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Financial Results 2016/2017

Dorset

Dorset

The Voice Of Reason
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#31
I hate to say I told you so......no, I don't of course I don't, I love it, so....I told you so!!! I've been telling you for fucking years, he's a cunt. All that bollocks about how great he has been for THFC, the training ground, the new stadium, his fiscal doddahnesss - all bollocks, he is just a cunt.
 
Yid

Yid

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#32
I hate to say I told you so......no, I don't of course I don't, I love it, so....I told you so!!! I've been telling you for fucking years, he's a cunt. All that bollocks about how great he has been for THFC, the training ground, the new stadium, his fiscal doddahnesss - all bollocks, he is just a cunt.
A very rich cunt...
 
Chavhater01

Chavhater01

Player in Training.
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#33
So basically over the last 4 years he’s been paid almost as much as the club’s net transfer spend...that’s mental! Also he shouldn’t get paid anything this year, as the fuck ups with the stadium should be laid firmly at his door.
 
skiathospurs

skiathospurs

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#34
Article about new stadium with insight into property purchases by thfc or shady parts of thfc/enic

https://www.theguardian.com/footbal...nt-haringey-neighbours?CMP=Share_iOSApp_Other

And more detail from 2013 article pre-work on the stadium,more complete naming of shady thfc property in N17

https://www.theguardian.com/football/2013/oct/30/tottenham-new-stadium-fury-regeneration
Such as;
Land Registry records of property owned by Spurs under the 11 UK-registered companies it has used to buy dozens of properties on Tottenham High Road, Paxton Road and elsewhere to create space for its new stadium, revealed none owned across in the High Road west area. However, a search of the Carbery enterprise park, still registered as "land on the north side of White Hart Lane, London", revealed that it is owned by TH Property Ltd, of 303 Shirley Street, PO Box N492, Nassua, New Province, the Bahamas. It was transferred to the Bahamas-registered company on 27 March this year, by Greenbay Property, one of the UK companies Spurs have used to buy and hold property.


A Spurs spokesperson confirmed that TH Property Ltd is owned by Enic International, the company registered in the Bahamas that owns 85% of Spurs. Joe Lewis, the billionaire currency trader, lives reportedly as a UK tax exile in the Bahamas, and owns just over 70% of Enic International. The other 29.4% is owned by a trust that has Levy and his family as potential beneficiaries. Levy's salary, £2.2m in 2011-12, is paid by Enic International, which recharges Spurs.


The Bahamas-registered TH Property owns approximately 20 separate properties on the Tottenham High Road west site now earmarked by the council for major residential development.


All of the properties – including 6, 14,16 and 63 White Hart Lane which Spurs bought, and a first floor flat, 12a White Hart Lane; shops on Tottenham High Road itself, unit 1 on the Peacock industrial estate and numbers 1, 2, 3, 4 and 5 in a block of flats, Percival Court – were transferred to TH Property Ltd on 27 March. Some were transferred by Greenbay, others by another UK property company owned by Spurs, Canvax Limited.
Owning assets in Britain via companies registered in tax havens can be a means of avoiding corporate capital gains tax when they are sold at a profit. Richard Murphy, the anti-tax avoidance campaigner of Tax Research UK, said this arrangement gives clear potential for corporation tax to be avoided: "If the property here is owned by an offshore company, there is no corporation tax on the gain when the property is sold," he said.



However, the Spurs spokesperson said this was not a reason for the property transfers and UK tax will be paid on any profit made. "The transfer was to clear debts out of our UK companies which had bought the properties, so the club itself is not carrying the debts," she said. "That will help with the bank financing required for the new stadium. Both this and the club are UK operating organisations and UK tax will be paid on all UK transactions."
 
BrooklynYid

BrooklynYid

Player in Training.
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#35
The problem with Levy running the club is that he is essentially the owner. Even though he only has a minority share, the majority owner couldn't care less about the club so Danny has a free run of the place. It is impossible for him to simply make football decisions. Every thing for him is about the bigger picture, which the supporters couldn't give a crap about.
 
TettenhallHotspur

TettenhallHotspur

Player in Training.
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#36
So basically over the last 4 years he’s been paid almost as much as the club’s net transfer spend...that’s mental! Also he shouldn’t get paid anything this year, as the fuck ups with the stadium should be laid firmly at his door.
Don't think he gets that every year. I'm sure I read that the figure included a big bonus for delivering the new stadium which now seems stupidly premature doesn't it.

The problem for us is that he is probably salaried and bonused on financial results so it is in his interest to avoid spending on the team.
 
skiathospurs

skiathospurs

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#37
Don't think he gets that every year. I'm sure I read that the figure included a big bonus for delivering the new stadium which now seems stupidly premature doesn't it.

The problem for us is that he is probably salaried and bonused on financial results so it is in his interest to avoid spending on the team.
Problem is he loves money more than he loves Spurs,at least joe lewis is just an opportunist wanker freely sitting on his yacht in a tax haven not pretending to be one of our own.

You can see by all the dodgy property dealings in the guardian article the owner,board are all thick as thieves buying up N17 as a venture,and when it comes down to say buying Bale,went spent it all on houses,land,businesses and snidely hide it in various shell corporations offshore.Imagine what journos havent managed to find,do we really believe this is it?Thing with greedy people is it is never enough,never and even though they have no use for it,money is their kryptonite and must keep hoarding more.

He will never change,until there is more money to be made elsewhere I think for £6m a year and all the other assets he owns around the club,we are stuck with this greedy bald leeching fucker,may as well change the name to golden goose fc.
 
TettenhallHotspur

TettenhallHotspur

Player in Training.
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78
#38
Problem is he loves money more than he loves Spurs,at least joe lewis is just an opportunist wanker freely sitting on his yacht in a tax haven not pretending to be one of our own.

You can see by all the dodgy property dealings in the guardian article the owner,board are all thick as thieves buying up N17 as a venture,and when it comes down to say buying Bale,went spent it all on houses,land,businesses and snidely hide it in various shell corporations offshore.Imagine what journos havent managed to find,do we really believe this is it?Thing with greedy people is it is never enough,never and even though they have no use for it,money is their kryptonite and must keep hoarding more.

He will never change,until there is more money to be made elsewhere I think for £6m a year and all the other assets he owns around the club,we are stuck with this greedy bald leeching fucker,may as well change the name to golden goose fc.
Don't you think that this development is the last part of the plan before they sell? If ENIC are investors then surely they've got an exit strategy. We just have to hope that whoever buys is interested in success on the field, not financial returns.
 
skiathospurs

skiathospurs

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#39
Don't you think that this development is the last part of the plan before they sell? If ENIC are investors then surely they've got an exit strategy. We just have to hope that whoever buys is interested in success on the field, not financial returns.
I think NFL is what may make them wait?The way Levy treats the playing side,thats managers,players,fans compared to how he treats buying property in (albeit loosely in) the clubs name,I just cannot see how his heart is in trophies and glory for the football club,not saying he wouldnt like them but he doesnt invest so much in that as a block of flats close to the stadium ready for gentrification. So how development of the high road west side progresses is probably key for them to secure,seeing as now they own considerable parts of the area .And being at the head of THFC gives him more clout with haringey and mayor of london in this regard.
Thing is we could easily get an even worse benefactor.
 
skiathospurs

skiathospurs

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#40
http://www.thstofficial.com/thst-news/thst-comment-on-thfc-financial-update

The Club has recently provided a financial update alongside an update on progress on the new stadium development. Typically, THFC waits until the last minute to publish its audited statements i.e. 9 months after the reporting date, when the information is already starting to get stale. While this update only represents the most edited of highlights of 2017-18 performance, it nonetheless sheds some light on the financial implications of the new stadium build. Its early release would appear to reflect a desire to address concerns raised by delays in opening the new stadium.
etc etc etc
 
Don Diaz

Don Diaz

Zero tolerance of Numpty's
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#41
Thing is we could easily get an even worse benefactor.
Brilliantly correct contradiction. step forward Mike Ashley, The Saints board, and many others. Levy has lost the plot in fans and PR terms over the new Stadium, the fuck up must be killing his personal financial smugness, hopefully someone somewhere will kick it all back into shape sooner rather than later.
 
Don Diaz

Don Diaz

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#42
This THST analysis of our current and projected finances. Selling Kane and Dele would fix the problem.....:oops: this report is contained in the THST minutes for November.

FINANCIAL UPDATE

The Club continues to operate on a sensible financial basis in order to take a long-term view for the benefit of current as well as future generations of Tottenham Hotspur fans.

The Club’s investment over recent years in facilities has resulted in total gross tangible assets at 30 June, 2018, in excess of £1bn - facilities which include the Training Centre, the new Players’ Lodge, Percy House, home of the Tottenham Hotspur Foundation, Lilywhite House Club offices, new retail warehouse, new Paxton House Ticket Office and now the new stadium along with the newly-opened Spurs Shop – the largest football club store in Europe - plus other property assets.

The Club does not define ‘total gross intangible assets’ but it is reasonable to assume that this is the sum of all assets on the balance sheet less intangible assets which, for a football club, primarily consists of the players. As at the last balance sheet statement (June 2017) this number totalled c. £490m, so has risen sharply as the stadium nears completion. The comparable figure for Manchester United is c. £750m. While the book value of MUFC’s assets have likely been substantially eroded by depreciation, it does help provide a sense of the scale of investment that has been undertaken by THFC. The additional, unstated costs of the project delays are also likely to have had to be expensed rather than added to the capital value of the stadium – which means that the Club’s profits are likely to take a substantial hit at the next June 2019 year end.

These investments have been financed by funds from the Club and bank finance, principally from Bank of America Merrill Lynch International, Goldman Sachs Bank USA and HSBC Bank plc (“Banking Partners”) who have provided a development facility of up to £637m. At 30 June, 2018, the Club had net debt of £366m.

The Club has previously reported that it had obtained a £400m loan from BML, GS & HSBC to fund the stadium but at our Board to Board (B2B) meeting in February it was acknowledged that this would need to rise upon refinancing to meet increased stadium costs. These were reported at the time at c. £800-850m. Even if we conservatively assume that such additional costs would increase the existing debt facility from £400m to £450m, it suggests that the unforeseen delay in opening the stadium has increased project costs by up to £187m (i.e. £637m minus £450m),taking the total cost over £1bn. Failing to hit the September opening date is not the sole cause of increased costs but is likely to cover a combination of factors including increased costs incurred to (not) meet the deadline for opening e.g. paying a premium to get more construction workers on site and opportunities for deferred works and upgrades to be brought forward due to more time now being available.

Net debt is total debt less cash balances. As at June 2017 this was negative £24m or, in plain English, the Club had £24m more in cash in its bank accounts than it had in outstanding loans to banks. With net debt at £366m at June 2018, this suggests the Club spent at least £390m in that 12 month period, or £32m per month. That rate of spend is likely to have started to wind down in the months since June.

It is of some note that BML, GS & HSBC have provided increased support. This can be seen as vote of confidence but this is not the refinancing trailed at recent B2B meetings. This appears to be a simple extension of the existing loan with final repayment in 2022, but negotiating the extension will have given banks the opportunity to revisit pricing in view of the changed (increased) risk profile of the borrower. We believe the previous interest rate to be c. 3.3%; this has not been confirmed and has likely increased following increases in the Bank of England base rate since June 2017.

This level of investment by the Club has been made possible by record revenues of £381m and profit from operations before football trading, depreciation, interest, tax and exceptional items of £163m for the year to 30 June, 2018. Trading for the current year will, however, be impacted by the additional costs of Wembley and the delay to the opening of the new stadium.

The comparable figures for 2017 were £306m and £118m. The substantial increase in 2018 can likely be put down to increased attendances at Wembley and further progress in the Champions League compared with 2016-17. By way of comparison, the comparative figures for MUFC are £590m and £62m. THFC’s gross profit margin can consequently be considered very healthy and it is these profits that are contributing the ‘equity’ into the stadium project. Once the stadium is complete, they will be required to service debt. It goes without saying that maintaining profits at the level seen in 2017-18 will be dependent on continued Champions League qualification.

Working with our Banking Partners and our financial advisor, Rothschild & Co, we shall be converting this development facility, which currently expires in April 2022, into notes with a mixture of debt maturities.

This suggests that the Club will enter into a flexible notes programme. This is a debt instrument which is, to the best of our knowledge, unusual in football finance but may be appropriate to the Club’s circumstances. By issuing these in a variety of maturities and, presumably with different repayment structures, the Club can try to match future cash flows with debt service on a bespoke basis e.g. a note could be issued with repayments that match the payments received from the new Nike contract (see below).

Our suspicion has been that the presence of US investment banks in the stadium bridge financing and the association with the NFL has provided a clue as to the geographical source of permanent long term financing. If we are correct, the Club will need to ensure appropriate mechanisms are in place to mitigate GBP/USD currency risks. It is also the case that as the debt rises, the Club’s negotiating position weakens.

The residual amount of gross debt to be converted or extinguished will depend on a number of factors including several commercial discussions.

Or, in other words, any upfront payments received from stadium naming rights and/or a new shirt sponsor deal will likely to be used to reduce the amount of debt raised in any refinancing.

In recent months we have secured an extended agreement with Nike up to 2033, one of the longest football club deals in Nike’s history. We have also announced a number of new brand partners including, amongst several others, Audi, IWC Schaffhausen, HPE and EA SPORTS.

The original deal with Nike was reported to be at £25m per season and newspapers have suggested the new contract amounts to £30m per season. The Club advises that the deal is commensurate with those of its top 4 peers despite reported numbers suggesting the contrary. The length of the Club’s new contract however does provide certainty of cash flow; a sensible objective if it matches debt service cash outflows, but comes at the cost of locking the Club into a contract that could over time fall behind those of peers. There may be break clauses in the contract to mitigate this risk.

Too Much Debt?

Tottenham fans will very aware of the precedent of football clubs overstretching themselves with debt and subsequently paying a heavy price. Given the rapid increase in THFC’s debt position during 2017-18 is this something we should be worried about?

The increase in debt in absolute terms increases the risk but THFC’s capacity to service debt has also increased due to improved profitability. Has the latter improved enough and can it be maintained? Only access to the Club’s modelling can answer these questions (even then this is a detailed forecast rather than cast-iron certainty) but unsurprisingly this information is not made public. What we can do however is consider performance in three quite different real-life scenarios over the last three seasons and then calculate debt repayment scenarios based on the increased £637m debt figure. We shall focus on the Operating Profit before Exceptional Items and Depreciation figure, which has been reported by the Club for each of the past three seasons. This figure reflects the true operating performance of the Club as it doesn’t include the results of transfer market activity, the depreciation of player contracts and the depreciation of the Club’s fixed assets. This number gives a good indication of the Cash Flow Available for Debt Service (CFADS). It should be noted that this is not the true CFADS figure that would ordinarily be used in the banking industry; this is normally derived from the Cash Flow Statement; in the absence of such for 2017-18 we are going to have to use operating profit as a proxy.

Our analysis of the Club’s financial performance in 2016-17 earlier this year considered the actual results for 2015-17 and also used them to arrive at a projected figure for NWHL based purely on its increased capacity at NWHL (which also meant keeping the old WHL ticket pricing structure). To this we now add what we know of 2017-18. Consequently, we now have three real-life scenarios plus one limited forecast that we can use to give us an indication, nothing more, of the cash generation possibilities for the Club:
Scenario 1: 2015-16 – the old WHL with a 36k capacity with the team performing in the Europa League and under the old Sky/BT deal;
Scenario 2: 2016-17 – the old WHL with a 32k capacity with the team performing in the Champions League at Wembley under the new Sky/BT deal;
Scenario 3: 2017-18 – the Club renting Wembley with the team performing in the Champions League under the new Sky/BT deal;
Scenario 4: taking Scenario 2 and simply doubling the match receipts from PL games as a conservative approximation of revenues at NWHL.

We have no additional data with which to make a meaningful forecast of future performance so our approach is to use what we do know simply to frame the possibilities; operating profit for 2015-16 provides a probably unrealistically low worse case and 2017-18 a reasonable proxy for the upper bound (the increased capacity of Wembley should be counterbalanced by the multiplicity of premium pricing points at NWHL and the new commercial partnerships noted in the Club’s statement). One thing we can do however is factor in an estimate for increased player wages following new contracts toward the end of 2017-18 or subsequent to the June 30 reporting date.

We now need to consider possible debt repayment structures for the reported new debt level of £637m, modelling six different repayment structures with a revised interest rate of 3.84% to reflect the increase in Bank of England base rates since our last calculation. The first three incorporate a typical corporate loan structure which repays interest and principal over 7, 10 and 15 year maturities (the shorter the tenor, the higher the debt service requirement). Scenario 4 takes the £30m annual cash flows arising from the new Nike contracts and asks what would be the amount of debt that could be paid off over the 15 year life of that contract if those revenues were only used for debt service, producing the answer £337m. Scenario 5 asks what would be the annual revenues from a similar contract (e.g. stadium naming rights) that would be required over a ten year period to service the remaining debt of £300m after the Nike revenues have been applied to debt service. Finally, Scenario 6 looks at the debt service requirement for a 10 year bullet, whereby, as with the Club’s current debt, interest only is paid up until final maturity when the full principal amount falls due. This produces the following results.




Based on previous results and our average scenario meeting annual debt service payments of £93m to £114m in Scenario 1 and £65m to £87m in Scenario 2 would be difficult to impossible in each of the 2015-16, 2016-17 and Average scenarios. Only when the tenor is stretched to 15 years and debt service falls to between £43m and £66m a year does the 2016-17 and Average scenarios start to come in to play.

Scenarios 4 and 5 should be taken together as they consider the amount of debt that can be serviced from the (reported) cash flows from the Nike contract over 15 years and another similar contract over 10 years. The latter could be a combination of cash flows from naming rights, shirt sponsorship and/or the NFL contract for instance. Note that these revenues are not included in our future cash flow projection and would therefore boost CFADS. Commentators however have suggested that naming rights for NWHL could be worth between £15-20m per annum so getting to £37m for the residual debt service looks a challenge based on naming rights alone. Moreover Scenarios 4 and 5 combined require debt service of £67m over the first 10 years, falling to £30m for the following five. This is similar to the requirement in the earlier years at least of Scenario 3 and therefore the benefits of using this approach is not immediately obvious.

Scenario 6 uses the same approach as the current debt financing with debt serviced on an interest only basis. Final maturity is at 10 years when the principal become payable. This produces much lower annual debt service requirements but does create a very significant refinancing risk in year 10 as the Club would be unlikely to have £662m in cash on its balance sheet to repay the principal and interest outstanding. It would therefore be required to refinance the debt with a new debt instrument but would be risking insolvency if the financial markets were in a 2008-style meltdown.

Scenario 7 provides a comparison by looking at the debt servicing costs of a 10 year corporate loan for the £450m previously assumed to be the external financing need prior to the Club’s recent announcement. This shows that other than under the 2015-16 scenario (a scenario which looks unreliable as a future forecast) debt service could have been maintained albeit with reduced flexibility for additional investment. The spiralling debt has eliminated this option.

The Club’s statement noted that “we shall be converting this development facility, which currently expires in April 2022, into notes with a mixture of debt maturities.” If we look at combining Scenario 6 with, say, Scenario 4 we can see the financial strategy the club appears to be pursuing. The annual £30m from Nike takes care of servicing £337m of the overall debt amount. If the residual £300m is financed by a facility with a bullet repayment structure the additional annual debt service requirement (until final maturity) is £11.5m per annum giving a combined debt service requirement of £41.5m. This amount still allows flexibility under all scenarios and while refinancing risk is not eliminated, finding £300m for a presumably successful cash generative business looks much more manageable than refinancing the whole amount.

It also follows that should the Club be able to stretch the tenor beyond 15 years the annual debt service requirement would fall further (but at the cost of increased cumulative interest expenses). For instance, if a 20 year tenor could be achieved on the full £637m, on a repayment basis annual debt service would fall to between c. £55m and £32m. This would be a long tenor by project finance standards and probably out of reach for the full amount. A smaller slug may be possible however and combined with one or more of the scenarios above could reduce pressure further.

In conclusion, the sharp increase in debt has taken some financing options off the table but there is still a path to service the increased debt without endangering the football operations. The Club’s statement suggests they are taking that path.

Michael Green
THST Board
 
skiathospurs

skiathospurs

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#43
The club were paid £3.4million by Fifa for our players participation in the 2018 World Cup. We received the second highest fee after Manchester City’s £3.9million.
 
C

corroded

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#45
We've spent a hella lot of money already on capex.

Like 500 million.
 
C

corroded

Player in Training.
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#47
Seriously though, £500m in capex for redoing the training facility, land, etc. Makes you wonder how much of the stadium we've already paid off.
 
Don Diaz

Don Diaz

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#48
Seriously though, £500m in capex for redoing the training facility, land, etc. Makes you wonder how much of the stadium we've already paid off.
I think and I haven't checked it's about £400m in money we've 'saved' through transfer dealings, CL prize money, and general prize money, TV, sponsorship and other receipts. The number is out there somewhere
 
skiathospurs

skiathospurs

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#50
Tottenham signings as a percentage of revenue



A Rebrov-size deal today would mean Spurs splashing out £87.3m.
 
Don Diaz

Don Diaz

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#51
deejbah

deejbah

Player in Training.
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#52
Excellent easy to read and digest. Spurs financially well run invested in infrastructure, Man City reliant on owners wealth have bought success. City spent over £900m net on players in 9 years, we spent £98m and have performed almost equally as well in terms of league points.
Yeah, I was reading that thread and some of the comparisons between clubs were staggering. As with the performances of teams like Man U and Real Madrid at the moment, having competent or incompetent, effective or ineffective people managing the club or the team can make a huge difference.
 
Liam

Liam

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#54
Tottenham signings as a percentage of revenue



A Rebrov-size deal today would mean Spurs splashing out £87.3m.
Thing is you probably wouldn't get anyone much better than Rebrov for that dosh these days. What's a genuinely top striker gonna cost nowadays? 200mil plus?
 
Don Diaz

Don Diaz

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#55
Thing is you probably wouldn't get anyone much better than Rebrov for that dosh these days. What's a genuinely top striker gonna cost nowadays? 200mil plus?
That's exactly the point. If Pulisic goes to Chelsea for £58m that's a Lucas Moura type price/player.

People forget who we have and their value - I'm not guessing because I don't know enough, but Kane, Dele, Eriksen, Son, Dier, Alderweireld, Vertonghen, Rose and Lloris alone must be worth a lot of money.

In order to improve our squad we need to sign big International, experienced players, who will command big fees and big wages. I can't see how we can do that at the moment without upsetting the whole balance of the dressing room. A Juan Mata type player might work, he was very good once and Poch could make him good again for a season or two? His experience would also help?
 

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