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Arminius

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The stadium debt is the inter-company debt (owed to the parent company, UKSV Holdings Company Ltd) which stood at £109.949 million in the last accounts.
The club also has a revolving credit facility of £150 million for "general corporate purposes including working capital and letters of credit" i.e. primarily for player purchases. for a term of five years from September 2015. This secured bank facility is due to mature in September 2020. As of 30 May 2017, £71.709 million had been drawn down against this facility (£73 million, less £1.291million deferred loan costs).
I thought those letters of credit went heavily to the stadium project?
 

Lowton_Red

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I thought those letters of credit went heavily to the stadium project?
The money for the stadium expansion came from the intercompy loan.
From page 26 of the accounts:
"The £109.9 million due to group undertaking at 31 May 2017 represented at £109.9 million intercompany creditor with the Club's UK holding Company, UKSV Holdings Company Limited. This intercompany loan has been provided to fund the stadium expansion work."

The bank loan, the revolving credit facility of £150 million is used for "general corporate purposes including working capital and letters of credit". In other words to fund any shortfall in financing player purchases.
 

Arminius

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The money for the stadium expansion came from the intercompy loan.
From page 26 of the accounts:
"The £109.9 million due to group undertaking at 31 May 2017 represented at £109.9 million intercompany creditor with the Club's UK holding Company, UKSV Holdings Company Limited. This intercompany loan has been provided to fund the stadium expansion work."

The bank loan, the revolving credit facility of £150 million is used for "general corporate purposes including working capital and letters of credit". In other words to fund any shortfall in financing player purchases.
Interesting - I had read them quickly, and was not aware that letters of credit would see much use in player transfers, so assumed that the total stadium debt was the UKSV plus some portion of the bank loan.
 

Lowton_Red

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Interesting - I had read them quickly, and was not aware that letters of credit would see much use in player transfers, so assumed that the total stadium debt was the UKSV plus some portion of the bank loan.
As far as I'm aware, LOCs are used extensively in player transfers, especially for international transfers.
 

Arminius

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As far as I'm aware, LOCs are used extensively in player transfers, especially for international transfers.
It makes sense, just that we fairly often hear about direct wire transfers being used, plus the fact that FIFA/UEFA provide a much more direct enforcement mechanism for non-payment.
 

Lowton_Red

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It makes sense, just that we fairly often hear about direct wire transfers being used, plus the fact that FIFA/UEFA provide a much more direct enforcement mechanism for non-payment.
The advantage of a LOC (especially if it is confirmed irrevocable) is the security it offers both the selling and buying club; payment is assured, provided that the conditions of the LOC are met. There is no risk of the purchasing club withholding or delaying payment, so there is no need to rely on possibly protracted enforcement measures.
 

Arminius

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The advantage of a LOC (especially if it is confirmed irrevocable) is the security it offers both the selling and buying club; payment is assured, provided that the conditions of the LOC are met. There is no risk of the purchasing club withholding or delaying payment, so there is no need to rely on possibly protracted enforcement measures.
Never quite figured out what the value was of a non-confirmed or revocable LC. The limitation with using LCs for player transfers would be the documents required to secure payment - I assume that would be the transfer of registration generally. That doesn't protect you from much of significance really, although the Cardiff-Nantes situation now comes to mind.
 

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Not unheard of to provide Letters of Credit to act as a guarantee for future payments relating to player transfers but certainly not usual for them to be requested of PL clubs.
 

Lowton_Red

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Notification just in from Companies House:
THE LIVERPOOL FOOTBALL CLUB AND ATHLETIC GROUNDS LIMITED
Group of companies' accounts made up to 31 May 2018
This document is being processed and will be available in 5 days.


It'll be interesting to see the state of the cash flows and borrowings, rather than the headline grabbing turnover and profit numbers.
 

Arminius

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Notification just in from Companies House:
THE LIVERPOOL FOOTBALL CLUB AND ATHLETIC GROUNDS LIMITED
Group of companies' accounts made up to 31 May 2018
This document is being processed and will be available in 5 days.


It'll be interesting to see the state of the cash flows and borrowings, rather than the headline grabbing turnover and profit numbers.
I was a little surprised not to see them there already after all the 'record-breaking profit' stories, so I will be curious. In particular, I wonder what the club's commercial revenue growth has looked like.
 

Arminius

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According to this club press release, commercial revenue increasing by £17million to £154 million.
So not as good on a percentage basis as the prior year, but still over 10% growth. That is encouraging after the doldrums of the previous couple of years, and I would guess that with a CL final appearance and now a title challenge, the commercial department has been running downhill of late.
 

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So not as good on a percentage basis as the prior year, but still over 10% growth. That is encouraging after the doldrums of the previous couple of years, and I would guess that with a CL final appearance and now a title challenge, the commercial department has been running downhill of late.
Still crap though for the reasons you refer to. Increasing commercial by 18% in a year without European football (2017) was a good effort if you ignore the low base we were starting from. A slower rate of increase in commercial revenue (13%) in a year where our profile could hardly be higher is a bit meh.

Chelsea's commercial revenue, for example, has gone £116.5m > £133.3m > £165.4m (2016, 2017, 2018) when we've gone £115.7m > £136.4m > £154m.

We largely tracked Chelsea over 2016 and 2017 but then were outperformed by them to the tune of £11m in 2018 with them achieving nearly double the rate of growth at 24% compared to our 13%?! In a year we got to the Champions League final and they finished 5th?! Who knew that the FA Cup continued to be such an earner, eh?
 

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Still crap though for the reasons you refer to. Increasing commercial by 18% in a year without European football (2017) was a good effort if you ignore the low base we were starting from. A slower rate of increase in commercial revenue (13%) in a year where our profile could hardly be higher is a bit meh.

Chelsea's commercial revenue, for example, has gone £116.5m > £133.3m > £165.4m (2016, 2017, 2018) when we've gone £115.7m > £136.4m > £154m.

We largely tracked Chelsea over 2016 and 2017 but then were outperformed by them to the tune of £11m in 2018 with them achieving nearly double the rate of growth at 24% compared to our 13%?! In a year we got to the Champions League final and they finished 5th?! Who knew that the FA Cup continued to be such an earner, eh?
It should be noted that the Chelsea numbers have jumped ahead in large measure because their new shirt deal came on track in 17/18, which was not an opportunity available to LFC in the same time frame. But your broader point holds - although the growth is solid, we aren't gaining ground on Chelsea, and we remain well behind ManU and ManC.
 

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It should be noted that the Chelsea numbers have jumped ahead in large measure because their new shirt deal came on track in 17/18, which was not an opportunity available to LFC in the same time frame. But your broader point holds - although the growth is solid, we aren't gaining ground on Chelsea, and we remain well behind ManU and ManC.
Agree some of Chelsea's growth last year was attributable to the new kit deal (an area we really need to make a big leap with in the next twelve months before the bubble bursts) but we're still behind where we should be, imo.

Also an element of a drag effect to commercial revenue with it somewhat reflecting immediately previous on pitch performance.

Still, we ought to be comfortably ahead of Chelsea and yet we're behind.
 

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Still crap though for the reasons you refer to. Increasing commercial by 18% in a year without European football (2017) was a good effort if you ignore the low base we were starting from. A slower rate of increase in commercial revenue (13%) in a year where our profile could hardly be higher is a bit meh.

Chelsea's commercial revenue, for example, has gone £116.5m > £133.3m > £165.4m (2016, 2017, 2018) when we've gone £115.7m > £136.4m > £154m.

We largely tracked Chelsea over 2016 and 2017 but then were outperformed by them to the tune of £11m in 2018 with them achieving nearly double the rate of growth at 24% compared to our 13%?! In a year we got to the Champions League final and they finished 5th?! Who knew that the FA Cup continued to be such an earner, eh?
Wasn't that increase for Chelsea the year after they won the league? And wouldn't any increases on our revenue due to the champions league run show in the following years accounts? Not the year during which it happened?
 

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Wasn't that increase for Chelsea the year after they won the league? And wouldn't any increases on our revenue due to the champions league run show in the following years accounts? Not the year during which it happened?
Yes and no. There is often the lag you allude to but also many commercial agreements provide for compensation to track performance 'real time' even if it's as basic as tv exposure or games played in the CL etc.
 
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I think we’re doing well for where we are. We haven’t won anything yet. If we win the EPL and/or ECL any time soon our commercial bargaining power will increase significantly. Winning one or both of these titles this season could be hugely significant for us in terms of any current ongoing commercial negotiations.
 

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And wouldn't any increases on our revenue due to the champions league run show in the following years accounts? Not the year during which it happened?
Yes, new deals struck this year would be registered upon date of invoice/payable date and will be reflected on year end account. If our year end falls in June, then whatever we did last July till this May, will be reported to the public after the account is audited and signed off. So it depends on when is our accounting cycle year-ending and how much revenue we received throughout the campaign that falls under that timeline.
 

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Yes, new deals struck this year would be registered upon date of invoice/payable date and will be reflected on year end account. If our year end falls in June, then whatever we did last July till this May, will be reported to the public after the account is audited and signed off. So it depends on when is our accounting cycle year-ending and how much revenue we received throughout the campaign that falls under that timeline.
Our year end is now 31 May.
 

Lowton_Red

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It should be noted that the Chelsea numbers have jumped ahead in large measure because their new shirt deal came on track in 17/18, which was not an opportunity available to LFC in the same time frame. But your broader point holds - although the growth is solid, we aren't gaining ground on Chelsea, and we remain well behind ManU and ManC.
Every year, at about this time, we appear to have the same conversation regarding our commercial income.

And every year we see that since 2010 the overall growth in our commercial income is relatively poor, when compared with the other "top six" clubs:


(the figures in italics are Deloite's estimates)

The growth in our commercial revenue over the period, expressed as a percentage, is the worst of the six.

Put another way, had our commercial revenue grown at the same rate as the other clubs, our commercial earnings would be:

So, even though there might be mitigating circumstances, there is no room for self congratulation or complacency.
Here's hoping our next kit sponsorship deal is an absolute stonker.
 

redfanman

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Every year, at about this time, we appear to have the same conversation regarding our commercial income.

And every year we see that since 2010 the overall growth in our commercial income is relatively poor, when compared with the other "top six" clubs:


(the figures in italics are Deloite's estimates)

The growth in our commercial revenue over the period, expressed as a percentage, is the worst of the six.

Put another way, had our commercial revenue grown at the same rate as the other clubs, our commercial earnings would be:

So, even though there might be mitigating circumstances, there is no room for self congratulation or complacency.
Here's hoping our next kit sponsorship deal is an absolute stonker.
I think if we continue to sustain our current progress we will see a good jump in our commercial revenues wont we? Kit sales appear to be going strongly with the store having to re-order stock and the kit deal being renegotiated at a time when we are also challenging for the title and going strongly in the CL while several of our rivals are in freefall.
 

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redfanman

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looking at those figures isnt it plausible that the differences can be explained by us already having a large fanbase which is ageing and being out of regular CL football? Now that we are back in there, the scope for getting increasing revenues is larger through greater tv exposure?
Still crap though for the reasons you refer to. Increasing commercial by 18% in a year without European football (2017) was a good effort if you ignore the low base we were starting from. A slower rate of increase in commercial revenue (13%) in a year where our profile could hardly be higher is a bit meh.

Chelsea's commercial revenue, for example, has gone £116.5m > £133.3m > £165.4m (2016, 2017, 2018) when we've gone £115.7m > £136.4m > £154m.

We largely tracked Chelsea over 2016 and 2017 but then were outperformed by them to the tune of £11m in 2018 with them achieving nearly double the rate of growth at 24% compared to our 13%?! In a year we got to the Champions League final and they finished 5th?! Who knew that the FA Cup continued to be such an earner, eh?
How much of Chelsea's revenue comes from non football events? Do they rent out for concerts and so forth?
 

Hope in your heart

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(...)

The growth in our commercial revenue over the period, expressed as a percentage, is the worst of the six.

Put another way, had our commercial revenue grown at the same rate as the other clubs, our commercial earnings would be:

(...)

So, even though there might be mitigating circumstances, there is no room for self congratulation or complacency.
Here's hoping our next kit sponsorship deal is an absolute stonker.
It's always the area where suspicions that FSG (via FSM) are skimming off the top are the most plausible.
Yeah, I find it a bit fishy to be honest. FSG/FSM aren't more stupid than the owners of other clubs, and you'd think that the commercial aspects of handling the club's rising reputation should be one of their strong points. And yet, we fall back behind the other top clubs in England.

At the end of the day, it's not a major issue as long as there is money available for Klopp when he needs it. But it's still a bit strange.
 

JustHitMyHead

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Yeah, I find it a bit fishy to be honest. FSG/FSM aren't more stupid than the owners of other clubs, and you'd think that the commercial aspects of handling the club's rising reputation should be one of their strong points. And yet, we fall back behind the other top clubs in England.

At the end of the day, it's not a major issue as long as there is money available for Klopp when he needs it. But it's still a bit strange.
FSM wouldn't be charging more than they charge other commercial clients so it is minimal as to how much (if any) they would be taking out via that method.

At the end of the day, FSG owns Liverpool too and I don't think that they are that hungry about yield that they need to take it out in a backhanded way.
 

JustHitMyHead

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Every year, at about this time, we appear to have the same conversation regarding our commercial income.

And every year we see that since 2010 the overall growth in our commercial income is relatively poor, when compared with the other "top six" clubs:


(the figures in italics are Deloite's estimates)

The growth in our commercial revenue over the period, expressed as a percentage, is the worst of the six.

Put another way, had our commercial revenue grown at the same rate as the other clubs, our commercial earnings would be:

So, even though there might be mitigating circumstances, there is no room for self congratulation or complacency.
Here's hoping our next kit sponsorship deal is an absolute stonker.
I wonder how much of the commercial revenues come from the local market though??? Not every sponsor is global... In fact, I would expect a large portion of it to be local and in that regard we can't compare to London or Manchester in terms of wealth.