Another year

[Pagan Hibernia]

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That’s what I thought.

What’s with the yellow/pishy colour?

To replicate their slacks after one too many bevvies down the golf club

[Alfred E Newman]

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Claret & Amber... Motherwell colours :)

The amber is to go with the corduroy breeks.

[Greensunshine]

Hertz are supposed to be this massive club, they’re currently having the best season they’ve had in many years finishing third spot which basically as good as it gets for the rest of us.
They’ve managed to get to a semi final and yet they can’t sell their allocation of tickets!

Aye, Hearts are massive right enough. 🤔

[cocteautwin]

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Let’s not forget the bestest hotel in the land which will make them £1 million a year. (Caveat being it has to sell out however a cheeky wee look shows availability every single day on pretty much every room)

Strangely enough the hotel doesn’t have to be profitable, it just needs to add to the Turnover as reported in the financial statements. The most reported financial KPI of a football club is its player/staff costs as a percentage of Turnover.

Due to the annual £5m of “doping” (not reported in Turnover) that HMFC receive from a board Director they could quite easily spend over 100% of Turnover on player costs but that wouldn’t look good for the club. By adding low margin turnover they can start to report their increasing player costs as a healthy %age of Turnover. The same as bringing catering in house. Low margin but adds to Turnover.

In reality the extra £5m from Anderson amounts to the same funding as an extra 13-14000 season tickets. Where should a club with the effective income of 30,000 season ticket holders stand within Scottish football?

Decidedly in 3rd place. Add in the money from group stages of Europe and semi final appearances and we can see that Hibs will probably be behind Hearts for a very long time now.

[CropleyWasGod]

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Strangely enough the hotel doesn’t have to be profitable, it just needs to add to the Turnover as reported in the financial statements. The most reported financial KPI of a football club is its player/staff costs as a percentage of Turnover.

Due to the annual £5m of “doping” (not reported in Turnover) that HMFC receive from a board Director they could quite easily spend over 100% of Turnover on player costs but that wouldn’t look good for the club. By adding low margin turnover they can start to report their increasing player costs as a healthy %age of Turnover. The same as bringing catering in house. Low margin but adds to Turnover.

In reality the extra £5m from Anderson amounts to the same funding as an extra 13-14000 season tickets. Where should a club with the effective income of 30,000 season ticket holders stand within Scottish football?

Decidedly in 3rd place. Add in the money from group stages of Europe and semi final appearances and we can see that Hibs will probably be behind Hearts for a very long time now.

I'm not sure I follow that.

If the hotel isn't profitable, ie its expenses exceeed its income, that will take away from the club's ability to spend elsewhere, eg on players.

Hearts report their income and wages costs separately, according to parts of the business. So the wages/turnover ratio, in terms of playing staff, won't be affected.

Or have I misunderstood your point?

[cocteautwin]

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I'm not sure I follow that.

If the hotel isn't profitable, ie its expenses exceeed its income, that will take away from the club's ability to spend elsewhere, eg on players.

Hearts report their income and wages costs separately, according to parts of the business. So the wages/turnover ratio, in terms of playing staff, won't be affected.

Or have I misunderstood your point?

UEFA considers a ratio of over 70% of turnover spent on player costs to be a health risk for a football club. I know FFP rules don’t apply to Scotland but a well run club would still be looking to operate within the UEFA defined healthy parameters.

If, say, Hearts had a turnover of £15m, the healthy spend on players would be £10.5m. Then, if for some reason they received an extra £6m of donations (not reported in Turnover), and they do, they could easily spend that on players but it would increase that expenditure to 110% (£16.5/£15) of Turnover. Outwith the healthy 70% ratio.

By diverting some of the cash to capital projects which generate a few million a year in Turnover (but say for the purposes of this exercise are break even) then they get to spend the 70% of the increased turnover on players (and stay within the 70% KPI). Of course it’s a bonus if the capital projects are profitable in the future but when they have an extra £6m of free money annually, the capital projects don’t have to be profitable. To utilise that £6m of free money as part of the player spend and remain within the 70% ratio then they effectively need to raise turnover by £8.6m (6/0.7). Profitability doesn’t really matter as they have £6m extra anyway.

Yes of course it would be dumb if they were loss making but I think the recent capital projects are not loss making but very low margin.

Anderson has said this himself, that it’s been difficult to manage his contributions to the club in the context of UEFA defined healthy spending percentages.

[nonshinyfinish]

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UEFA considers a ratio of over 70% of turnover spent on player costs to be a health risk for a football club. I know FFP rules don’t apply to Scotland but a well run club would still be looking to operate within the UEFA defined healthy parameters.

As of this season (under the new UEFA rules) it's not just about being well run, it's now an actual restriction that could jeopardise participation in UEFA competitions: https://www.uefa.com/news-media/news...y-regulations/

The new regulations will see clubs subject to squad cost controls for the first time. The cost control rule restricts spending on player and coach wages, transfers, and agent fees to 70% of club revenues. (The gradual implementation will see the percentage at 90% in 2023/2024, 80% in 2024/2025, and 70% in 2025/2026).

[CropleyWasGod]

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UEFA considers a ratio of over 70% of turnover spent on player costs to be a health risk for a football club. I know FFP rules don’t apply to Scotland but a well run club would still be looking to operate within the UEFA defined healthy parameters.

If, say, Hearts had a turnover of £15m, the healthy spend on players would be £10.5m. Then, if for some reason they received an extra £6m of donations (not reported in Turnover), and they do, they could easily spend that on players but it would increase that expenditure to 110% (£16.5/£15) of Turnover. Outwith the healthy 70% ratio.

By diverting some of the cash to capital projects which generate a few million a year in Turnover (but say for the purposes of this exercise are break even) then they get to spend the 70% of the increased turnover on players (and stay within the 70% KPI). Of course it’s a bonus if the capital projects are profitable in the future but when they have an extra £6m of free money annually, the capital projects don’t have to be profitable. To utilise that £6m of free money as part of the player spend and remain within the 70% ratio then they effectively need to raise turnover by £8.6m (6/0.7). Profitability doesn’t really matter as they have £6m extra anyway.

Yes of course it would be dumb if they were loss making but I think the recent capital projects are not loss making but very low margin.

Anderson has said this himself, that it’s been difficult to manage his contributions to the club in the context of UEFA defined healthy spending percentages.

All of which is reasonable, but the hotel still needs to make money to be of any use. The wages/turnover ratio in that will be around 50%, which has to be serviced.

[cocteautwin]

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As of this season (under the new UEFA rules) it's not just about being well run, it's now an actual restriction that could jeopardise participation in UEFA competitions: https://www.uefa.com/news-media/news...y-regulations/

I didn’t know that but it does make my points on increasing a club’s turnover even more relevant.

[CropleyWasGod]

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As of this season (under the new UEFA rules) it's not just about being well run, it's now an actual restriction that could jeopardise participation in UEFA competitions: https://www.uefa.com/news-media/news...y-regulations/

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I didn’t know that but it does make my points on increasing a club’s turnover even more relevant.

Does the hotel income count as "football income"?