Swiss Ramble @SwissRamble
Many people asking me about CFC chances of meeting FFP targets after purchases of Hazard and (probably) Hulk, so here’s a few thoughts.
1) CFC 10/11 loss (last year before FFP) was £67m, but that included exceptional items of £42m, so underlying loss was “only” £25m.
2) FFP allows some costs to be excluded (youth, depreciation, community), estimated at £18m, so CFC 10/11 loss was just £7m (in FFP terms).
3) FFP allows total losses of €45m (£36m) for first 2 years (11/12 + 12/13), if benefactor covers losses, so clubs have some leeway.
4) 11/12 CFC revenue boosted by CL win (£12m more prize money + gate receipts + sponsor bonuses), tho partly offset by player/coach bonuses.
5) CFC 11/12 PL revenue was £3m lower (6th place), but more from FA Cup win. Profit on player sales also likely to be lower than 10/11.
6) CFC 11/12 commercial revenue should have increased, not just from main Adidas & Samsung deals, but also secondary sponsors.
7) CFC 11/12 will be hit by pay-off to AVB (£12m?) and higher player amortisation, due to other purchases, e.g. Mata, Lukaku, Meireles, etc.
FFP allows exclusion of wages for players signed before June 2010, if break-even deficit only due to this factor, which will help CFC.
9) All in all CFC 11/12 per FFP rules still a loss, but within striking distance of FFP.
10) CFC 12/13 Hazard £32m & Hulk £38m obvs hurt FFP, but if 5 year contracts, annual impact only £12m player amortisation (£70m / 5 years).
11) CFC higher wages also a factor, but offset by departures (Anelka, Drogba, Kalou, Malouda, Boswinga, Ferreira, etc).
12) CL money up 20% in 12-15 cycle. CFC got £49m from CL last season – they (& others) simply cannot afford to miss out on qualification.
13) CFC could still pull a few irons out of the fire, e.g. stadium naming rights (Gazprom Bridge, anyone?).
14) So Hazard & Hulk obviously make it more difficult for CFC to meet FFP (it was already a struggle), but may be closer than most believe.
15) Please note that this is NOT an attempt to forecast next CFC figures, but just some food for thought.
