How can we be running at a loss due to the wage bill?

[ComeOffit 0]

I dont know what's more ridiculous, Green saying he'll give Ally £10m for players, or actually giving Ally £10m for players.

[Stimpy 0]

Here's a point from last night's meeting that I thought was maybe worthy of discussion in a new thread:

 

Green apparently said at the meeting that we're running at a loss and the reason for it is the wage bill, specifically high earners who've been kept on because we'll need them on our return to the top. Not his exact words, but that's the gist of what was said by the sounds of it, right?

 

Well, how many times has Green boasted about the health of our finances and that our wage bill has been massively reduced to a fraction of our turnover?

 

He's talked about it repeatedly including during his recent interview on Sky, so I find it hard to fathom how it can be both.

 

He can't say we've massively reduced the wage bill to a fraction (was it about a third?) of the turnover, then turn round the next week and say we're running at a loss this season due to the high wage bill.

 

Am I missing something here or is this a complete contradiction?

 

From memory the club's forecasting expenditure of £32m for the next three/five seasons. First year we will post a loss of £3m (if those forecasts are still accurate) then profit the following year via increased ST prices and other commercial revenue. The trend was profits increasing year on year without any actual cuts, just growing the income year on year.

 

While this is going on we have the IPO cash sitting in the bank and whatever comes in from selling the naming rights to the stadium. The five year plan appears for us to be cash rich by the time we're back playing at the top again.

[Zappa 0]

The only way to make this deal work is by increasing the income. Not sure if Green had this in mind when he stated that.

 

Maybe or he might have just been talking total nonsense. Either way, when the club's just gone through what it went through last year, I don't think it's right to be going on about having 10 million sitting waiting for Ally to spend on players. Even if it's true and there is £10m sitting waiting for Ally, that's not the right way for the CEO to try and highlight the ludicrous and unfair transfer embargo in televised interviews on Sky etc when there's unpaid creditors out there.

[Zappa 0]

From memory the club's forecasting expenditure of £32m for the next three/five seasons. First year we will post a loss of £3m (if those forecasts are still accurate) then profit the following year via increased ST prices and other commercial revenue. The trend was profits increasing year on year without any actual cuts, just growing the income year on year.

 

While this is going on we have the IPO cash sitting in the bank and whatever comes in from selling the naming rights to the stadium. The five year plan appears for us to be cash rich by the time we're back playing at the top again.

 

Aside from posting a loss for the first year, that's a magic 5 year plan then! The club gets back to the top rolling in dosh with tens of millions in the bank, all while Green & co get minted too.

[simplythebest 0]

Maybe or he might have just been talking total nonsense. Either way, when the club's just gone through what it went through last year, I don't think it's right to be going on about having 10 million sitting waiting for Ally to spend on players. Even if it's true and there is £10m sitting waiting for Ally, that's not the right way for the CEO to try and highlight the ludicrous and unfair transfer embargo in televised interviews on Sky etc when there's unpaid creditors out there.

 

Come on Zap, we can't carry the can for Whyte's crimes forever.

[Stimpy 0]

Aside from posting a loss for the first year, that's a magic 5 year plan then! The club gets back to the top rolling in dosh with tens of millions in the bank, all while Green & co get minted too.

 

Pretty much, yeah.

[Zappa 0]

Pretty much, yeah.

 

If an everybody including the club get's rich scheme like that is easy to achieve you have to wonder why it took Duff & Phelps 4 months to sell the goldmine.

[Zappa 0]

Come on Zap, we can't carry the can for Whyte's crimes forever.

 

No we can't, but neither can we simply ignore what's happened in the past 12 months as if it didn't occur.

[der Berliner 3,325]

He has access to data and stats that we don't have. If he's saying that we do not want to spend more than 30% of our turnover (?) on salaries and we are not doing it right now, we're effectivly running at a loss ... by his own words. We cannot risk to a) give the high-earners (if any) worse contracts as that would be a breach of contract and actually not appropriate, as they remained loyal to the club. Furthermore, we would be out of the quality and most experienced players in the side. So for the time being, we are "stuck" with them.

As for the money "made" thus far, do keep in mind that the club - i.e. newco - has recently paid off all transfer debts of the olcdo.

 

Still, as we do not have any real figures, we are left with guesswork for the time being. I for one won't take a negative slant on this by default though.

[rbr 1,247]

It was stated in the summer that we would run at a small loss this year why an 11 pager now