admira Posted March 31, 2014 Share Posted March 31, 2014 Derby confirm financial results up to 30 June 2013. The financial year to 30 June 2013 saw the Club report a turnover of £15.4 million compared with £17.3m for the year ended 30 June 2012. This reduction in turnover was due to a combination of factors, predominantly a reduction in TV receipts and the outsourcing of the Club's retail operation, both of which contributed to a £1.5m reduction. Although the Club's decision to outsource its retail operation resulted in a reduction in turnover, it also removed the associated operational and administration costs associated with it, which ultimately was much more profitable for the Club. The net loss for the year reduced by £0.8m, from £7.9m in 2011/12 to £7.1m in 2012/13. This financial year saw the introduction of the first “live” period of the Football League Financial Fair Play (FFP) regulations, which continues to provide a significant challenge. The Club needs to balance success on the field together with the financial imperatives of this new regulatory framework. The result recorded in this financial year, together with the future forecasts puts us in a position to meet the assessment criteria. The main source of external funding has continued to come from the Club’s ultimate shareholder, General Sports Derby Partners LLC, who remains committed to achieving success for both the football and commercial operations of the company. During the year to 30 June 2013 £6.0m of loans owed to the Club’s parent was converted to equity and since the year end the remaining £22.5m of loans has also been converted to equity. The Club has maintained its position as being one of the best supported teams in the country although the economic downturn had started to impact on the Club's self-generated income streams: this is not unique to Derby County but it does mean there is more reliance placed on the Club's owners to fund and pressure to find new and additional revenue generators. Looking forward to the current financial year 2013/14 and beyond, commercial relations continue to remain strong with our existing partners and the Club continues to have success in securing new commercial opportunities. For the 2013/14 season, we expect a significant increase in terms of turnover, which will be in excess of the £17.3m recorded in 2012. November 2013 saw the Club announce a 10 year stadium naming rights deal worth £7.0 million. The deal with the challenger brand isotonic sports drink manufacturer iPro, saw the Stadium re-named to the "iPro Stadium". It is believed that this is one of the biggest independent deals of its kind in the history of the Football League. Similarly phase one of the 2014-15 Season Ticket campaign has seen a 22.5% increase in sales compared to the same period in 2013. Derby County President & Chief Executive Sam Rush said: “During a challenging period for the club Derby County has remained on a financially stable platform. In the new era of proposed financial regulation it again demonstrates the significant backing and commitment of the Club's owners. “The owners have further reaffirmed their commitment to the future of Derby County by converting loans into equity. In total, General Sports Derby Partners have converted £28.5 million pounds of loan into equity. “As well as being committed to investing and improving the squad, we have also been smart in the loan market to acquire the likes of England Under 21 players Andre Wisdom and Patrick Bamford on loan deals, while we are also committed to producing up and coming talent through our Academy with Will Hughes and Mason Bennett remaining part of our first-team squad. “Looking forward to the current financial year 2013/14; when the figures are released for the current campaign they will show just how significant an upturn in results on the field can have on financial results. With the majority of the season spent in the top six of Championship and a lucrative home FA Cup tie against Chelsea in January of this year, the 'feel good' factor will contribute to an increase of nearly £2.4 million in turnover.” Link to comment Share on other sites More sharing options...
RamNut Posted March 31, 2014 Share Posted March 31, 2014 No wonder the club shop is so cr@p Link to comment Share on other sites More sharing options...
Day Posted March 31, 2014 Share Posted March 31, 2014 More importantly we won 3-0 on Saturday yay! Link to comment Share on other sites More sharing options...
ariotofmyown Posted March 31, 2014 Share Posted March 31, 2014 Where is ramblur, it's your cup final? 7 million loss sounds a season seems a lot of money when we have a big crowd and have been through a long period of cost cutting. I guess this is small compared to other clubs though. Link to comment Share on other sites More sharing options...
G STAR RAM Posted March 31, 2014 Share Posted March 31, 2014 Where is ramblur, it's your cup final? 7 million loss sounds a season seems a lot of money when we have a big crowd and have been through a long period of cost cutting. I guess this is small compared to other clubs though. Put into context, Leeds are probably losing double that, Forest treble that and QPR 6/7/8? times that! Link to comment Share on other sites More sharing options...
nfb Posted March 31, 2014 Share Posted March 31, 2014 So this is for last season with it being until June 2013.... hence the drop in turnover, bet its gone up this season.... speculate to accumulate 'Boys' plus i-pro.. Im not good on these things, how does this work ? “The owners have further reaffirmed their commitment to the future of Derby County by converting loans into equity. In total, General Sports Derby Partners have converted £28.5 million pounds of loan into equity. Thanks in advance.... Link to comment Share on other sites More sharing options...
G STAR RAM Posted March 31, 2014 Share Posted March 31, 2014 So this is for last season with it being until June 2013.... hence the drop in turnover, bet its gone up this season.... speculate to accumulate 'Boys' plus i-pro.. Im not good on these things, how does this work ?“The owners have further reaffirmed their commitment to the future of Derby County by converting loans into equity. In total, General Sports Derby Partners have converted £28.5 million pounds of loan into equity. Thanks in advance.... In a nutshell £28.5m which was previously showing as a loan from the investors (and therefore repayable to them) has been reclassified as capital and is now equity investment in the club and is no longer repayable to the investors. Basically it is akin to them writing a £28.5m cheque and saying clear your debts with it. Link to comment Share on other sites More sharing options...
Abu Derby Posted March 31, 2014 Share Posted March 31, 2014 £0.8m could be attributed to selling Brayford. Rush says that the profit made during this financial year will exceed £2m, but that will only return us to where we were in 2011/12. Link to comment Share on other sites More sharing options...
ilkleyram Posted March 31, 2014 Share Posted March 31, 2014 So this is for last season with it being until June 2013.... hence the drop in turnover, bet its gone up this season.... speculate to accumulate 'Boys' plus i-pro.. Im not good on these things, how does this work ? “The owners have further reaffirmed their commitment to the future of Derby County by converting loans into equity. In total, General Sports Derby Partners have converted £28.5 million pounds of loan into equity. Thanks in advance.... Ramblur will correct me but basically the owners have bankrolled the club's losses over the last few years by way of loans - they've loaned DCFC money to keep going. Because they are loans the owners have been able to reclaim their money whenever they have wanted to (subject to the loan agreement). What they have done is redefine those loans as 'equity' or in other words a stake or share in the club, which will be repayable when/if the club is sold. The financial gamble they are taking is that the club will be worth more than their equity stake when it is sold (probably a good bet especially if we are in the PL rather than the Championship). Psychologically it also encourages the owners to continue to invest because the healthier the club the more value their stake will have. It also allows the club to say they are debt free - apart from the loan to the coop for the stadium - because the equity cannot be reclaimed until sale. That's might be important from an FFP point of view. Link to comment Share on other sites More sharing options...
WoollyJumper Posted March 31, 2014 Share Posted March 31, 2014 Ramblur will correct me but basically the owners have bankrolled the club's losses over the last few years by way of loans - they've loaned DCFC money to keep going. Because they are loans the owners have been able to reclaim their money whenever they have wanted to (subject to the loan agreement). What they have done is redefine those loans as 'equity' or in other words a stake or share in the club, which will be repayable when/if the club is sold. The financial gamble they are taking is that the club will be worth more than their equity stake when it is sold (probably a good bet especially if we are in the PL rather than the Championship). Psychologically it also encourages the owners to continue to invest because the healthier the club the more value their stake will have. It also allows the club to say they are debt free - apart from the loan to the coop for the stadium - because the equity cannot be reclaimed until sale. That's might be important from an FFP point of view. Would I be correct to assume that there will no longer be any interest component on those loans, as they have now been converted to equity? Link to comment Share on other sites More sharing options...
RamNut Posted March 31, 2014 Share Posted March 31, 2014 Would I be correct to assume that there will no longer be any interest component on those loans, as they have now been converted to equity? Thats the sort of question that makes me want to shrivel up and die. Link to comment Share on other sites More sharing options...
ilkleyram Posted March 31, 2014 Share Posted March 31, 2014 Would I be correct to assume that there will no longer be any interest component on those loans, as they have now been converted to equity? I would guess so - the return that they get will depend upon the sale of the club and how much it goes for. In theory - depending on the deal that's been struck - the greater the value of the club when it is sold, the more they get. Hope you're still alive, Ram Nut Link to comment Share on other sites More sharing options...
Animal is a Ram Posted March 31, 2014 Share Posted March 31, 2014 The loan-to-equity conversion tactic seems to be a recurring theme - fair few clubs have been doing this, Leicester the most obvious example. To some one as non-financial as me, this seems to be headed in the right direction, LFL season tickets up, costs down, LFL losses down, revenue streams up.. what's not to like? Link to comment Share on other sites More sharing options...
SSD Posted March 31, 2014 Share Posted March 31, 2014 We don't owe the owners anymore money, they've converted the loans into equity..... Can someone with intelligence please explain Link to comment Share on other sites More sharing options...
Stive Pesley Posted March 31, 2014 Share Posted March 31, 2014 Not sure I really get the whole loan-to-equity thing. Surely our owners already "own" the club? So how are they getting more equity in the club? They already have the whole equity as the owners don't they? It sounds like a pure accounting tactic to me. They'd never expect repayment on those investment loans anyway – at least not if they remained as owners of the club. Link to comment Share on other sites More sharing options...
Animal is a Ram Posted March 31, 2014 Share Posted March 31, 2014 SR: 'Our only debt now is the £15m mortgage on the stadium' Link to comment Share on other sites More sharing options...
Curtains Posted March 31, 2014 Share Posted March 31, 2014 Well done too our owners for converting debt into equity Glad to see next year results will show improvement . Chelsea FA Cup tie did us a power of good financially and so have season ticket sales and improved gates etc etc. Brilliant news for us Rams fans real feel good factor. Up up up we go . Link to comment Share on other sites More sharing options...
ilkleyram Posted March 31, 2014 Share Posted March 31, 2014 I think this is right but apologies if not, and for confusing matters even more. We have been running at a loss each year for a number of years and individual owners have been covering those losses by lending the club money - thereby allowing us to continue to trade. As loans they could, if they had wanted to, called in those loans at any time - they could have said to the company they lent the money to, 'please can I have my money back, with the interest that I am owed' (depending on what the loan agreement was). If then the money couldn't be found then the lender could potentially put the club into administration/bankruptcy in order to get as much of their money back as possible. Something similar actually happened recently, at Leeds, when one of their major loans was called in during all the ownership rows. What they appear to have done is to have transferred the money already loaned into equity ie to have taken a financial stake in the club, presumably to the value of their loan - so that if owner A has loaned twice as much as owner B then A gets double the share of the club. This means that they are no longer debtors who can call in their loan at any time but stakeholders in the club who will get their money back only when the club is sold. The risk they take is that their share of the club, when sold, might not be worth the money they put in; alternatively it might be worth a lot more, and their stake is therefore much more valuable than the money they put in. My bet would be that those involved are seeing signs that we might go up and that having a stake or equity in the club will be worth much more than maintaining the loan, even though it ties their money up until a sale goes through (or until they can sell their share to someone else). I don't know the FFP rules but from the club's point of view I would guess that having less debt helps them achieve their financial goals. It will also remove an element of financial doubt - that the loans could be called in. It will be interesting to see how they manage in the future because we are still running at a loss by the sound of it. Link to comment Share on other sites More sharing options...
Animal is a Ram Posted March 31, 2014 Share Posted March 31, 2014 I think this is right but apologies if not, and for confusing matters even more. We have been running at a loss each year for a number of years and individual owners have been covering those losses by lending the club money - thereby allowing us to continue to trade. As loans they could, if they had wanted to, called in those loans at any time - they could have said to the company they lent the money to, 'please can I have my money back, with the interest that I am owed' (depending on what the loan agreement was). If then the money couldn't be found then the lender could potentially put the club into administration/bankruptcy in order to get as much of their money back as possible. Something similar actually happened recently, at Leeds, when one of their major loans was called in during all the ownership rows. What they appear to have done is to have transferred the money already loaned into equity ie to have taken a financial stake in the club, presumably to the value of their loan - so that if owner A has loaned twice as much as owner B then A gets double the share of the club. This means that they are no longer debtors who can call in their loan at any time but stakeholders in the club who will get their money back only when the club is sold. The risk they take is that their share of the club, when sold, might not be worth the money they put in; alternatively it might be worth a lot more, and their stake is therefore much more valuable than the money they put in. My bet would be that those involved are seeing signs that we might go up and that having a stake or equity in the club will be worth much more than maintaining the loan, even though it ties their money up until a sale goes through (or until they can sell their share to someone else). I don't know the FFP rules but from the club's point of view I would guess that having less debt helps them achieve their financial goals. It will also remove an element of financial doubt - that the loans could be called in. It will be interesting to see how they manage in the future because we are still running at a loss by the sound of it. So, General Sports Derby owns all of DCFC, but instead of each individual investor being owed £X, they now own X 'shares'? Have I got this right? Link to comment Share on other sites More sharing options...
MrsRam Posted March 31, 2014 Share Posted March 31, 2014 Owen Bradleys just posted this on twitter. http://wrongsideofthethames.blogspot.co.uk/2014/03/is-anyone-making-money-out-of.html?m=1 Link to comment Share on other sites More sharing options...
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