Football Clubs & Debt

[JawD 99]

I see the administrators of Rangers have set a deadline for the anticipated (by me) sale of the club. be interesting to see if any sale happens before they demand getting rid of some players. The players offered to defer some salaries to the end of the season but the administrator declined as while that assist immediate cash flow it doesnt stop the losses.

[ewerk 31215]

Newcastle United settles image rights tax dispute with HMRC

 

 

Newcastle United has become the latest Premiership club to settle its tax dispute with HM Revenue & Customs over the payment of image rights to players.

 

The club, owned by Sports Direct founder Mike Ashley, will disclose the agreement this week when it announces upbeat full-year results.

Newcastle Utd is not expected to reveal how much it paid to settle the dispute, however it is understood to be less than the contingent liability the club put aside in previous years' accounts.

The settlement covers all outstanding disputes with HMRC, an insider said. The bulk of the matter is understood to relate to the payment of image rights to its footballers. By labelling payments image rights rather than salaries they can be paid to companies, often offshore, and attract corporation tax at 26pc rather than higher rate income tax at 50pc.

Although only Chelsea and Newcastle have released information on settlements with HMRC, most Premiership clubs are understood to have come to agreements covering past liabilities and future treatment of payments.

An HMRC spokesman said: “The majority of premier league football clubs have now confirmed that they will pay tax arising from image rights payments, and we continue to negotiate with those that are yet to settle.”

Details of the tax dispute were contained in the accounts for Mr Ashely’s MASH Holdings vehicle. The accounts also detailed how Mr Ashley has taken a £5.8m charge against the value of shares in Blacks Leisure after it went into administration earlier this year. The charge will be made in the current year’s accounts.

For the year ending April 30, 2011, Mr Ashley’s holding company made a profit of £79.4m. Turnover was up 10pc at £1.68bn. The company did not pay a dividend.

[Gemmill 46058]

For the year ending April 30, 2011, Mr Ashley’s holding company made a profit of £79.4m.

 

 

I think we've found the Carroll money!

[Kitman 2207]

For the year ending April 30, 2011, Mr Ashley's holding company made a profit of £79.4m.

 

 

I think we've found the Carroll money!

 

Aha, it was in his pocket all along!

[LeazesMag 0]

For the year ending April 30, 2011, Mr Ashley's holding company made a profit of £79.4m.

 

 

I think we've found the Carroll money!

 

round of applause

[Gemmill 46058]

There's only you clapping.

[Baggio 0]

According to the telegraph we are on course to make a £10 million profit for this season, which will be invested back in the club.

[Monroe Transfer 0]

According to the telegraph we are on course to make a £10 million profit for this season, which will be invested back in the club.

 

Into Ashley's back pocket, you mean.

 

You do mean that, right?

[LeazesMag 0]

According to the telegraph we are on course to make a £10 million profit for this season, which will be invested back in the club.

 

Into Ashley's back pocket, you mean.

 

You do mean that, right?

 

the same place as the Carroll money, right ?

[PaddockLad 17664]

According to the telegraph we are on course to make a £10 million profit for this season, which will be invested back in the club.

 

heres the article, not a lot we didnt know really, but a few things of interest....

 

7 Comments

 

 

While rival chairmen may have smirked at Mike Ashley’s public relation blunders since he bought the club in 2007 and rival supporters revelled in seeing the Magpies get their wings clipped by relegation to the Championship in 2009, it is Newcastle United who are feeling pleased with themselves at the moment.

 

Sixth in the Premier League, five points ahead of Liverpool, ten points ahead of Sunderland, two points behind Chelsea in fifth, things have gone surprisingly well on the pitch.

 

But their progress has not been confined to the decisions coming out of manager Alan Pardew’s office or because of the players recommended to him by chief scout Graham Carr.

 

As revealed by Telegraph Sport on Tuesday, Newcastle have bucked the Premier League trend and will announce a small profit when they officially release their annual accounts on Thursday.

 

As things stand, Telegraph Sport can also reveal the club is on course to make a profit of around £10m for the forthcoming financial year, money that will, managing director Derek Llambias has assured, go straight back into the club for player recruitment.

 

 

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In a favourite phrase of his, Newcastle are now “wiping their own mouths” as a business. That was the task given to him when he succeeded Chris Mort as chairman in 2008 and while he probably still wouldn’t win any popularity contests on Tyneside, Llambias has done what was asked.

He has cut costs and increased revenue streams and appointed a manager, Pardew, who has not only kept Newcastle in the Premier League – and therefore protected the business – he has also put them on the cusp of Europa League qualification.

Most importantly of all, he has stopped asking owner Ashley for money to prop up a business he had gone into naively as a result of failing to look at the books properly before buying it from Sir John Hall and Freddie Shepherd.

Llambias inherited a mess. Mort had appointed Kevin Keegan as manager – a good move – but he had saddled him with a continental style management structure with Dennis Wise – a bad move – as head of player recruitment.

He also took over a business typical of top flight football that was out of control, a business which needed millions from its owner each year to remain afloat, let alone stay competitive at the top end of the division.

It was a disaster and when Keegan stormed out as a result of boardroom interference player recruitment in August 2008, he turned Ashley and Llambias into hate figures.

Twice Ashley has tried to sell the club and twice he has failed. He had lost interest, owning a football club was supposed to be fun, now he just wanted to get rid.

When he couldn’t find a buyer in a global recession, he ordered Llambias to at least make sure he did not have to lose any more money bailing it out.

It has been a long and painful journey. For every step forward in the public relations battle – Ashley covered loses of £500,000 a week in the Championship – there has been a disaster, like the sale of Andy Carroll to Liverpool last January or the decision to rename St James’ Park the Sports Direct Arena, after his own retail chain.

To be tolerated and, even admired for the way they have brought spiralling debts under control, is a huge improvement on where they were two years, even 12 or six months ago.

They deserved some of the criticism. They make mistakes, they upset people, ruffled feathers and went back on the odd promise. They have, at times, acted with all the sensitivity of a drunken barber holding a cut-throat razor.

This season, though, has been a triumph, not just for the team, but also the business. With the £35m from Carroll looking a superb transaction, it has, in the main, been reinvested in the team. There is even some left to spend in the summer.

They have a smaller budget than the rest of the teams in the top six, but they are holding their own nonetheless.

Newcastle do not pay for players in instalments, they pay the whole fee up front so they completely own the asset.

They agree contracts – including the recent significant ones with captain Fabricio Coloccini and goalkeeper Tim Krul – with players that do not have bonus payments or image rights. The weekly wage is the weekly wage so they can keep complete control of their wage bill.

They do have debt, around £111m, but it is all in the form of interest free loans from Ashley, not the banks.

They also try to tie all key personnel to long term contracts, so that their market value is at its highest, hopefully to ward off interest, but if one of the “top four” calls, it ensures they can get the highest fee possible.

As for agents, Llambias “will not be bullied” in negotiations. It has, at times, caused problems and led to the departure of Kevin Nolan and Joey Barton in the summer, but it also ensures they are not taken for a costly ride by those who make money out of the talent of others.

The one blot is the release clause in Demba Ba’s contract, but nobody knew he would have the season he has had and the Senegal international may yet decide to stay at Newcastle if they qualify for Europe, even if others have a vested interest in getting him to move.

While some will scoff at the suggestion they need help keeping their houses in order, Newcastle are in better shape than most ahead of the implementation of Uefa’s Financial Fair play regulations.

Llambias privately fears their rivals will get around the rules with extravagant sponsorship deals from their owners or companies linked to them. But for a club without a benefactor, Newcastle have every reason to be pleased with the shape they are in.

For the first time since Ashley’s first season in charge, there is optimism of a brighter future with him at the helm and that is priceless.

 

http://www.telegraph.co.uk/sport/football/teams/newcastle-united/9129072/Newcastle-United-buck-Premier-League-trend-by-posting-profit-as-Mike-Ashleys-club-perform-on-and-off-field.html

Edited March 8, 2012 by PaddockLad

[Happy Face 29]

Debt reduced to £111m?

 

Previously £150m.

 

Interesting.

[Happy Face 29]

"when Keegan stormed out as a result of boardroom interference player recruitment in August 2008, he turned Ashley and Llambias into hate figures."

 

 

 

 

 

 

Was this written by Llambias? All Keegans fault.

[Monroe Transfer 0]

"when Keegan stormed out as a result of boardroom interference player recruitment in August 2008, he turned Ashley and Llambias into hate figures."

 

 

 

 

 

 

Was this written by Llambias? All Keegans fault.

 

Not like you to twist something.

[Happy Face 29]

"when Keegan stormed out as a result of boardroom interference player recruitment in August 2008, he turned Ashley and Llambias into hate figures."

 

 

 

 

 

 

Was this written by Llambias? All Keegans fault.

 

Not like you to twist something.

 

You're twisting my melon.

[PaddockLad 17664]

"when Keegan stormed out as a result of boardroom interference player recruitment in August 2008, he turned Ashley and Llambias into hate figures." Was this written by Llambias? All Keegans fault.

Not like you to twist something.

 

Luke Edwards looks as if hes well in with the powers that be at the club judging by this story and has to toe the party line. Keegan took his former employers to a tribunal so he could prove he was constructively dismissed by them. I think most of us know the truth.

[Christmas Tree 4837]

Excellent stuff.

 

I aint interested in the old board, or constantly discussing the wrongs of the last few years. Im really only interested in where we are now and what shape we are in.

 

Barring a few tweaks we are looking great on the pitch, great off the pitch and looking like a club that is really getting its act together from top to bottom. Im realistic enough to know that its probably not enough to challenge the top four meaningfully, but Im quite happy having them looking over their shoulder at the minute.

 

Its a massive, massive turnaround throughout the club since (self inflicted) relegation and Im really pleasantly optimistic about the next few seasons.

 

Hopefully the debt can gradually be paid off to Ashley putting us in an even healthier financial position should the day arrive when he decides to ride off into the sunset.

 

Happy days.

[loonyTOON 10]

Just a thought, but could we see movement from potential suitors to try and buy the club near the summer? Perfect time for Ashley to try and sell. Atm, top 6 team staring at Europe at the moment. A strong, valuable squad which is worth a pretty penny (compared to most teams in the prem). And no debt, except the interest free loan from Ashley, which I would imagine he could try and recoup from the purchase price?

 

Thoughts please.

 

Be good for an Arab to come in and really take us to the next level (without £100-£200 mil transfer budgets)

[Happy Face 29]

Just a thought, but could we see movement from potential suitors to try and buy the club near the summer? Perfect time for Ashley to try and sell. Atm, top 6 team staring at Europe at the moment. A strong, valuable squad which is worth a pretty penny (compared to most teams in the prem). And no debt, except the interest free loan from Ashley, which I would imagine he could try and recoup from the purchase price?

 

Thoughts please.

 

Be good for an Arab to come in and really take us to the next level (without £100-£200 mil transfer budgets)

 

£270m+ bid required for Ashley to break even.

 

Can't see it happening.

Edited March 8, 2012 by Happy Face

[The Fish 10971]

Also, I think his attitude towards the club has changed (again) the purchase of Cisse isn't the action of a man who simply wants to survive the Premier League. If he just wanted to remain in the top flight he could have done that without any January purchases at all.

[Toonpack 9970]

Just a thought, but could we see movement from potential suitors to try and buy the club near the summer? Perfect time for Ashley to try and sell. Atm, top 6 team staring at Europe at the moment. A strong, valuable squad which is worth a pretty penny (compared to most teams in the prem). And no debt, except the interest free loan from Ashley, which I would imagine he could try and recoup from the purchase price?

 

Thoughts please.

 

Be good for an Arab to come in and really take us to the next level (without £100-£200 mil transfer budgets)

 

£270m+ bid required for Ashley to break even for Ashley.

 

Can't see it happening.

 

Me neither, anyway rich benfactor type ownership will fall foul of UEFA going forward.

 

BTW some EU watchdog body have just ruled that Man City's Ehitad deal (whilst not illegal) is not right and has urged UEFA to stop such deals by companies/organisations with connections to football ownership happening.

 

http://www.dailymail.co.uk/sport/football/article-2111563/Manchester-City-400m-Etihad-deal-banned-says-EU-watchdog.html

[Toonpack 9970]

Also, I think his attitude towards the club has changed (again) the purchase of Cisse isn't the action of a man who simply wants to survive the Premier League. If he just wanted to remain in the top flight he could have done that without any January purchases at all.

 

Billionaire's don't like to fail (or be also rans) at anything they do, they'll do it 100% their way though. T'is one of the things I'm optimistic about.

[The Fish 10971]

Also, I think his attitude towards the club has changed (again) the purchase of Cisse isn't the action of a man who simply wants to survive the Premier League. If he just wanted to remain in the top flight he could have done that without any January purchases at all.

 

Billionaire's don't like to fail (or be also rans) at anything they do, they'll do it 100% their way though. T'is one of the things I'm optimistic about.

 

What would be interesting ( and something I doubt we'll know until after his reign) is what exactly his measure of success is?

 

Also I know this may seem odd, but I just don't think of Ashley as a Billionaire.

[Happy Face 29]

Also, I think his attitude towards the club has changed (again) the purchase of Cisse isn't the action of a man who simply wants to survive the Premier League. If he just wanted to remain in the top flight he could have done that without any January purchases at all.

 

Billionaire's don't like to fail (or be also rans) at anything they do, they'll do it 100% their way though. T'is one of the things I'm optimistic about.

 

What would be interesting ( and something I doubt we'll know until after his reign) is what exactly his measure of success is?

 

Also I know this may seem odd, but I just don't think of Ashley as a Billionaire.

 

He moved up the Forbes list to number 491 in the world this week.

 

Up 150 places

 

15th richest in UK

 

Net worth $2.5 Billion now.

[Toonpack 9970]

Also, I think his attitude towards the club has changed (again) the purchase of Cisse isn't the action of a man who simply wants to survive the Premier League. If he just wanted to remain in the top flight he could have done that without any January purchases at all.

 

Billionaire's don't like to fail (or be also rans) at anything they do, they'll do it 100% their way though. T'is one of the things I'm optimistic about.

 

What would be interesting ( and something I doubt we'll know until after his reign) is what exactly his measure of success is?

 

Also I know this may seem odd, but I just don't think of Ashley as a Billionaire.

 

I would guess in his head it's be the best and conquer the world doing it his way, whether his methods in the current environment will/can allow that is another matter.

 

Have worked for a couple of multi-millionaires, trying to get their next multi millions, in my past and they are an immensly (insanely) driven lot, would imagine billionaire's are significantly worse.

[The Fish 10971]

He moved up the Forbes list to number 491 in the world this week.

 

Up 150 places

 

15th richest in UK

 

Net worth $2.5 Billion now.

 

I know he is, but I just look at other Billionaires, then I look at Mike Ashley and... I don't know I just fully expect is wealth to be considerably less than it is. I mean.. seriously Just look at him