" MAY 2012 CCFC ACCOUNTS "

I have pm Keith Morgan aka Since 62.
Thank you Keith for your time and effort in putting them out.

These are Keiths readings of them.

" MAY 2012 CCFC ACCOUNTS "


I have now had a brief read through the May 2012 accounts which were available for download when I logged in this morning , and these are some of the key points.

Despite an increase in income for the year to £20.2m (2011 £15.9m) , the annual loss for 2011/12 went up to £13.5m (2011 £12m).

The increase in turnover was due to a £1m increase in gate receipts , £2.4m in extra advertising and sponsorship (inc. £1m in shirt sponsorship from one of VT`s Malaysian businesses) and nearly £1m extra from TV money etc.

The extra £4m in income was more than overturned by big increases in expenditure , the main elements of which were

a) nearly £2m of extra administrative expenses (a rise of over 30%!!) - I dont know why such a big increase as the accounts don`t have to reveal a breakdown of this

b)an exceptional item of £1.6m relating to compensation for the dismissal of Dave Jones and others

c) an increase in interest payable of £1.2m to £3.3m - all related to the interest on the VT loans

d) an increase in cost of sales (mainly the wage bill) of a net £1m. The wage bill actually went up by £3.9m after the exceptional item in b) above , so some other costs in this category must have come down by £2.9m.


As a result of the above losses , the balance sheet position got worse by £13m or so , and the asset and liability position was as follows at 31 May 2012

The main asset in the balance sheet was the stadium at £48.4m. There is a note in the accounts suggesting it was going to be revalued in the current financial year to its "replacement cost" - I presume to give a value increase and help with the Financial Fair Play Rules.

Players were shown at a total value of just £2.3m (so undervalued because of the way clubs value them for accounts purposes).

There was cash at bank of £0.5m and some debts due to the club of £2.2m.


On the liabilities side , there were debts recorded as due and payable before 31 May 2013 of £51.9m and debts recorded as payable after 31 May 2013 of £31.2m.

So total recorded debts of £83.1m , but this actually overstates the reality of the position.

Included in the £51.9m is £37.4m due to VT and associates. If he sticks to his promise to convert this to shares ,then all of this liability disappears.
There is also about £3m relating to the fact that season ticket holders had already paid in advance for the following season - none of this repayable in cash - and £3.6m due to PMG (was £7.7m the year before) which is being paid off in instalments.

Included in the £31.2m is £19.2m due to Langstone (£15m plus 4 years interest at £1m a year)and £9m re stadium naming rights , plus £2.9m due to Player Finance fund (was £3.4m the year before).
There has been much talk of settling the Langstone debt at or around the £10m or £12m mark (including SH suggesting he would accept the latter) , so the £19.2m seems greatly overstated. Also , none of the £9m re naming rights will be paid out of club assets as , to the extent they will ever be paid for , it will be paid by the buyer of those rights , not the club itself.

Player Fund are only paid as and when the club sells a player , and no interest is accruing on the debt. I expect it to be paid off in the Summer , either from selling players we deem not good enough for the Premier or (god forbid) we sell because we don`t get promoted.

So the headline level of £83m of total debts is not as worrying as first seems. At least £16m can be written off the Langstone debt if settled shortly and a further £37m of VT debt should be converted to shares. So the total debts would then come down to £30m from the headline figure.

On a related note , there is provision to pay Langstone a further £5m if the club gets promoted before it has paid off the £15m plus accrued interest figure. So the club can settle the debt before promotion and avoid that further potential liability.

In summary , the loss of £13.5m is worrying in that it shows that the club simply cannot run at Championship level without making a big loss , but the resultant balance sheet position is not as bad as it first appears.

A second worry for me is the big increase in administrative expenses which we were assured would be better controlled and reduced when the new investors came on board.

Hope this helps. If not , it wasn`t me who wrote it

Keith

Any debt is worrying but not as bad as some were portraying in recent times. Or have Imissed something?

Thanks Keith. It's good to have someone on here who can explain all things things financial

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

If I remember right he said it would be done after The Sam issue was finalised. If so, there's your answer!

Looks like the debt to Sam could double in the event of promotion then

so Hammam gets another 5 million if we're promoted, that explains a lot

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

If I remember right he said it would be done after The Sam issue was finalised. If so, there's your answer!

Looks like the debt to Sam could double in the event of promotion then

Gav, you are correct. He did say that. Not sure the debt will double, as I still believe VT knows what he is doing but only time will tell

How is the new job going, mate?

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

If I remember right he said it would be done after The Sam issue was finalised. If so, there's your answer!

Looks like the debt to Sam could double in the event of promotion then

Gav, you are correct. He did say that. Not sure the debt will double, as I still believe VT knows what he is doing but only time will tell

How is the new job going, mate?

Oops just reread it, extra 5 million I meant, no wonder Sam is not rushing to get it sorted, if the money's written off in the accounts I guess they've accepted that it will have to be paid, hopefully after that's paid we can move onto the debt to equity swap!

New job is great Sven, nice to hang up them fire boots once and for all!

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

If I remember right he said it would be done after The Sam issue was finalised. If so, there's your answer!

Looks like the debt to Sam could double in the event of promotion then

Gavin,

Personally I see Sam/Langston getting £30 mill after we are promoted. Tan should of settled in full last July at £10mill plus £5 mill if promoted.

At this current moment.

Langston charge our club 7% interest.
Tan charges our club 7% interest.
PMG charge our club 7% interest.

I JUST WANT OUR CLUB DEBT FREE ONCE AND FOR ALL, THATS ALL IVE EVER WANTED.

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

If I remember right he said it would be done after The Sam issue was finalised. If so, there's your answer!

Looks like the debt to Sam could double in the event of promotion then

Gavin,

Personally I see Sam/Langston getting £30 mill after we are promoted. Tan should of settled in full last July at £10mill plus £5 mill if promoted.

At this current moment.

Langston charge our club 7% interest.
Tan charges our club 7% interest.
PMG charge our club 7% interest.

I JUST WANT OUR CLUB DEBT FREE ONCE AND FOR ALL, THATS ALL IVE EVER WANTED.

Just read the info again break down of what's owned to Sam appears to be:

£12 million - currently owned plus whatever the annual interest is on that (£490000 is your correct at 7%)

£5 million - extra if we are promoted

£9 million - for the sale of naming rights (but our club may not necessarily buy those themselves, I bet one of Tan's buddy's will scoop those rights up)

does the club pay dividends to its other share holders?

I wonder if we had to get Sams permission to change it from Cardiff city stadium to Cardiff City Football club.

Thanks Annis for the post

These accounts are for May 2012 right. That's before this season started correct! With the sales of red/black/blue shirts, TV venues and etc... I wonder if the debts at present has gone significantly down or up?

Thanks Annis for the post

These accounts are for May 2012 right. That's before this season started correct! With the sales of red/black/blue shirts, TV venues and etc... I wonder if the debts at present has gone significantly down or up?

Well we've spent at least 18.5 million in wages, plus all the transfer fees last summer, so I think they've gone up a fair bit, but I'm confident that Tan will come through with his promises, one things for sure promotion is VERY important to our clubs future financially!!

Base it on the figures in we have:

83 million debt
13.5 annual losses
10 on summer transfers

= £106.5 million

All that being said, I'm not that worried personally, as long as the Malaysians are in place the futures bright (in my opinion)

great post just a quick question the 30 mil can that be put against profits so the club pays less tax sorry if thats a stupid question

I spend more than that in a weeks shopping.

It just goes to show how complicated Accounts are. In cash terms I suppose you have to say Annis was correct in saying we were £82m in debt last May (£81.6m actual). His estimate is around £105m now and again it seems reasonable to assume that is correct.

However, once you start messing with plus/minus and the if/when's the figure can come down to as low as (if that's the correct term) £30m.

On another note when I go through these things I like looking for the odd fee which never gets talked about. This year its the £16,000 the auditors charged for producing these accounts. Not bad work if you can get it

Might aswell be a billion quid because as fans we dont have than money in the OP eitherway, just support the team is all we can do, gone past the care stage now i have

great post just a quick question the 30 mil can that be put against profits so the club pays less tax sorry if thats a stupid question

The club paid no Corporation Tax, meaning we are as bad as Starbuck's & Amazon

Might aswell be a billion quid because as fans we dont have than money in the OP eitherway, just support the team is all we can do, gone past the care stage now i have

This is the key point

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

If I remember right he said it would be done after The Sam issue was finalised. If so, there's your answer!

Looks like the debt to Sam could double in the event of promotion then

So an extra 5 million to Langstone on our promotion . Let me think now .. Why would Langstone be in a hurry to settle ?

Thanks Annis for the post

These accounts are for May 2012 right. That's before this season started correct! With the sales of red/black/blue shirts, TV venues and etc... I wonder if the debts at present has gone significantly down or up?

Well we've spent at least 18.5 million in wages, plus all the transfer fees last summer, so I think they've gone up a fair bit, but I'm confident that Tan will come through with his promises, one things for sure promotion is VERY important to our clubs future financially!!

Base it on the figures in we have:

83 million debt
13.5 annual losses
10 on summer transfers

= £106.5 million

All that being said, I'm not that worried personally, as long as the Malaysians are in place the futures bright (in my opinion)

Obviously the debt has gone up since May 2012.

However, as Since '62 explained previously (and is contained within the accounts notes) any transfer expenditure on new players will be evened out over the length of their contracts. I think the example given was Nicky Maynard who will cost £850,000 next year and the year after etc.

So if we take this summers £10m out lay (if that is what it was) as an example then the next accounts should show an extra £2.5m expenditure if we assume all the contracts were over 4 years.

Oh I missed that, I suppose it's just an annual account friendly way of doing it, but it does make sense.

So an extra 5 million to Langstone on our promotion . Let me think now .. Why would Langstone be in a hurry to settle ?

Well at risk of opening up the whole Langston debate again, you pick up a very good point there. As the £5m only has to be paid if the £15m continues to be outstanding when we gain promotion you would think that now might be a good time to pay Sam £10m?

Oh I missed that, I suppose it's just an annual account friendly way of doing it, but it does make sense.

Yes but NM on his own has added the best part of a £million's to the debt. Although if VT is good to his word it doesn't really matter.

So an extra 5 million to Langstone on our promotion . Let me think now .. Why would Langstone be in a hurry to settle ?

Well at risk of opening up the whole Langston debate again, you pick up a very good point there. As the £5m only has to be paid if the £15m continues to be outstanding when we gain promotion you would think that now might be a good time to pay Sam £10m?

Surely he wouldn't accept it?? He can drag his feet for another few months for a chance of getting the extra £5 mil? I would!

So Mr Tan has "loaned" £37m to the club? So it isnt his debt, its the clubs debt and they owe it to him, yet he is the owner?
If it all went wrong, the club would owe all that money and he (Tan) could collect from the one major asset - the stadium.
Note - he hasnt loaned more than the stadium is worth . Maybe im way too cynical, and he will convert the debt into shares, but when will that happen? After promotion?

He said he would (transfer to shares) and he has done what he says so far, hasn't he?

In his own time, mate, In his own time

If I remember right he said it would be done after The Sam issue was finalised. If so, there's your answer!

Looks like the debt to Sam could double in the event of promotion then

Gav, you are correct. He did say that. Not sure the debt will double, as I still believe VT knows what he is doing but only time will tell

How is the new job going, mate?

Oops just reread it, extra 5 million I meant, no wonder Sam is not rushing to get it sorted, if the money's written off in the accounts I guess they've accepted that it will have to be paid, hopefully after that's paid we can move onto the debt to equity swap!

New job is great Sven, nice to hang up them fire boots once and for all!

It's an in interesting time, Gav, but hopefully one with a rosy future

Glad to hear you're enjoying life without the leather boots and rubber hoses!!

Nearly there myself, mate No doubt we'll bump into each other. Take it easy, mate

So an extra 5 million to Langstone on our promotion . Let me think now .. Why would Langstone be in a hurry to settle ?

Well at risk of opening up the whole Langston debate again, you pick up a very good point there. As the £5m only has to be paid if the £15m continues to be outstanding when we gain promotion you would think that now might be a good time to pay Sam £10m?

Surely he wouldn't accept it?? He can drag his feet for another few months for a chance of getting the extra £5 mil? I would!

Correct Gavin, I could not stand another Langston debate. But 100% they wont accept that anymore,they know were def Premier League bound and that means more Dinero, put your selves in their position now. they want £30 mill, Tan had his chance at £10mill plus £5mill and he played games with them.
Like Ive said, I am waiting for the day we are DEBT FREE

So an extra 5 million to Langstone on our promotion . Let me think now .. Why would Langstone be in a hurry to settle ?

Well at risk of opening up the whole Langston debate again, you pick up a very good point there. As the £5m only has to be paid if the £15m continues to be outstanding when we gain promotion you would think that now might be a good time to pay Sam £10m?

Surely he wouldn't accept it?? He can drag his feet for another few months for a chance of getting the extra £5 mil? I would!

Well if I was Sam I wouldn't

Annis,

You'll like this, but i agree with you.
The game changes if we go up.

VT will be in a position where he wants to take full control, (in shareholding terms as well as the 'de facto' position he has at the moment), so will need to pay Sam off, plus the £5m will get added to the debt.

Sam will therefore get more if we go up, but on the other hand maybe VT feels that it will be worth paying to have a Premiership club and the extortionate amount of extra income the club would get. Perhaps he thinks 'I'm not paying more than £10m if we are in the Champ, and if we don't go up by 2016 I'll put the club through unless he takes the £10m. IF we go up I'll take the debt-equity route, take over the club, pay Sam off in line with the agreement (shown in the accounts) £15m + £5 +£4-£5m interest, plus a lump for naming rights (near your £30m)... Sam pretty much gets back what he put in (plus maybe some shares/place on the board to sweeten the deal)... everyone's happy (apart from the kit colour )

Lets hope for the sake of all our sanities that it WILL be sorted.