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Wage cuts
Topic Started: Nov 17 2010, 05:38 PM (2,355 Views)
Ivan
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F*cking plebs.
[ *  *  *  *  *  * ]
Setenza
Nov 18 2010, 01:10 PM
Hamish
Nov 18 2010, 01:04 PM
A bit from The Courier:

Given the economic climate, Thompson conceded he should have said yes to Boro when they came in for Conway, who falls out of contract in May.

"Do I regret it? Hindsight is a great thing, but I think what the summer proved is that there is not a lot of money out there for transfer fees," he said. "If people think players are worth one, two or three million they are living in cloud-cuckooland.

"I am trying to be honest and you can look back and say maybe we should have taken the money, particularly if Craig doesn't re-sign for us."


In hindsight too.  We'd have likely given him pelters if he'd sold for £600,000.

And now Conway is injured, and Strachan has gone. :(

Wasn't it him that said Goodwillie etc was worth 2-3m only a few months ago though?

And that Conway was worth £1.2M, yes.
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Naebody
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Twat
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Here's what I can't get my head around. Attendances have been flat for a decade, pretty much. The debt's not budged so we can assume interest payments haven't changed drastically either. Corporate sponsorship has always been meagre but appears steady. The transfer market's dormant, of course, but income that way was only ever a sporadic bonus.

We were told in 2008 that the club was operating at breakeven. What happened?

Oh yes. Of course. Setanta imploded. Circumstances beyond our control.

Hang on though. The old Setanta deal was £54.5m over four years, or £13.5m a year between 12 clubs.

The current Sky/ESPN deal is worth £65m over five seasons, which is £13m a year between 12 clubs.

Are we saying the current crisis is because of a shortfall of £41,666 per club? That's about the price of Danny Cadamarteri's twatwagon.

I'm confused.
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Setenza
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Knitting with only one needle
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Ivan
Nov 18 2010, 01:13 PM
Setenza
Nov 18 2010, 01:10 PM
Hamish
Nov 18 2010, 01:04 PM
A bit from The Courier:

Given the economic climate, Thompson conceded he should have said yes to Boro when they came in for Conway, who falls out of contract in May.

"Do I regret it? Hindsight is a great thing, but I think what the summer proved is that there is not a lot of money out there for transfer fees," he said. "If people think players are worth one, two or three million they are living in cloud-cuckooland.

"I am trying to be honest and you can look back and say maybe we should have taken the money, particularly if Craig doesn't re-sign for us."


In hindsight too.  We'd have likely given him pelters if he'd sold for £600,000.

And now Conway is injured, and Strachan has gone. :(

Wasn't it him that said Goodwillie etc was worth 2-3m only a few months ago though?

And that Conway was worth £1.2M, yes.

That's what concerns me the most. I don't mind the moaning and deflecting blame too much - it's the making it up as he goes along approach that's a worry. Anyone listening is going to love that should they want anyone now.


In 6 months he's changed his mind completely on the sale of players and the value of our players and what our plan is. I don't even know if there is a plan anymore.


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Barca87
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Gordon Chisholm
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Hmmm, this is the worry though. We clearly need to sell and he was probably banking on getting some reasonable offers in for anyone of Goodie, Gomis, Conway and Kenneth and only got one that was a half what we would expect (and yes we would have ripped right into him if accepted a £600,000 bid from 'Boro).

The worry is that Rangers or whatever CHampionship side who are desperate to give their play off charge a push now know they can offer reduced money and we will have no option but to bend over and say "how low?"
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Ivan
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F*cking plebs.
[ *  *  *  *  *  * ]
The only way that I can see United clearing the debt is by selling players, or as naebody would put it, exceptional income (probably while puffing on an ornate pipe). That's how Hibs did it.

It's not a great plan, but it might be doable, with a prevailing wind and a steady hand. It's not going to work however if you lurch from one season to the next pushing the wage budget up and down as the wind changes. Do we really want to keep Conway. Gomis, Buaben in the hope that we can achieve a good price further down the line? If so, hold your nerve for god's sake man!

It's this vacilating between playing hardball and then pleading desperation which gets on my tits.*

And if we're not going to clear the debt by selling on players then we need to go for debt release and take our medicine. Unless Thomson has identified a third option ...



* Well, that and the constant high pitched whining in the background. Where's the good news story, Steven? All I can hear is boo hoo my dad pissed away my inheritance and it's not fair and you should all be grateful because if it wasn't for me and my dad the club that you pay money to support would be ... erm, pretty much exactly where it is today. Nobody knows the troubles I've seen.
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Naebody
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Twat
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Ehck-chewally ..... If I were chairman (and it's only a matter of time etc etc etc) I wouldn't be overly worried about paying off the debt. It currently equates to about once annual turnover, which is quite ordinary for this sort of business. Providing the bank was happy to get its interest payments, I'd be happy. Anyone used to paying off the minimum balance on their credit card each month will be familiar with this form of financial management.

If United did somehow manage to pay off its debt, the first thing I'd do as chairman is borrow some more. There's not a lot of value in having a very predictable revenue (ie, attendences) if you don't leverage it. And if management don't have any confidence that they'll earn back the cost of capital, they're financially illiterate incompetents that should have nothing to do with a business larger than a tuck shop.

I recognise, however, that the people who've run football clubs for the past five decades have been financially illiterate incompetents that should have had nothing to do with a business larger than a tuck shop.
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The Eggman
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Tommy McLean
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Barca87
Nov 18 2010, 12:20 PM
Who? Who is going to buy or put into a Scottish Premier League club? The game is on its arse - Aberdeen, Kilmarnock, St Midden, Rangers all have been unable to attract new investment, the investment they have has come from in most cases weathly fans. How on earth would we do it? I don't remember anybody coming forward at the time Eddie Thompson invested.

If all he's getting is more misery (which is what it seems like), then call it quits. Save yourself some money, Thompson.
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Barca87
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Gordon Chisholm
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As I understand it, as long as the debt doesn't grow as Naebody says the bank are content with the interest payment being met. And i think the debt hasn't grown substancially since its high/low point - several years ago (Brewster's close season?). If it were to get higher, like say Kilmarnock whose debt kept ballooning, then the bank will come in as they would worry this means we can't keep up on our basic obligations and the interest payments. now it may well be the case that the Thompsons are having to dig in to pay some of that off and keep the debt static.

However, you would have to say that Thompson (faither and son) have done alright by this club, mistakes included. The facts are not every United fan is dare I say, not as considered as we are about these issues, and will be demanding we buy this and that over the transfer window. And as we have alluded to, they will go spare as and when our "big names" move on.

Being a chairman must be an absolute ball ache.
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Ivan
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F*cking plebs.
[ *  *  *  *  *  * ]
Naebody
Nov 18 2010, 02:11 PM
Ehck-chewally ..... If I were chairman (and it's only a matter of time etc etc etc) I wouldn't be overly worried about paying off the debt. It currently equates to about once annual turnover, which is quite ordinary for this sort of business. Providing the bank was happy to get its interest payments, I'd be happy. Anyone used to paying off the minimum balance on their credit card each month will be familiar with this form of financial management.

If United did somehow manage to pay off its debt, the first thing I'd do as chairman is borrow some more. There's not a lot of value in having a very predictable revenue (ie, attendences) if you don't leverage it. And if management don't have any confidence that they'll earn back the cost of capital, they're financially illiterate incompetents that should have nothing to do with a business larger than a tuck shop.

I recognise, however, that the people who've run football clubs for the past five decades have been financially illiterate incompetents that should have had nothing to do with a business larger than a tuck shop.

That's just the sort of wrong-headed nonsense that caused the economy of the world to explode. Then collapse.

When the revolution comes and we're looking to elect* a party chairman, you won't be getting my nomination, Mr Naebody. Good day.



* yes, I know.
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Ivan
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F*cking plebs.
[ *  *  *  *  *  * ]
Barca87
Nov 18 2010, 02:39 PM
However, you would have to say that Thompson (faither and son) have done alright by this club, mistakes included. The facts are not every United fan is dare I say, not as considered as we are about these issues, and will be demanding we buy this and that over the transfer window. And as we have alluded to, they will go spare as and when our "big names" move on.

Being a chairman must be an absolute ball ache.

Well, father certainly did. I'm not entirely clear what Jr's done. Other than complain about his lot and spend his dad's money.

If you can't stand the aching balls, get out of the 'kitchen'.
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yasser
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Ivan Golac
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Setenza
Nov 17 2010, 11:29 PM
I presume it's a kind of message to those not wanting to give money for the derby thing, I can't see any other reason to just repeat the same old doom and gloom story again, blaming everyone else.

Exactly what I thought when I read this statement from Mr T. Aimed as a reality check for all those Arabs who have smugly spouting that while the Dee are deep in the brown stuff, DUFC are in a financial comfort zone. DFC being in the first division might not be seen as disaster for the Tangerine side of Tannadice Street but it comes fairly close to it. Hamilton bring 58 visiting fans compared to a full house for a full blooded competitive Dundee derby doesn’t need someone with an M.A in accountancy or business studies to work out the hard facts in the cold light of day. Like it or hate it a vibrant DFC is good news for DUFC. A full house at this friendly derby would benefit us as well as them. Hold yer noses if you must and turn up for the game.
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Setenza
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Knitting with only one needle
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Naebody
Nov 18 2010, 01:37 PM
Here's what I can't get my head around. Attendances have been flat for a decade, pretty much. The debt's not budged so we can assume interest payments haven't changed drastically either. Corporate sponsorship has always been meagre but appears steady. The transfer market's dormant, of course, but income that way was only ever a sporadic bonus.

We were told in 2008 that the club was operating at breakeven. What happened?

Oh yes. Of course. Setanta imploded. Circumstances beyond our control.

Hang on though. The old Setanta deal was £54.5m over four years, or £13.5m a year between 12 clubs.

The current Sky/ESPN deal is worth £65m over five seasons, which is £13m a year between 12 clubs.

Are we saying the current crisis is because of a shortfall of £41,666 per club? That's about the price of Danny Cadamarteri's twatwagon.

I'm confused.

An anwer just for you from the newsletter...

Quote:
 

The Club reported last year that it faced an almost £1m shortfall due to collapse of Setanta. Why was this and how did it cope?

The collapse of Setanta in the summer of 2009 cost the Club well over £800k in budgeted income for the year to June 2010. To put this into perspective this was getting on for some 20% of the budgeted annual turnover; a massive amount to cope with virtually overnight. The shortfall was not in respect of over-budgeting for the new improved Setanta deal; this was in respect of the existing contract.

The shortfall manifested itself in two ways - 1) The sudden collapse led to Setanta defaulting on a major payment to the SPL which meant that we did not receive our final place money for season 08/09, which had to be treated as a bad debt 2) The Sky/ESPN replacement contract for 09/10 was some £12m compared with the existing Setanta £18m, meaning that each club was over £400k worse off. Taking into account other recessionary factors such as reduced gate money etc, plus essential costs which had to be met, it is true that at one point we were looking at a potential shortfall of some £1m for the financial year to June 2010.

The Board took the decision to honour all existing contracts and not allow this deficit to affect the football side, by employing various alternative measures and of course, being rewarded (or getting lucky if some prefer) by an improved financial performance due to on the park success. While the rewards for finishing third in the SPL are not as great as they were just two seasons ago and the Cup Final does not produce as much as some might think, this and other measures helped us address the overall deficit. A modest net profit was recorded for the year.
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Setenza
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Knitting with only one needle
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Hamish
Nov 18 2010, 01:04 PM
A bit from The Courier:

Given the economic climate, Thompson conceded he should have said yes to Boro when they came in for Conway, who falls out of contract in May.

"Do I regret it? Hindsight is a great thing, but I think what the summer proved is that there is not a lot of money out there for transfer fees," he said. "If people think players are worth one, two or three million they are living in cloud-cuckooland.

"I am trying to be honest and you can look back and say maybe we should have taken the money, particularly if Craig doesn't re-sign for us."


In hindsight too.  We'd have likely given him pelters if he'd sold for £600,000.

And now Conway is injured, and Strachan has gone. :(

And a confusing one:

Quote:
 
Why then did we not accept the bid for Craig Conway?

The fee offered was not as much as some reports suggested and taking into account that it was further diluted by payments to third parties, spread over a period of time and in part conditional on circumstances outwith our control, a decision was made that the player was more valuable for us on the park this season. Hopefully Craig will be back playing again before too long and prove this decision - even with the golden benefit of hindsight - to be a correct one.
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Naebody
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Twat
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Ivan
Nov 18 2010, 02:45 PM
That's just the sort of wrong-headed nonsense that caused the economy of the world to explode. Then collapse.

Debt's not bad. It's what you do with it that counts.

Just say if Mr Mclean, instead of running up an overdraft shipping random blokes in boxes from South America, bought a gym operator. The club and the business would have some quite obvious synergies (and I apologise for the management bullshit, but there's no other word). The same could be said for catering firms, security firms, property agencies, media agencies and about a hundred other companies that offer obvious and easy synergies (sorry) with the core Dundee United FC operations (sorry again). No capital expenditure (sorry) is risk-free, but this is as close as you get. It's called vertical integration (sorry). It's on the opening page of The Idiot's Guide to How to Avoid Running Your Moderately Successful Business into the Shite Within Five Years.

Sure. The fans would've bleated about buying actual assets rather than signing this or that player. However, I don't have a great deal of time for this idea that football clubs are simply bowing to what the fans want. They've shown no evidence of ever having done so, except retrospectively when looking for someone to blame for their asshatted decisions.
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Naebody
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Twat
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I've read United's response before, of course, and I remain confused.

Quote:
 
1) The sudden collapse led to Setanta defaulting on a major payment to the SPL which meant that we did not receive our final place money for season 08/09, which had to be treated as a bad debt


The SPL said it covered half of this payment, suggesting an unplanned shortfall of ~£300k. Unfortunate, certainly. But "major"?

Quote:
 
2) The Sky/ESPN replacement contract for 09/10 was some £12m compared with the existing Setanta £18m, meaning that each club was over £400k worse off.


My figures above are taken direct from the SPL archives (£13.5m/£13m per season). I can find no source for United's figures (£18m/£12m per season).
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