I think your last paragraph is the most relevant. Very concerning. No one thinks we are on the precipice today. The fear is that we will be very soon.
Yeah they got short shrift from the court when they tried to claim relegation as some sort of force majeure and it was rightly pointed out that clubs of our size should always consider it a possibility!
I would also presume that the wealth of the owner is somewhat important to the long term future of the club when you have debt at our level but that wasn't really touched on by Maguire. I don't think there's any reliable estimate of Gino Pozzo's wealth but he's certainly not a billionaire and able/willing to just keep pumping money in - if he was, presumably we wouldn't always be taking out loans left, right and centre.
While I agree with this premise on then whole, there are plenty of clubs that have been run into the dirt by owners who have vast wealth purely because they won't put their own money in any longer. The Pozzo family are incredibly wealthy and could write off Watford's debt to them should they want to. It would come at great personal expense of course, but they could do it in theory. Ellis Short at Sunderland for example....incredibly rich. But simply said he wasn't throwing more money at them. Gino has taken out so many loans because he has always had something to secure them against and that means he can do that rather than put his hand in his own pocket. Those times are simply coming to an end.
How wealthy are the Pozzos? I've genuinely no idea. Obviously they're very wealthy by any normal person yardstick but I've always assumed they're relative minnows amongst others in the top two English tiers.
This was posted on the forum a few months ago wasn’t it ? Aren’t we in the bottom 3 wealthiest owners in the league or similar ?
They are minnows in terms of billionaires etc. But they (as a family) are very wealthy to the point that we aren't paupers. But when you separate Gino as a separate entity, then I think that outlook probably changes. I think his families wealth is not really his to use.
It was but no idea where that article got their figures from and they offered no explanation! Like to see the workings before I believe anything... From memory they had Gino Pozzo's wealth at under £100m.
....and of course no idea of liquidity, ie how much of the wealth is available to invest in the club/lend to the club.
Is part of the issue that you have to look at our finances in the context of the other clubs around us to come up with a view if we are doing badly or very badly? I mean it’s not like judging Waitrose against Morrisons, Tesco or Lidl. Professional football does not operate in the same reality. Financing of football is a madness all its own. Hence you get even billionaires wasting huge sums, like Chelsea on Potter. How much have Leicesters made from winning the title and the FA Cup? No doubt not enough. Long term there will be money to be made in football, through a global internet audience. You just need an ownership with very deep pockets to keep you in the fringes of the feeding trough. Having had Premier League history adds some value to a new owner. Pozzo is just is not rich enough without a meg bucks partner. That to me is the real problem that is obvious from the experience of Promotion. You need lots and lots of money, and a willingness not to see it back for a very long time.
As revenues go up, so do player/manager/ agent demands negating the increase. The sums that need to be paid just to sit at the big boys table grow and grow, and the impact of relegation becomes more and more difficult to adapt to. The sums that Chelsea have wasted on Potter are obscene at a time when most fans are struggling to feed their families and heat their homes.
It’s not really about making money for the majority of clubs, look at Barcelona, so measuring us against that metric won’t really help us. Our concerns are not about profitability, but how much debt we’ve got (debt that hasn’t been ploughed back into investing in the club) and our ability to repay it in the coming years whilst also remaining competitive on the pitch.
Pretty much no-one buys a football club to make accounting profits. It's all about status and ego. Maybe someone like Glazer will look at a potential re-sale profit based on an increase in capital value, but they are few and far between I think. It's such a risky investment to buy a club and expect to make money one way or another.
Indeed, and he does flag it up where it arises, he's posted this morning that West Brom are in big trouble (https://twitter.com/KieranMaguire/status/1643904186935902210)
"meet its liabilities" Beat you to it @Keighley . I wish I had a pound for every time I wrote on student work: "its only has an apostrophe when it's short for it is."
West Brom of course just being one year further down the line than us in terms of when they were relegated and their parachute payments running out. That will be us in a year, so not much comfort to be gained from them being in a worse position according to Maguire.
And West Brom fans have been making noise about this for ages, it was obvious they were in massive trouble - think their owner took a loan out from the club to keep his other business interests going during Covid and has shown no sign of paying it back. The fans were flagging the problems well in advance of Maguire (understandably given he only has limited time to spend on each club) so not inconceivable that that's the case here too.
Apologies for bumping a thread I started last May but with the current questions around finances I cannot stop scratching this itch I have relating to "other costs". @Jumbolina and I exchanged useful messages but no one is able to explain why. Keiran Maguire couldn't really answer why they were £44m last year and in comparison with other similar sized clubs the disparity is now even larger. Since then BMuff have published their accounts -other costs £17m-sure they were in EFL but look at the trend (Burnley and Palace have not yet published their 2022 accounts)-Norwich other costs were £17m. Sure the accounts are signed off by auditors and as fans we have no angle to ask the club and rely on experts like Keiran Maguire as to why our costs have averaged £32m pa whilst others of our ilk are c £16m -so over the last 7 years thats £110m difference. This is real cash out the door-not wages or player purchases. https://wfcforums.com/index.php?posts/3129436/
Given the materiality, you would have thought the auditors would have insisted on some sort of analysis in the notes to the accounts. Bayat/agent fees/worldwide recruitment consultant fees ?
Direct agent fees are capitalised into player asset value, so if it is something like that would need to be of a more general nature. It would be amusing if we were just bunging Bayat £10m a year for consultancy services!
I've heard some horrific stories over the past 3 years about where some money goes but isn't reported. So these 'other costs' are of no surprise to me. The fact that Kieron Maguire isn't concerned really isn't important. We are fans of the club and trust me, we should be concerned.
TBF I was on ‘oliday. Visited some Italianate gardens in Wiltshire. Gino would “of” loved them. Agree with the last comment. Also, principle/principal. My students could “of” made me a millionaire!