Chelsea lost £140million last year

super_furry

http://www.rte.ie/sport/2006/0127/chelsea.html

And still people claim that they aren't buying the league. Unbelievable really, I can't see anyone competing with them financially ever again.

iregk

ok thats what annoys me about the lets have it both ways brigade. I'm a chelsea fan and yes while i agree the money spent is vile at the best of times its also not a true valuation of what we have. I.e. SWP was 10mill at best, as soon as Chelsea came in he was 28mill. Now that is our fault for paying that amount of money i will agree but what annoys me is the hypocrisy from a lot of people.

When Roman came in I had to put up with weeks/months of you can’t buy success and money wont buy you the title. Now those same people are saying you bought the title and you bought your success. So which way is it? You can’t have it both ways!

Pigman II

super_furry wrote:

I can't see anyone competiting with them financially ever again.

They said the same thing about Blackburn. Don't worry once Abramovich dies everything will be back to normal.

yom 1

iregk wrote:

When Roman came in I had to put up with weeks/months of you can’t buy success and money wont buy you the title. Now those same people are saying you bought the title and you bought your success. So which way is it? You can’t have it both ways!

Is that even an argument? They are right - you did buy the Title

Superfurry is spot on. There is not a single team in the world that can or will get close to Chelsea's money unless Roman II buys some club. I mean they made losses of £140m but will still spend in the region of £50m in the summer if previous years are to go by.

Guy:Incognito

Pigman II wrote:

They said the same thing about Blackburn. Don't worry once Abramovich dies everything will be back to normal.

He's probablt younger than some of teh posters here so we'll have to wait a while. Hopefully he'll get bored before that.

redspider

Yes, Chelsea are buying their success. Bates was doing it before Abramobitch arrived as they had ran up a massive debt. The aim of the club is also laughable, to only reach break-even by 2010. Roman is will to run the club at a loss until then and buy success with it.

I think Uefa should step in, set club spending limits in any one year to something like 50m and prevent clubs from running at a oss say more than 10m. That allows any club to invest, but no club to unfairly dominate, especally as the source of Abramovich;s wealth is from corruption. (dont ask!).

chelsea.com wrote:

Chelsea are on course to achieve the business plan and break even in 2009/10 said chairman Bruce Buck and chief executive Peter Kenyon at the announcement of the year’s accounts this morning, Friday.

The accounts were for the year from July 1st 2004 — June 30th 2005, the second year of Roman Abramovich.

Chairman Buck emphasised: “The very beginning of the business plan was that Chelsea Football Club should aspire to be successful on the pitch.” That’s what stimulated the investment of £175m in Mr Abramovich’s first year, 101m in the year reported, and is currently at £57m this year.

Its there in black and white that they are trying to buy success on the pitch, even they are not denying it.

For real Chelsea fans with any morals, they should feel sick to their stomach. Granted they have success, but not one best on principals and their reputation will forever be tarnished in this period.

redspider

Guy:Incognito

Clubs should befinately be sanctioned for running at a loss, if for nothing else than to protect the club. If Abramovich ups and leaves tomorow Chelsea will go under, which would not be in anyones interest.

p.pete

yom 1 wrote:

Is that even an argument? They are right - you did buy the Title

I think you missed his point.

redspider

Stekelly wrote:

Clubs should befinately be sanctioned for running at a loss, if for nothing else than to protect the club. If Abramovich ups and leaves tomorow Chelsea will go under, which would not be in anyones interest.

They wouldnt go under straight-away. There is a difference between running at a loss and debt. Chelsea, although I haven't seen their financial accounts, dont have large debts. Abramovich is bankrolling them by putting in money. A good analogy is VC funding, or with listed corporates, a share issue. Celtic got more money in this way reently from Dermot Desmond.

But you are right in the sense that if Abramovich left quickly and managed to sell his holding to someone, the new owner would be left with more costs than income as the business last season ran at a loss of 140m. They would have to sell/loan players to reduce salary costs and would have a far less chance of winning the title or the CL. They shouldnt go under if they can adjust their trading position quickly and match costs to income.

What a lot of clubs do is they wait to long hoping for things to change before its too late. eg: Leeds. They needed to qualify for the CL in the year that they got relegated. It must have been obvious tio the bean counters that it was unsustainable.

redspider

Atlas_IRL

Will be interesting to what happens to Chelsea when Abramovich is hauled to jail for being in the Russian Mafia

ianmc38

redspider wrote:

The aim of the club is also laughable, to only reach break-even by 2010.

I see you have a shrewd business acumen.

ianmc38

Stekelly wrote:

Clubs should befinately be sanctioned for running at a loss, if for nothing else than to protect the club.

Isn't a football club a business? Should all companies running at a loss receive sanctions?

Mighty_Mouse

Bates was doing it before Abramobitch arrived

:eek: slight difference me thinks!

think Uefa should step in, set club spending limits in any one year to something like 50m and prevent clubs from running at a oss say more than 10m. That allows any club to invest, but no club to unfairly dominate, especally as the source of Abramovich;s wealth is from corruption. (dont ask!).

good idea

iregk

p.pete wrote:

I think you missed his point.

Exactly, thanks pete

iregk

The thing is and for a moment lets ignore the football and uefa side of things here. From a purely business point of view the loss is colossal, 140mill is a hit in anyone’s language unless your Microsoft of course.

The way you have to look at this is that football clubs are a business. They are not what we all like to think and have the interest of the fans as their priority, the bottom line is their priority. That 140mill accounts for a restructure and the buying out of contracts that quite frankly they had to get rid off. In place of those contracts they have signed up to huge ones that will see revenue jump in the coming years.

Redspider’s comment that the aim of the club is laughable shows a complete lack of business knowledge. Roman when he arrived at Chelsea walked into a mess of Ken Bates making. He banked on Chelsea either winning the league or the champions league in ’99. A bold, brave but also stupid strategy that went wrong. The did neither and they almost collapsed. In business you either win or loose, Ken Bates lost.

Since Roman has come in he has cleared out most of the aging over the hill staff that and replaced them and the back room as well. After that it was time to buy out some contracts and get out of ones that were worthless and replace them with money makers that will result in a healthy revenue stream. He has also replaced the youth setup and training facilities with state of the art ones that are now regarded as the best in the country so the future plan is in place.

He took over a business in debt, cleared it and is now restructuring. For anyone that knows about business, this is a slow, painful and costly process. To break even by 2009/10 is good going considering the wage bill and outlays that were necessary. Most business be it new or restructure usually follow a 3 year break even plan then follow through to projected profit. From a business point of view when you have cash reserves of 1billion and can easily take the hit what they are doing at Chelsea is actually quite brilliant.

One of the comments earlier that if this doesn't work Chelsea will collapse and thats not good for anyone, i must say i find rather ironic. Considering if Roman hadn't come in thats exactly what would have happened so which would you prefer?

redspider

iregk wrote:

From a purely business point of view the loss is colossal, 140mill is a hit in anyone’s language unless your Microsoft of course.
That 140mill accounts for a restructure and the buying out of contracts that quite frankly they had to get rid off. In place of those contracts they have signed up to huge ones that will see revenue jump in the coming years.
Redspider’s comment that the aim of the club is laughable shows a complete lack of business knowledge. Roman when he arrived at Chelsea walked into a mess of Ken Bates making. He banked on Chelsea either winning the league or the champions league in ’99. A bold, brave but also stupid strategy that went wrong. The did neither and they almost collapsed. In business you either win or loose, Ken Bates lost.

He took over a business in debt, cleared it and is now restructuring. For anyone that knows about business, this is a slow, painful and costly process. To break even by 2009/10 is good going considering the wage bill and outlays that were necessary. Most business be it new or restructure usually follow a 3 year break even plan then follow through to projected profit. From a business point of view when you have cash reserves of 1billion and can easily take the hit what they are doing at Chelsea is actually quite brilliant.

It looks like you need some ABC lessons in business and finance.

First, 140m is not large for Abramovich, his exact wealth can only be guessed at (een by MI5, MI6, Putin) but you are talking 10 billion. Put it another way, if somene that has 10,000 euro and they spend 140 euro, its peanuts to them. Chelsea are peanuts to Roman. He gained more than 2 billion last year with Sibneft dealings.

He is funding the business (Chelsea) from other wealth creating assests. Chelsea is running at an annual loss. Their stated claim is to have a run-rate of break-even by 2010. Not to have recovere all the investment money. So, that will means losses of in 2003, 04, ... 10. The memgt stated today in their press release that they may not even reach that!

In terms of the debt, you say it was paid off, true, but not from the profits of the Chelsea business. He has used his deep pockets to finance it.

He has not turned the finances around, it is costing Roman a fortune every year and they have forecast that it will continue to do so. In effect, he is running Chelsea at a loss and buying success, or trying to. The backdrop to all of this is that Roman has bought himself a lifeline and UK citizenship, pot6entially. His 85m yacht bribe to Putin has also bought him favouritism in Russia. He is no entreprenur. His background is as a gun-totting mafia dogsbody Oil smuggler.

if Abramovic stopped bankrolling Chelsea next year, they would be in a much worse situation than when Bates left them.

> considering the wage bill and outlays that were necessary

Those outlays (large purchases) and salaries were not necessary !!!

Abramovich isnt the first business man to run a club at a loss. We have the Newcastle's, the Blckburn in the 90's (Walker), the Wigan chap now, etc. The main problem is the scale of the Chelsea spending. I dont know their revenues, in 2002/03 it was 133m euro (source Deloitte). Lets say in the year reported it was 120m ukp. Their costs were 260m. There is no other club spending anywhere near that in the world.

Uefa will have to change the rules if Chelsea win the league 3 years in a row and say 2x CL's. It will be obvious to blindmen then, maybe even some of ye that doubt it on boards.ie.

redspider

iregk

Ok you spent an entire post apparently giving me some abc's on business without making 1 bit of business sence yourself. go back read my post again and you will see what your missing.

I'm not going to get into a tit for that, he said she said argument here, but I suggest you go back, re read my post and you will realise you have come back with a completely invalid post all together.

How can Uefa change the rules just because of Chelsea. Is this not what Real did for years? Why should they be different?

For some reason it was grand when Real were buying success (yes i agree looks where its got them!) but it was only when Chelsea started doing the same that it became a problem. Why? Because Real aren't a rival club, Chelsea are.

Rikand

Pigman II wrote:

They said the same thing about Blackburn. Don't worry once Abramovich dies everything will be back to normal.

At least Jack Walker was a Die-Hard supporter of Blackburn and wanted the best for his own club.
Chelsea is just Roman Abramovichs play-thing.

Guy:Incognito

ianmc38 wrote:

Isn't a football club a business? Should all companies running at a loss receive sanctions?

The FA/FIFA dont have any power over non football business as , say, ANpost doesnt have a team in the PL so its irrelevant. It's in their best interests to ensure clubs dont go under. They deduct points if clubs go into recievership, so whats wrong with pre-empting it?

The Muppet

redspider wrote:

They wouldnt go under straight-away. There is a difference between running at a loss and debt. Chelsea, although I haven't seen their financial accounts, dont have large debts. Abramovich is bankrolling them by putting in money. A good analogy is VC funding, or with listed corporates, a share issue. Celtic got more money in this way reently from Dermot Desmond.

redspider

Who would pay the inflated salaries Chelsea Pays to its players if Abromvich were to Leave. It would be leeds all over again if He left



What success did Bates buy for Chelsea?

ziggy

This post has been deleted.

besty

If someone like Brentford got this sort of cash into its coffers, it too would win the Premiership in a couple of seasons. It's ridiculous.

MrJoeSoap

£140m is worth it to stop the United/Arsenal bore that has been going on for well over 10 years pre-Abramovich.

KdjaCL

ziggy67 wrote:

I think Abramivich is better for the game than the likes of Glazer.

Abramomich is pouring money into football while Glazer is taking it out to service his debts.

There seems to be a proper business plan at Chelsea, calling for the authorities to step in if Chelsea win 3 leagues in a row & 2 CL's smacks of jealousy TBH.

Tell that to the English player Wright Philips that its good for the game he was bought so he coudnt play against Chelsea.

Obviously good for football when a team can buy players to ensure their rivals dont get them, and also great for youth teams everywhere.


kdjac

KdjaCL

MrJoeSoap wrote:

£140m is worth it to stop the United/Arsenal bore that has been going on for well over 10 years pre-Abramovich.

Didnt Arsenal and Utd make the the money they spent by being succesful on and off the pitch? Didnt Arsenal and Utd play attacking attractive football?
How is that a bad thing?


kdjac

Dempsey

What success did Bates buy for Chelsea?

FA Cup

MrJoeSoap

KdjaC wrote:

Didnt Arsenal and Utd make the the money they spent by being succesful on and off the pitch? Didnt Arsenal and Utd play attacking attractive football?
How is that a bad thing?


kdjac

The repitition was driving myself and many others insane, its great if you follow one of the clubs but from the outside it tends to be boring.

[Cue eL rant!]

KdjaCL

MrJoeSoap wrote:

The repitition was driving myself and many others insane, its great if you follow one of the clubs but from the outside it tends to be boring.

[Cue eL rant!]

How can attacking attractive football drive you insane? it was superb each teams league winning sides provided the ultimate in footballing entertainment...either playing keepie uppie in the other teams half or winning the Cl in the 92nd minute by just wanting it more...


Now look ....what Chelsea and long ball pool are at...are you and the others happy now?? Are you?? damn you....it was earth all the time!!!!!


kdjac

MrJoeSoap

KdjaC wrote:

How can attacking attractive football drive you insane?

It wasn't the football that drove me insane, it was United winning almost every year, every kid in school supporting them, and the sheer repitition. I loved watching Arsenal at their best, and they were a breath of fresh air (still are in many respects) but a league needs more than two competitive teams to maintain interest. Now that Chelsea have it sealed for the foreseeable future things have gotten stale again, but at least its not still Arsenal/United.

it was superb each teams league winning sides provided the ultimate in footballing entertainment...either playing keppie uppiy in the other teams half or winning the Cl in the 92nd minute by just wanting it more...

I loved it too, it just got stale.

Now look ....what Chelsea and long ball pool are at...are you and the others happy now?? Are you?? damn you....it was earth all the time!!!!!

I hate when people criticise or mock succesful teams for the way they play, just like Kaids did in the other thread saying Bolton will win by "two tries and a conversion". It's not like there is a certain way to play football. Not every team should try to play exciting and entertaining football, because it doesn't suit everyone. Teams should play to their strengths, and you can hardly argue with Chelsea or Liverpools results last season or this season.

Of course I'd prefer to watch Arsenal in full flow.

Pigman II

Have to say I hate watching Arsenal (admittedly unlike probably 99.9% of people). To me anyway they always look like they're more worried about scoring the perfect goal than putting the foot in and actually winning the game. I think that's why their away form is so bad this season. A lot of teams let them do their stuff at Highbury but don't give them an inch on their own patches.

KdjaCL

MrJoeSoap wrote:

Teams should play to their strengths, and you can hardly argue with Chelsea or Liverpools results last season or this season.

Yes pubs teams should not clubs who spent 250million to play a certain way or bought a reject Globetrotter to play a certain way. Attacking football and dodgy defending all the way, not the Greek way.




kdjac