Liverpool report debt increase of £21.8m and 10-month loss of £40.5m

You can't be serious.  £100m in debt, given our history, and if, just maybe, you have even an inkling of worry about this, then you're a WUM?!  wow.

The only history we've got regarding financial impropriety is the unfortunate tenure of H&G, to describe that as a part of our illustrious past is unfortunate to say the least and tells a story about the culprit. 

Just saying it as I see it - the 2013/14 report should counteract this one. If it doesn't, then I'll ask questions.  Until then, I'm not worried. It's really simple.

Well.  We had a £40.5m loss over the last 10 months.  So it's not totally irrelevant.  And of course, lest we forget, we are a football club, which means that on the pitch issues have to be taken into account as well, not just merchandising, sponsorships etc.

So it has to be brought up.  The last 10 months includes last summer.  Let's look at our total player outlay for the summer of 2012:

Fees paid to original clubs

£15m - Allen
£10m - Borini
£3m - Assaidi
£3m - Sahin loan fee

= £31m

Then let's add their wages in, and multiply it by 30 weeks starting from August 1:

£45K - Allen = £1.5m
£40K - Borini = £1.2m
£20K - Assaidi = £600K
£115K - Sahin = £2.8m (25 weeks since he left in January)

= about £6m

Joe Allen also got a signing fee of £2m.

total = £39m

If we're honest, none of these players has contributed a single thing at all since they came here in the summer.  In the future?  who knows.  But up to this point, they haven't done a damn thing.  And of course Sahin is already gone.

So out of the £40.5m loss in the last 10 months, if we hadn't purchased these totally useless players, we basically would have broken even.

Reslivo, you say you aren't worried and we'll see what 13/14 has to offer, but the problem is that for the last 3 years we keep digging ourselves in a huge hole by purchasing players who contribute nothing.  Not only do we buy them, but we buy them at exorbitant prices, and we just can't afford to do that anymore.  Literally, we can't afford it.

So the reason why I think you and everyone else should have some worry is because there is very little sign that this is going to end anytime soon.  What if our wonderful 13/14 outlook that you mention is then flushed down the toilet this summer by £20m on Ashley Williams, £15m on another flop, and so on and so forth? 

Nothing to worry about. It's just documenting the major F**k ups of the last two years. Any rise in debt is not good obviously, but there would only be cause for concern if the club were still carrying out such careless manouevres.

Well.  We had a £40.5m loss over the last 10 months.  So it's not totally irrelevant.  And of course, lest we forget, we are a football club, which means that on the pitch issues have to be taken into account as well, not just merchandising, sponsorships etc.

So it has to be brought up.  The last 10 months includes last summer.  Let's look at our total player outlay for the summer of 2012:

Fees paid to original clubs

£15m - Allen
£10m - Borini
£3m - Assaidi
£3m - Sahin loan fee

= £31m

Then let's add their wages in, and multiply it by 30 weeks starting from August 1:

£45K - Allen = £1.5m
£40K - Borini = £1.2m
£20K - Assaidi = £600K
£115K - Sahin = £2.8m (25 weeks since he left in January)

= about £6m

Joe Allen also got a signing fee of £2m.

total = £39m

If we're honest, none of these players has contributed a single thing at all since they came here in the summer.  In the future?  who knows.  But up to this point, they haven't done a damn thing.  And of course Sahin is already gone.

So out of the £40.5m loss in the last 10 months, if we hadn't purchased these totally useless players, we basically would have broken even.

Reslivo, you say you aren't worried and we'll see what 13/14 has to offer, but the problem is that for the last 3 years we keep digging ourselves in a huge hole by purchasing players who contribute nothing.  Not only do we buy them, but we buy them at exorbitant prices, and we just can't afford to do that anymore.  Literally, we can't afford it.

So the reason why I think you and everyone else should have some worry is because there is very little sign that this is going to end anytime soon.  What if our wonderful 13/14 outlook that you mention is then flushed down the toilet this summer by £20m on Ashley Williams, £15m on another flop, and so on and so forth? 

Try reading the article properly mate. 

The 10 months is up to 31st May 2012 so it doesn't include any transfers, in or out, that have been done since Brendan arrived.

Try reading the article properly mate. 

The 10 months is up to 31st May 2012 so it doesn't include any transfers, in or out, that have been done since Brendan arrived.

Wow, put my foot in my mouth there.   Thanks mate.

Although, to be honest, I really don't think we want to switch the numbers up and go from August 2011 - May 2012, because then the numbers would look even worse:

£20m - Downing
£16m - Henderson
£9m - Adam
£7m - Coates

= almost £50m

That's before we even go on their wages.

So basically if we didn't buy those players, we wouldn't have been in debt for those 10 months. 

Simple as that.

Nothing to worry about whatsoever.

Yet.

I agree though. We're 12 months away from knowing our position.

Shows what a shambles H&G left us in (if everything else didn't). Still paying for their incompetence and their sidekick Purslow.

Liverpool Echo

          LFC's Debts rise by £22m

Liverpools debt rose by almost £22m to £87.2m the club's latest set of accounts released today show.
But Anfield directors insist the cost of squad rebuilding in a period without any European football at all played a big part in the £21.8m net increase.
Significant instalments due on the previous transfers of Stewart Downing and Jordan Henderson - plus paying off under achieving players in order to get them off the books - are also part of the reason for the rise.
The club insist fans should not be worried by the rise in debt and highlighted an interest-free £46.8m inter company loan, since made by FSG as evidence of an ongoing commitment to return the club to full health both on and off the field.
That FSG loan has now seen the debt figure being reported today reduced.
Liverpool also point to still growing commercial revenues and the club's continued position in the Deloitte list of top 10 European clubs as reasons for optimism over the future - the only side not involved in European competions to male Deloitte's prestigious money league shortlist.
The record breaking Warrior kit deal - worth £25m a year over six years is not included in the financial snapshot just lodged with Companies House .

full story:-
 http://www.liverpoolecho.co.uk/liverpool-fc/liverpool-fc-news/2013/03/04/liverpool-fc-debts-up-by-
22m-to-87-2m-new-club-accounts-show-100252-32916775/

Wow, put my foot in my mouth there.   Thanks mate.

Although, to be honest, I really don't think we want to switch the numbers up and go from August 2011 - May 2012, because then the numbers would look even worse:

£20m - Downing
£16m - Henderson
£9m - Adam
£7m - Coates

= almost £50m

Well it equals £52M. Not that your figures are correct though. Adam was never £9M.

just going to throw in an accounting POV

i also do not think there is a cause of immediate concern.  to me, it looks like the realignment of the fiscal period, the write offs and debt is FSGs way to quickly close that nightmare portion of our history (high spending, stadium, salaries).  I'll be more interested in the following 12 months as it will more accurately reflect our revenues and expenses.  In accounting we look at trends and our past few years vs this current year, I would say LFC has made a material change to its strategy... to be more fiscally responsible. 

to give you guys an analogy, when a company goes into a loss and starts to layoff ppl..  usually the fiscal period right after shows a bleak picture still (lots of severance pay etc)... but once that is passed, the financial position of the company improves.... I see LFC the same.

None of this will be unexpected. Between the stadium write off, sacking and subsequent payoffs for several members of back room staff and a lack of Champion's league football after huge investment in the team, we where never going to make a profit. All of this will have been budgeted for this year hence wage trimmings and reduced team investment. It only becomes a concern if this is a trend and until the next set of accounts are released, we're not going to know if it is.

Wow, really caught surprised and felt downbeat when read we are in serious debt again but after reading our forumers comments and analyst, the pros and cons of it all, feeling a bit relieve now. Guess still reeling from that last debt situation debacle.

just going to throw in an accounting POV

i also do not think there is a cause of immediate concern.  to me, it looks like the realignment of the fiscal period, the write offs and debt is FSGs way to quickly close that nightmare portion of our history (high spending, stadium, salaries).  I'll be more interested in the following 12 months as it will more accurately reflect our revenues and expenses.  In accounting we look at trends and our past few years vs this current year, I would say LFC has made a material change to its strategy... to be more fiscally responsible. 

to give you guys an analogy, when a company goes into a loss and starts to layoff ppl..  usually the fiscal period right after shows a bleak picture still (lots of severance pay etc)... but once that is passed, the financial position of the company improves.... I see LFC the same.

It's amazing how many people didn't actually read the article properly, and failed to notice the dates.

None of this will be unexpected. Between the stadium write off, sacking and subsequent payoffs for several members of back room staff and a lack of Champion's league football after huge investment in the team, we where never going to make a profit. All of this will have been budgeted for this year hence wage trimmings and reduced team investment. It only becomes a concern if this is a trend and until the next set of accounts are released, we're not going to know if it is.

Of course mate these stats would be accounted for and adjustment no doubt applied - illustrated by the interest free loan sorted out by FSG in an inter-company transaction.
For the most part the statement of account consists of extrordinary payments, the declaring of these payments has no doubt been made in a less challenging part of the financial year in an effort to consolidate and strengthen at a later date.
With the full financial term taken into account this is indeed a snapshot of a much bigger picture, fiscal hysterics are certainly not required.

Oh well at least that Guardian report didn't include this classic quote from Ayre in the Liverpool Echo:

“I think there has never been a better time for Liverpool Football Club – ever – to have success than now because we have such a great team of people and depth to the infrastructure. Everything is there to capitalise upon it.”

That's some bullshit they are expecting us to swallow though!!

Remind us again Ian about what positions at the club need filling?

On a related note to our debt, the Independent reported this:

Liverpool spent £10m to sack Kenny Dalglish

Liverpool's dismissal of Kenny Dalglish as manager cost the club nearly £10m, new accounts reveal.

They paid £9.6m in termination payments in the 10 months to June last year. The club also lost a total of £40.5m in that period and net debt rose by £22m to £87m.

However, despite a wage bill that equates to £131m over a full year, the managing director, Ian Ayre, claimed the figures represent a transitional period and "a new transfer strategy" is in place.

He said: "This shows in players like Jose Enrique and Sebastian Coates. We will continue to invest in players and have a better structure in deals with them."

http://www.independent.co.uk/sport/football/premier-league/liverpool-spent-10m-to-sack-kenny-dalglish-8520082.html

On a related note to our debt, the Independent reported this:

Liverpool spent £10m to sack Kenny Dalglish

Liverpool's dismissal of Kenny Dalglish as manager cost the club nearly £10m, new accounts reveal.

They paid £9.6m in termination payments in the 10 months to June last year. The club also lost a total of £40.5m in that period and net debt rose by £22m to £87m.

However, despite a wage bill that equates to £131m over a full year, the managing director, Ian Ayre, claimed the figures represent a transitional period and "a new transfer strategy" is in place.

He said: "This shows in players like Jose Enrique and Sebastian Coates. We will continue to invest in players and have a better structure in deals with them."

http://www.independent.co.uk/sport/football/premier-league/liverpool-spent-10m-to-sack-kenny-dalglish-8520082.html

Again a slightly exaggerated headline by the media.  The termination costs will also include Comolli, senior management and other backroom staff that left during this period.

What are Seb and Jose earning?

What are Seb and Jose earning?

Seb - £25k
Jose - £65k

Around that.

Not concerned at all. You can make accounts look as bad as you want for whatever reason, I did the same when in business.

True enough mate and the obvious conclusion is that perspective is to the advantage of the individual/company formulating the information.

Blame Kenny#

 

It's amazing how many people didn't actually read the article properly, and failed to notice the dates.

Not amazing, just par for the course.

Numbers dont lie...on the other hand, people who do the numbers...

Nothing to worry about, its normal, and, from a financial point of view, expected. I would worry if we see more or less the same next year.

 Why do we need a facility to borrow £120 million ?

 The only reason I can see for this is so we (LFC) can pay FSG back there interest free loan.