The generic Hearts thread

[Future17]

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I've kind of lost track of the wages saga at Hearts. Why are they imposing a take it or leave it wage cut instead of coming to a deferral agreement like Hibs seemed to do without much fuss?

Budge said in her recent statement that she wasn't prepared to allow the creation of an unknown amount of debt. The subtext was that they either couldn't afford it to pay it in future or just don't want to have to when they consider there's an easier way out.

[cocteautwin]

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I think you're way over estimating their income here. £4m =16k seasons at £250 a time. They'll be lucky to get half of that number & I would expect quite a few to be on an instalment plan. They would bite your hand off for £2m over the next 2 or 3 months.

The past few years they've taken in approx £5m in season ticket sales before 30 June (as per their accounts) so they must be bringing it in at a rate of around £0.5m a week. The instalment plans aren't financed by the clubs - the clubs get most of the season ticket price up front and the finance company collects the instalments. Their season ticket sales aren't going to be much lower than previous years, even if we are in the midst of a huge economic crisis.

There's little chance HMFC will be having a cash flow problem in the next 2-3 months but if they keep the spending rate at the same as previous 24 months they are going to hit a wall sometime around September. I think this is why Budge is pushing to have most of the highly paid team of duds removed from the club. They need to reposition the club for the championship, and even if by some miracle they push through a reorganisation they'll still want to get most of their players off the books as they've been garbage. It's pathetic they are using the virus as an excuse for their financial troubles when it should be widely known that they are in difficulty mostly because of owner incompetence.

[cocteautwin]

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Budge said in her recent statement that she wasn't prepared to allow the creation of an unknown amount of debt. The subtext was that they either couldn't afford it to pay it in future or just don't want to have to when they consider there's an easier way out.

And thanks to the coronavirus they have an easier way out by blaming something else rather than their own incompetence.

[Barney McGrew]

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I've kind of lost track of the wages saga at Hearts. Why are they imposing a take it or leave it wage cut instead of coming to a deferral agreement like Hibs seemed to do without much fuss?

It’s a wage cut and not a deferment they’re trying to put in place. The issue Hertz have is that most of their ‘name’ players generally joined them because they were getting more money at Tynecastle. Footballers are not known for their loyalty at the best of times and all they’ll be looking for is their money, especially the type of player they’ve signed.

If I’m one of those players looking at what other clubs are doing where wages are deferred and I know I’ll still get them somewhere down the line, I’m unlikely to voluntarily take a 50% cut where I lose out. I’d also be pretty pissed off that the owner was publicly hanging me out to dry while the recruitment department was simultaneously sending out emails to other agents saying there was money to spend on new players. Add in the fact they’ve got previous for shafting creditors, and that they’re clearly suffering cash flow problems then there’s no danger I’d be accepting anything especially where football debt is prioritised and well covered by the authorities.

Someone made a point on their season ticket numbers, and from what I have heard they are not very good at all - they’d expected that would bail them out for a bit but they’re struggling to shift them which has put even more pressure on the cash flow. Given that’s their only source of income right now and for the foreseeable future, and that they’re still not getting any prize money for last season due to the fannying about that them and Rangers are doing, it all adds up to a pretty precarious position. While they might not have massive debts (yet), there’s no way they have enough money to meet the payroll these next few months coming, hence why Budge is scrambling around in last chance saloon threatening clause 12.

Its all as they say, pleasing.

[Caversham Green]

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It’s a wage cut and not a deferment they’re trying to put in place. The issue Hertz have is that most of their ‘name’ players generally joined them because they were getting more money at Tynecastle. Footballers are not known for their loyalty at the best of times and all they’ll be looking for is their money, especially the type of player they’ve signed.

If I’m one of those players looking at what other clubs are doing where wages are deferred and I know I’ll still get them somewhere down the line, I’m unlikely to voluntarily take a 50% cut where I lose out. I’d also be pretty pissed off that the owner was publicly hanging me out to dry while the recruitment department was simultaneously sending out emails to other agents saying there was money to spend on new players. Add in the fact they’ve got previous for shafting creditors, and that they’re clearly suffering cash flow problems then there’s no danger I’d be accepting anything especially where football debt is prioritised and well covered by the authorities.

Someone made a point on their season ticket numbers, and from what I have heard they are not very good at all - they’d expected that would bail them out for a bit but they’re struggling to shift them which has put even more pressure on the cash flow. Given that’s their only source of income right now and for the foreseeable future, and that they’re still not getting any prize money for last season due to the fannying about that them and Rangers are doing, it all adds up to a pretty precarious position. While they might not have massive debts (yet), there’s no way they have enough money to meet the payroll these next few months coming, hence why Budge is scrambling around in last chance saloon threatening clause 12.

Its all as they say, pleasing.

Their high basic/low bonus model won't be helping either. Hibs and Aberdeen will have saved the bonuses they would have paid if the season had continued as normal and the deferral debt will be lower than HoMFC would have incurred if they had gone down the deferral route.

Players like Boyce signed for them on the basis of a high basic wage in comparison with Aberdeen, but he would almost certainly have earned more through bonuses while the season was ongoing. He's now going to lose at least a percentage of that high basic wage while Aberdeen's players will be paid in full eventually. He must be kicking himself (or images of his agent).

[Geo_1875]

Why all this talk of administration? Surely they can just declare self-sufficiency like they did last time.

[Sammy7nil]

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I hope this documentary getting filmed is key work because I’ve ran out of things to watch and can’t wait for it

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Their high basic/low bonus model won't be helping either. Hibs and Aberdeen will have saved the bonuses they would have paid if the season had continued as normal and the deferral debt will be lower than HoMFC would have incurred if they had gone down the deferral route.

Players like Boyce signed for them on the basis of a high basic wage in comparison with Aberdeen, but he would almost certainly have earned more through bonuses while the season was ongoing. He's now going to lose at least a percentage of that high basic wage while Aberdeen's players will be paid in full eventually. He must be kicking himself (or images of his agent).

Just had a thought I wonder if making the top six attracts a player bonus sure it will so Hibs dropping place may not be a disaster for our board. No extra gate money as no games played so it may result in a bigger loss to be sixth?

Hibs will eventually agree a wage decrease with the players and Hearts will shout loudly they did the right thing first. Unfortunately they did not they jumped the gun and tried to bully players instead of considering their family needs and working with them for the benefit of them and the club.

[brog]

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The past few years they've taken in approx £5m in season ticket sales before 30 June (as per their accounts) so they must be bringing it in at a rate of around £0.5m a week. The instalment plans aren't financed by the clubs - the clubs get most of the season ticket price up front and the finance company collects the instalments. Their season ticket sales aren't going to be much lower than previous years, even if we are in the midst of a huge economic crisis.

There's little chance HMFC will be having a cash flow problem in the next 2-3 months but if they keep the spending rate at the same as previous 24 months they are going to hit a wall sometime around September. I think this is why Budge is pushing to have most of the highly paid team of duds removed from the club. They need to reposition the club for the championship, and even if by some miracle they push through a reorganisation they'll still want to get most of their players off the books as they've been garbage. It's pathetic they are using the virus as an excuse for their financial troubles when it should be widely known that they are in difficulty mostly because of owner incompetence.

I haven't seen their a/cs & i appreciate you're a knowledgeable poster but im struggling to get my head round this. £5m = 20k seasons @£250 or over 16k at £300, all before end June? Do their a/cs actually identify season ticket revenue separately or are your numbers all revenue?

[Peevemor]

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The past few years they've taken in approx £5m in season ticket sales before 30 June (as per their accounts) so they must be bringing it in at a rate of around £0.5m a week.

I'd be surprised if they give as detailed à breakdown.

ST sales up to June 2019, will also include July & August 2018.

[Caversham Green]

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I haven't seen their a/cs & i appreciate you're a knowledgeable poster but im struggling to get my head round this. £5m = 20k seasons @£250 or over 16k at £300, all before end June? Do their a/cs actually identify season ticket revenue separately or are your numbers all revenue?

Season ticket money sold before 30 June for the following season is recorded in the Balance Sheet as deferred income. HoMFC's deferred income was £5.199m. It's possible there was other income received in advance included but the bulk of it would be season ticket money.

By comparison Hibs deferred income and accruals was £5.781m, but HoMFC showed accruals of ££1.048m separately so the true comparison was £5.781 vs £6.247.

[H18 SFR]

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Their high basic/low bonus model won't be helping either. Hibs and Aberdeen will have saved the bonuses they would have paid if the season had continued as normal and the deferral debt will be lower than HoMFC would have incurred if they had gone down the deferral route.

Players like Boyce signed for them on the basis of a high basic wage in comparison with Aberdeen, but he would almost certainly have earned more through bonuses while the season was ongoing. He's now going to lose at least a percentage of that high basic wage while Aberdeen's players will be paid in full eventually. He must be kicking himself (or images of his agent).

I can see us paying/deferring an average of the bonus they will have missed out on. Just a hunch.

[greenginger]

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I'd be surprised if they give as detailed à breakdown.

ST sales up to June 2019, will also include July & August 2018.

Their accounts to June 2019 show deferred income as £ 5.2 million and I’ve always taken that to be mostly season ticket sales. Some might be pre payments for other forms of sponsorship.

unfortunately for them , they only had £ 600 k in the bank to show for it at the end of their financial year.

[Keith_M]

I think any talk of them going into Admin is wishful thinking.

They still have regular FoffH money coming in and will now be able to use part of next Season's ST money to help see them through till the end of this season (as is the norm for them).

I think the main effect of missing four home games is that it'll be even longer till they finish building their new stand.

[Caversham Green]

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I can see us paying/deferring an average of the bonus they will have missed out on. Just a hunch.

I think it probably depends on how things develop. If finances allow I could see the club paying a general bonus when the deferred wages are settled, but they'll be walking a fine line between keeping the players happy and keeping the club afloat.

[Greenworld]

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Their accounts to June 2019 show deferred income as £ 5.2 million and I’ve always taken that to be mostly season ticket sales. Some might be pre payments for other forms of sponsorship.

unfortunately for them , they only had £ 600 k in the bank to show for it at the end of their financial year.

Thats the big one 600k in the bank and what other bills fall due in the month / next month apart from wages.
The last i saw they had moved 1000 season tickets there's been nothing since . As pointed out FOC contributions are holding up so credit has to be given to their fans.
The players that have not agreed to a cut was rumored to be about 20 with the pfa.
Its very messy and seem to the only club in the spfl leagues openly fighting with their players . This clause allowing to not pay the players is a srange one if implemented does thevplayer become a free agent ?

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[Barney McGrew]

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The last i saw they had moved 1000 season tickets there's been nothing since

Less than 1500 was the number I was told at the end of last week.

If that’s accurate - and I’ve no reason to doubt it is given the source - then unless they start selling at a serious rate over the next month then they’re really in the deep stuff.

[H18 SFR]

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Less than 1500 was the number I was told at the end of last week.

If that’s accurate - and I’ve no reason to doubt it is given the source - then unless they start selling at a serious rate over the next month then they’re really in the deep stuff.

I still think that if it comes out that they’re genuinely in the brown stuff there will be a flurry of FoH donations and season tickets bought.

They’re clearly financially wounded, but thoughts of their demise or administration etc are far fetched.

[Greenworld]

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Less than 1500 was the number I was told at the end of last week.

If that’s accurate - and I’ve no reason to doubt it is given the source - then unless they start selling at a serious rate over the next month then they’re really in the deep stuff.

Yup this is a defining moment for hearts and Anne Budge

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[malcolm]

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Thats the big one 600k in the bank and what other bills fall due in the month / next month apart from wages.
The last i saw they had moved 1000 season tickets there's been nothing since . As pointed out FOC contributions are holding up so credit has to be given to their fans.
The players that have not agreed to a cut was rumored to be about 20 with the pfa.
Its very messy and seem to the only club in the spfl leagues openly fighting with their players . This clause allowing to not pay the players is a srange one if implemented does thevplayer become a free agent ?

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I’d say the clause has never been used and is untested as to what it means in practice as the wording is not as clear as it could be. It is possible that it was not given as much thought as it might have, if it was considered a real possibility. So whether it means it operates within the term agreed for a contract, perhaps allows for the suspended time to be added on the end if the contract, or perhaps even less likely was just meant to pause the duties of the contracted player to the club whilst there are no games due to the suspension of competition, it is a matter of interpretation. It also may be intended to be applied to all that have it in the contract not some. Budge may have got an opinion from a legal person but that is simply an opinion untested in court.

In the kind of circumstances where an employer was picking on some to suspend but not others, a normal employee with at least 2 years service can opt to resign and claim constructive dismissal (not an easy road). If Budge picks on those not bending to her will to suspend in circumstances where the underlying suspension of the game applies to all then I’d like to think that it would give grounds for legal action. I’m sure that the players union will keep the players right and will also have sought an opinion. All good clean fun

[cocteautwin]

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I haven't seen their a/cs & i appreciate you're a knowledgeable poster but im struggling to get my head round this. £5m = 20k seasons @£250 or over 16k at £300, all before end June? Do their a/cs actually identify season ticket revenue separately or are your numbers all revenue?

I don't think their accounts actually separate or highlight what the pre 30 June season ticket money number was but it's fairly reasonable to assume almost 100% of the deferred income number is advance season ticket sales and I've just taken that number (£5m) and divided it by 10 to get an approximate number of £0.5m a week over 10 weeks.

Not so sure on what the make up of each season ticket might be, I think a lot of their tickets are priced at £450. Minus the VAT, that gives £375 in revenue. I would assume that a lot of the early season ticket buyers would be less hard up for cash and probably seated in the more expensive seats, maybe? Perhaps a lot of the early season tickets sold are the higher priced seats?

[Keith_M]

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Less than 1500 was the number I was told at the end of last week.

If that’s accurate - and I’ve no reason to doubt it is given the source - then unless they start selling at a serious rate over the next month then they’re really in the deep stuff.

They put their Season Tickets on sale later than us, though,

I think they did that last year as well and eventually caught up (roughly) with the number we sold.

Though the fact they don't know what league they'll be in will probably have an effect on sales, especially if they're charging £450 for most of the seats in the main and Wheatfield stands.

[brog]

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Season ticket money sold before 30 June for the following season is recorded in the Balance Sheet as deferred income. HoMFC's deferred income was £5.199m. It's possible there was other income received in advance included but the bulk of it would be season ticket money.

By comparison Hibs deferred income and accruals was £5.781m, but HoMFC showed accruals of ££1.048m separately so the true comparison was £5.781 vs £6.247.

Thanks, & to GG, I went in & saw that. The problem I'm having reconciling is how their deferred income of £5.2m from mostly season ticket sales (£4.9m at 30/6/18) matches up to total gate receipt income of just under £6m. Remember in last financial year they had a semi at Murrayfield in front of 60k & a Scottish Cup semi & final. Add that to 6 home games against us & the uglies, a further 13 home league games & 6 home cup games & they only brought in £1m more than the deferred income figure? Illumination would be appreciated.
PS, I recognise we could probably ask the same question about us but we IIRC, don't break our turnover down.

[Caversham Green]

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I’d say the clause has never been used and is untested as to what it means in practice as the wording is not as clear as it could be. It is possible that it was not given as much thought as it might have, if it was considered a real possibility. So whether it means it operates within the term agreed for a contract, perhaps allows for the suspended time to be added on the end if the contract, or perhaps even less likely was just meant to pause the duties of the contracted player to the club whilst there are no games due to the suspension of competition, it is a matter of interpretation. It also may be intended to be applied to all that have it in the contract not some. Budge may have got an opinion from a legal person but that is simply an opinion untested in court.

In the kind of circumstances where an employer was picking on some to suspend but not others, a normal employee with at least 2 years service can opt to resign and claim constructive dismissal (not an easy road). If Budge picks on those not bending to her will to suspend in circumstances where the underlying suspension of the game applies to all then I’d like to think that it would give grounds for legal action. I’m sure that the players union will keep the players right and will also have sought an opinion. All good clean fun

It seems to me the key word is 'suspended'. It's applied to both the contract and the season within the same clause so you would expect it to have an identical meaning in both cases. As things stand the season is suspended with the intention of completing it at some future date (although that looks increasingly unlikely to happen) therefore I would expect the same to hold true for the contracts - ie they will have to be fulfilled if and when the season can be completed. It's unclear what will happen when they finally decide the season can't be continued but it's doubtful that the contracts could just be cancelled in those circumstances. They certainly can't just get rid of underperforming players as some over on the dark pink side are advocating.

All IMHO of course.

[brog]

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I don't think their accounts actually separate or highlight what the pre 30 June season ticket money number was but it's fairly reasonable to assume almost 100% of the deferred income number is advance season ticket sales and I've just taken that number (£5m) and divided it by 10 to get an approximate number of £0.5m a week over 10 weeks.

Not so sure on what the make up of each season ticket might be, I think a lot of their tickets are priced at £450. Minus the VAT, that gives £375 in revenue. I would assume that a lot of the early season ticket buyers would be less hard up for cash and probably seated in the more expensive seats, maybe? Perhaps a lot of the early season tickets sold are the higher priced seats?

Thanks, just saw after I posted in response to Cav & GG. I understand your thinking but something doesn't add up, see my comments above, given total gate income was under £6m

[The Modfather]

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It seems to me the key word is 'suspended'. It's applied to both the contract and the season within the same clause so you would expect it to have an identical meaning in both cases. As things stand the season is suspended with the intention of completing it at some future date (although that looks increasingly unlikely to happen) therefore I would expect the same to hold true for the contracts - ie they will have to be fulfilled if and when the season can be completed. It's unclear what will happen when they finally decide the season can't be continued but it's doubtful that the contracts could just be cancelled in those circumstances. They certainly can't just get rid of underperforming players as some over on the dark pink side are advocating.

All IMHO of course.

That’s what I am curious about, depending on various outcomes if it is possible to cancel contracts how will it be decided which contracts to cancel? The players union, and UEFA, will surely be close to this so clubs don’t use it as a convenient excuse to get rid of players not wanted.

[Bostonhibby]

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I think any talk of them going into Admin is wishful thinking.

They still have regular FoffH money coming in and will now be able to use part of next Season's ST money to help see them through till the end of this season (as is the norm for them).

I think the main effect of missing four home games is that it'll be even longer till they finish building their new stand.

This could well be right but it was a bit of a surprise to see Budge hit the panic button so early when faced with a comparaviely small loss of revenue from the remaining home games, especially for such a huge well funded club.

Events since then, and their cash balances from all that cash flow suggests there's an issue that but for the crisis they'd have been able to conceal, defer or sustain longer term.

We'll probably never know but it's great entertainment.

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[Carheenlea]

At least Hearts are now acting with a bit of humility and dignity befitting of their status of one of footballs most famous clubs by starting to apologise to those they left high and dry. Well done Hearts :aok

https://mobile.twitter.com/ApologyHearts

[whiskyhibby]

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At least Hearts are now acting with a bit of humility and dignity befitting of their status of one of footballs most famous clubs by starting to apologise to those they left high and dry. Well done Hearts :aok

https://mobile.twitter.com/ApologyHearts

😂😂

[Frankhfc]

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I’d say the clause has never been used and is untested as to what it means in practice as the wording is not as clear as it could be. It is possible that it was not given as much thought as it might have, if it was considered a real possibility. So whether it means it operates within the term agreed for a contract, perhaps allows for the suspended time to be added on the end if the contract, or perhaps even less likely was just meant to pause the duties of the contracted player to the club whilst there are no games due to the suspension of competition, it is a matter of interpretation. It also may be intended to be applied to all that have it in the contract not some. Budge may have got an opinion from a legal person but that is simply an opinion untested in court.

In the kind of circumstances where an employer was picking on some to suspend but not others, a normal employee with at least 2 years service can opt to resign and claim constructive dismissal (not an easy road). If Budge picks on those not bending to her will to suspend in circumstances where the underlying suspension of the game applies to all then I’d like to think that it would give grounds for legal action. I’m sure that the players union will keep the players right and will also have sought an opinion. All good clean fun

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It seems to me the key word is 'suspended'. It's applied to both the contract and the season within the same clause so you would expect it to have an identical meaning in both cases. As things stand the season is suspended with the intention of completing it at some future date (although that looks increasingly unlikely to happen) therefore I would expect the same to hold true for the contracts - ie they will have to be fulfilled if and when the season can be completed. It's unclear what will happen when they finally decide the season can't be continued but it's doubtful that the contracts could just be cancelled in those circumstances. They certainly can't just get rid of underperforming players as some over on the dark pink side are advocating.

All IMHO of course.

Agreed. Clause 12 is ambiguous. It clearly lacks definition and guidance. In the event a club refuses to pay a players salary based on clause 12, my instinct is that clause 12 will fail if it is tested in court. The agreed deferral of wages appears to be not only the safe route to go down, but, that it is also the morally correct one.

[lord bunberry]

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That’s what I am curious about, depending on various outcomes if it is possible to cancel contracts how will it be decided which contracts to cancel? The players union, and UEFA, will surely be close to this so clubs don’t use it as a convenient excuse to get rid of players not wanted.

This is the bit that I’d like to know more about. Surely they can’t suspend some players wages but still pay others. If they’re going to invoke the article 12 it has to be across the board.