Tiger's Visit

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OtmoorYellow
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Re: Tiger's Visit

Post by OtmoorYellow » Sun Mar 31, 2019 7:33 pm

I understand that the players were paid by the club scrimping around for the cash to pay them, and having only just about enough.

Coaching and admin staff were not paid, and threatened not to come in on Saturday. The club advised the staff they would be paid on Saturday if they came in. They staff turned up on Saturday and were not paid and were apparently very unhappy and might not staff the club tomorrow (Monday) because of this.

This is no way to run any business, let alone by a man claiming wealth.

This would easily have been prevented by simply always having the next months funding in place, rather than trying to transfer it on a just in time basis.

OtmoorYellow
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Re: Tiger's Visit

Post by OtmoorYellow » Sun Mar 31, 2019 8:49 pm

OK I've read the accounts, but because they are abbreviated accounts, there is much less detail to read than in previous years. There is no requirement for the club to publicly publish full accounts and there hasn't been in living memory, so we've actually had access to a lot of information previously. It would be very helpful to have someone who owns a share or shares in the club at the AGM to get the detailed p&l. The change is a policy decision due to the new owners and seemingly new auditors. There is also a format change to the accounts to comply with up to date financial reporting standards, which make the accounts look more complex to the layman than they really are - much is about terminology changes and the financing of money due to Daryl Eales, rather than changes to how the numbers are computed.

There were player disposals referenced in the accounts, but without the detailed p&l account, the only information we have is the value of their remaining contract at disposal, rather than how much they were sold for. The accounts tell us that there were further player sales post 30 June 2018, whose contracts were referenced in these accounts. To find out who the players are in both circumstances, we would need to look at timing of player transfers in the year ended 30 June 2018.

There was a cash injection of £2.4m in the year, but that was capitalised as new share issues, rather than being part of the p&l, therefore the loss of £2.1m was not affected by the cash injection, and the loss would have been the same amount whether or not the cash injection took place. Essentially the share issue was a takeover tool to provide cash.

The accounts show Eales was owed about £4m in loan notes at 30 June 2018 by the club. As we know, future player disposal values are due to Eales as first dibs to repay his loan notes, so any post 30 June 2018 player sales referred to above, will not benefit the club.

There is a big spend (£0.75m) on tangible assets, which I suspect to be to do with the training ground equipment and buildings, and possibly preparation of the playing surface costs. These have little bearing on losses though as they are capital expenditure and not revenue expenditure.

A review of my player contracts schedule shows the following players left during the year ended 30 June 2018:

Christian Ribeiro
Dwight Tiendalli $
Mike Williamson $
John Lundstram
Ryan Ledson
Aaron Martin $
Wes Thomas $
Jack Payne *
Marvin Johnson
Kane Hemmings
Joe Rothwell $
Todd Kane *
Xemi Fernandez
Riccardinho $
Josh Ashby $
Alex Mowatt *
Agon Mehmeti $
Ashley Smith-Brown *
James Roberts $
Isaac Buckley-Ricketts *
Gino Van Kessel *

The loan players marked * are not relevant for player disposals. The OOC players marked $ are not relevant for player disposals either. Of the remaining, the relevant players are those which will have cost us a fee, and those that will have been sold for a fee.

The players disposed since 30 June 2018 are:

Cameron Norman
Sam Smith (loanee)
Ricky Holmes (loanee)
Canice Carroll
Jonathon Mitchell (loanee)
Ivo Pekalski

So the potentially relevant players are Norman & Pekalski, neither of whom we paid a fee for IIRC, and Canice Carroll who we sold for a fee.

There may also be delayed payments from previous player sales included in club income, as is the club's policy.

On this basis, we can see that the £2.1m loss is despite having received large sums for player transfers. That is quite worrying and without those player sales, I suspect we would be looking at a loss of nearer £5m, and without a continuous supply of saleable talent, that business model is clearly unsustainable in League 1 in our present circumstances.

No wonder it is being said that the playing budget for next season is to be notably reduced.

Myles Francis
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Re: Tiger's Visit

Post by Myles Francis » Mon Apr 01, 2019 8:33 am

Thanks for that Terry. I wasn't sure how the equity injection was treated in the accounts, so that was really useful.

Can we ascertain from these accounts how much, if any, debt owed to DE was written off with the takeover?

Kernow Yellow
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Re: Tiger's Visit

Post by Kernow Yellow » Mon Apr 01, 2019 10:25 am

OtmoorYellow wrote:
Sun Mar 31, 2019 7:33 pm
This would easily have been prevented by simply always having the next months funding in place, rather than trying to transfer it on a just in time basis.
But surely that's the problem - Tiger doesn't 'simply' have the funding available! If he did, as you say he could 'easily' prevent these problems continually happening. Who knows where the money is coming from - is it Tiger's personal wealth/business profits? Is he borrowing money in the Far East? Are the other directors being asked to put their hands in their pockets and proving reluctant?

We should be far from reassured that the club is in safe financial hands...

Kernow Yellow
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Re: Tiger's Visit

Post by Kernow Yellow » Mon Apr 01, 2019 10:29 am

Just seen that the club offices, shop and ticket office are closed today. Staff on strike? Or Kassam denying access? It's not good...

slappy
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Re: Tiger's Visit

Post by slappy » Mon Apr 01, 2019 10:32 am

So checking on timings. O'Dowda and Roofe were sold July 2016 so those transfer fees should be income in the 2017 accounts.

The 2017 post balance sheet note had net player buys and sells for £3M.

Lundstram was sold July 2017 (500k?), Johnson August 2017 (3M?)so those should be in the 2018 accounts. Ledson was sold May 2018, Hemmings June 2018 (100k?) but perhaps the contracts may have been pre-agreed and dated July 2018?

I believe the reason for the secured loan notes was that there were transfer instalments due on those first four players, however trade debtors at June 2018 were only £2.2M compared to the total loan notes of £3.5M. Which leaves another £1.3M due? Perhaps to protect sell-ons or appearance based fees, or a valuation of players like Ledson, Hemmings, Nelson?

The post balance sheet note only has £345K of net player sales and purchases.

I am struggling to see how the club managed to lose £2M with those player sales in 2018. There is the service charge dispute presumably in there, but that was only around 520K at June 2017.

OtmoorYellow
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Re: Tiger's Visit

Post by OtmoorYellow » Mon Apr 01, 2019 10:59 am

Kernow Yellow wrote:
Mon Apr 01, 2019 10:25 am
OtmoorYellow wrote:
Sun Mar 31, 2019 7:33 pm
This would easily have been prevented by simply always having the next months funding in place, rather than trying to transfer it on a just in time basis.
But surely that's the problem - Tiger doesn't 'simply' have the funding available! If he did, as you say he could 'easily' prevent these problems continually happening. Who knows where the money is coming from - is it Tiger's personal wealth/business profits? Is he borrowing money in the Far East? Are the other directors being asked to put their hands in their pockets and proving reluctant?

We should be far from reassured that the club is in safe financial hands...
I agree completely. I have no confidence that Tiger has any liquid assets, and certainly not enough to prevent the club from moving from one financial crisis to another.

OtmoorYellow
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Re: Tiger's Visit

Post by OtmoorYellow » Mon Apr 01, 2019 12:01 pm

slappy wrote:
Mon Apr 01, 2019 10:32 am
So checking on timings. O'Dowda and Roofe were sold July 2016 so those transfer fees should be income in the 2017 accounts.

The 2017 post balance sheet note had net player buys and sells for £3M.

Lundstram was sold July 2017 (500k?), Johnson August 2017 (3M?)so those should be in the 2018 accounts. Ledson was sold May 2018, Hemmings June 2018 (100k?) but perhaps the contracts may have been pre-agreed and dated July 2018?

I believe the reason for the secured loan notes was that there were transfer instalments due on those first four players, however trade debtors at June 2018 were only £2.2M compared to the total loan notes of £3.5M. Which leaves another £1.3M due? Perhaps to protect sell-ons or appearance based fees, or a valuation of players like Ledson, Hemmings, Nelson?

The post balance sheet note only has £345K of net player sales and purchases.

I am struggling to see how the club managed to lose £2M with those player sales in 2018. There is the service charge dispute presumably in there, but that was only around 520K at June 2017.
I agree on the player transfer timings as per my note above.

Player disposal values are accounted for at the date of transfer (other than add on fees for appearances etc). Anything else would be illegal and contrary to accounting and tax laws.

The post balance sheet notes are just an advisory note that assets listed in the accounts are no longer at the club at the time of writing the accounts. As a wider accounting issue, it's intended to stop investors looking at accounts and believing there to be riches, when in fact the riches have since departed. It does not mean the income from those transfers is included in the turnover of the club at the B/S date. The income will be included when the club contractually has earned it.

The (net) £3m post B/S disposals in the 2017 accounts are therefore players sold in the year ended 30 June 2018, but before the date of signing off of the 2017 accounts, which was on 29 March 2018. So that will include Johnson and Lundstram. No other players were sold for a fee during that period. The income from these two sales are included in the accounts for the year ended 30 June 2018. Which is why I pointed out that a £2m+ loss without those player sales would have been more like a £5m loss, and therefore why it is an unsustainable business model without significant ongoing player development and sales.

The (net) £345k post B/S disposals in the 2018 accounts must be for Canice Carroll as there is no other player sold during the period. That income is not included in the 30 June 2018 accounts, but will go into the 30 June 2019 accounts.

All other player sales, which is essentially Ledson and Hemmings, will have been included in the 30 June 2018 accounts, so that £5m could have been even worse.

Moving on to the loan notes, they may well be linked to player transfers. They are part of the overall sale package that gives Eales guarantee over receipt of his money. The value of the loan notes as current liabilities at 30 June 2018 (£2.4m) was higher than 30 June 2017 (£1.9m), and those figures closely correlate with the trade debtors (which will be mostly for transfer fees due within 12 months). There is a further £1.1m in long term liabilities (2017: £0) which will presumably be either for future transfer fees (Canice Carroll?) or simply a way of guaranteeing some of the sale proceeds to Eales.

The service charge was still in dispute at 30 June 2018, but there is no reference to it as disputed in the accounts. This suggests to me that by the time these accounts were being prepared, the club had long since given up hope of winning the case and so it was no longer justified to exclude the full provision of monies due. That ties in with the known information that the dispute was ceased in November 2018. From memory, this was around £600k, of which only £68k was provided in the 2017 accounts, and therefore that identifies roughly £0.5m of the extra losses in these accounts.

The rest of the losses have to go down to costs of running the academy, probably some of the costs of developing the training ground, coupled with high player wages and transfer fees paid to avoid relegation last season.

OtmoorYellow
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Re: Tiger's Visit

Post by OtmoorYellow » Mon Apr 01, 2019 12:08 pm

Myles Francis wrote:
Mon Apr 01, 2019 8:33 am
Thanks for that Terry. I wasn't sure how the equity injection was treated in the accounts, so that was really useful.

Can we ascertain from these accounts how much, if any, debt owed to DE was written off with the takeover?
My pleasure mate.

I'll have to spend a few minutes checking the Eales debt position to see what, if anything, was written off. I may be wrong, but my thoughts thus far are that Eales didn't lose too much, but I will check.

slappy
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Re: Tiger's Visit

Post by slappy » Mon Apr 01, 2019 12:20 pm

That adjusted £5M is very worrying as an owner needs very deep pockets to fund it year-on-year.

For the last 15 years or so the club has muddled along losing under a million a year in the Conference, then under 1.5M a year in L2 under Lenagan. This increased to 2.5M and 1.9M under Eales in L2, presumably extra player investment for promotion to L1. An exceptional profit in 2017 when we reached the Checkatrade final again, had a decent FA Cup run, and sold players.

tomoufc
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Re: Tiger's Visit

Post by tomoufc » Mon Apr 01, 2019 12:28 pm

I remember the song well: "Eales's money to buy the players we need ... Oxford United - we're on our way back". So, did he actually give the club any money or did he simply finance some short-term success that subsequent owners would need to find the money for?
&quotI've been a slave to football. It follows you home, it follows you everywhere, and eats into your family life. But every working man misses out on some things because of his job. &quot

Myles Francis
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Re: Tiger's Visit

Post by Myles Francis » Mon Apr 01, 2019 1:17 pm

slappy wrote:
Mon Apr 01, 2019 10:32 am

I am struggling to see how the club managed to lose £2M with those player sales in 2018. There is the service charge dispute presumably in there, but that was only around 520K at June 2017.
It is very worrying indeed. With the service charge dispute, that figure was purely the amount in dispute. The club now also have to pay a chunk of Kassam's legal costs bringing the total to nearer £750k.

slappy
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Re: Tiger's Visit

Post by slappy » Mon Apr 01, 2019 1:55 pm

I'm still struggling with that loss. My memories of the 2017/18 season were that Pep was a disaster, and the club seemed to be running on vapours, with various members of staff leaving and not being replaced.

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