Hibs Debt

[Mikeystewart]

I keep hearing people saying we are basically debt free. What I want to know is how much does basically mean. I don't believe that the fletcher money was enough to shell out for the whole stand plus new signings. Can anyone confirm or give a ball park figure?

[ancienthibby]

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I keep hearing people saying we are basically debt free. What I want to know is how much does basically mean. I don't believe that the fletcher money was enough to shell out for the whole stand plus new signings. Can anyone confirm or give a ball park figure?

Originally Posted by Keith Wright Jnr
For years I've been seeing posts on here about shoving money into the squad when clearly the dosh has been needed even more so off the pitch.

Now that we're almost debt free (what is the figure there btw?) are we in a position where if we bring in say 4 Million we could set it aside for the squad?

The whole money being used for new contracts, signings and their wages over a 3-4 year period. See how we fare, if we end up in a position where prize money is going back into the coffers or perhaps had to accept one or two bids that have repaid our investment allowing us to push on.

Perhaps we'll still do no better than 3rd and struggle in Europe so the money whittles away. If we've stuck it in there knowing we're fine should it be fruitless then fair enough, we'll try again later.

I realise we're still some way off for this as Stokes will need another blinding season or DS to step up further.

Or will it be the retractable roof

The future's bright!



Sorry to dis-illusion you, but we are quite a distance away from being debt-free - and that's before the financing of the new stand is included - and understood!!

The actual figure you want at 31 July last year is £6.5 million.

I imagine that the operating position for the year to 31 July just ended will likely be cash negative, unless the balance of the Fletcher sale monies, plus any add-ons have already been received.

[GlesgaeHibby]

Should have a clearer idea in the near future when the annual accounts are published (Hibs year runs until 31st July).

IIRC net debt is just under £4million + we have a mortgage on the stadium.

[ahibby]

And do we not have money in the bank which if offset against the debt would bring it down significantly or is that just bull***?

[ancienthibby]

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And do we not have money in the bank which if offset against the debt would bring it down significantly or is that just bull***?

marginally true but still bull

[jgl07]

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And do we not have money in the bank which if offset against the debt would bring it down significantly or is that just bull***?

Hibs will have money in the bank at the moment as the bulk of the season ticket cash is in. This will drop throughout the year as wages are paid out.

Most football clubs are awash with cash at this time of the year.

There are some notable exceptions. Allegedly!

[PaulSmith]

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Should have a clearer idea in the near future when the annual accounts are published (Hibs year runs until 31st July).

IIRC net debt is just under £4million + we have a mortgage on the stadium.

As at July 31st 2009 the debt was c £6.5m. Which was made up of £4m due in annual installments of £250k pa and a further £2m which is due a lump sum repayment in 2020.

That was basically it. How the Fletcher, Jones money and the completion of the East Stand effects debt we'll know in around 4 weeks.

In essence we need to find £500pa to finance the rebuilding of Easter Road up until 2020. All long term debt much which is fixed interest and part of running any business. No pressure from anywhere to sell anyone

[sesoim]

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marginally true but still bull

This is all pretty vague, but I would guess our true debt, ie money in bank minus the mortgage, is around £3M. Petrie started ringfencing some of our income/money from player sales from 2007/08 onwards to put towards the stadium, so hopefully it is just the mortgage left to pay off.

If we had sold, say, Stokes for £2M and Bamba for £1M, and made it to the Europa group stages, we would probably have been a good enough position to either invest more into the team or virtually pay off the mortgage.

[ancienthibby]

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This is all pretty vague, but I would guess our true debt, ie money in bank minus the mortgage, is around £3M. Petrie started ringfencing some of our income/money from player sales from 2007/08 onwards to put towards the stadium, so hopefully it is just the mortgage left to pay off.

If we had sold, say, Stokes for £2M and Bamba for £1M, and made it to the Europa group stages, we would probably have been a good enough position to either invest more into the team or virtually pay off the mortgage.

Utter bull

[KWJ]

aww!

So we need another 5 years like we've just had to sort outselves out, and then another 5 of similar good business and quality young player/signings to get into the position I posted about.

Nae bother!

[Geo_1875]

I don't particularly care how much Hibs debt is. All I care about is that it is serviceable and sensible leaving the club sustainable. And it is.

[sixtwo]

The sad reallity is, our debt situation is very bad indeed.

We are approximately £40m in debt and our stadium has been given over to a dubious eastern european bank. Even after selling all our prize assets the debt has not reduced. We have to keep buying season tickets and 'beleiving' things will be ok or there is a risk the rug will be pulled from our feet


oh wait a minute, that's the big massive team i'm talking about!

[Bostonhibby]

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The sad reallity is, our debt situation is very bad indeed.

We are approximately £40m in debt and our stadium has been given over to a dubious eastern european bank. Even after selling all our prize assets the debt has not reduced. We have to keep buying season tickets and 'beleiving' things will be ok or there is a risk the rug will be pulled from our feet


oh wait a minute, that's the big massive team i'm talking about!

It's not debt, I am getting fed up hearing why, and hearing it explained. It is beyond the likes of us to understand how you can keep remortgaging and issuing paper equity way beyond the value of the tin shack you live in, after all, it worked in the States didn't it

[Bostonhibby]

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This is all pretty vague, but I would guess our true debt, ie money in bank minus the mortgage, is around £3M. Petrie started ringfencing some of our income/money from player sales from 2007/08 onwards to put towards the stadium, so hopefully it is just the mortgage left to pay off.

If we had sold, say, Stokes for £2M and Bamba for £1M, and made it to the Europa group stages, we would probably have been a good enough position to either invest more into the team or virtually pay off the mortgage.

Nah, better balance sheet, and maybe even build another stadium next to the one we have but even grander is surely a much better use of any free capital or credit worthiness we have, what do you think we are , a football club FFS?

[Vini1875]

Our debt is mostly made up of mortgage and while that is money we owe to a bank, no one classes it as debt, which is why we keep hearing about Hibs being debt free. We owe a mortgage but not any loans of any significance.

[IWasThere2016]

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As at July 31st 2009 the debt was c £6.5m. Which was made up of £4m due in annual installments of £250k pa and a further £2m which is due a lump sum repayment in 2020.

That was basically it. How the Fletcher, Jones money and the completion of the East Stand effects debt we'll know in around 4 weeks.

In essence we need to find £500pa to finance the rebuilding of Easter Road up until 2020. All long term debt much which is fixed interest and part of running any business. No pressure from anywhere to sell anyone

Even the Yams could find that much

[Caversham Green]

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And do we not have money in the bank which if offset against the debt would bring it down significantly or is that just bull***?

We did have £2.9m in the bank at the beginning of last season which reduced the net debt figure to £3.6m, but that's misleading because it assumes we would use all our cash to pay off the debt. The debt figure we're discussing also ignores ordinary debtors and creditors, so we're alway's looking at an incomplete picture.

Net debt is a frequently used headline figure, but it often hides a multitude of sins.

[mjhibby]

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We did have £2.9m in the bank at the beginning of last season which reduced the net debt figure to £3.6m, but that's misleading because it assumes we would use all our cash to pay off the debt. The debt figure we're discussing also ignores ordinary debtors and creditors, so we're alway's looking at an incomplete picture.

Net debt is a frequently used headline figure, but it often hides a multitude of sins.

The cost of the new stand is added to the mortgage presumably taking that up to £10m and with probably now £3.5m in the bank after fletchers money then in essence there is a £6.5m difference between the mortgage and cash we have.Not debt free but apart from st mirren the most finacial stable team in the spl by far and one that killie for instance would love to have.

[Craig_in_Prague]

Having a long-term liability, which the club can service easily, is completely different to debt. We have a healthy balance sheet and Assets > Liabilities.

Debt is money due in the past.

Long live the 'tache.

[Caversham Green]

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The cost of the new stand is added to the mortgage presumably taking that up to £10m and with probably now £3.5m in the bank after fletchers money then in essence there is a £6.5m difference between the mortgage and cash we have.Not debt free but apart from st mirren the most finacial stable team in the spl by far and one that killie for instance would love to have.

I don't think it is, or at least not all of it. On top of the £2.9m I mentioned there was a further £1.8m to come in - most of it from Burnley. That gives us £4.7m in the bank which strikes me as far too much, season ticket money notwithstanding. We had a further million-ish from Fletcher's sell-on, so I think most if not all of the stand costs will have been paid in cash.

As Craig says a long-term manageable debt is not a problem and I don't see any need to pay off these loans early. The repayment part does mean that we need to make an average profit of £240k pa just to stand still, but that is easily achievable with minimal player sales.

[SaudiHibby]

As someone has already said we are trading solvently (we have a sustainable business with cash flow that allows us to pay any debt that becomes payable) and that makes me a happy bunny as there are alot who aren't

[down-the-slope]

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Having a long-term liability, which the club can service easily, is completely different to debt. We have a healthy balance sheet and Assets > Liabilities.

Debt is money due in the past.

Long live the 'tache.

if only that were true

Money due in the 'past' would be debt thats defalted. Anything you owe is debt until you no longer owe it

The big difference is length of liability...most of our debt is long term liabilities (mortgage) and the short term liabilities (debts due paid in short period) are quite low

[--------]

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I don't think it is, or at least not all of it. On top of the £2.9m I mentioned there was a further £1.8m to come in - most of it from Burnley. That gives us £4.7m in the bank which strikes me as far too much, season ticket money notwithstanding. We had a further million-ish from Fletcher's sell-on, so I think most if not all of the stand costs will have been paid in cash.

As Craig says a long-term manageable debt is not a problem and I don't see any need to pay off these loans early. The repayment part does mean that we need to make an average profit of £240k pa just to stand still, but that is easily achievable with minimal player sales.

Thanks, CG. Even I can understand that post. :notworthy:

[ancienthibby]

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I don't think it is, or at least not all of it. On top of the £2.9m I mentioned there was a further £1.8m to come in - most of it from Burnley. That gives us £4.7m in the bank which strikes me as far too much, season ticket money notwithstanding. We had a further million-ish from Fletcher's sell-on, so I think most if not all of the stand costs will have been paid in cash.

As Craig says a long-term manageable debt is not a problem and I don't see any need to pay off these loans early. The repayment part does mean that we need to make an average profit of £240k pa just to stand still, but that is easily achievable with minimal player sales.

That's a hugely optimistic statement to make!!

For myself, I just can't reconcile 'a stand paid for in cash' with Hibs recent cash flows and the gross debt position, but we'll all know in about three weeks!!

[Turnip]

Im pretty sure that the Hibs debt is owed to the fans by the players after some pretty awful performances since the turn of the year

[BSEJVT]

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That's a hugely optimistic statement to make!!

For myself, I just can't reconcile 'a stand paid for in cash' with Hibs recent cash flows and the gross debt position, but we'll all know in about three weeks!!

I am the same, I cant see where the cash was "hidden" in previous years accounts that we are going to use to pay for the stand.

If we lost £2m excluding player sales in the last Mixu year, I cant believe we will have done much better last year, especially with the east stand out of commission for the post split infirm games and the wages we must be paying Stokes & Miller.

I think you can draw some inference from the fact that we have released so many players, loaned out so many others, recruited so few and cant recruit any more without others going that there are certain stresses in the football budget.

The fact that no-one appears to be going to be bought from us, we would sell anyone IMO, so it is a lack of buyers, appears to be exacerbating the problem.

We must get back to near break even on a turnover only basis, excluding player sales or the good work over the last few years will be lost.

I also think we will be exceedingly lucky to bring in anything like the cash we have in previous years as the market for players of that ilk has all but collapsed.

Look how little the infirm have realised from their disposals ( McGeady excepted)

[Caversham Green]

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That's a hugely optimistic statement to make!!

For myself, I just can't reconcile 'a stand paid for in cash' with Hibs recent cash flows and the gross debt position, but we'll all know in about three weeks!!

It does look tight, and I certainly won't be taking any bets on the debt staying at £6.5m, but taking on new debt when you're sitting on excess cash is just wasting money so I would expect as much of the cash as possible to have gone towards the cost of the stand. I've detailed upward of £5.5m that seems to have been available (before any trading losses are taken into account) and the cost of the stand was quoted on here as £3.5m so that leaves £2m-ish for future costs which seems to me to be a far more sensible cash figure to carry.

It all rather depends on last season's trading results, and I have a feeling there will be an improvement on the previous year.

[IWasThere2016]

Hard to see the net debt not rising IMHO. There was also a valuation on the new East - undertaken for the bank - suggesting extended debt terms or a new debt facility.

[Dashing Bob S]

Surely though, the real debt we owe is to our friends across the city, for their selfless sacrifices in single-handedly winning WW2, thus ensuring that we can play football without jackboots. Also, we have the freedom to tarmac drives and sell pegs, which might not have been taken as given under any Hitlerian style National Socialist regime.

We have so much to thank them for.

[Caversham Green]

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Hard to see the net debt not rising IMHO. There was also a valuation on the new East - undertaken for the bank - suggesting extended debt terms or a new debt facility.

The net debt will certaily rise - either cash will have gone down or gross debt will have gone up. I'm saying that gross debt will not increase by the full cost of the stand because of the "ring-fenced" cash. The numbers I've given indicate that it's conceivable that the stand was paid for in full by cash, but they are very rough calculations and it still looks very tight, so it's probably more likely that some further debt has been taken on.

I did say "most if not all" in my first post.