How Manchester City Could Break Even

[13021J]

Interesting article from an excellent blog:

http://swissramble.blogspot.com/

[The Foggy Blue]

Excellent piece.

Great analysis of how the financial criteria can be met, and written in a way I can actually understand!

A lot depending on qualification for the Champs League of course, but there are other ways of accounting for things that make it look like the club are making more money then they actually are (amortisation etc). And there's the possibility of selling naming rights to eastlands as well...

[Fish111]

Very interesting but i lose the will to live when i read finanial stuff. The upshot is that everything should be ok then?

[Beeks]

Very interesting but i lose the will to live when i read finanial stuff. The upshot is that everything should be ok then?

So long as we rename the stadium 'The Durex Dome' we will be fine ;-)

[Exiled]

Swiss Ramble's articles always seem to be interesting. It really shows that with declining gate receipts and commercial revenue in the pre-Sheik era, we really were starting to sink down the shitter.

So when our beloved team gets called Mercenary City and the 'can't wait for the financial fair play rules to kick in' jibes get sounded out, I sit back and laugh because with falling revenue, we would never get near the Chumps League and most probably be flirting with relegation again. I know where I prefer to be.

[craigmcfc]

What a fascinating read and I fully expect all the back pages to reflect the new air of optimism before the week is out.......

[Ted Hughes]

You can't compete regularly in the Champions League with a transfer budget of £4 Mil per season, so even if we did all those things we'd still be blown away by Real Madrid, Barca etc. It would take us ten years just to replace Lescott & Bridge whilst they signed everyone else.

Either we have a way of getting in big investment for the forseeable future or we're fucked as far as the plans for us being an elite club are concerned. Elite clubs sign elite players, however good their youth policy. We're not going to generate enough money even for wages & the odd big transfer without having some serious source of income that we don't have now & not just the Chump's Lg. I believe/trust that we've got it covered.

[Socrates]

The article assumes ongoing amortisation of £81m a year in the future Ted, that means the writer is assuming we will continue to spend an average of £80 m a year as, once the current players have been written down amortisation will only stay the same if new players have subsequently been bought! A fugure I find unlikely to be honest, £30m - 50m a year in the future would seem more likely and I would expect amortisation of players to be down to 50m after 5 years.

[Ted Hughes]

The article assumes ongoing amortisation of £81m a year in the future Ted, that means the writer is assuming we will continue to spend an average of £80 m a year as, once the current players have been written down amortisation will only stay the same if new players have subsequently been bought! A fugure I find unlikely to be honest, £30m - 50m a year in the future would seem more likely and I would expect amortisation of players to be down to 50m after 5 years.

I think we'll still have to buy players though, to get to, & stay at the top. Not so many at one time of course but a few per season & for big money. Half the current squad will need replacing within the next 5 years & they can't all be youth team players. Then after that the ones who are 25 now will be on the way out etc so it would cost a lot just to stay as we are, without improving.

[Socrates]

The article assumes ongoing amortisation of £81m a year in the future Ted, that means the writer is assuming we will continue to spend an average of £80 m a year as, once the current players have been written down amortisation will only stay the same if new players have subsequently been bought! A fugure I find unlikely to be honest, £30m - 50m a year in the future would seem more likely and I would expect amortisation of players to be down to 50m after 5 years.

I think we'll still have to buy players though, to get to, & stay at the top. Not so many at one time of course but a few per season & for big money. Half the current squad will need replacing within the next 5 years & they can't all be youth team players. Then after that the ones who are 25 now will be on the way out etc so it would cost a lot just to stay as we are, without improving.

Wasn't disagreeing and neither was the Swiss article saying that.

[Swales4ever]

The article assumes ongoing amortisation of £81m a year in the future Ted, that means the writer is assuming we will continue to spend an average of £80 m a year as, once the current players have been written down amortisation will only stay the same if new players have subsequently been bought! A fugure I find unlikely to be honest, £30m - 50m a year in the future would seem more likely and I would expect amortisation of players to be down to 50m after 5 years.

I think we'll still have to buy players though, to get to, & stay at the top. Not so many at one time of course but a few per season & for big money. Half the current squad will need replacing within the next 5 years & they can't all be youth team players. Then after that the ones who are 25 now will be on the way out etc so it would cost a lot just to stay as we are, without improving.

Lacking of enough knowledge about the combined of UK accountancy law and FA rules on amortisation, I necessarily had to wait for the assessment from our Top Senior Adviser.
Now, having been confirmed that the investments amortisation stands brightly than it may superficially appear, I'd also add:
the expenditure level on [senior] players acquisition will definitely slow down for the next 5 years, as:
a) the squad had been widely formed and it appears City is currently just short of an additional top striker (and only because Ade seems to justify the Arsene choice of getting rid of him, because of his continue waste of talent) - over the next 3 years it might possibly arise the need to replace Yaya which is already 27 and plays a very tearing role (and always if the young Lad Abdi won't turn to became the new Paddy/Yaya)
b) among the investment upon amortisation there has been and still continue a very clever recruitment policy of the world's best youngsters, so that it does not seems unwise to expect some top reward in the next 5 years
c) along with point b) the natural, unstoppable City rise to success (and a manager more reliable for top players' confidence) will however level the costs of players acquisitions down to those of the other top European side.

Last but not least, MCFC not only owns the service of a "boring, clueless" football manager, but also a CEO who knows nothing about brand development [and is only able to fly to american pubs to embarass the Club!]: this useless Man, has already reported terrific increases on mercandising related incomes - while selling a brand we all are very proud of, but still is not as attractive as some others on the world market. Just immagine what level of revenue Sir Gary might generate to City once Mancini and the Lads will have delivered...

Thanks to Jonathan now and forever... :-)

[avoidconfusion]

I am surprised to not see any "tasteless" jokes regarding de Jong's tackle in this thread. :)

[Ted Hughes]

I've never seen DeJong's tackle.

[john@staustell]

The article assumes ongoing amortisation of £81m a year in the future Ted, that means the writer is assuming we will continue to spend an average of £80 m a year as, once the current players have been written down amortisation will only stay the same if new players have subsequently been bought! A fugure I find unlikely to be honest, £30m - 50m a year in the future would seem more likely and I would expect amortisation of players to be down to 50m after 5 years.

I think we'll still have to buy players though, to get to, & stay at the top. Not so many at one time of course but a few per season & for big money. Half the current squad will need replacing within the next 5 years & they can't all be youth team players. Then after that the ones who are 25 now will be on the way out etc so it would cost a lot just to stay as we are, without improving.

Dont forget that UEFA have more or less stated that debts (huge loans) are permitted as long as they are 'sustainable in interest payments, repayment' etc. This is why SCUM, Real, Barca and everybody in Italy seems not to be a target. So at a high level of income we could easily borrow money, presumably at the best rate in the world, to sustain any challenge. It wouldn't be a millstone to us because the Sheik has the dosh anyway. I wouldn't expect Vicky Kloss to present this as our future plans, but it seems quite obvious really.

And when it all comes out in the wash, the Platini rules wont last long anyway in their initial form. "Euro Champions (whoever they are) banned by Platini"? Not gonna happen.

[Ted Hughes]

The article assumes ongoing amortisation of £81m a year in the future Ted, that means the writer is assuming we will continue to spend an average of £80 m a year as, once the current players have been written down amortisation will only stay the same if new players have subsequently been bought! A fugure I find unlikely to be honest, £30m - 50m a year in the future would seem more likely and I would expect amortisation of players to be down to 50m after 5 years.

I think we'll still have to buy players though, to get to, & stay at the top. Not so many at one time of course but a few per season & for big money. Half the current squad will need replacing within the next 5 years & they can't all be youth team players. Then after that the ones who are 25 now will be on the way out etc so it would cost a lot just to stay as we are, without improving.

Dont forget that UEFA have more or less stated that debts (huge loans) are permitted as long as they are 'sustainable in interest payments, repayment' etc. This is why SCUM, Real, Barca and everybody in Italy seems not to be a target. So at a high level of income we could easily borrow money, presumably at the best rate in the world, to sustain any challenge. It wouldn't be a millstone to us because the Sheik has the dosh anyway. I wouldn't expect Vicky Kloss to present this as our future plans, but it seems quite obvious really.

And when it all comes out in the wash, the Platini rules wont last long anyway in their initial form. "Euro Champions (whoever they are) banned by Platini"? Not gonna happen.

I think he'll lose his job if it does.

[john@staustell]

Also there comes a point when you stop and think that UEFA is supposed to be a body that represents clubs, represents associations etc, not some sort of autocratic dictatorship.

If UEFA is dicating rather than representing then that's pure revolution stuff. If they are just representing the associations then the clubs are once again entitled to think hard, just as they did once before with all that break-away stuff.

Basically you dump the old UEFA and set up your own!

[ronk]

Also there comes a point when you stop and think that UEFA is supposed to be a body that represents clubs, represents associations etc, not some sort of autocratic dictatorship.

If UEFA is dicating rather than representing then that's pure revolution stuff. If they are just representing the associations then the clubs are once again entitled to think hard, just as they did once before with all that break-away stuff.

Basically you dump the old UEFA and set up your own!

But the clubs want this. Because of the competitive nature of spending between the top clubs it's going to be very difficult to make a profit. That's the major effect of this rule change, it ensures there's a pot of honey at the end of all this.

[hyper]

Great article, if for no other reason than the pic of Adebayor with the caption "born offside"...