Wolves annual report and financial statements 2018/19

[clivewolves]

The report can be found on the link below for those interested.

WOLVERHAMPTON WANDERERS FOOTBALL CLUB (1986) LIMITED - Filing history (free information from Companies House)

 

[hollo]

Wonderful. We will let swiss ramble dissect this and give their findings a jolly good read.

 

[Guzeppi]

Interesting. Thank you very much.
Now, someone that's into corporate/company law, explain to me the significance of the cessation of Fosun and Guo as a person with significant control and the notification of WW (1990) Ltd as person with significant control. Is WW(1990) technically a subsidiary of Fosun?
I am only interested in the legal ramifications.

 

[Hot Fuss]

Operating loss of 65 million in the championship to operating profit of 10 million in the premier league.

 

[RosehillWolf]

Scary ..... we have borrowed £164million ?? which is payable within 12 months...have I read this correctly ? I assume this includes the two tranches of Macquarie money..... so when we get our PL payment and TV rights, that will have to go towards paying this off , and will still leave monies owing. Add to this the escalating salary bill due to contractual obligations , deduct season ticket revenue and we are in a big hole by the looks of things
My question is , where are the funds for new players ?? and to me, it looks like we need to sell in the summer ..... and I have to say, if I've read those figures correctly we are totally ****ed if we get relegated !

 

[Deleted member LP 3925]

Scary ..... we have borrowed £164million ?? which is payable within 12 months...have I read this correctly ? I assume this includes the two tranches of Macquarie money..... so when we get our PL payment and TV rights, that will have to go towards paying this off , and will still leave monies owing. Add to this the escalating salary bill due to contractual obligations , deduct season ticket revenue and we are in a big hole by the looks of things
My question is , where are the funds for new players ?? and to me, it looks like we need to sell in the summer ..... and I have to say, if I've read those figures correctly we are totally ****ed if we get relegated !

And those 4 points to stave off relegation - I can’t see where they’re coming from - doomed, we’re doomed!

 

[Deleted member LP 3925]

Or we could just take out another loan. It seems to work for Mrs Lupo.

 

[North West Wanderer]

Scary ..... we have borrowed £164million ?? which is payable within 12 months...have I read this correctly ? I assume this includes the two tranches of Macquarie money..... so when we get our PL payment and TV rights, that will have to go towards paying this off , and will still leave monies owing. Add to this the escalating salary bill due to contractual obligations , deduct season ticket revenue and we are in a big hole by the looks of things
My question is , where are the funds for new players ?? and to me, it looks like we need to sell in the summer ..... and I have to say, if I've read those figures correctly we are totally ****ed if we get relegated !

No we don’t.
They’re a brilliant set of figures, and only you could see any negative. I’ll remind you of this when you start moaning about the lack of signings.

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[AndyWolves]

Scary ..... we have borrowed £164million ?? which is payable within 12 months...have I read this correctly ? I assume this includes the two tranches of Macquarie money..... so when we get our PL payment and TV rights, that will have to go towards paying this off , and will still leave monies owing. Add to this the escalating salary bill due to contractual obligations , deduct season ticket revenue and we are in a big hole by the looks of things
My question is , where are the funds for new players ?? and to me, it looks like we need to sell in the summer ..... and I have to say, if I've read those figures correctly we are totally ****ed if we get relegated !

Ok, in my mind you're clearly a WUM

 

[Golden_Wolf]

No we don’t.
They’re a brilliant set of figures, and only you could see any negative. I’ll remind you of this when you start moaning about the lack of signings.

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Cheers for putting that in NWW. Figures look good, the increasing in gate receipts & broadcasting rights are interesting.

 

[AndyWolves]

Interesting. Thank you very much.
Now, someone that's into corporate/company law, explain to me the significance of the cessation of Fosun and Guo as a person with significant control and the notification of WW (1990) Ltd as person with significant control. Is WW(1990) technically a subsidiary of Fosun?
I am only interested in the legal ramifications.

Yes

Fosun et al took control during the takeover and then gave it back to WW Ltd

 

[jrpb-3]

Interesting. Thank you very much.
Now, someone that's into corporate/company law, explain to me the significance of the cessation of Fosun and Guo as a person with significant control and the notification of WW (1990) Ltd as person with significant control. Is WW(1990) technically a subsidiary of Fosun?
I am only interested in the legal ramifications.

don't know but would guess it is down to the Mendes gestifute link with Guo, and the fact that the prem league rules differ to the Championship ones on links/conflicts of interest etc. So need to show there is no direct link/influence between Mendes and Wolves

Edit:
OK, just seen the actual date of cessation was 2016 so not to do with promotion to the prem, but could be to ensure they stayed on the right side or regulations with regard to Guos share in Mendes agency

 

[RosehillWolf]

No we don’t.
They’re a brilliant set of figures, and only you could see any negative. I’ll remind you of this when you start moaning about the lack of signings.

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PriceOfFootball on Twitter

Not one bit of that article mentions the borrowing figure I've mentioned above, I understand the figures are better, and improved , but that borrowing.....sheesh

 

[SingYourHeartsOut]

Looks very encouraging, in the bonkers world of Premier league football finance we only look slightly silly. Hard to know how to grow further though without joining those clearly living beyond their means. Keep buying a s selling smart I guess and fight for more EL football.

 

[S G Wolves]

Scary ..... we have borrowed £164million ?? which is payable within 12 months...have I read this correctly ? I assume this includes the two tranches of Macquarie money..... so when we get our PL payment and TV rights, that will have to go towards paying this off , and will still leave monies owing. Add to this the escalating salary bill due to contractual obligations , deduct season ticket revenue and we are in a big hole by the looks of things
My question is , where are the funds for new players ?? and to me, it looks like we need to sell in the summer ..... and I have to say, if I've read those figures correctly we are totally ****ed if we get relegated !

I know you are just joking...
Good set of accounts making a 20m profit after player sales..
The debt payable is to our Holding Co. Or to ourselves.. all very secure and sensible..
Initial thoughts without going to much into it..

 

[North West Wanderer]

Not one bit of that article mentions the borrowing figure I've mentioned above, I understand the figures are better, and improved , but that borrowing.....sheesh

The higher the level of turnover in a business, depending of course on their payment terms, the higher the cash flow/borrowing facilities tend to be.

 

[Olivergoldblack]

Not one bit of that article mentions the borrowing figure I've mentioned above, I understand the figures are better, and improved , but that borrowing.....sheesh

I think we were spending the money we were gonna get for last season in the pre-season of 18/19, so must have needed the loan to bridge the gap. However loans are not as scary as long as what your borrowing for goes up in value, and exceeds the amount you need to pay in interest for the loan.

 

[AndyWolves]

PriceOfFootball on Twitter

 

[OLDGOLD]

I understand very little about money and so will not comment.
Perhaps that is a good starting point for others on this thread...??

 

[Derbywolf85]

If you all follow Kieran Maguire on Twitter, you'll see that our results are, in his words, "Excellent". Basicaly we are well run, whilst remaining competitive. That's all we really want...Along with £50m signings

 

[RosehillWolf]

I know you are just joking...
Good set of accounts making a 20m profit after player sales..
The debt payable is to our Holding Co. Or to ourselves.. all very secure and sensible..
Initial thoughts without going to much into it..

Referring to the debt payable.... is this simply not inflating our own income through loans and borrowing to get around FFP ?? This is all very confusing , my understanding of a secure debt is a mortgage....it's still payable isn't it ?
So if FOSUN want to take back that money ( loan) ...we would be in trouble ?

 

[clivewolves]

It will be interesting to see how it compares with the rest of the league when all of them have published their results, but it seems we are doing very well, especially as it was our first season back in the Premier League. A huge gap in revenue compared to the 'top 6' clubs, but that will only really be closed with regular European football, a bigger stadium & more commercial activities.

 

[Deleted member 5635]

Most importantly what could our summer transfer budget possibly be without putting the club into problems?(FFP/UEFA,etc)

 

[Chris H]

Referring to the debt payable.... is this simply not inflating our own income through loans and borrowing to get around FFP ?? This is all very confusing , my understanding of a secure debt is a mortgage....it's still payable isn't it ?
So if FOSUN want to take back that money ( loan) ...we would be in trouble ?

No.

You can't inflate income via introducing money. The creditors figures are all amount owing to all creditors the vast majority (£131m) of which is cash Fosun have injected.

Its a balance sheet, if the owners put money in the bank there has to be another entry somewhere else which will be a loan account to the shareholder which is Fosun in our case. It's not anything to worry about and also debunks the theories that Fosun are wary of putting money in when they've actually physically given us £131m in cash on top of the various "sponsorship" monies they give us (£1m for the naming rights of the training ground for instance) in the 3 years they've owned us up to 31 May 2019.

People want Fosun to bank roll us but don't want us to owe them any money, it doesn't work like that.

I think because its a football club people sometimes forget its an actual company that has to follow actual company law and accounting principles.

 

[RosehillWolf]

No.

You can't inflate income via introducing money. The creditors figures are all amount owing to all creditors the vast majority (£131m) of which is cash Fosun have injected.

Its a balance sheet, if the owners put money in the bank there has to be another entry somewhere else which will be a loan account to the shareholder which is Fosun in our case. It's not anything to worry about and also debunks the theories that Fosun are wary of putting money in when they've actually physically given us £131m in cash on top of the various "sponsorship" monies they give us (£1m for the naming rights of the training ground for instance) in the 3 years they've owned us up to 31 May 2019.

People want Fosun to bank roll us but don't want us to owe them any money, it doesn't work like that.

I think because its a football club people sometimes forget its an actual company that has to follow actual company law and accounting principles.

OK , thanks for explaining , without the stupid name calling as per above

 

[Boss Hogg]

A couple of things I noted:

1. Gate receipts are really insignificant - less than 10% of our total income. They could let us all in for free and we would still have made a profit.

2. Levels of borrowing quite high: £164m to Fosun plus another £50m to Macquarrie. The Fosun loans are repayable on demand - ie if they decide they’ve had enough they can call the loan in.

 

[wolvesjoe]

Most importantly what could our summer transfer budget possibly be without putting the club into problems?(FFP/UEFA,etc)

As a rule of thumb, you can say the signing of a 20m player takes between 8 and 10m of turnover, (annual amortised payment of 4m plus 4-6m in wages). The other factors to take into account is players sold, both in terms of transfer fee and freed up wages, and any overall increase in revenue. This will mainly depend on where Wolves finally finish in the league and how far they go in the EL, (plus any further increases in very impressive commercial, sponsorship and matchday figures). A good second half to the season and Wolves will have up to 50m to use in the summer market, imo.

 

[RosehillWolf]

A couple of things I noted:

1. Gate receipts are really insignificant - less than 10% of our total income. They could let us all in for free and we would still have made a profit.

2. Levels of borrowing quite high: £164m to Fosun plus another £50m to Macquarrie. The Fosun loans are repayable on demand - ie if they decide they’ve had enough they can call the loan in.

Don't mention the borrowing, you will be labelled a WUM

 

[Deleted member 5635]

As a rule of thumb, you can say the signing of a 20m player takes between 8 and 10m of turnover, (annual amortised payment of 4m plus 4-6m in wages). The other factors to take into account is players sold, both in terms of transfer fee and freed up wages, and any overall increase in revenue. This will mainly depend on where Wolves finally finish in the league and how far they go in the EL, (plus any further increases in very impressive commercial, sponsorship and matchday figures). A good second half to the season and Wolves will have up to 50m to use in the summer market, imo.

Strangely 50m doesn’t seem a lot at all nowadays, especially as other clubs can spend double or triple that amount on returning to the league.

 

[wolvesjoe]

Strangely 50m doesn’t seem a lot at all nowadays,

That's a very good point I think, with many implications. The elite transfer market remains highly inflated, especially when the restrictions of FFP are taken into account. Club owners cant just pile money in to enrich their squads. Logically it suggests that the market will break at some point soon, as teams have to move on players in order to replenish their squads. Wolves have done well with the Cavaleiro, Costa and Cutrone deals, if they are all followed through on. This plus a relatively lean squad hopefully means some room to manoeuvre in the summer.

 

[Bankswolf The Third]

What does it mean by League distributions because that looks like the biggest increase
Is this position in the table?

 

[Jonzy54]

Can someone please explain in layman’s terms how we now stand regarding FFP ?To what extent have we improved ?

 

[Olivergoldblack]

What does it mean by League distributions because that looks like the biggest increase
Is this position in the table?

Basically TV money + league position reward, I think facility fees is for how many times you've been on TV (might be wrong.

I believe this table explains it:

Premier League value of central payments to clubs 2018/19

 

[Bill McCai]

Wages are £92m, up from £51m. However our wage/income ratio is one of the lowest in the PL at 53%

 

[Sussex Wolf]

A couple of things I noted:

1. Gate receipts are really insignificant - less than 10% of our total income. They could let us all in for free and we would still have made a profit.

2. Levels of borrowing quite high: £164m to Fosun plus another £50m to Macquarrie. The Fosun loans are repayable on demand - ie if they decide they’ve had enough they can call the loan in.

1. That’s indicative of modern PL football and the much greater value of TV rights and prize money. I think gate revenue along with commercial income is or was relevant for certain FFP tests however. Hence the drive to expand grounds and increase corporate income.

2. They are our owners, that’s how it works. Was the same for our prior owners (albeit smaller total value) and would be the same for many other growing clubs. Longer term I think the expectation is that we become self funding and that these loans are repaid as/when it makes sense for Fosun and Wolves. Morgan had the same objective but put much less money in to “prime the pump”.

 

[Brizzlewolf]

A couple of things I noted:

Levels of borrowing quite high: £164m to Fosun plus another £50m to Macquarrie. The Fosun loans are repayable on demand - ie if they decide they’ve had enough they can call the loan in.

It's largely theoretical though, it would make no sense for them to place it's own company under financial stress by calling in the loans....I'm guessing it's in there in case they decide at some stage in the future, to sell.

 

[sc91]

That is really impressive turn around, £53 wages for every £100 earned is a frankly brilliant.

 

[oldgoldheart]

Referring to the debt payable.... is this simply not inflating our own income through loans and borrowing to get around FFP ?? This is all very confusing , my understanding of a secure debt is a mortgage....it's still payable isn't it ?
So if FOSUN want to take back that money ( loan) ...we would be in trouble ?

Of course but thats been the case from day one.

 

[oldgoldheart]

These are decent numbers. Thats why we will definitely expand the ground. The club needs every penny it can raise so more punters help. I dont expect transfer fireworks in the summer - just more of the same steady development. Not without risk but it could be worse. Guo is key. If he gets fed up/dies/leaves then all bets are off

 

[WW1963]

Looks good to me, but that's just on the surface. No idea about all the stratas beneath the final figures.