Will HMFC suffer an Administration or Insolvency event in the Championship 20/21?

[Green Blood]

I don't see reconstruction being a viable proposition. So given HMFC's precarious financial position will they suffer and Administration or Insolvency in the Championship?

They will need to build a new squad and get rid of others, no guarantee they will have a good enough team or squad to win promotion at first attempt. FOH subscriptions will likely slow up as will revenue generated. I think they are in a very precarious state!

[Lofarl]

One dreads to think...

[The 90+2]

Nah. Who do they owe money to apart from the players?

[Carheenlea]

Hearts supporters have pumped an extraordinary amount of money into the club in recent years - I can’t see that drying up if there was a danger of the club hitting serious financial peril.

We poke a lot of fun at Hearts fans but one thing they do deserve credit for is the amount of money put in by the ordinary fan, and it’s absolutely criminal the way their club has frittered that’s away. In this instance the fans do deserve a lot better than what they’ve been served up by Budge and co who should be ashamed of their financial handling of funds donated.

[Green Blood]

Money is going to be hard to come by for quite a time, I don't think their pockets are too deep! They have a track record in trying to buy their way out of a crisis, my guess is they will do so again and come a cropper! Budge will leave, FOH will acquire a ticking time bomb, all the ingredients are there!

[The 90+2]

Money is going to be hard to come by for quite a time, I don't think their pockets are too deep! They have a track record in trying to buy their way out of a crisis, my guess is they will do so again and come a cropper! Budge will leave, FOH will acquire a ticking time bomb, all the ingredients are there!

They will get a lot of players off their books once relegation is confirmed or at least on reduced wages. The way they usually fluke out of stuff they will probably be allowed to cut loads being relegated then get reinstated through reconstruction.

[munchar]

Hearts supporters have pumped an extraordinary amount of money into the club in recent years - I can’t see that drying up if there was a danger of the club hitting serious financial peril.

We poke a lot of fun at Hearts fans but one thing they do deserve credit for is the amount of money put in by the ordinary fan, and it’s absolutely criminal the way their club has frittered that’s away. In this instance the fans do deserve a lot better than what they’ve been served up by Budge and co who should be ashamed of their financial handling of funds donated.

Their fans have been brilliant saving & keeping them going. 👏
What I find strange though, is they’ve never queried the mismanagement. You’d think FOH were in a position of power to ask where funds were going.

[Waxy]

Dunno. But i think they should rename their chips championchips.

[Steve20]

I hope so.

But honesty don’t see them being in the Championship next season. League reconstruction is a certainty. There wouldn’t be all this talk about it and they wouldn’t have put Budge in charge of it if there was a chance it wouldn’t happen IMO.

[hibbyfraelibby]

I hope so.

But honesty don’t see them being in the Championship next season. League reconstruction is a certainty. There wouldn’t be all this talk about it and they wouldn’t have put Budge in charge of it if there was a chance it wouldn’t happen IMO.

True...after liquidation they'd have to restart in the Lowland League.

[MrSmith]

Personally and in my opinion, they will go into administration. It will be used to clear the decks to start anew. that is fine because shedding that waste of finance will be a good thing for the fans to see in terms of living within their means and doing things properly.

Right now they are a fast sinking ship full of bloated payments to players and chucking em all over board will certainly keep the good ship Bidco afloat.

[Sioux]

Their fans have been brilliant saving & keeping them going. 👏
What I find strange though, is they’ve never queried the mismanagement. You’d think FOH were in a position of power to ask where funds were going.

FOH gave their blessing when the club wanted to use FOH funds for 'other purposes'. FOH is part of the problem, suggesting that when they get Budge's shares, they will do what they have always done - overspend!

Hell mend them.

[Jim44]

I hope so.

But honesty don’t see them being in the Championship next season. League reconstruction is a certainty. There wouldn’t be all this talk about it and they wouldn’t have put Budge in charge of it if there was a chance it wouldn’t happen IMO.

:agree: I wouldn’t go as far as saying it’s certain but I have a feeling that reconstruction will eventually be accepted as the best worst case scenario. Dundee will get nowt out of their 15 minutes of spotlight but will go down as martyrs.

[Sioux]

I hope so.

But honesty don’t see them being in the Championship next season. League reconstruction is a certainty. There wouldn’t be all this talk about it and they wouldn’t have put Budge in charge of it if there was a chance it wouldn’t happen IMO.

A certainty that 11 of 12 PL clubs will vote for some fantasy idea with no guarantee of improvement?

[Peevemor]

Budge is too proud to let them go into administration again so she'll take the hit if need be (even in the form of a loan).

Their days of paying OTT wages will be finished though and the roof view restaurant won't be completed in a hurry.

[murray26]

I don’t think they’ll go bust but will be severely weakened.. that’s why we must vote against reconstruction..

[hibbyfraelibby]

Budge is too proud to let them go into administration again so she'll take the hit if need be (even in the form of a loan).

Their days of paying OTT wages will be finished though and the roof view restaurant won't be completed in a hurry.

It has a roof?

[Onion]

Biggest risk to Hearts is a breakdown in trust in management. It's astonishing how patient their fans have been, given the amount they've pumped into the club over the last few years. Their underperformance on and off the field has been extraordinary - pound for pound the worst run club in Scotland. They are a bloated beast which will need to make some hard decisions that won't go down well with their Hibs obsessed followers.

[blackpoolhibs]

Please please please please please. :I'm waiti:I'm waiti:I'm waiti:pray::pray::pray:

[weecounty hibby]

Maybe I'm being petty but I seriously hope so. I want to see them as weak as possible for as long as possible. Hibs to really take control and be without any doubts the No1 team in Edinburgh and outside of the old firm. They are on their knees and I'd love to see them struggle for years to come.

[Coco Bryce]

The fans are turning on here in their droves!

That's good enough for me :agree:

[Waxy]

http://news.bbc.co.uk/sport1/hi/football/scot_prem/6947466.stm

(http://news.bbc.co.uk/sport1/hi/football/scot_prem/6947466.stm)

[Green Blood]

Another thing that might rear up and bite them is an investigation into the source of Benny Factors money. Is it legal, where does it come from, has tax been taken at source etc etc...

If they turn on Budge she could cause them quite a few issues I suspect. Her health must have suffered recently and I would imagine her family have already asked her to step back.

[H18 SFR]

Personally and in my opinion, they will go into administration. It will be used to clear the decks to start anew. that is fine because shedding that waste of finance will be a good thing for the fans to see in terms of living within their means and doing things properly.

Right now they are a fast sinking ship full of bloated payments to players and chucking em all over board will certainly keep the good ship Bidco afloat.

Do they even have any bank debt?

[Peevemor]

It has a roof?No, but the school across the road does.

[Ozyhibby]

Very much doubt there will be an admin. I do think there will be a financial restructuring though which will be very painful for them. There will be significant cutbacks.


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[Phil MaGlass]

http://news.bbc.co.uk/sport1/hi/football/scot_prem/6947466.stm

(http://news.bbc.co.uk/sport1/hi/football/scot_prem/6947466.stm)

Thats 12 years old

[The 90+2]

Dunno. But i think they should rename their chips championchips.

Heyyyyyyy 👍😁

[The 90+2]

Do they even have any bank debt?

I said the same, what happens if they can’t afford player wages and costs though? How much money has Budge got left and although her daughter is a Jambo (heard through the media) surely the family won’t want her frittering everything into hearts?

[MrSmith]

Do they even have any bank debt?

dunno but where do they get in excess of £30m when their income is around £9m per season?

[The Count]

Wonder if they are paying the Council rates on Tynie and the wee bit of Heriot Watt?

[MWHIBBIES]

No

[PatHead]

Hope they die and Tynecastle gets turned into flats.

[FilipinoHibs]

Not sure how many of the players have clauses that reduces their wages if they get relegated. Also, Budge or somebody is sitting on the £2.4 million FOH money as the share transfer has been postponed. That could be used to keep Hearts running with FOH's agreement. Would not be surprised if Budge sells Hearts in a fire sale to get some of her money back. But may be few buyers in this current virus situation. Voluntary administration would clear Budge of any liability for Hearts debts. The debt I see as what is owned to her brother and the players' wages. Admin would allow wages to be frozen or players' made redundant - not classed as a football debt. They could then come out of admin and run as shell club until the season started again. They could then employ a new manager and players to take part in the championship based on their real income from season ticket sales etc..

If the start of the next season is delayed for a significant length of time many more clubs will fall into this situation. The league may be forced to suspend the points penalty rule for administration.

[cocteautwin]

With their season ticket campaign just launched this should see them through the next few months while they figure out how to get out of their hole. Budge also has £2.4m of the loan repaid which I presume she can inject back into the club so I don’t think Administration is imminent.

The biggest issue for HMFC is that in each of the previous 2 seasons they’d spent most of their advance season ticket money before the season even started.

At season end 2019 they had cash in the bank of £0.5m but deferred income (season ticket money) of £5.2m. At season end 2018 they had cash in the bank of £0.2m and deferred income of £4.9m so they seemed to have got into a habit of spending around £4-5m of their advance season ticket money before the next season even started. This must have been done in the knowledge that they knew they had £4 or £5m coming in from the benefactor. One presumes they won’t be able to do the same in the coming year although they will still have to spend a large part of next season’s money this season.

It’s not beyond the realms of possibility that they’ll suffer an insolvency event but as long as they recut their cloth to suit their income next year I can’t see them going in to Administration. They're not going to be able to spend £8.2m on staff costs, that's for certain.

[Keith_M]

They're not going into Administration. They don't have any massive debt to anybody so there's nothing to pay off.




All it would take on their part is to tighten their belts, stop relying on anonymous donations and start living within their means....


Sorry, I can't keep a straight face.



:faf:

[Peevemor]

They're not going into Administration. They don't have any massive debt to anybody so there's nothing to pay off.




All it would take on their part is to tighten their belts, stop relying on anonymous donations and start living within their means....


Sorry, I can't keep a straight face.



:faf:

They were struggling for cash to finish the season. They're relying on donations (and next season's ST money) to pay wages now and over the summer. They could easily find themselves rooked well before the end of the year.

In these circumstances it's easy to miss a couple of PAYE/NI & VAT payments.

Outwith donations administration could be a real risk for them.

[Forza Fred]

They're not going into Administration. They don't have any massive debt to anybody so there's nothing to pay off




:faf:

Don’t they owe a fortune to themselves?

[Keith_M]

Don’t they owe a fortune to themselves?



Should be easy to work out a CVA with their Creditors then.



:greengrin

[Ozyhibby]

They were struggling for cash to finish the season. They're relying on donations (and next season's ST money) to pay wages now and over the summer. They could easily find themselves rooked well before the end of the year.

In these circumstances it's easy to miss a couple of PAYE/NI & VAT payments.

Outwith donations administration could be a real risk for them.

Agree, it’s not just debt that can put a club in admin but cash flow as well. They won’t be able to borrow from anywhere so it will depend on how much they cut back on spending and the willingness of Budge to lose her own money.


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[hibbyfraelibby]

Wonder if they are paying the Council rates on Tynie and the wee bit of Heriot Watt?

Like all businesses rates currently suspended no?

[Bostonhibby]

It has a roof?No, it's an external climate protection control curtain.

Big teams don't have roofs.

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[MagicSwirlingShip]

I don’t think you need bank debt to be insolvent

[CropleyWasGod]

Like all businesses rates currently suspended no?

No.

There's a relief of 1.6% on non-domestic rates.

[green day]

If they sell a decent number of STs and FoH donations continue then Hearts should be fine in the championship.

However, they will take a big hit paying off big earners when they trim the squad.

We lost a fair amount of cash when we were relegated and our cost base was significantly lower than Hearts is now.

[whiskyhibby]

Depends on how deep the pockets are of Budge and the other benefactors in the current and ongoing economic downturn

The recent panicked way Budge has dealt with wages etc suggest that they are not very deep.....