't the answer going by the Kirkby figures. Whether the Kirkby figures given by the board are accurate (one way or the other) is something else entirely. That said, it may be part of the answer in the medium or long term. And it has to be medium or long term because right now Kenwright can't sell or mortgage off anything else get a loan for anything - let alone tens or hundreds of millions for either a new stadium or a refurb/redevelopment of Goodison.
One way to help out with the club's finances is for ticket prices to be raised. In fact, one of the worries anyone calling for new owners should have is that it is such an obvious part of any solution - like the Glazers did at Manchester United. Course the downside is that everyone's broke right now, and even in the best of times raising ticket prices isn't going to be popular. And that assumes that there is the excess demand is there to pick up higher priced tickets. Goodison isn't selling out - there may not be that demand making it self-defeating from the very start. Take your pick on what that might raise - maybe £2m if prices went up 10%? Only part of a solution here though in combination with others it might be something to consider.
Anther way to do it is to radically cut players wages. Back in 02, the club were on about getting the club down to a wages to turnover ratio of 50% as that was the only financially viable way forward they saw. Currently that would give a wage bill of around £38m or so - that would be around what Wigan pays though most newly promoted sides would be able to offer better wages. Still possible to stay up, of course, but a radical rethink of expectations would be needed. Would save around £18m a year if we went down to that level. More than ample to start paying down debt and player sales could be reinvested back into the squad. Course, finding those £18m a year savings in wages won't be popular and it would mean player sales but we can trust this manager to find cheaper but adequate replacements which won't weaken the squad to the point that a relegation battle follows.
One can also point to the commercial operations of the club and how limited they have been in generating money. Though it may be the case that money needs to be spent to see a return there - whether from on the pitch success leading to higher profile in the Backendofnowhere and the club getting better sponsorship deals and selling more shirts etc or whatever money making opportunities clubs use to cash in on supporters' loyalties.
Really, the point of this post (also hello) is to say that there aren't any easy answers after two decades or so of racking up the debt. The only options involve some hard choices which Kenwright and the board have been kicking down the road just as much as Carter did.
There's no doubt in my mind that Kenwright loves the club. I also think he tries his best to do right by the fans. But the club does need to take the bull by the horns now, and I can't see him doing it. As it stands, the club is selling to meet the demands of the bank, not the manager of the team. That alone will ultimately put us in a very precarious position. Would much rather the board were proactive on this than continue a charade which will take us to the same point in the end but cost us a hell of a lot more getting there - whether that be in loan charges or whether that be disgruntlement within the football side of things or whether that be good blues sniping at each other because of a disagreement over which is the best way forward from here.
Club needs unity and leadership from the top which is willing to take tough decisions and carry the supporters forward through some rough times with them. Sad thing is that I don't think we'll get that and people will just continue to stick their fingers in their ears and hope for some blue knight to ride to the rescue, just like last time when we ended up with Kenwright and co.
davek
Player Valuation: £150m
Good post mate. I tend not to agree with much of it though.
You kick off by totally dismissing out of hand the possibility that we could be taken over and transformed by a rich owner. On what basis? The FFP regulations? They aren't even in play yet and wont take full effect untl a few years down the line; and the signs are that the amount of wriggle room to fund a club will be enormous anyway. I also think you're dead wrong on the stadium situation. The Kirkby shambles proved only one thing: that Everton's board of directors (looking for a quick sell on post stadium build) couldn't drive a long term bargain for the club. To dismiss a stadium led solution to our ills because of the Kirkby failure is unsupportable. What if one was built for us and deals were done on revenue share, or the club took up an equity seat rights to fund a Goodison regeneration etc etc. Where there's a will... As for cutting the costs of running the club, that will get you going in precisely one direction: through the trapdoor into the Championship. Wolves are the club to look for as an example here - and if they keep the policy that Steve Morgan has in place - cutting wages as a proportion of turnover down to 45% - they'll get done in one of the next couple of seasons. You cant expect our academy or Moyes' proficiency in the market place to both bring through enough new players who'll shine and then also expect him to keep hold of them for a few years on small wages. It'll lead to a rapid turnover of the squad and instability.
We were cursed when Gregg's shares, at Bill's request, fell into the hands of a pair of scumbags who couldn't give a shite about Everton and wont feel the need to act until they can get a big price for their shares.
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Archie
Player Valuation: £100k
Been a long time lurker on this site, and have an admiration for your posts (even if you do take flak for them at times).
FFP accounting starts this financial year mate. It's a gradual process but the first year of accounts will be 2011/12 - 1st June 2011 through to May 31st 2012 for us. The impact of that for clubs being taken over now and expecting serious investment in the playing side is such to pretty much prevent it. In some ways that's why the existing clubs have agreed to it being implemented - it pulls up the ladder and entrenches their position. Our current problem isn't that the levels of debt can't be serviced but that our revenue generation is totally out of kilter with our expenditure.
Most definitely agree with you on the doubts over the motivations of current board and the Kirkby project. My personal suspicion was that the Kirkby figures seemed cooked in a way which almost demanded large ticket price rises by new owners allowing Kenwright and co to pass the blame onto them. That said, the Deloitte report to the board suggested an average attendance of 38k rather than 47k. That is an attendance figure which can be matched at Goodison. In fact, refurbishing Goodison to modern standards would be a far cheaper alternative than paying for a brand new stadium to achieve similar results. The problem remains though is how to finance anything. £78m could not be found for Kirkby (and Deloitte doubted it could be found). The banks are refusing us credit and the club is currently seeking advances of tv money at a 10% interest rate. There is nothing left to mortgage or provide security for a loan of tens of millions of pounds. The current financial mess has to be cleared up first.
There's been a few suggestions of a stadium being built for the club. The devil would be in the details. The last time it was by the company doing the work down on the docks (Switch Island if my old fart's memory serves me right) and yet the board still decided to go ahead with the Kirkby project. It's a possibility but for it to work financially for a developer one wonders just how much revenue the club would be sacrificing. The 25 year bond at 8% interest was great at the time, we were told, but now it looks good only in comparison to the loans we're taking out courtesy of bottom feeder credit companies. Again, it's not dismissing the idea (and there could be other funding models which may work) but it's medium to long term in nature - five years down the line at best. Our problems are now and need to be resolved in the short-term first.
Absolutely agree that cutting costs and wages will have a huge risk of taking the club down. Sadly, however, that's the reality of our current situation. We've kicked against it hard under Kenwright. We're now in the position where the bank is effectively dictating transfer policy. At least by taking matters into our own hands we can mitigate things to an extent. As it stands, we'll continue to see offers such as 250k for the club captain from other clubs and it may not be in Moyes or Kenwright's hands to say 'no'.
Club's been cursed for a long time in terms of the board, its competence and its ability to handle the finances absent 'get rich quick' development schemes. Earl's just the latest of a long line in my view.
davek
Player Valuation: £150m
On FFP: I'm not really as sure as you it's unworkable for a big buyer. There'll be ways and means around it. The rules are that any benafactor between now and season 2017/18 under 'rules of acceptable deviation' can boost spending by roughly £60M as long as they convert their funding to shareholding at some specified time in the future; stadium building or other infrastructure doesn't come into consideration for the cap and, by the looks of it, stadium naming rights and other sponsorship deals at 'market rates' are a way in around the back door. It might well work out that this FFP will copperbottom the present elite. Time will tell, I suppose.
Agree with you that the stadium led escape route is not on the table at the moment, so we can dismiss that as a way of solving things in the short term. But I cant agree that tackling the wage bill is the way forward. That'd be too great a shock to the system; it'd endanger the club's survival, and the support would not wear the likely tumble down the table it'd involve. I think Moyes (who's flirted with this notion lately of using existing resources and buying in cheap) knows that it's not really on as a season upon season strategy - hence his post match comments about supporters getting real about repeat performances like Staurdays where kids and loan signings come off the bench to effect.
Besides the takeover posssibility, we dont have an awful lot of tricks left in the bag. The club have proven themselves incapbale of commercial activity worthy of the name, so we wont get any joy there. I suppose there's the possibility of getting money into the club with the directors diluting their shareholding, but the board of directors have made plain through the CEO(s) that this isn't a strategy they want to adopt.
davek
Player Valuation: £150m
Hardly breaking news mate, i think those comments have been a long time coming Mr Birch.
In other news Elvis died!
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davek
Player Valuation: £150m
TBH. I wasn't putting it up to agree with it. I think he's barking if reckons Everton could compete with a new stadium and an extra £5M per year. The stadium led facility 'solution' has always been bollocks that covered the get rich quick plans of the owners.
It also means we can have a good old moan about our current situation as well.
davek
Player Valuation: £150m
Ex-CEO sacked by the board speaks up. I dont know why, but I thought that might be appropriate for a thread devoted to boardroom affairs.
*sigh*
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