SL - As good as it can ever get?

[morgan123]

I've been reading another forum where they publish the financial results of the clubs. It doesn't make good reading and one has to wonder if its possible for SL to remain as it is once the next TV deal is negotiated. With the economic downturn, the demise of Setanta and with the Union-biased domestic channels not being interested in bidding, Sky will surely slice a huge chunk off the next deal. That IMO will make SL as it currently is no longer viable.

Hull FC -PROFIT £185,000
Bradford - Loss £17,000
Warrington - Loss £212,000
Cas - Loss £369,000
Saints - Loss £449,000
Hull KR - Loss £478,000
Wigan - Loss £592,000
Salford - Loss £832,000
Huddersfield - Loss £1,377,000
Harlequins - Loss £1,819,000

Wakefield - Have not filed accounts and recently faced a winding up order, so it's unlikely theirs will be good. Same with Celtic.

The clubs bolded simply don't have the backing to survive many more years like that. Clubs will fold in the coming years, the sport seems to be shrinking at professional level, with franchises becoming less viable due to the costs. This means even less media coverage (Is less than none possible?) and even fewer people playing the game.

 

[Evil Homer]

You seem to be a very negative poster.

 

[Paullyboy]

Whether or not he is a negative poster, those figures are flat out horrible and if they are accurate paint a very dire image for the future of the ESL.

 

[tiburon]

do you have a link for those figures?

 

[VictoryFC]

Profitability in sport makes me sick. Those are peanut numbers.

Wanna check out the English Premier League clubs and what the business they're doing over there? Liverpools current debt alone is about 20 times bigger than all those put together.

Debt can be tolerated, if its serviceable. Those are very insignificant figures you've posted.

 

[Chook Norris]

Profitability in sport makes me sick. Those are peanut numbers.

Wanna check out the English Premier League clubs and what the business they're doing over there? Liverpools current debt alone is about 20 times bigger than all those put together.

Debt can be tolerated, if its serviceable. Those are very insignificant figures you've posted.

wow, thnks for that.. i only just realised how much those debts are puny compared to Football clubs :lol:

Liverpool are operating at a 350m pounds loss with United at a 699m pound loss..

Only Spain’s two biggest clubs, Real Madrid and Barcelona, of the 20 first-division clubs didn’t post a loss last season, the study found.

http://www.football-industry.com/tag/barcelona/

 

[Rastus_in_Melbourne]

No talent, no money = screwed.

 

[morgan123]

Profitability in sport makes me sick. Those are peanut numbers.

Wanna check out the English Premier League clubs and what the business they're doing over there? Liverpools current debt alone is about 20 times bigger than all those put together.

Debt can be tolerated, if its serviceable. Those are very insignificant figures you've posted.

The is a world of difference between the Premier League and Super League though. Most Premier League sides are backed by incredibly wealthy boards. They are also able to secure financing based on future TV money and on the whole are very marketable. If the Glaziers were to announce United were for sale, the club would be snapped up almost instantly.

Harlequins turnover is around the £1.7m mark. Manchester United turnover £300m+. If they were close to missing a debt repayment United could sell Wayne Rooney for £50m, Harlequins couldn't raise more than £50,000.

The figures quoted above for the football teams are debt figures not profits. They have debts of £669m but they made a profit last year of £80m.

Rugby League isn't the same. The likes of Quins and Salford cannot afford to be losing that kind of money each year, if they do they won't be around for long.

 

[biggestbroncosfan]

SL have to get itself together and should start NOW!. 1st thing is to get rid of all the aussies/kiwis(well most of them anyway id have 3 per team) 2nd thing is to bring the interchange down to 10 like the NRL and the next thing is to introduce 2 refs to speed up the game a bit and then include an under 20s which operates in the same way as the NRL under 20s with a u20s world club challenge as well and there you have it SL is fixed

 

[WireMan]

So Hull FC are the only team in Super league making money? I doubt that.

The thing we need to do is to stop trying to re-create the NRL a few years to late. We have our own way of playing and we should play it!

The clubs have been around for longer than Australia and survived despite not being the best internationally. We are close enough to have hope of winning a world cup and teritorial enough to not give a stuff as long as own team is winning anyway.

 

[VictoryFC]

The is a world of difference between the Premier League and Super League though. Most Premier League sides are backed by incredibly wealthy boards. They are also able to secure financing based on future TV money and on the whole are very marketable. If the Glaziers were to announce United were for sale, the club would be snapped up almost instantly.

Harlequins turnover is around the £1.7m mark. Manchester United turnover £300m+. If they were close to missing a debt repayment United could sell Wayne Rooney for £50m, Harlequins couldn't raise more than £50,000.

The figures quoted above for the football teams are debt figures not profits. They have debts of £669m but they made a profit last year of £80m.

Rugby League isn't the same. The likes of Quins and Salford cannot afford to be losing that kind of money each year, if they do they won't be around for long.

I'm pretty well versed in Premier League finances - I did make the point of servicable debt. Nonetheless, EPL clubs debt levels are a big issue, which ever way you look at it. No, the big clubs won't go bust, but they're taking the smaller clubs along on the ride, and they are suscepitble to going bust. I just felt that some perspective needs to be shed - they can find ways to make that debt serviceable.

 

[morgan123]

http://news.bbc.co.uk/sport1/hi/rugby_league/super_league/hull_kr/8364387.stm

Hull KR facing fine for failing to submit their accounts to companies house. They are blaming it partly on the image rights issue. This is another potential bombshell for SL clubs. The league papers have quoted possible six figure fines.

My point in my initial post is that the next Sky deal, due in 2011 (?) will surely be reduced. There won't be any bidders bar Sky unless something changes in terms of the games profile or the media market (New sports channel etc).

 

[morgan123]

http://www.yorkshireeveningpost.co.uk/leedsrhinosnews/Leeds-Rhinos-Leeds-facing-stand.5829534.jp

Leeds Rhinos are setup as a subsidiary of one of Caddick's companies I believe. They posted a £324,945 operating loss, turned into a big profit after tax through the sale of the cricket ground.

It's surprising that only one club is operating at break even despite the salary cap being so low. It makes you wonder what it would be like if there was no cap. The likes of Wigan, Warrington and Leeds are lobbying for it to be increased, but it's obvious from those figures it cannot be done.

 

[WireMan]

Not only is it possible to post an operating loss whilst actually making money by writing down values off assets such as the ground in a property slump or player values but most clubs had a one off payment to the governent because we needed to bail a few failing banks out of business.

Hence these figures seem bad. Warrington made money last year. So did a few clubs. We just paid out transfer fees for Myler and Atkins approaching half a mil, and we will be at full cap next year.

A fine for submitting late means the accounts were late, not that the club is one bill away from oblivion.

Also in Football a few clubs are sailing very close to going under. Chelsea were days away from going bust, Leeds and Southampton amongst others did. Reports are if Hull get relegated they are history. Its not all rosey in Football land.

 

[morgan123]

Not only is it possible to post an operating loss whilst actually making money by writing down values off assets such as the ground in a property slump or player values but most clubs had a one off payment to the governent because we needed to bail a few failing banks out of business.

WTF is that all about? What kind of one off payment did they make? Please explain that? Also, I'm no accountant but writing off an asset isn't a great way to make money. Writing off debts would improve things perhaps but not assets.

Hence these figures seem bad. Warrington made money last year. So did a few clubs. We just paid out transfer fees for Myler and Atkins approaching half a mil, and we will be at full cap next year.

Those figures are all to December 2008 I believe, so Warrington didn't make money. The transfers are in 2009 so will make your accounts worse for this year, although they will be offset by the Wembley appearance somewhat. But Warrington could afford it either way, they have more viable backing than a lot of the clubs do.

A fine for submitting late means the accounts were late, not that the club is one bill away from oblivion.

No one said it did. I put that in to highlight the image rights issue, which will affect a lot of clubs next accounts if the clawback from HMRC is as big as rumoured.

Also in Football a few clubs are sailing very close to going under. Chelsea were days away from going bust, Leeds and Southampton amongst others did. Reports are if Hull get relegated they are history. Its not all rosey in Football land.

Again, no one said it is. I made the point about football being that the fact that another sport is financially questionable, doesn't mean we should relax about SL clubs.

 

[Evil Homer]

So basically, all the clubs are going to go bust within the next year and there is nothing any of us can do. We should all enjoy rugby league while we can because in 2011 there will be no such sport played at a professional level in the UK.

 

[morgan123]

So basically, all the clubs are going to go bust within the next year and there is nothing any of us can do. We should all enjoy rugby league while we can because in 2011 there will be no such sport played at a professional level in the UK.

Well if you want to be childish you can think that. I don't see why most of the replies have been so immature? Can you not give your opinion? One of the other people in the thread explained why he thinks it not an issue (Debt being sustainable within reason). Do you not have anything to say? I've not once said 'every club will go bust' I've just questioned if SL as it is currently is sustainable. Can those clubs post those figures for the next 10 years?

It just seems to me that clubs rely far too heavily on the Sky money to survive. A lot of the clubs in that list are helped out by one benefactor, what happens if they remove their support? Do we just laugh and move onto the next club? Such precarious situations are not only found in league and have been around for years, but 2011 could be absolutely crucial to leagues future in over the next decade in the UK.

 

[Evil Homer]

Well if you want to be childish you can think that. I don't see why most of the replies have been so immature? Can you not give your opinion? One of the other people in the thread explained why he thinks it not an issue (Debt being sustainable within reason). Do you not have anything to say? I've not once said 'every club will go bust' I've just questioned if SL as it is currently is sustainable. Can those clubs post those figures for the next 10 years?

It just seems to me that clubs rely far too heavily on the Sky money to survive. A lot of the clubs in that list are helped out by one benefactor, what happens if they remove their support? Do we just laugh and move onto the next club? Such precarious situations are not only found in league and have been around for years, but 2011 could be absolutely crucial to leagues future in over the next decade in the UK.

I just don't know what you're trying to prove really. Clubs run at a loss every year, and have always done so. This is not a problem exclusive to RL, I would be surprised if there were more than a handful of clubs in any sport that made a profit. Almost all clubs are in a much better state now than in the past, and the game's administrators are far more competent. These clubs have been around for years and survived far worse times than this. It just seems like a completely unneccesary doom-mongering thread to me.

 

[morgan123]

I just don't know what you're trying to prove really. Clubs run at a loss every year, and have always done so. This is not a problem exclusive to RL, I would be surprised if there were more than a handful of clubs in any sport that made a profit. Almost all clubs are in a much better state now than in the past, and the game's administrators are far more competent. These clubs have been around for years and survived far worse times than this. It just seems like a completely unneccesary doom-mongering thread to me.

Fair enough. I was just shocked looking at the figures. I had thought that with the introduction of the salary cap that clubs would now be doing okay financially. I thought one of the reasons it was brought it was to prevent a repeat of the fiasco at Wigan where they were very close to being defunct until Whelan needed them for the stadium application.

 

[WireMan]

WTF is that all about? What kind of one off payment did they make? Please explain that? Also, I'm no accountant but writing off an asset isn't a great way to make money. Writing off debts would improve things perhaps but not assets.

Depreciation of assets and goodwill. If you have an asset like a player for example Matt King, he is worth something. Every year he is older and his contract has less time to run, therefore his value drops. Its normal to depreciate players for the length of the contract.

Same with the value of land. The various bits of land and buildings Warrington own would of lost value during the reccession. Therefore you lower the values hence depreciate.

Depreciation is an expense on a balance sheet hence can be used to lower profits, hence reduce tax. Obviously if you lower the value to much and sell a player or land you have to pay a capital gains tax on any profits. So Bradford could value Burgess at £150,000 one year and only £100,000 the next. Hence a £50,000 loss on the books. However when they sell him to Souths for a reported £500,000 they have made a £400,000 profit liable on capital gains. Sorry for the boring reply there.

Hull probably made a profit because there stadium is owned by the football club?

Sky money is useful and i doubt we receive much anyway, with ESPN hanging around they can't offer to little. The salary cap is in place to stop teams chasing wild dreams Leeds United style.

I wouldn't worry about the actual business of super league, quality control on the pitch maybe...