CCFC accounts

[Undercoverinwurzelland]

Just gone on companies house. Haven't looked at them yet https://find-and-update.company-info...filing-history

[Undercoverinwurzelland]

Re: CCFC accounts

£29m loss to May 2022, up from about £12m the previous year.

[Ninian1962]

Re: CCFC accounts

£29m loss to May 2022, up from about £12m the previous year.

I have just completed my usual commentary on the accounts which I am just checking for possible factual errors before releasing

[Undercoverinwurzelland]

Re: CCFC accounts

I have just completed my usual commentary on the accounts which I am just checking for possible factual errors before releasing

Great, thanks 👍

[The Lone Gunman]

Re: CCFC accounts

£29m loss to May 2022, up from about £12m the previous year.

The club made a £29 million loss while finishing 18th in the Championship? Good grief.

[Pedro de la Rosa]

Re: CCFC accounts

The club made a £29 million loss while finishing 18th in the Championship? Good grief.

After spending no money and selling Kieffer Moore.

[The Lone Gunman]

Re: CCFC accounts

After spending no money and selling Kieffer Moore.

And before settling any of the Sala debt.

[Pedro de la Rosa]

Re: CCFC accounts

And before settling any of the Sala debt.

It is incredible just how bad Vincent Tan and friends are at running a football club.

[Ninian1962]

Re: CCFC accounts

And before settling any of the Sala debt.

Dave

The main reason for the big increase in losses is losing the parachute payments the club received in the previous two years which couldn`t be compensated for in reducing costs to the same extent, most player salary costs savings came from June 2022 onwards.

The Sala debt has been fully provided for in the accounts since 2019 so any future accounts adjustment will be of benefit to the profit and loss figures not an extra charge. Don`t think there will be much of a saving mind unless Nantes agree a full and final settlement at a far lower figure than their full claim.

[The Lone Gunman]

Re: CCFC accounts

The main reason for the big increase in losses is losing the parachute payments the club received in the previous two years which couldn`t be compensated for in reducing costs to the same extent, most player salary costs savings came from June 2022 onwards.

If the £29 million loss figure is accurate, it's incredible considering the squad for 2021/22. The senior players (discounting loan signings) were:

Bacuna, Collins, Flint, Moore (sold in January), Morrison, Nelson, Ng, Pack, Phillips, Ralls, Smithies, Vaulks and Wintle.

Some of those players must have been on ridiculous wages by comparison to their talents.

[Chris Pontprennau Blues]

Re: CCFC accounts

If the £29 million loss figure is accurate, it's incredible considering the squad for 2021/22. The senior players (discounting loan signings) were:

Bacuna, Collins, Flint, Moore (sold in January), Morrison, Nelson, Ng, Pack, Phillips, Ralls, Smithies, Vaulks and Wintle.

Some of those players must have been on ridiculous wages by comparison to their talents.

Are we at risk of points deduction etc with this report?

[the other bob wilson]

Re: CCFC accounts

The following has just been sent out to Trust menbers.

"Trust Chair Keith Morgan, a football finance expert, comments on the latest Cardiff City FC (Holdings) Ltd accounts for the year ended May 31, 2022.

The accounts were signed off by Chair Mehmet Dalman on February, 24, 2023 and the accompanying group strategic report by CEO Ken Choo on the same date. The audit report was signed off by auditors BDO on February 28, 2023.

Summary

The accounts show an operating loss for the year of £28.9m (2021 £12.1m) and a loss after tax of £26.6m (2021 £12.0m).

As a consequence of the above losses and other adjusting transactions the balance sheet deficit as at 31 May 2022 rose from £36m as at 31 May 2021 to £56m.

Profit and loss account

Turnover fell dramatically in the year from £55.2m in 2020/21 to £20.0m as a consequence of losing income from "parachute payments" and despite an increase of £3.5m in gate receipts in the post-Covid pandemic period.

Efforts were clearly made to reduce operating costs to try and offset at least part of the loss of income with player salaries down by approximately £4m although it should be noted that the majority of player salary savings would have occurred after the balance sheet date with 11 players whose contracts had expired coming off the payroll in June 2022. The 14 players brought in to replace them (and three other loan signings) were at significantly lower salary cost.

Administration costs were down by £11.4m from £30.9m to £19.5m. This was principally due to a reduction in the cost of amortising (depreciating) and making an impairment provision for the playing squad where this cost reduced by £11m compared to 2020/21. There was a profit on player sales of £4.2m (2021 £2.9m).

Interest payable in the year of £2.4m was slightly up on the 2021 figure of £1.9m

Directors` remuneration was down significantly to £143k (2021 £550k) with the highest paid director paid £121k (2021 £413k). The accounts do not disclose which other director(s)received remuneration in the two years. The reduction is almost certainly as a result of the CEO Ken Choo moving to a part time role at the club.



Balance sheet

The value of the playing squad as at 31 May 2022 had been written down to £2.5m from a value at the previous year end of £10.5m. Player addition costs in the year were only £1m with players originally costing over £14m leaving the club at a profit of £4.2m compared to their written down value.

The club`s stadium asset stood in the accounts at £77.6m.

As at 31 May 2022 a total of £7.7m was due to the club, including £4.6m of transfer fee instalments

The main liabilities in the May 2022 balance sheet were amounts of £73m due to Vincent Tan and his family and £25.8m due to Tormen Finance, a company in which Mehmet Dalman has a significant interest – this loan carries interest at 9%. This amounted to £98.8m of total debts due of £123.4m (up from £113.4m in 2021). The balance of debts due included £12m of accruals (including season ticket money received in advance) , transfer fee instalments payable of £2.6m and the remaining balance of an EFL pandemic support loan of £5.5m.

There continues to be full provision in the accounts at £20.7m for settlement of the Emiliano Sala dispute with FC Nantes, as has been the case since 2019.

There are important matters to note in respect of the debt due to Vincent Tan

a) There were new loans of £19.8m made by him in the year, with repayments to him and his family of only £1.1m

b) In the year he converted £6.6m of debt due to him into shares

c) Just after the year end, in June 2022 he converted a further £19m of debt into shares

d) Of the total due to Vincent Tan £51.2m carries interest at 7% and rights to convert into shares. The rest carries no interest and has no conversion rights.



Contingent liabilities

The Companies Acts require companies to disclose material liabilities which might arise in future , dependent upon certain events occurring. In the balance sheet notes is a disclosure of a potential liability of £4.9m relating to player contracts and these will refer to amounts payable should a player achieve certain targets such as appearances, goals , international caps etc. plus any share of transfer profits due to a former club should a player be sold on. The notes state that such events will probably not occur so no provision is needed for this in the balance sheet.



Related party transactions

In the year consultancy fees were paid to WMG Group in respect of the services of Mehmet Dalman and £1.7m was paid in loan interest to Tormen Finance .



Post balance sheet events

Some significant events have occurred between the 31 May 2022 balance sheet date and the date the accounts were signed off by the directors on 24 February 2023 which are noted in the accounts

a) As noted above ,Vincent Tan converted a further £19m of debt into shares

b) Further loans of £24.4m were made to the club at 9% interest by an unnamed party

c) New players were acquired at a cost of £5.4m

d) Legal actions regarding the Emiliano Sala case are ongoing

Other matters

The directors' reports accompanying the accounts reveal two other important points

a) The club is negotiating with the EFL to have the current transfer embargo under EFL rule 52.6 fully lifted

b) Plans are progressing for the construction of a new training facility for sole use of the club first team to be held under a 150 year lease with the aim of completion in time for the 2025/26 season. This is not the same facility currently being developed in Llanrumney for the club to hire for its Academy teams"

[Chris Pontprennau Blues]

Re: CCFC accounts

in plain English - how good or bad is this report please Keith?

Are we at risk of any points deductions?

[Ninian1962]

Re: CCFC accounts

If the £29 million loss figure is accurate, it's incredible considering the squad for 2021/22. The senior players (discounting loan signings) were:

Bacuna, Collins, Flint, Moore (sold in January), Morrison, Nelson, Ng, Pack, Phillips, Ralls, Smithies, Vaulks and Wintle.

Some of those players must have been on ridiculous wages by comparison to their talents.

You don`t have to look much further than Neil Warnock for overinflated wages paid to players he signed. Took until June 2022 for the cost savings to be possible

[Ninian1962]

Re: CCFC accounts

in plain English - how good or bad is this report please Keith?

Are we at risk of any points deductions?

In plain English a poor set of results, but not really surprising in the first season that we received no parachute payments and therefore income dropped by £35m. Some cost savings but we couldn`t get a lot of player wage savings until the end of their contracts until June 2022.
Don`t think we are in danger of any points deductions as I am led to believe that we remained within the EFL Profitability and Sustainability requirements even after those results (we had some help from the EFL allowing some extra losses above the £13m a season average because of a "Covid adjustment"