FFP

Leeds United news here, transfer rumours, club affairs, players, fans, etc.
Specific match discussions should go in the category below.
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SCOTTISH LEEDS
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Re: FFP

Post by SCOTTISH LEEDS »

DominanceUK wrote:
rigger wrote:That's not a loophole at all - it's because the deal was for a loan of one year with the option to buy at the end of it, which they've exercised perfectly legally.
They paid £40m for the transfer fee, Rigz. Loop hole somewhere.
Yes they paid a £40m fee but it was part of the loan deal before the transfer ban had come into effect, which mean's the deal stands.
DominanceUK
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Re: FFP

Post by DominanceUK »

SCOTTISH LEEDS wrote:
DominanceUK wrote:
rigger wrote:That's not a loophole at all - it's because the deal was for a loan of one year with the option to buy at the end of it, which they've exercised perfectly legally.
They paid £40m for the transfer fee, Rigz. Loop hole somewhere.
Yes they paid a £40m fee but it was part of the loan deal before the transfer ban had come into effect, which mean's the deal stands.
Thank you for clearing that up, guys. More fool them then, £40m for one of the worst MDF's I've ever seen. More money than sense.
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Austin91
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Re: FFP

Post by Austin91 »

rigger wrote:That's not a loophole at all - it's because the deal was for a loan of one year with the option to buy at the end of it, which they've exercised perfectly legally.
I believe it was due the fact he was already registered as a player. My understanding is that the ban is on registering players, not the actual purchase (Leicester has a similar situation a couple of seasons ago where they bought a player who ultimatly couldn't play cos registered late - and they still had to pay).

For me, FFP is frustrating as, as people have alluded too it allows those with money to maintain positions and those without money have no chance. For me, what should be done instead is the banning of these chairmen no interest 'loans' to their clubs, which they then leverage against the club and ultimatly claim back. I think if an owner wants to pump money into a club they are more than welcome, as long as thats what it is, a payment to help with the club with no expectation of getting it back or 'loan' added to the clubs books.
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Re: FFP

Post by Deleted User 728 »

DominanceUK wrote:
rigger wrote:That's not a loophole at all - it's because the deal was for a loan of one year with the option to buy at the end of it, which they've exercised perfectly legally.
They paid £40m for the transfer fee, Rigz. Loop hole somewhere.
It's NOT a loophole because the price was fixed as part of the loan deal.
This is really common.

It's no different to us allowing Spurs to sign Clarke on condition they loan him back to us for a season - it's just a clause in the contract like any other bonus, penalty or added fee.
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SCOTTISH LEEDS
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Re: FFP

Post by SCOTTISH LEEDS »

Sales like Pontus Jansson’s and Jack Clarke’s at Leeds United have a very reasonable, real and threatening answer, fans were reminded in Australia on Monday.

Executive director Paul Bell joined former Whites Michael Bridges and Tony Dorigo at Perth’s Cottesloe Beach Hotel to host fans as part of the club’s centenary pre-season tour.

Bell, who leads the off-field business side of United, was put on the spot by fans in a question and answer session.

Jansson’s exit, confirmed last week, was questioned by one fan and while Bell made it clear it was not for him to comment on the finer details, he also painted a clear picture on the reality of the situation.


“There’s a reasonable answer to all of this. You look at the Championship now and Financial Fair Play, or Profitability and Sustainability as it’s now called, has been talked about, talked about, talked about,” he said.

“Last year, for the first time, you saw the rules have teeth. You saw Birmingham [City] cheat the rules, bust the bank and they had a horrendous year the year before last, spent way above their means and you saw they got a nine-point penalty.

“That’s really put into focus all Championship clubs now, this three-year rolling loss limit of £39m is a genuine deterrent from breaking the rules.

“You’ve seen recently the clubs looking at doing different things to try and ensure they don’t break the rules.

“It’s well documented Derby [County] sold their stadium, Aston Villa, Sheffield Wednesday, their accounts came out this week and they’ve made £38m profit on the sale of Hillsborough.”

He added: “People talk about it and people have scant disregard for it, but we have to be very mindful there are a set of regulations in place we have to adhere to because we can’t run the risk of having point deductions, particularly when we’re chasing the dream of the Premier League.

“Imagine if that had happened to us this year, so close and to get nine points taken off.

“By the time it went to the tribunal it didn’t happen until April, but these are real things we need to be mindful of.”

With the sales of Clarke and Jansson likely to be followed by several more million pounds in sales of fringe players, the Whites are in a healthy situation, even after splashing out on Helder Costa.

Bell, who keeps a close eye on the financial picture at Elland Road, waxed lyrical about the current status for the Whites and how healthy they looked moving forward.

“We as a club, in terms of revenue, just to give you some kind of barometer, we did over £40m worth of turnover,” he said.

“Sheffield Wednesday’s latest accounts show they turned over £25m. I’m just using that as a barometer and example.

“People often put Sheffield Wednesday and Leeds into the same sort of bracket: big clubs in Yorkshire.

“We’re doing extremely well and we look at all of our revenue streams over the last 12 months and they’re all fantastic.

“We’ve got record season ticket numbers, we’ve got record hospitality numbers, last year we sold 72,000 replica shirts.

“It’s phenomenal, honestly it’s phenomenal and when we look at the club, it’s ready for the Premier League.”
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Re: FFP

Post by isrodger »

NottinghamWhite wrote:I’m sure I’m not the only one who doesn’t understand this ruling. Could someone in lay mans terms explain what it covers & what it effects. It appears to be riddled with loop holes ( Villa selling their ground to the owner in order to comply )

Confused of Nottingham
Here goes pal.....

The maximum loss limit is now £13m per Championship season - the owner is free to supplement the club’s income up to this level.

Losses are assessed over three seasons, therefore a loss in season 3 of £50m can be offset/by a profit of £11m in years 1 & 2.

Some expenditure (Youth development, Women’s Football spend) is excluded from the calculation, as is capital expenditure (ground development).

Clubs relegated from the Premier League are allowed to make losses of up to £35m in respect of any season spent in the top flight.

In the 2016/17 season we made a profit of £1m, last season we lost £4m therefore permissible losses for the next 2 seasons are a combined £35m.

Now for the confusing bit....

Transfer fees are also counted, although they are broken down and spread - “amortised” - over the life of a contract and so can be structured shrewdly to minimise their FFP impact.

For example, when we sign Costa next year for £15m on a five year contract the fee will be amortised at the rate of £3m a year. At the end of a player's contract, their 'book value' will therefore be zero.

The amount amortised each year is counted as a 'cost' in the club's FFP calculations.

The cash outlay / income for a player varies from how the the fee is accounted for in the P&L.

We spent £28m in transfer fees in 2017/18 assuming the average contract was 3 years the spend will hit the P&L at £9m per annum for 3 years. The income of from sale of Wood & Taylor etc of circa £27m was accounted for in full that year. Hence a profit on transfers of £18m that year.

Last summer ignoring loan fees (which are direct costs that year) in cash terms we broke even in the transfer market the sale of Viera, Antonsson etc paying for Douglas and Bamford. The £10m income would hit the P&L immediately however the £10m expenditure would hit the P&l @ circa £2.5m per annum for 4 years.

This summer we have paid £250k to Carlisle, and collected £9m Clarke, £4m Jansson, £2.5m Saiz, Ekuban £1m circa £2m Halme, Wilks, Dalby etc. The majority of that revenue will hit the P&L as profit.

In 2017/18 Radz effectively made a owners contribution of £11m with the introduction of the 49rs money. He’s made no such contribution last season or this season to date.

It would be safe to say Radz probably takes a £1m in expenses out of the club per annum. Lufc or Eleven sports pay his Net Jets account, prior to 2017/18 he did not take a salary.
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johnh
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Re: FFP

Post by johnh »

Article in the Telegraph Sport today.

UNITED DEBT 'to last 158 years'

The financial liability incurred when the Glazer family bought Manchester United in 2005 means it will be 158 years before the club are entirely debt free, according to a supporters' group............... they point out that just £44m of the more than £660m initially taken out to buy the club has been paid back. That means that in the 14 years since the American owners took control, some £750m has left the club's bank account simply to service the debt.

I wonder where this stacks up in the mystery that is FFP?
I once played against Don Revie.
isrodger
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Re: FFP

Post by isrodger »

johnh wrote:Article in the Telegraph Sport today.

UNITED DEBT 'to last 158 years'

The financial liability incurred when the Glazer family bought Manchester United in 2005 means it will be 158 years before the club are entirely debt free, according to a supporters' group............... they point out that just £44m of the more than £660m initially taken out to buy the club has been paid back. That means that in the 14 years since the American owners took control, some £750m has left the club's bank account simply to service the debt.

I wonder where this stacks up in the mystery that is FFP?
It has no impact whatsoever Man United have made profits every year which more than service the debt.

The club is worth circa £2b debts of circa £300m and makes a profit before tax and interest ( Ebitda ) of £200m per annum. They could conceivably spend £500m in the transfer market this summer and still be with FFP parameters.
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johnh
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Re: FFP

Post by johnh »

isrodger wrote:
johnh wrote:Article in the Telegraph Sport today.

UNITED DEBT 'to last 158 years'

The financial liability incurred when the Glazer family bought Manchester United in 2005 means it will be 158 years before the club are entirely debt free, according to a supporters' group............... they point out that just £44m of the more than £660m initially taken out to buy the club has been paid back. That means that in the 14 years since the American owners took control, some £750m has left the club's bank account simply to service the debt.

I wonder where this stacks up in the mystery that is FFP?
It has no impact whatsoever Man United have made profits every year which more than service the debt.

The club is worth circa £2b debts of circa £300m and makes a profit before tax and interest ( Ebitda ) of £200m per annum. They could conceivably spend £500m in the transfer market this summer and still be with FFP parameters.
I take your point but your 'debt' figure of £300m looks low. If the club have paid out £750m servicing the £660m borrowed, then this debt must be shown in the accounts and there is still over £600m outstanding.
I once played against Don Revie.
isrodger
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Re: FFP

Post by isrodger »

johnh wrote:
isrodger wrote:
johnh wrote:Article in the Telegraph Sport today.

UNITED DEBT 'to last 158 years'

The financial liability incurred when the Glazer family bought Manchester United in 2005 means it will be 158 years before the club are entirely debt free, according to a supporters' group............... they point out that just £44m of the more than £660m initially taken out to buy the club has been paid back. That means that in the 14 years since the American owners took control, some £750m has left the club's bank account simply to service the debt.

I wonder where this stacks up in the mystery that is FFP?
It has no impact whatsoever Man United have made profits every year which more than service the debt.

The club is worth circa £2b debts of circa £300m and makes a profit before tax and interest ( Ebitda ) of £200m per annum. They could conceivably spend £500m in the transfer market this summer and still be with FFP parameters.
I take your point but your 'debt' figure of £300m looks low. If the club have paid out £750m servicing the £660m borrowed, then this debt must be shown in the accounts and there is still over £600m outstanding.
Not an expert mate but at last accounts 31st march 2019 - AND YOUR CORRECT the outstanding debt was higher @ excluding player commitments was £495m.
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