Albion STILL losing money

[El Presidente]

There are a few accountants on NSC, why can't get get a definitive answer on whether loan repayments can be counted as costs to make sure we don't make a profit?

They can't, interest is taken into account, capital repayments are not.

 

[Triggaaar]

It may not be an expense, but it still means that there is less money available to the club. So AFTER the loan repayments the club could be making a loss

No, that's not how it works. If we were paying back the loan, we would have less money available for other things, but that wouldn't be a loss, because that's not what a loss is.

If the target deadline of 2025 for £123m is to be reached, the club would be looking at repaying nearly a million quid a month.

Do you have any evidence that 2025 isn't just an arbitrary date? We have nothing at all to suggest we're paying back any of the loan. I doubt it's being paid back at all.

Yes I have no doubt that TB is having a great time running the club, but remember he's losing millions of pounds every year that he could be earning with interest. There is a lot of fun to be had with that kind of money too.

He's wealthy enough to still be able to spend money on enjoying himself. Nobody said investing in a football club was a cheap way of getting your kicks, quite the opposite in fact.

It's in everyone's interest if the loan is repaid as soon as possible.

It would be in everyone's interest to pay off their mortgage quickly, but that doesn't mean we can all do it. It's in many fans' interest to get promoted to the premier league, but that costs money, so paying back a loan instead of investing in the squad isn't in their interest.

Don't you think there is a chance that TB would like his money back, and he has indeed agreed a structured loan for the club to pay it?

Sure he'd like it, but it's his choice - invest earnings in the squad and have a successful team, or get the loan repaid and struggle at the foot of the championship, while watching gates fall and earnings decrease. It's up to him which he chooses, and I'm grateful for all he's done for us either way, but don't assume he wants his money back as a priority over success on the pitch.

 

[West Hoathly Seagull]

Norwich city is a good bench mark for crowds the have held 25000 in all 3 divisions for a good few years now-best ask them

Being more or less London-based during the week, I don't get down to the Amex very often, but are the facilities in use every day? Your example of Norwich is a good one. When we played them in 2009, I got there very early, and took a tour round the ground. It is crammed with business suites, and every one of them was in use, and being used by high end businesses, such as Aviva. Now I know Norwich is far more of a financial centre than Brighton, but surely that has to be a focus, and presumably one of the things Barber was brought in to achieve. I'm not saying they're not being used - as I say I'm hardly ever there apart from match days, but perhaps someone more locally based knows what the situation is.

 

[Triggaaar]

There are a few accountants on NSC, why can't get get a definitive answer on whether loan repayments can be counted as costs to make sure we don't make a profit?

I have a degree in accounting. Loan repayments cannot be counted as costs against profit.

 

[Working class pride]

I have a degree in accounting. Loan repayments cannot be counted as costs against profit.

I'm not an accountant but I thought that if there is a "debt repayment", then that would go against profit? Or looking at it another way, you "do a starbucks"

 

[fataddick]

Yes you are right. I was using the absurd Charltn policy to highlight a failing in football administration that fails the business aim of selling tickets.

It's absurd to have a specific set away end/allocation? Why are you highlighting Charlton here, I'm pretty sure every club in the championship is the same. Plus where we put the away fans isn't just Charlton's decision, but that of Greenwich council and the Met police too. To allocate extra seating in the East Stand (how many extra tickets could Albion have realistically sold, maybe 1,500?) would involve moving - and therefore pissing off - season ticket holders, and the extra stewarding/policing costs (if the police allowed it, which they wouldn't) would have negated any extra gate revenue. Anyone who wanted to see the game that badly did anyway. Anyway, stop complaining about getting 3,400 seats, we only gave Man U 2,000 when were in the Prem.

 

[Working class pride]

It's absurd to have a specific set away end/allocation? Why are you highlighting Charlton here, I'm pretty sure every club in the championship is the same. Plus where we put the away fans isn't just Charlton's decision, but that of Greenwich council and the Met police too. To allocate extra seating in the East Stand (how many extra tickets could Albion have realistically sold, maybe 1,500?) would involve moving - and therefore pissing off - season ticket holders, and the extra stewarding/policing costs (if the police allowed it, which they wouldn't) would have negated any extra gate revenue. Anyone who wanted to see the game that badly did anyway. Anyway, stop complaining about getting 3,400 seats, we only gave Man U 2,000 when were in the Prem.

Really mate, I'm not singling out Charlton and yes 3400 is a good allocation, but it was not enough, and I just say "keep it simple". Ask, "right, they have sold 3400, so how can we help them sell some more", not "how do we stop people coming to a game". It is not just Charlton, or Brighton with their officious nonsense with kids in the north stand, its the modern mentality of football middle management. Just coming at things from the wrong direction. Its certainly not an individual pop at Charlton. Its just pointing out that there used to be more flexibility when large away supports would roll into town. This is something that should be looked at and a solution found by the middle management as that is what they should be there for.

 

[Thunder Bolt]

[MENTION=4019]Triggaaar[/MENTION] Fair enough, we're not going to agree on this, so I suppose all we can do is wait until the accounts are released next year. I would be more inclined to agree with you if we had a top of the division playing budget, which is the biggest expense of most clubs, but we certainly don't appear to. Like I say, I just suspect that we are repaying the loan, as planned, because we are in a bloody good position to do so at the moment.

Bloom has stated that if the loan isn't paid back by a specific date (poss 2025) then he will convert it to shares.

 

[fataddick]

Really mate, I'm not singling out Charlton and yes 3400 is a good allocation, but it was not enough, and I just say "keep it simple". Ask, "right, they have sold 3400, so how can we help them sell some more", not "how do we stop people coming to a game". It is not just Charlton, or Brighton with their officious nonsense with kids in the north stand, its the modern mentality of football middle management. Just coming at things from the wrong direction. Its certainly not an individual pop at Charlton. Its just pointing out that there used to be more flexibility when large away supports would roll into town. This is something that should be looked at and a solution found by the middle management as that is what they should be there for.

I agree that there should be flexibility, but you're singling out the football clubs when there are other forces at play. The Taylor Report did more than just do away with terraces, it gave local authorities (who grant the safety certificate) and the police far more power with regard to things like segregation. One example, Man U fans persistently stood in our away end. Many fans do, but Greenwich council decided to make an example of them (for whatever stupid reason they liked) and ordered us to cut their allocation from 3,400 to 2,000 for future games. Charlton complained, Greenwich said if you don't we will revoke your safety certificate and you won't be able to use the Valley for matches full stop. Net result: CAFC lost 1,400 seats worth of revenue as a result of Man U fans behaviour (standing) and the back half of the away end remained empty for their future visits. Now that is absurd, but there was nothing Charlton could do about it. As I say, post Hillsborough/Taylor Report the councils and police have more scope to interfere re football matchdays. The points you make are valid, but its not the football clubs you should be complaining about - rest assured Charlton like any club/business would want as many paying punters through the gates as possible, but where away fans/segregation comes into play the council and police make the rules

 

[Triggaaar]

I'm not an accountant but I thought that if there is a "debt repayment", then that would go against profit?

No. If you take out a loan, you don't suddenly have to pay tax on it, as though it was profit. And likewise, when you pay it off, that's not a loss, so doesn't count against tax. Only the interest on the loan (or loan arrangement fees etc) are costs against profit.

Or looking at it another way, you "do a starbucks"

Starbucks didn't do that, they inflated their costs of goods, so as to reduce their profits in this country, and move their profits elsewhere.

[MENTION=4019]Triggaaar[/MENTION] Fair enough, we're not going to agree on this, so I suppose all we can do is wait until the accounts are released next year.

Indeed.

I would be more inclined to agree with you if we had a top of the division playing budget, which is the biggest expense of most clubs, but we certainly don't appear to.

I don't think we do have the top budget, but then we know many other clubs are losing a lot of money, so their spending is not from income, but from the owners. Just to keep close to the top spending teams I suspect we're spending all we earn.

 

[Psychobilly freakout]

We must surely be incurring costs for submitting plans for the training ground and maybe even already building / preparation costs.

Not to mention the costs for the extra seating, and museum etc.

Are Brighton & Hove Albion paying for the training ground or Mr Tony Bloom ?

 

[Thunder Bolt]

I agree that there should be flexibility, but you're singling out the football clubs when there are other forces at play. The Taylor Report did more than just do away with terraces, it gave local authorities (who grant the safety certificate) and the police far more power with regard to things like segregation. One example, Man U fans persistently stood in our away end. Many fans do, but Greenwich council decided to make an example of them (for whatever stupid reason they liked) and ordered us to cut their allocation from 3,400 to 2,000 for future games. Charlton complained, Greenwich said if you don't we will revoke your safety certificate and you won't be able to use the Valley for matches full stop. Net result: CAFC lost 1,400 seats worth of revenue as a result of Man U fans behaviour (standing) and the back half of the away end remained empty for their future visits. Now that is absurd, but there was nothing Charlton could do about it. As I say, post Hillsborough/Taylor Report the councils and police have more scope to interfere re football matchdays. The points you make are valid, but its not the football clubs you should be complaining about - rest assured Charlton like any club/business would want as many paying punters through the gates as possible, but where away fans/segregation comes into play the council and police make the rules

This is something the protestors in the North Stand should be reading instead of blaming the Albion for their stance. It happens at other clubs too. None of us like it but because of Hillsborough and all the lies told by the authorities, the fans are still paying the cost.

 

[nwgull]

I'm sure we're losing money as far as the annual accounts are concerned. However, this will be down to payments made for construction of the stadium and training facility. As others have already stated: the accountants would not be doing their job if they showed the Albion making a taxable profit given all the investment made over the past couple of years.

I'd find it very hard to believe that the operating costs exceed the income given that we get 25K+ for most home games!

 

[Working class pride]

This is something the protestors in the North Stand should be reading instead of blaming the Albion for their stance. It happens at other clubs too. None of us like it but because of Hillsborough and all the lies told by the authorities, the fans are still paying the cost.

No mate, this excuse does not wash. Leeds, Spurs and most clubs up and down the country have not sought to cause a fight with their punters in the same way and at a time when 13 clubs have voted for standing. Brighton's middle management have come at this from the wrong direction, as did Charlton's. Its a cultural thing, just not customer focussed enough and distinctly lacking in imagination. I do scratch my head as really, its not difficult. Think, "how can we help" not " how can we hinder"

 

[Working class pride]

I agree that there should be flexibility, but you're singling out the football clubs when there are other forces at play. The Taylor Report did more than just do away with terraces, it gave local authorities (who grant the safety certificate) and the police far more power with regard to things like segregation. One example, Man U fans persistently stood in our away end. Many fans do, but Greenwich council decided to make an example of them (for whatever stupid reason they liked) and ordered us to cut their allocation from 3,400 to 2,000 for future games. Charlton complained, Greenwich said if you don't we will revoke your safety certificate and you won't be able to use the Valley for matches full stop. Net result: CAFC lost 1,400 seats worth of revenue as a result of Man U fans behaviour (standing) and the back half of the away end remained empty for their future visits. Now that is absurd, but there was nothing Charlton could do about it. As I say, post Hillsborough/Taylor Report the councils and police have more scope to interfere re football matchdays. The points you make are valid, but its not the football clubs you should be complaining about - rest assured Charlton like any club/business would want as many paying punters through the gates as possible, but where away fans/segregation comes into play the council and police make the rules

I hear all that, and in that instance, Charlton did their best and fair enough. They should however try and get people in and not turn them away. As long as they do that, then fair play. But dont just stop there, keep trying and you never know what can be achieved. The police also as we all know need a cultural change, and to be fair, they are trying also.

 

[Se20]

This is an interesting read, with so many different views on events, but it will certainly be interesting come March when the accounts for 2011/2012 are revealed.
I think what was telling was the appointment of Mr Barber, and it appears his remit was, increase revenue streams. With the lack of spending in the summer ( compared to the previous year) increased prices of the match day experience ( resulting in Azure given the heave-ho) the expansion of the ground, and referred to being "customers", all point to things being not too rosy off the field.
My personal view is repayments have started for the loan, what other reason could it be ?

 

[GingerBeerMan]

I have a degree in accounting. Loan repayments cannot be counted as costs against profit.

They can't, interest is taken into account, capital repayments are not.

Clears it up, thanks. Also am I right in remembering the loan from TB was interest free and as such has no bearing on the profits/loss of our club?

As said, it's all speculation until the reports are published.

 

[El Presidente]

I'm not an accountant but I thought that if there is a "debt repayment", then that would go against profit? Or looking at it another way, you "do a starbucks"

You're 100% wrong WCP, best stick to the Latvian ladies mate!

 

[El Presidente]

Clears it up, thanks. Also am I right in remembering the loan from TB was interest free and as such has no bearing on the profits/loss of our club?

Correct.

Also, from a practical point of view, why would TB want loan repayments when he has just agreed to dip his hand into his pocket for a further £20-30 million for the training facilities?

 

[Chicken Runner61]

I'm sorry and I don't wish to be rude but most people on here have no idea about the costs of running a business let alone a stadium.

All some people see is 25k fans turning up every other week and spending say £50-60 each. That might seem a lot of money but its not and when you take off match day costs its probably not enough to run the stadium each year let alone players wages and day to day staff wages.

When you add on wages and the costs of running AITC and all the other daily costs you would probably then understand where all the TV, shirt sales, corporate and 1901 etc etc money goes and I bet we are running at a loss still.

The ground and training costs must be adding to losses even with TB's money and without that I bet we would have had a very small budget stadium.

You try running a business and you will be amazed at where money disappears too no matter how much is coming in. If our crowds drop to 14k while we are still paying off debt I suspect the club could have a real problem unless TB keeps funding us.