Official Site: AGM DATE CONFIRMED

[Sergio sledge]

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A £700k+ trading loss can't really be described as healthy - we won't make millions from player trading every year.

I wonder how much the Lennon situation cost?

Does gain on player trading include any fees we might have paid out in that time? We signed Horgan and Doidge for transfer fees and rumour has it that Milligan was expensive, perhaps a hefty signing on fee. Scott Allan was also signed and may have needed a signing on fee.

Then there was the huge number of loan deals in that time which may have required loan fees. MacLaren, Agyepong, Gauld, Hyndman, Omeonga, McNulty...

[brianmc]

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Anything likely to be attributed to a payoff to Lennon?

I imagine that's included in the operating loss?

[04Sauzee]

How much was the unexpected layout for new cctv?

[ancient hibee]

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How much was the unexpected layout for new cctv?

That will be next year's accounts/

[Spike Mandela]

No anonymous benefactors???

[Onceinawhile]

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I imagine that's included in the operating loss?

Yup, but presumably we'll have a similar amount due to Heckingbottom for this year's accounts as well.

[ancient hibee]

The £700K loss included nearly £1Million for depreciation of the fixed assets(ground etc) and the annual charge of writing down the value of players contracts (so that the value is nil when the contract ends).Staff wages were up £1M and general expenses up £1.4M (mainly Euro travel and ground and ET maintenance.All the price of success.

[Hibs4185]

£750k loss isn’t too bad especially when it included £500k+ debt repayment to STF. I don’t think these accounts will show the bonus for SJM and promotion.

In the end it’s a £2 million profit which is unheard of outside of Celtic, which should be celebrated.

Very healthy position. Especially with such a large cash balance.

Anyone know what turnover was?

[Golden Bear]

I'm just reading Ron's accompanying letter now:-

"As part of my acquiring the major shareholding, we paid off the Club's £2.5 million mortgage and put a further £1.25 million into the Club's Bank Account . As a result, we ended the year in a very strong financial position, with a cash balance of £5.5m and no debt."

"It's worth noting that without the McGinn money the Club would have made a significant loss"

"I've spent the last 6 months learning, asking many questions, and taking a good look at all aspects of the Club, - working closely with Leeann , the Board and the Management team in developing a strategic plan to guide our vision and actions for the next several years. At the forthcoming shareholders meeting I will share the vision we have created for the Club. We're excited about it, and I hope you will be too. Look forward to seeing you at Easter Road Stadium on February 26th"

It all sound very upbeat right now.

[Chorley Hibee]

Forgive my ignorance, but shouldn't the pre-tax profit of £2 million account for everything (lennon, cctv, anything else)?

How do we go from £2 million profit to -£750k purely on tax?

[Onceinawhile]

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The £700K loss included nearly £1Million for depreciation of the fixed assets(ground etc) and the annual charge of writing down the value of players contracts (so that the value is nil when the contract ends).Staff wages were up £1M and general expenses up £1.4M (mainly Euro travel and ground and ET maintenance.All the price of success.

That's a large wedge of depreciation, but I suppose if fixed assets are say £20m; it's only 5%.

I assume it's straight line deduction.

[Peevemor]

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The £700K loss included nearly £1Million for depreciation of the fixed assets(ground etc) and the annual charge of writing down the value of players contracts (so that the value is nil when the contract ends).Staff wages were up £1M and general expenses up £1.4M (mainly Euro travel and ground and ET maintenance.All the price of success.

Why would the fixed assets depreciate by so much in 12 months? Preparation for the saale to RG? Tax "management"?

[04Sauzee]

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That will be next year's accounts/

Cheers Ancient

[Cataplana]

How will this effect the quality of chips we are being offered?

[ancient hibee]

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Why would the fixed assets depreciate by so much in 12 months? Preparation for the saale to RG? Tax "management"?

The fixed asset depreciation charge was just under £600K-last year just over £600K-in other words no change.

[Onceinawhile]

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Why would the fixed assets depreciate by so much in 12 months? Preparation for the saale to RG? Tax "management"?

Depreciation isn't allowable for tax purposes anyway.

[Peevemor]

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The fixed asset depreciation charge was just under £600K-last year just over £600K-in other words no change.

OK cheers!

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Depreciation isn't allowable for tax purposes anyway.

Ha! That'd be too easy.

[Rocky]

We need to bear in mind that the £5.5m in the bank is primarily made up of season ticket money that then needs to cover expenses (wages / maintenance etc) right through till the next year's season ticket money comes in). It isn't just a wedge of cash that's available to be spent.

[HoboHarry]

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No anonymous benefactors???

I'd settle for CWG coming back myself and explaining this gobbledygook.....

[ancient hibee]

In his letter to shareholders Ron Gordon says "surprised at how many clubs in Scotland aim to just break even.......strong and sustainable club can only be built on a strong business------generate profit to reinvest in the team...........more success = more supporters..............progress based on generating funds to reinvest making team stronger..................hope I've demonstrated that I am prepared to invest in taking Club forward.................important foundational steps but prepared to invest further whether in players and matchday experience".
All very promising and will share vision at AGM.

[Rocky]

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In his letter to shareholders Ron Gordon says "surprised at how many clubs in Scotland aim to just break even.......strong and sustainable club can only be built on a strong business------generate profit to reinvest in the team...........more success = more supporters..............progress based on generating funds to reinvest making team stronger..................hope I've demonstrated that I am prepared to invest in taking Club forward.................important foundational steps but prepared to invest further whether in players and matchday experience".
All very promising and will share vision at AGM.

I don't really understand the point he's making about breaking even. If he intends to reinvest all profits into club then the net result of that is breaking even too, no?

The only difference I can see is in time horizon, i.e. at the moment we project how much cash we're going to have for the season and invest it all during the season, hence break even by the time accounts are prepared. Is he saying we're now going to aim to make profits and hold on to them for a while before investing? Stick cash away each year with a view to building a helipad some time in the future?

Say he wants to make £500k profit a year to fund a major investment in the future - if so then we're no better off in the short term than we were with the mortgage - it's still £500k less to spend on the pitch.

[Vault Boy]

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A £700k+ trading loss can't really be described as healthy - we won't make millions from player trading every year.

We won't be trading at that kind of loss every year either. Debt free and £5m+ in liquid funds is healthy.

[ancient hibee]

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I don't really understand the point he's making about breaking even. If he intends to reinvest all profits into club then the net result of that is breaking even too, no?

The only difference I can see is in time horizon, i.e. at the moment we project how much cash we're going to have for the season and invest it all during the season, hence break even by the time accounts are prepared. Is he saying we're now going to aim to make profits and hold on to them for a while before investing? Stick cash away each year with a view to building a helipad some time in the future?

Say he wants to make £500k profit a year to fund a major investment in the future - if so then we're no better off in the short term than we were with the mortgage - it's still £500k less to spend on the pitch.

I think you're over complicating and confusing yourself.If you take it year by year you don't spend it all as you get it.You make a profit in year 1 and reinvest it in year 2 from a position of strength .This creates a bigger profit and you reinvest it in year 3 and so on.Break even means marking time and going nowhere.As the year end is June you don't hang on to profits long if you up the player intake the following month do you.If you make £500K more and spend it it's hardly having £500K less to spend on the pitch if we never had it previously to spend.

[Since452]

Exciting stuff to come by the sounds of it

[Hibs90]

Operating loss, can someone explain what the 750k figure includes? Is it STF repayment plus other bits and bobs? The departure of Lennon and co? CCTV upgrade etc?

No debt and good cash balance though. Very healthy starting position for Ron

[Rocky]

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I think you're over complicating and confusing yourself.If you take it year by year you don't spend it all as you get it.You make a profit in year 1 and reinvest it in year 2 from a position of strength .This creates a bigger profit and you reinvest it in year 3 and so on.Break even means marking time and going nowhere.As the year end is June you don't hang on to profits long if you up the player intake the following month do you.If you make £500K more and spend it it's hardly having £500K less to spend on the pitch if we never had it previously to spend.

If you make £500k more and spend it you've increased income (and expenses), not profits. You're still breaking even. So the only thing that changes in your scenario is that you don't spend that income until the next season, instead of projecting it and spending it in current season.

For the avoidance of doubt, I'm absolutely in favour of increasing income in order to be able to spend it on the pitch, and I'm expecting to see some good proposals on that point at the AGM. I just don't see what he's driving at by wanting to be profit making instead of breaking even.

[Onceinawhile]

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Operating loss, can someone explain what the 750k figure includes? Is it STF repayment plus other bits and bobs?

It includes all our income, less all our expenses - including the debt repayments (£500K) and the lennon pay off (£???) as well as items like depreciation that aren't actual cash expenditure.

Without the debt figure next year, we should be looking quite a bit healthier and, hopefully, the Hecky pay off is less than the lennon one. So the loss should hopefully be substantially less next year.

[Hibs90]

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It includes all our income, less all our expenses - including the debt repayments (£500K) and the lennon pay off (£???) as well as items like depreciation that aren't actual cash expenditure.

Without the debt figure next year, we should be looking quite a bit healthier and, hopefully, the Hecky pay off is less than the lennon one. So the loss should hopefully be substantially less next year.

Okay cheers. So in a healthy position. So from the 5.5m balance on 2nd July, you could include Hecky's pay off, CCTV upgrade, new signings etc to come off on this years.


All about pushing on now, on the pitch and commercially. Time for some sporting ambition.

[Hibs4185]

I’ve owned a few businesses and the profit or loss isn’t where you really get a feel for the health of a business. Accounting practices and being good with numbers can skew the end result quite a bit.

The cash balance, the assets of the business, no debts, healthy(ish)turnover, show the club is in very good condition.

Maybe not as good as I thought it would be admittedly after STF comments before walking away but none the less absolutely no worries.

Ps RG must be well satisfied. Imagine buying a business for £5-6 million and it has that sitting in a bank account available. Plus £20 million in assets. Pretty safe investment so hopefully we will be impressed with his vision

[CockneyRebel]

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I don't really understand the point he's making about breaking even. If he intends to reinvest all profits into club then the net result of that is breaking even too, no?

The only difference I can see is in time horizon, i.e. at the moment we project how much cash we're going to have for the season and invest it all during the season, hence break even by the time accounts are prepared. Is he saying we're now going to aim to make profits and hold on to them for a while before investing? Stick cash away each year with a view to building a helipad some time in the future?
Say he wants to make £500k profit a year to fund a major investment in the future - if so then we're no better off in the short term than we were with the mortgage - it's still £500k less to spend on the pitch.

This will depend on what the investment is and how it benefits the club - it's not like 500k chucked down a hole. The mortgage is gone now and out of the equation so that 500k is now available every season.