Delaney: Eight clubs made profit

[A face]

Delaney: Eight clubs made profit


FAI chief executive John Delaney was staunch in the face of recent criticism over the association's handling of club expenditure and yesterday reiterated that eight League of Ireland clubs were profitable last year. Delaney made the claim as the dust was still settling on a turbulent season during which two Premier League clubs entered court-appointed examinership, three more made pleas for public fund-raising and numerous others endured severe financial difficulties.

He also said he would welcome an end to confidentiality agreements which prevent clubs from releasing details of their finances to the general public, as pressure mounts over the state of the domestic league. Speaking at a press conference announcing Newstalk as a top-tier sponsor for the League of Ireland, Delaney said: "Last season was in some respects difficult, but there were also a number of positives.


Read more at www.independent.ie (http://www.independent.ie/sport/soccer/eircom-league/delaney-eight-clubs-made-profit-1611603.html)

[bigmac]

Hard to believe, but he also said

Now, in one or two cases that is in terms of director's contributions, so the difference there is that if they make those contributions, they can't take it back out.

For one or two, read four or five. It looks to me like clubs are making a loss, a director is covering the loss (plus €1 maybe??) and Delaney is presenting the club as making a profit....

Technically correct, but distorting the reality.

[Ezeikial]

Any informed specualtion as to who are the Golden Eight?

Delaney is quoted as saying that one or two clubs relied on directors contributions - so 6 special ones then who are completely self-financing???

[HammerNThongs]

If he's going by Director contributions, it could be anyone who didnt go into Examinership basically.

Sporting Fingal so I guess??? UCD maybe?

[Dodge]

But those trying to make out that all clubs who made a loss are in trouble are just as guilty of distorting reality, and probably doing more harm.

[pineapple stu]

UCD maybe?
Nope. In the sub E50k loss band.

[oldyouth]

Any informed specualtion as to who are the Golden Eight?

Delaney is quoted as saying that one or two clubs relied on directors contributions - so 6 special ones then who are completely self-financing???
Significant shortfall for us last year but a lot of it down to capital expenditure.

[Black and White]

Ill muster a guess...id go with Dundalk, Wexford, Shels, Limerick, Fingal, Sligo(I know they had cash flow problems etc but this is over the trading yera for them), Pats(same as Sligo reason and Kildare?!if not some of these throw in Monaghan!!

[pineapple stu]

Significant shortfall for us last year but a lot of it down to capital expenditure.
Capital expenditure doesn't count in the P&L.

[LeixlipRed]

We made a 70k loss last season so it's not us.

[pineapple stu]

Don't think anyone thought it was, in fairness. ;)

[oldyouth]

Capital expenditure doesn't count in the P&L.

But do loan repayments which financed the capital expenditure??

[Buile Shuibhne]

Nope. In the sub E50k loss band.


In the 'The Final Premier Division Spot' thread - you said this:


As an example, every club bar us and Shamrock Rovers had some sort of financial problem last year, be it asking players to take wage cuts, not paying bills, massive cut backs for 2009, etc....

Is losing sub E50k not classed as some sort of financial problem?



In relation to Shels- at a fans forum last Feb, the board told the supporters that the budget for the season ahead would likely fall short of 70k and that it would be made up by drawing down 70K from the sale of Tolka Park.

Technically speaking does this qualify as a loss - i.e an asset was sold to balance the books?

[Dodge]

Is losing sub E50k not classed as some sort of financial problem?




Either UCD are guilty of the dreaded "overspending" or the even worse "optimistic budgeting"

I couldn't even begin to believe they'd be guilty of deliberately trying to deceive anyone

[pete]

Delaney should never have used the term profit. He should have said surplus. You can't say a Director donation makes a club profitable.

[bigmac]

Is losing sub E50k not classed as some sort of financial problem?


Sub 50K gives a wide range to play with...

49K loss = financial problem
€500 loss = not a financial problem

[Longfordian]

We are also one of those clubs in the sub 50k loss bracket. Hence a reduced playing budget this year.

[MariborKev]

Derry aren't one of the profitable ones either.

[pineapple stu]

We're a good way sub E50k. And have cut back our 2009 budget this to make up the gap.

Every other Premier club has either asked players to take pay cuts, gone into examinership, had urgent fire sales of players or asked fans to raise lots of cash. That's a financial problem. Losing a few grand isn't. Though I'm sure you know that and are just looking for a row.

Interesting that you refer to a E70k loss as "modest", yet Delaney's figures show put you in the bottom half in terms of 2009 results. Not sure how you reconcile that, even allowing for the holes in the statement as pointed out.


But do loan repayments which financed the capital expenditure??
Nope. Loan interest, yes. Depreciation, yes, but land and buildings tend not to be depreciated. It harks back to the olden days when such items kept their value.

[Buile Shuibhne]

Interesting that you refer to a E70k loss as "modest", yet Delaney's figures show put you in the bottom half in terms of 2009 results. Not sure how you reconcile that, even allowing for the holes in the statement as pointed out.


I don't understand the above?

Did Delaney publish figures - are they available online?

What holes, in what statement, pointed out by who/where?

[pineapple stu]

You announced Shels' loss as E70k. Delaney in the article notes eight clubs with profit and five with losses under E30k. Conclusion - you're either well outside the top 11 or lying.

The holes in Delaney's point have been pointed out in this thread - specifically, bigmac's post.

Think you're just trolling at this stage, TBH.

[Dodge]

Interesting that you refer to a E70k loss as "modest", yet Delaney's figures show put you in the bottom half in terms of 2009 results. Not sure how you reconcile that, even allowing for the holes in the statement as pointed out.


Far be it for me to make excuses for Shels (or Fintan for tht matter) but surely the loss should be measured aginst turnover, and other factors. Whether they're one of the 10 biggest losses or not really isn't relevant. If Shels had a turnover of €800,000 and their loss was €70k, I'd say that was modest (considering they still have funds available to them. If, for example, Monaghan lost €50k on a budget of, say, €200k than its altogether more of a problem.

While accountants may not agree, luckily the league isn't run solely by accountants.

If clubs break even, copngrats to them.

[pineapple stu]

Valid point.

It can be measured against lots of things. I think euro value is an important one though; long-term, clubs need to break even. As % of turnover, it's probably equal to us. Other factors, as you mention, could include things like existing debts or opening retained losses - you'd want to be eating into them as fast as possible, in which case, a E70k loss isn't really modest. Our loss is irrelevant if we make the equivalent profit next year; Shels' squad doesn't seem to indicate they'll be making E70k profit next year.

I think overall, it's fair to say Shels' E70k loss isn't modest. By their standards, maybe, but not for a sustainable club, and certainly not for a First Division team.

[Bald Student]

UCD, Shels and most of the clubs are in the 'modest loss' category. The immodest losses seem to be concentrated in 4 clubs and that's where the big problems are.

[Buile Shuibhne]

I didn't say we made a loss of 70k


I said a potential shortfall of 70k was identified in the budget before the season started. The problem was addressed in the budget by bringing in an additional 70k, either before or during the season.


I've no idea - and neither have you - whether or not Shels made a profit or loss after that, in their end of year figures notified to the FAI.

[pineapple stu]

You said - "In relation to Shels- at a fans forum last Feb, the board told the supporters that the budget for the season ahead would likely fall short of 70k and that it would be made up by drawing down 70K from the sale of Tolka Park."

That's a E70k loss. The asset has been sold long ago. Other sources, including extratime.ie, back up the E70k figure.

higgensian obfuscation doesn't boost your point, and nor does it make your original post in the thread any less nonsensical.

[Buile Shuibhne]

An agreement to sell the asset was made a number of years ago.

Not all the money has been paid over.

Shels drew down some more last season, increasing their income, to balance their projected budget

Separately, you don't know whether Shels made a loss or not last year.

[pineapple stu]

An excellent attempt to redefine accounting. Bravo.

[Buile Shuibhne]

A stubborn attempt to avoid acknowledging that you got this one wrong.

[gael353]

the way the FAI calculate "profit" in their eyes is as follows. Lets say that last year your club ran into debt to the tune of 2 million. This year you logged up 1 million of debt. Therfore you have reduced your yearly debt by half thus resulting in a 1 million profit! lol now i dont think any club made profit maybe one or two broke even but this made profit thing is a joke.

[oldyouth]

Nope. Loan interest, yes. Depreciation, yes, but land and buildings tend not to be depreciated. It harks back to the olden days when such items kept their value.
I was only trying to make the point that The Youths spent far more last year than we took in. Jeez, what an example you are of the craic to be found at UCD home games. The place must be filled to the rafters every time

[Candystripe]

Derry aren't one of the profitable ones either.

Normally I would agree with you but I'm guessing Delaney has included both Mc Court and McGinn's transfers and the profit Derry has made/will make from the friendlies with Celtic.

So you can add Derry to the eight clubs he's talking about.

[Black and White]

Maybe hes just trying to cover up how the FAI have made a balls of the league since they took over running it!!

[MariborKev]

profit Derry has made/will make from the friendlies with Celtic.

:p:p:p Profit from them?Ha.

I'd still be confident(unfotunately) that we are not profitable.

[Bald Student]

A stubborn attempt to avoid acknowledging that you got this one wrong.

He didn't get it wrong. Capital income appears on a cash flow statement but not the P&L account.

I think the two of you are just speaking at crossed purposes. A lot of clubs do their accounting on a cash basis and would consider themselves to have broken even if they finish the year the same amount of money in the bank account as they started but by any normal standard money from the sale of a fixed asset can't be offset against an operating loss.

[LeixlipRed]

Don't think anyone thought it was, in fairness. ;)

Yawn, someone posted that they believed we were among the clubs posting a profit. I'll enjoy our 3 victories over UCD this season. It'll be easy to spot you crying in the stand Stu :o

[John83]

I was only trying to make the point that The Youths spent far more last year than we took in. Jeez, what an example you are of the craic to be found at UCD home games. The place must be filled to the rafters every time
We're considering giving him his own half time show. :p


Maybe hes just trying to cover up how the FAI have made a balls of the league since they took over running it!!
"Made"? Failed to unmake, surely?

[Rovers Maniac]

Sligo Rovers are 1 of the 8 clubs

[John83]

Sligo Rovers are 1 of the 8 clubs
Considering the pleading for donations they had to go through mid season, I think this ends any little credibility Delaney's claims had.

Truth is, I don't care how many clubs made money last year. I'm much more interested in whether the league's reached a tipping point and the FAI's going to use the recent financial woes to force proper budgeting on the clubs. Their rejecting various proposed budgets so far has me hopeful.

[Rovers Maniac]

Considering the pleading for donations they had to go through mid season, I think this ends any little credibility Delaney's claims had.

Truth is, I don't care how many clubs made money last year. I'm much more interested in whether the league's reached a tipping point and the FAI's going to use the recent financial woes to force proper budgeting on the clubs. Their rejecting various proposed budgets so far has me hopeful.

Ya but stil made a profit you can't call a profit a loss ! :D

I think the FAI should have be doing this last year but choose to ignore it. I will give them a season to get it working correctly imo, ut i think they have made a decent start all though i would have some concern they have gone from one extreme to the other, but lets wait and see.

[pineapple stu]

He didn't get it wrong. Capital income appears on a cash flow statement but not the P&L account.

I think the two of you are just speaking at crossed purposes. A lot of clubs do their accounting on a cash basis and would consider themselves to have broken even if they finish the year the same amount of money in the bank account as they started but by any normal standard money from the sale of a fixed asset can't be offset against an operating loss.
Thank you.

No cross purposes either, I don't think. Fintan knows he's wrong, but is mudding the waters as he does so well.

Shels were cash neutral maybe, but made a loss. Tolka was sold entirely when the contract was signed; you can't spread its sale over numerous years.

[Buile Shuibhne]

It's very simple.

The sale was completed a few years ago, but full payment was deferred.

Shels have drawn down several payments out of the total amount.


Payment will be completed in full when Shels move out and the buyer takes possession.


The payments are spread - not the sale.

[Mr A]

So can you tell us roughly how much Shels have left to take from the sale, or even roughly what percentage has been drawn down so far?

Have Shels any plans regarding a new ground?

[shelsfan1]

So can you tell us roughly how much Shels have left to take from the sale, or even roughly what percentage has been drawn down so far?

Have Shels any plans regarding a new ground?

afaik we're expected to have a few million when we leave but no where near enough to build our own ground from scratch so we've been lookin elsewhere. a plan to move into home farms ground and building a new stand there was rejected by home farm so we're still lookin

[Buile Shuibhne]

circa €4m


The club are looking around.

Latest rumour (source not from Shels) is that the FAI want us move into Dalyer with that sum & groundshare with Bohez. The FAI would invest a similar amount to redevelop the ground between the two clubs.

Total non-starter for a variety of reasons on all sides - imho.

[Dodge]

FAI won't have to meny to develop Dalymount with so much invested in new Lansdowne

[pineapple stu]

The payments are spread - not the sale.
I'm aware what your point is; the above though is you saying that you are making a loss, but you're cash neutral.

Look up any accounting standard, which defines how to treat what you're talking about, and you'll see you're making a loss.

E4m left would just about clear Bohs' overdraft...

[garyderry]

circa €4m


The club are looking around.

Latest rumour (source not from Shels) is that the FAI want us move into Dalyer with that sum & groundshare with Bohez. The FAI would invest a similar amount to redevelop the ground between the two clubs.

Total non-starter for a variety of reasons on all sides - imho.

The FAI have been pushing that for years, Both clubs are in that big a mess it may very well be the only long term solution.

[Bald Student]

No cross purposes either, I don't think. Fintan knows he's wrong, but is mudding the waters as he does so well.I don't agree with you here. Your disagreement seems to be a semantic one. You're using the correct accountancy definition of a loss, he's using commoner language.

[pineapple stu]

Have to agree to disagree so. Fintan said -


Technically speaking does this qualify as a loss - i.e an asset was sold to balance the books?
And the answer is yes, because the asset was sold years ago, and you can't spread the sale over a large number of periods as it suits you. "Commoner language", as you put it, I assume means that Shels are happy they were cash neutral over the last year, but that's a completely different matter, common language or not.

Meanwhile, the issue of UCD's alleged financial problems on the basis of a small loss has been swept under the carpet.