Shrimpsvoices

A.F.C. Barrow have just reported a loss of £990,000 for the year ended 31 May 2016 :-

https://beta.companieshouse.gov.uk/comp ... ng-history

And they are not even in a play-off place currently!!

This is pretty much ‘ON’ topic, really, as it has lots of relevance to our own situation.
I’ve had this discussion a few times recently.

“Loss” and “investment” are sometimes interchangeable words depending on how you are angling a line of discussion.

Our current board have been criticised for ‘getting us into this mess’ – referring to our annual ‘losses’.

But most clubs at our level – and above and below – will usually have a gap between operating income and expenditure on players, staff and other things. That gap is usually covered – and more – by a wealthy board, chairman or owner making big investments.

It’s when that investment stops that you get trouble, as we’ve discovered.

Things can and should have been run more effectively at our club, that’s fair comment – but playing in the Football League on gates like ours, there will always be a big gap between income and expenditure that needs covering.

It’s not a loss if it’s covered.

My worry for us for next season is that we don’t get a resolution to all the off-field stuff in time. We need ownership sorting – and not just back on an even keel but with signs of significantly improved investment for next season.

Otherwise our players – and possibly our management team will be looking for other offers. And no-one can blame them, they will owe the club nothing by then – with what they’ve put in this season while worrying about being paid every month.

The club certainly owes them a resolution – and improved contracts for the future if we’re to keep them.

Coventry City have posted £700k profit but are £44m in debt. How's that work? Also may have to leave The Ricoh again as the Owners Wasp's have walked out of ground sharing talks.....

outsider wrote:Coventry City have posted £700k profit but are £44m in debt. How's that work? Also may have to leave The Ricoh again as the Owners Wasp's have walked out of ground sharing talks.....

Profit/loss is like the country's deficit - difference between income and expenses in the particular year.

Debt is the cumulative effect, i.e. the net accumulation of all the annual profits/losses over the years.

So in Coventry's case, they've clearly made huge losses in the past funded by debt, but have made a profit in the last year which has reduced the debt slightly.

Thanks. Still in the doodoo though

Another club to mention, applying what Shrimper has said, is Accrington who have just posted a £230k loss for the year to May 16 however shares were issued in the same year for a total consideration of £1.1m. That is investment in the truest sense rather than losses being covered by directors loans (which are repayable) OR through the sale of assets (i.e. asset stripping) - which only helps a company's cash flow short term if losses continue.