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ENIC

Bullet said:
Thanks, I now understand what you are saying.
Putting it in very crude terms and using completely incorrect figures, if our revenue is £550m and we spent £300m on wages, the ratio of wages to turnover would be 300/550 = 55%
Whereas you note we might be spending £50m on financing the stadium so the ratio should be 300/500=60%

Obviously these actual figures are wrong, I'm just using figures to make your point, that the ratio we spend on wages is actually higher than advertised.


Meanwhile, one cannot have the huge revenue (the £550m) without having to finance it (the £50m) and we are far better off with this net £500m than if we had stayed in the old WHL with £200m revenue (or whatever figure, I know these are not the correct figures) so the new stadium is a huge success financially.

Is that what you're saying? I don't want to twist your words.
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Exactly that. The only way we would ever know is if Spurs run 2 P&Ls (football vs non-football) and shared the detail of the one we currently see which is the rolled up version. They've obviously got no incentive to tell us what goes where. Nor should they.
 
ricky2tricky4city said:
We are only servicing the debt pile (akin to interest only mortgage)................circa £20-25m a year.

(Edit: £45m in the last accounts, which appears hefty given most of the £851m debt is secured at 2.8% average??)
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Bedfordspurs said:
Maybe it did include capital
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I was always assuming that the amortisation cost is against the P&L. So if we spent £800m on a stadium and amortised it over 60 years then the P&L cost each year would be £13m. Then you add the 2.8% interest on the debt and that is another £22m. So basically to do nothing, we would need to find £35m. That obviously doesn't work forever because at some point Levy and co will need to renegotiate that interest rate which is only fixed for a number of years. As we've all seen with our mortgages, this new era of interest rates can be brutal even if the stadium build just about missed the rising costs of raw materials.

Either way you'd like to think we are trying to bring down the debt and doing some capital repayment out of the £550m turnover each year. Alternatively, that can also be displaced into building more things like the hotel and the debt stays where it is, or even goes up.

Also, if the club is valued at something like £4b then if Levy sells small shares to investors then that money can reduce the stadium debt. 1/16th of the club is valued at £250m. If an investor genuinely believes that £250m will grow and we'll become a £6b or £8b club eventually then we might see investment soon.

One caveat - I'm not an accountant :)
 
Bedfordspurs said:
Now if we had sold a few players each season for moderate money it would all look a little better but we have brought so much crap that we couldn’t sell it hurts us most years. We will thus summer be seeing go in a free another high value purchase in Reggie and we will take a huge hit on Brian Gil. Unless we counter that with a skipp we’re at a deficit to start with.
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This is what I always talk about. A club's job is to have a squad where every player has a current or future 1st team impact. Spurs go in cycles, mostly because of manager change and poor recruitment, where we keep ending up with these bloated squads and players current values are less than their current amortised value. Levy has been way too kind to prior managers (e.g. Redknapp). We've often ended up with 30-35 senior pros on our books. We end up loaning out over-25's and selling them for a loss. As you say, you then don't realise your full value of players like Winks, Kane, Skipp etc that generate profits.

Saying that, I feel the direction is way better at the moment. I think the squad is appreciating in value again and will look very lean by Aug 2025. I hope we keep it this way, this time. It would be the first time we ever did.
 
Muttley said:
I was always assuming that the amortisation cost is against the P&L. So if we spent £800m on a stadium and amortised it over 60 years then the P&L cost each year would be £13m. Then you add the 2.8% interest on the debt and that is another £22m. So basically to do nothing, we would need to find £35m. That obviously doesn't work forever because at some point Levy and co will need to renegotiate that interest rate which is only fixed for a number of years. As we've all seen with our mortgages, this new era of interest rates can be brutal even if the stadium build just about missed the rising costs of raw materials.

Either way you'd like to think we are trying to bring down the debt and doing some capital repayment out of the £550m turnover each year. Alternatively, that can also be displaced into building more things like the hotel and the debt stays where it is, or even goes up.

Also, if the club is valued at something like £4b then if Levy sells small shares to investors then that money can reduce the stadium debt. 1/16th of the club is valued at £250m. If an investor genuinely believes that £250m will grow and we'll become a £6b or £8b club eventually then we might see investment soon.

One caveat - I'm not an accountant :)
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iirc we are amortatising the stadium at around £70m per accounting period.
That's why we have recorded a loss in the last accounts and will probably continue to do so. The plus side of that is even as revenue increases it's probably saving us a corporation tax bill on profits.

I don't think there's any indication that we are paying down any of the capital. With the rates we've secured...why would you?. The average date of maturity is 23 years out.
Plus by all reports the stadium cost £1.2bn, we have approx £850m debt but 200-250m of that was COVID losses, so without COVID we'd be at £600-650m debt for the stadium, so in theory have already paid down half the cost for it.

Not forgetting we have been running with approx a £150-200m cash balance in the bank. So even less when looking at the net debt total. (Although caveat that with not fully knowing our transfers owed figure).
 
Muttley said:
This is what I always talk about. A club's job is to have a squad where every player has a current or future 1st team impact. Spurs go in cycles, mostly because of manager change and poor recruitment, where we keep ending up with these bloated squads and players current values are less than their current amortised value. Levy has been way too kind to prior managers (e.g. Redknapp). We've often ended up with 30-35 senior pros on our books. We end up loaning out over-25's and selling them for a loss. As you say, you then don't realise your full value of players like Winks, Kane, Skipp etc that generate profits.

Saying that, I feel the direction is way better at the moment. I think the squad is appreciating in value again and will look very lean by Aug 2025. I hope we keep it this way, this time. It would be the first time we ever did.
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I think we've certainly had a bad time of it.
Firstly some iffy signings and then the arse falling out of the transfer world made buyers in the room (to offload to) scarce. (Especially Europe)

Ironically, as one of the few clubs with money, I thought we'd be able to bottom feed and screw some clubs to the floor who were desperate BUT I don't really feel it's worked out like that.

We do appear to have moved on though, and in loose terms have adopted a more Brighton approach but on steroids :) (ie we can still snag a £60m+ player as well).
We are in the very last throws of shedding the mistakes of the past and it appears are in the early days of fruitful recruiting. Lots of upside.
 
ricky2tricky4city said:
iirc we are amortatising the stadium at around £70m per accounting period.
That's why we have recorded a loss in the last accounts and will probably continue to do so. The plus side of that is even as revenue increases it's probably saving us a corporation tax bill on profits.

I don't think there's any indication that we are paying down any of the capital. With the rates we've secured...why would you?. The average date of maturity is 23 years out.
Plus by all reports the stadium cost £1.2bn, we have approx £850m debt but 200-250m of that was COVID losses, so without COVID we'd be at £600-650m debt for the stadium, so in theory have already paid down half the cost for it.

Not forgetting we have been running with approx a £150-200m cash balance in the bank. So even less when looking at the net debt total. (Although caveat that with not fully knowing our transfers owed figure).
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Thanks, makes sense. As I said, I'm no accountant but do get the concept that we're on this journey and the apples to apples comparison to other clubs don't always work.

The £150m equity investment definitely helped that COVID issue as well. Whether we call it against the overall debt or the reason for the bank balance, it certainly helped. Didn't Joe Lewis sell a property or something and redirected the money our way, or did I imagine that?
 
Muttley said:
Thanks, makes sense. As I said, I'm no accountant but do get the concept that we're on this journey and the apples to apples comparison to other clubs don't always work.

The £150m equity investment definitely helped that COVID issue as well. Whether we call it against the overall debt or the reason for the bank balance, it certainly helped. Didn't Joe Lewis sell a property or something and redirected the money our way, or did I imagine that?
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I'm not sure how it came about BUT by all accounts DL did well to get JL to put his hand in his pocket. I think we have only drawn £100m of that £150m to date...and I'm not sure whether the timescale of when we can draw the rest down was extended?

In some ways we are on a far progressed unique model....so club comparisons aren't much use...plus I'm sure a large percentage of clubs would love to be in our position.
 
Jurgen the German said:
Think 3/10 is a little harsh, but there’s no doubt the owners excel in the commercial area and not so much when it comes to the football side which is ultimately why we support the club.
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Although if we had remained with villa and Everton and their revenue ranges (where we were appx pre-enic) would we be spending 100m a year on transfers?
 
SpurMeUp said:
Although if we had remained with villa and Everton and their revenue ranges (where we were appx pre-enic) would we be spending 100m a year on transfers?
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We’re able to do that mainly because the club have maximised the earning potential of the club off the pitch, with the exception of naming rights for the stadium.
 
Gazza said:
Enic

Matters Off the field: 8/10
Matters on the field: 3/10

average total: 5.5/10

Just my opinion
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Sometimes it does feel that way.

The problem with the scoring metric for on the field is that it can get a skewed view.

For instance if someone said that Enic would take that average club/team from the 90s and would turn them into Europe and Champions League regulars and along the way we would even own several bonafide world class players, I probably wouldn’t go meh that’s a 3/10 performance.

Since Poch the on field has been poor. However it looks like Levy has learnt from this and put a new footballing structure in place that’s only a year in. Personally I’m willing to reset and see how this new structure plays out rather than lump it in with the previous 5 years.
 
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