A letter from America...Henry.

[FanchesterCity]

What is the current pissing contest between you and Chelsea, then?

 

I agree! it's crap. It's bad for the game. I'm not in favour of any of that.

That's precisely what it is... a crazy example of outspending until you win something.

It's wrong that teams do it.

It's even more wrong that teams should feel they HAVE to do it.

 

And now Liverpool are having problems, half the fans are asking FSG to start stumping up their own money too!

 

FFP (in principle) is the right way to go - but it won't work because in practice, the game still favours the elite clubs, and is more concerned with being an entertainment / advertising platform than it is in being a sport.

[Bobby Hundreds]

I'll ask again. Prove it?

 

There is £60m net spend on transfers these past two years, that you are now suggesting was not invested by them but what the club earned. So for clarification could you provide evidence for why you are making that statement?

 

They stated from the beginning they won't invest anything other than what the club earns. The difference between the size of our kitty this year and from when they first came in is we have no one to sell worth shit lets not forget they didn't bring anybody in last January despite us crying out for it then too. The kitty will get smaller each year as the squad does and our revenue dwindles, nothing to sell no champions league football to pay the way. How are we going to generate enough of an income to be competitive are they relying purely on Rodgers being a genius.

[Whelan]

Liverpool’s losses rose in the year in question - from £19.9m previously to £49.4m.Debt interest charges as a result of the FSG takeover have reduced from £18m to £3m annually

£131m was spent in the period on new players including Luis Suarez, Andy Carroll, Jordan Henderson, Stewart Downing, and Charlie Adam.

The net spend on players was £41m - as opposed to just under £17m the year previously.

Wage costs went up by £10m during the year - reflecting an ageing squad and an issue since addressed, say the club, when ten players left Anfield during the summer (including Emiliano Insua, Christian Poulsen, Paul Konchesky, Philip Degen and Milan Jovanovic).

A 25 per cent growth in commercial revenues - up from £62.1m to £77.4m

Total club revenue in 2011 fell by just under a million pounds to £183.6m - reflecting the loss of Champions League football this season.

Media revenues dropped from £79.6m to £65.3m - again reflecting the loss of Champions League football from TV sourcesMatchday revenues dropped £2m to £40.9m - again an impact of no Champions league games

 

 

Read More EXCLUSIVE: Liverpool FC accounts show £50m loss including £35m on Hicks & Gillett's 'new Anfield' - Liverpool FC News - Liverpool FC - Liverpool Echo

[Major Tom]

I agree! it's crap. It's bad for the game. I'm not in favour of any of that.

That's precisely what it is... a crazy example of outspending until you win something.

It's wrong that teams do it.

It's even more wrong that teams should feel they HAVE to do it.

 

And now Liverpool are having problems, half the fans are asking FSG to start stumping up their own money too!

 

FFP (in principle) is the right way to go - but it won't work because in practice, the game still favours the elite clubs, and is more concerned with being an entertainment / advertising platform than it is in being a sport.

 

FFP will never be enforced in a manner which will stop you and Chelsea throwing silly money at transfers and wages. So, if I were you, I would sit back and enjoy the ride!

[Whelan]

They stated from the beginning they won't invest anything other than what the club earns. The difference between the size of our kitty this year and from when they first came in is we have no one to sell worth shit lets not forget they didn't bring anybody in last January despite us crying out for it then too. The kitty will get smaller each year as the squad does and our revenue dwindles, nothing to sell no champions league football to pay the way. How are we going to generate enough of an income to be competitive are they relying purely on Rodgers being a genius.

 

That is not true! They have always maintained the club will be self sufficient, but they invested in the short term in the hope that it will bridge the gap. Defoe is on record saying he nearly came in January.

 

But I am prepared to be proven wrong, I am asking is that people explain where the money came from to spend last season! We were operating at a loss, yet spent £40m net. Now that money came from somewhere.

 

 

Liverpool Transfers | Premiership Transfers

 

We have always sold players, and all clubs have always old players. Except nobody wants to buy a pile of shit that is overpriced and on too much money.

[Neil G]

I'll ask again. Prove it?

 

There is £60m net spend on transfers these past two years, that you are now suggesting was not invested by them but what the club earned. So for clarification could you provide evidence for why you are making that statement?

 

 

Just because the accounts to July 2011 show a loss on the balance sheet, it doesn't mean that they've put their own money in. They have borrowing facilities, all big businesses do.

 

They expected more money to be coming in from the new sponsorship deals they were lining up, and from the new TV rights deal that was in the pipeline, plus they knew there were more wages that could be cut. This increased income and reduced wagebill would help to cover the loss made in the particular period in question.

[piscinin]

That is not true! They have always maintained the club will be self sufficient, but they invested in the short term in the hope that it will bridge the gap. Defoe is on record saying he nearly came in January.

 

But I am prepared to be proven wrong, I am asking is that people explain where the money came from to spend last season! We were operating at a loss, yet spent £40m net. Now that money came from somewhere.

 

 

Liverpool Transfers | Premiership Transfers

 

We have always sold players, and all clubs have always old players. Except nobody wants to buy a pile of shit that is overpriced and on too much money.

 

That loss was an accounting loss only. It involved no cash. All they were doing was writing off an asset on which H&G spent the money back in 2000 and whenever. It is completely irrelevant to this discussion.

[MichaelThomas]

 

But I am prepared to be proven wrong, I am asking is that people explain where the money came from to spend last season! We were operating at a loss, yet spent £40m net. Now that money came from somewhere.

 

 

Yeah, that 40m didnt go in the pockets of the bank to pay for two leveraged buyout merchants to own us.

[piscinin]

That is not true! They have always maintained the club will be self sufficient, but they invested in the short term in the hope that it will bridge the gap. Defoe is on record saying he nearly came in January.

 

 

But he didn't. This was also around the same time Comoli was trying to sell Carroll to someone or other, right. Another move that didn't happen . . .

[Whelan]

Just because the accounts to July 2011 show a loss on the balance sheet, it doesn't mean that they've put their own money in. They have borrowing facilities, all big businesses do.

 

Sorry but that is irrelevant and unless that debt is loaded onto the club (note you menionted interest repayments being reduced early!) then it is irrelevant to the point, which is where did the money come from?

 

They expected more money to be coming in from the new sponsorship deals they were lining up, and from the new TV rights deal that was in the pipeline, plus they knew there were more wages that could be cut. This increased income and reduced wagebill would help to cover the loss made in the particular period in question.

 

So they did put money in then. But you think they were expecting it back? We have an operating loss, and yet still have a Net spend - sorry but that money comes from somewhere. You are accusing them of not putting their money in and I am asking you to prove this? Again, operating loss and transfer net spend = their money!

 

That loss was an accounting loss only. It involved no cash. All they were doing was writing off an asset on which H&G spent the money back in 2000 and whenever. It is completely irrelevant to this discussion.

 

Was there an operating loss?

 

Yeah, that 40m didnt go in the pockets of the bank to pay for two leveraged buyout merchants to own us.

 

Sorry but I don't really know what you mean mate?

[MichaelThomas]

 

Sorry but I don't really know what you mean mate?

 

G&H took the money the club made to pay off the debt incurred by the takeover. That's debt has gone. And FSG are letting the club spend that money.

[FanchesterCity]

Serious question chaps - aimed at those who might actually know....

 

When FSG bought Liverpool there were 'claims' of 300m debt (but let's put the specific figure to one side for a moment)...

 

Did FSG pay off that debt totally, or did they rearrange the debt in such a way that the interest payments were far more favourable to Liverpool (and if the latter... are FSG now creditors of LFC?) or even set the interest to 0% (still requiring the debt to be paid)?

 

From some of the above posts, it sounds like FSG truly paid off the debt, leaving Liverpool effectively with zero debt at the start of their tenure? is that correct?

[zigackly]

Serious question chaps - aimed at those who might actually know....

 

When FSG bought Liverpool there were 'claims' of 300m debt (but let's put the specific figure to one side for a moment)...

 

Did FSG pay off that debt totally, or did they rearrange the debt in such a way that the interest payments were far more favourable to Liverpool (and if the latter... are FSG now creditors of LFC?) or even set the interest to 0% (still requiring the debt to be paid)?

 

From some of the above posts, it sounds like FSG truly paid off the debt, leaving Liverpool effectively with zero debt at the start of their tenure? is that correct?

 

Not quite zero, we retained a thirty million credit facility for working capital.

[Neil G]

Sorry but that is irrelevant and unless that debt is loaded onto the club (note you menionted interest repayments being reduced early!) then it is irrelevant to the point, which is where did the money come from?

 

 

It could perfectly well have been loaded onto the club. The difference between it and H&G's debt would be:

 

a) It was much lower, as the repayments needed to service a £50m operating loss in one year would be a lot less than those needed for the debt to buy the whole club, and

 

b) There was a guaranteed, or highly likely, chance of it being paid back, unlike with H&G's purchase of the club.

 

So the answer to "where did it come from" would either be from whichever lender FSG got it from, and/or from FSG's own assets with the intention of recouping it as the new revenue came in.

 

 

So they did put money in then. But you think they were expecting it back? We have an operating loss, and yet still have a Net spend - sorry but that money comes from somewhere. You are accusing them of not putting their money in and I am asking you to prove this? Again, operating loss and transfer net spend = their money!

 

 

Yes I do think they were expecting it back. Why not? They may have physically made a cash transfer from their own assets to the club's accounts at some point before July 2011, but that's not the same as investing it in the squad or even the club without any expectation of getting it back directly, which is what I want them to do.

 

I'm happy to revise my claim to "I don't see any evidence that they've invested their own money in the squad" if you'll do the same. The loss in the accounts to July 2011 is not evidence of them doing that.

[piscinin]

Was there an operating loss?

 

If you factor out the stadium write-off, which involved no/0 cash, as H&G had pilfered that money years ago, we broke even.

[FanchesterCity]

Not quite zero, we retained a thirty million credit facility for working capital.

 

Ok... so for all intents and purposes the debt situation was 'put right'... so no there's no (current) issue of any large part of Liverpool's revenue disappearing to service debt. Although how FSG themselves came by that money is another issue... they might be paying off debt of their own... we'll never know.

 

Given that quite simplistic assumption, Liverpool's profits =

 

Revenue - (running costs + transfer fees/3 + wages)

 

 

I assumed 3 year average contract, so transfer fee amortised over 3 years?)

 

 

So (roughly speaking)

 

That's 180m income

 

150 million on wages (according to official figures)

26 million transfers in (80 million / 3)

30 million running costs?

 

That is roughly a 25 million loss - the wages being the killer.

 

 

Are these figures even close to accurate? and if not, it would be nice to get them so in order than folks can see for themselves that there's no pot of cash screaming out to be spent.

[piscinin]

Where did the money come from? From 2010 Accounts:

 

+15m Standard Chartered Money

+43m Profit on disposal of players registration

+15m Reduced interest payments

 

-15m Champs League media revenue

 

You can take it from there right whelan?

[Nasty Lizard]

Unless that letters going to grow legs, stick on a pair of boots and play up top, you can fuck completely off. Wouldn't sanction 2m extra to get Dempsey, on deadline day, because it didn't represent good value. It was fucking deadline day. And we have zero striking options. How much value will be lost on your investment if we finish 8th again. Or lower?

 

 

If he thinks were gonna hold out for bargains here and there and win the league somehow he's high as a fucking kite.

 

Most of us don't want a sugar daddy. A decent fucking striker would be enough right now.

 

Amen to that.

[DirkDiggledinho]

To my mind all this "moneyball" and the preconception of running the club under some new-age, all-knowing philosophy is simply a handy, any situation excuse for not investing and making negligent decisions.

 

"Confuscius say: we can't buy that player, he's 29 and doesn't fit our system."

 

"Confuscius say: but we had to sell Suarez, he was too old. And we didn't spend on a replacement because there were no suitable buys on the market and we should promote the youth."

[Ranxerox]

I've got a jar of "Kenco Costa Rican" coffee on my desk which would be a more than adequate replacement for Andy Carroll.

 

Clever....still your're at odds with our Manager who said he wouldn't have let Carroll go if knew he wouldn't get Dempsey. Perhaps you should go see Rodgers and offer him that can of coffee and see what kind of response you get.

[piscinin]

Not quite zero, we retained a thirty million credit facility for working capital.

 

Net debt was 65m for some reason.

[WaltonRed]

amen also

[piscinin]

Ok... so for all intents and purposes the debt situation was 'put right'... so no there's no (current) issue of any large part of Liverpool's revenue disappearing to service debt. Although how FSG themselves came by that money is another issue... they might be paying off debt of their own... we'll never know.

 

Given that quite simplistic assumption, Liverpool's profits =

 

Revenue - (running costs + transfer fees/3 + wages)

 

 

I assumed 3 year average contract, so transfer fee amortised over 3 years?)

 

 

So (roughly speaking)

 

That's 180m income

 

150 million on wages (according to official figures)

26 million transfers in (80 million / 3)

30 million running costs?

 

That is roughly a 25 million loss - the wages being the killer.

 

 

Are these figures even close to accurate? and if not, it would be nice to get them so in order than folks can see for themselves that there's no pot of cash screaming out to be spent.

 

You forgot our annual 10m+ stupid tax for hiring and firing managers/academy staff/CEOs/medical team etc etc.

 

And our wages were 135m. And you only have 1 side of the transfer equation, we've been making money on selling benitez signings for years now 43.3m profit in the 2010 accounts. Nice.

[Timão]

They can afford it. They can put their own money in, something they haven't yet done to any siginificant event.

 

Why should they put their own money in?

 

We are a fucking business, nothing more and nothing less. LFC is not their plaything as Chelsea or City are to their owners.

 

If they are to run it as a business, than they have absolutely no obligation to put their own money in.

 

I am as fed up as anybody about not having another striker, but let`s stay in the real world.

 

I said it in 2003: Chelsea have ruined football and brains alike.

[FanchesterCity]

You forgot our annual 10m+ stupid tax for hiring and firing managers/academy staff/CEOs/medical team etc etc.

 

And our wages were 135m. And you only have 1 side of the transfer equation, we've been making money on selling benitez signings for years now 43.3m profit in the 2010 accounts. Nice.

 

I thought players sales were included as part of the revenue figures? is that not the case?

(obviously I'm simplifying a lot 'cos I'm not an accountant, and neither are most of the fans, but it's easy enough to grasp 'Money In' and 'Money Out' if the figures are accurate and helps folks to see roughly where the money lies (or doesn't lie!).