21 replies to this topic

[charierre]

Chelsea have announced a total loss of £67.7million for the financial year ending June 30 2011.

The club revealed its operating loss had reduced from a figure of £70.9million as it aims to fall in line with UEFA's new financial fair play rules.
Transfer fees were a main contributor to the loss while the club was able to declare a record group turnover of £222.3million.
The figure stood at £205.8million last year and increased thanks to higher receipts from the Champions League together with a rise in income from the central Barclays Premier League television contract relating to overseas broadcasting.
Chelsea chairman Bruce Buck told the club's official website: "The club is focused on complying with the requirements of UEFA's financial fair play regulations while maintaining its ability to challenge for major trophies. We would expect this to be reflected in our results for the current financial year."

Chelsea chief executive Ron Gourlay added: "Achieving a record level of turnover is satisfying given the economic background against which we are operating."


http://uk.eurosport....e-big-loss.html

[Snedger]

While I'm not one of those who always follows the club or 'party' line I'm surprised to note you have titled this thread with the emphasis on the loss part and not the profit part of this story. The club chose the headline "CHELSEA ANNOUNCES RECORD TURNOVER". I think that even I might have tried focusing more on the positive side of this story.

And I hope we didn't lose over 67 million quid in June alone!

Edited by Snedger, 31 January 2012 - 07:22 PM.

[undertow]

We lost 50m of it in last January...

[Zola]

Money well spent !

[evissy]

70mill of that went to Luiz and Torres...Would have broke even without those buys...

[Spiller86]

Not entirely.  I think Torres sits as an asset on the balance sheet but no doubt he would have depreciated somewhat.

[wxwax]

I may be wrong but I think the transfer fees are amortized (is that the right word)?) over the length of the player's contract.

Torres signed a five year contract. So his transfer fee would count for 10 million annually.

I think. Doesn't include his wages, of course.

[comtrend]

Transfers 2010/2011:

IN:

Yossi Benayoun    5.5 mil
Tomas Kalas    5.2mil
Ramires     17 mil
Matej Delac    2.3 mil  
Torres     50mil
Luiz    21mil

OUT:

Stoch 4.95mil
Sinclair 0.5mil
Carvalho 6.7mil
Di Santo 2mil  
Deco  ?mil                                                                                                                                                        



Thats about -86 mil in player buying/selling and 15-20 mil profit if we didnt do anything in the transfer market. That dosent really give us much room in the transfer market the next seasons. Financal fair play is in effect from this transfer window, wich means we cant go more then -45mil  aggregate over the 3 next years. We already Spent 16 mil on Cahill and De Bruyne this window and without CL spot next year I fear we cant really reinforce the team.

Our main problem is the wage bill, wich in 2010 was 173 mil, I doubt it has changed much for the better the last seasons,  In comparison United had 133mil, Arsenal 111mil and Tottenham 67mil. The one big advantage we have had though is not having interest on our loans, United payed 70mil and Arsenal 20 mil on those in 2010.

Im hoping we can cut this wage bill with atleast 50-60 mil after our veteran players have left. When Shevchenko left us for Dinamo we cut about 10 mil, Im guessing that Drogba, Malouda and Kalou would be 3 times that ammount or more, if they leave this summer. With that in mind we should have 30-35 mil to spend on signing new players and their wages, unless we spend over budget (FFP -45 mil over 3 years).

Long article here about Fair play and chelsea finaces (2010) : http://swissramble.b...-challenge.html

Edited by comtrend, 01 February 2012 - 12:59 AM.

[wxwax]

comtrend, on 01 February 2012 - 12:56 AM, said:

Our main problem is the wage bill

Yes indeed. Hence the Cahill standoff. And the wish to have young players who command smaller wages.

[Backbiter]

charierre, on 31 January 2012 - 07:03 PM, said:

Chelsea have announced a total loss of £67.7million for the financial year ending June 30 2011.

The Telegraph reckons £30m went on changing managers:
http://www.telegraph...illas-Boas.html

[wxwax]

Backbiter, on 01 February 2012 - 07:02 PM, said:

The Telegraph reckons £30m went on changing managers:
http://www.telegraph...illas-Boas.html

I believe numbers like these, and the existence of FFP, give AVB the confidence he'll be here long enough to rebuild the club the way he feels it needs to be done.

Although truth to tell, I don't think he'd lack for confidence regardless of the circumstance.

[DoubleHelix74]

Sorry, RA has lost close to a billion USD in less than a decade just alone on investing in Chelsea alone... This does not include the millions in other investments since the credit crisis that hit the globe a few years back.  If it were me, I'd be running for the door looking to sell to someone else who's willing to pay a handsome price for the club.  He shouldn't have trouble finding somebody, considering the club is in posh West London and now a global  brand to buy the club and could more than double his initial investment... Hate to say it but as a trader I've been taught that one needs to learn to walk away even if its their love (or baby) and this big if a loss is screaming to get out!  Not sure if he will but the truth is he should!  I am sure I will be flogged with this post but reality is reality... The spark and love has gone and when you've lost a good 15% or so of your wealth on a football team, resentment comes creeping in.  Its only human!  Any rational person investing their hard earned money (whether it be 100K or $1B) would be feeling the same way...  His money managers would be doing a dis-service and not their fiduciary duty.... Be a lunatic to hold onto an investment like this in the real world... Flog on but its areality!

Edited by DoubleHelix74, 02 February 2012 - 05:56 AM.

[andy]

DoubleHelix74, on 02 February 2012 - 05:47 AM, said:

Sorry, RA has lost close to a billion USD in less than a decade just alone on investing in Chelsea alone... This does not include the millions in other investments since the credit crisis that hit the globe a few years back.  If it were me, I'd be running for the door looking to sell to someone else who's willing to pay a handsome price for the club.  He shouldn't have trouble finding somebody, considering the club is in posh West London and now a global  brand to buy the club and could more than double his initial investment... Hate to say it but as a trader I've been taught that one needs to learn to walk away even if its their love (or baby) and this big if a loss is screaming to get out!  Not sure if he will but the truth is he should!  I am sure I will be flogged with this post but reality is reality... The spark and love has gone and when you've lost a good 15% or so of your wealth on a football team, resentment comes creeping in.  Its only human!  Any rational person investing their hard earned money (whether it be 100K or $1B) would be feeling the same way...  His money managers would be doing a dis-service and not their fiduciary duty.... Be a lunatic to hold onto an investment like this in the real world... Flog on but its areality!

Think you will find if you have that amount of money at your disposal you would want to spend some of it. if he truely has spent a billion (I do doubt that figure) it has hardly made him poor.

He probably feels like he is giving something to the international community by owning a high profile club. which he is, football is the world game.

[Zola]

http://www.givemefoo...pent-at-chelsea

Roman we love you.

[DoubleHelix74]

@ Andy, actually that figure is more... I originally used the 630M pound sterling figure which if converted over the past decade to USD would be about $1B.. Article above states it could be even 970M pound sterling.  While RA is worth a lot about $13.4B losing about a tenth of his current wealth on a sports team is a bit crazy!  It's basically the same as an investor holding a dog in his portfolio because he's emotionally attached to it... Obviously, RA can do whatever he wants and who am I to say sitting on the complete opposite side of the spectm, I am just thinking rational... Its a bit of lunacy, even for a billionaire.  I do appreciate the rewards that RA has bestowed on us all though and certainly not ungrateful of his borderline insane generosity...

[briantbudd]

To be fair though, even if Roman has lost nearly 10% of his worth on this club, his losses in this year and in the coming years will have been nothing compared to the years during which he first took over ownership. Chelsea have been established as one of the world's top clubs, the investment, or financial sacrifice, to make that happen has been made, it won't need to be done on that level again. Surely at some level, profit and/or money must come into his thoughts, but can you point to other owners who've lived as conspicuously as he has? Hundreds of millions of dollars on yachts alone will tell you he's not your typical businessman. Unlike the new owners at Liverpool, Roman seems more intent in every aspect of his life; remaining the biggest and the best, or at least appear as having the means to do so, rather than turning a profit or being fiscally responsible. It seems in the case of CFC and in his personal life to some extent, money is not the foremost thought in his mind.

[wxwax]

DoubleHelix74, on 02 February 2012 - 05:47 PM, said:

While RA is worth a lot about $13.4B losing about a tenth of his current wealth on a sports team is a bit crazy!

No question he's pouring a lot of money into the club.

But the verb "losing"implies the massive losses are an ongoing matter. In fact, his greatest outlay was at the beginning, in the purchase and the conversion of loans to equity. Since then his net worth has remained in the billions but his annual losses have been in the 10's of millions.

Surely that puts it in a different light?

[Backbiter]

Also, he paid around £130m for the club in 2003. Nearly 9 years later, the club would be worth several times that if he were to sell. He wouldn't have lost anything like £1bn if he sold the club.

[DoubleHelix74]

You guys all bring every valuable points that I didn't explore much into.  For instance the initial purchase of the club and what he has built and for what he can sell it for today.  Let's hope he doesn't realize that but I am sure enough positive that he does.  A guy who came from nothing and amassed an empire is obviously bright (it didn't just happen on luck, like a lottery ticket) and he knows what he is doing.  And this may and probably is his proverbial "baby" and knows its a longterm investment and eventually the profits will stream in.  I guess what I was trying to show is that the average person invests on emotion all too much and then when the "inkling" doesn't work they finally come to terms and cashed out.  Sadly, in my line of work I see it all too often but I should've never compares it to a guy with a fraction of what RA is worth.  Great conversation though and appreciate the humane comments that were addressed to my original comments.  I think once Chelsea can clear some of the books by letting go of some purchases that aren't as profitable as they were originally, we will all see Chelsea splurge.  Let's hope we have that coveted 4th spot so it won't cost an ARM and a leg because Chelsea can dangle Champions League Football as an incentive...

[DoubleHelix74]

...And I am quite apologetic about my atrocity-like spelling... I post from my phone and it can be somewhat horrible with its spellcheck that I always fail to get a grip on...