Sshh! It's how we operate.

[Southbank Old Boy]

We made a pretty decent profit last year, so revenue falling at a greater rate than the wage bill (within reason) shouldnt be too much of an issue really

Yes, the club should be budgetting to keep the wage bill in check for the next few years, but thats what the big incoming transfer fees will be going towards covering

I still dont think we have gone from making a decent profit one year to wages being greater than income (even excluding incoming transfer fees)

[Sun Tzu]

I still dont think we have gone from making a decent profit one year to wages being greater than income (even excluding incoming transfer fees)

I'm sure someone with a better grasp of the facts than me will confirm whether the profit made last year was just an operating profit for the one season or whether it took into account all the losses from previous seasons ?

[Arch]

We made a pretty decent profit last year, so revenue falling at a greater rate than the wage bill (within reason) shouldnt be too much of an issue really

Yes, the club should be budgetting to keep the wage bill in check for the next few years, but thats what the big incoming transfer fees will be going towards covering

I still dont think we have gone from making a decent profit one year to wages being greater than income (even excluding incoming transfer fees)

The "decent profit" was on the back of Premiership money and player sales. Neither of those can be counted on in the long run. My point was it's not a sustainable model because those are one time payments not regular projectible income. We didn't break even on regular income/outlay when we were in the Championship before and it's unlikely that we will now that our wagebill is higher.

[Southbank Old Boy]

We made a pretty decent profit last year, so revenue falling at a greater rate than the wage bill (within reason) shouldnt be too much of an issue really

Yes, the club should be budgetting to keep the wage bill in check for the next few years, but thats what the big incoming transfer fees will be going towards covering

I still dont think we have gone from making a decent profit one year to wages being greater than income (even excluding incoming transfer fees)

The "decent profit" was on the back of Premiership money and player sales. Neither of those can be counted on in the long run. My point was it's not a sustainable model because those are one time payments not regular projectible income. We didn't break even on regular income/outlay when we were in the Championship before and it's unlikely that we will now that our wagebill is higher.

What player sales in the Premiership when we were really making money (I actually meant in the Premiership season as opposed to the season just ended because I dont think those accounts have been issued yet)?

Your right we cant count on incoming transfer fees in the long term, I totally agree on that

I dont agree that our current income/wages model is that unsustainable though

At the end of the day, not many clubs at this level will be living within their means

[Ian Royal]

We also have far more costs than just wages in case people may have forgotten.

The Parachute payment is £11m yes?

Well that won't cover our total player wage bill. Then there are backroom & coaching staff, stadium staff. Police costs, stewarding costs, maintenance, academy, etc.

Clearly we also get other revenue - TV money, gate receipts, merchandising.

And loss in many previous seasons more than cancels out the profit we made in the last two or three. We also have to take into account probable losses for future years.

We did slash the wage bill by roughly 40%. But after that Doyle and Hunt in particular got new deals which almost certainly took them back up to close to their Premier League wages. We may have shifted a number of the big earners, but our wage budget is still likely to be high for the championship last season. This season we need to get it in line in the probable case we don't go up.

That means we had to shift a number of players. AND then get rid of more to make room in the squad for replacements.

As I posted earlier We have only actually made roughly £9m profit from player sales compared to fees payed. That's in the last FIVE years.

[Ian Royal]

We made a pretty decent profit last year, so revenue falling at a greater rate than the wage bill (within reason) shouldnt be too much of an issue really

Yes, the club should be budgetting to keep the wage bill in check for the next few years, but thats what the big incoming transfer fees will be going towards covering

I still dont think we have gone from making a decent profit one year to wages being greater than income (even excluding incoming transfer fees)

The "decent profit" was on the back of Premiership money and player sales. Neither of those can be counted on in the long run. My point was it's not a sustainable model because those are one time payments not regular projectible income. We didn't break even on regular income/outlay when we were in the Championship before and it's unlikely that we will now that our wagebill is higher.

What player sales in the Premiership when we were really making money (I actually meant in the Premiership season as opposed to the season just ended because I dont think those accounts have been issued yet)?

Your right we cant count on incoming transfer fees in the long term, I totally agree on that

I dont agree that our current income/wages model is that unsustainable though

At the end of the day, not many clubs at this level will be living within their means

Just because other clubs don't doesn't mean we shouldn't. Those clubs are risking their stability by living beyond their means. All it takes is a few poorer seasons than expected and it's administration and down the leagues you go.

[Thaumagurist*]

I would imagine that Reading's wage bill is in excess of something like £3m

i hope that was a typo

accounts apparently showed wage bill in premiership was around the £32 million mark

alledged to have halved on return to championship...so roughly £16 million a season now

If the wage bill is really what you say, then what I said was still correct as I said it was in excess of £3m. i.e. a lot more.

[Sun Tzu]

IIRC Birmingham were pretty active this time last year and look what happened to them!

Almost exactly what happened to us as it happened !

You'd be a genius to identify what transfer deals would have made the difference between our season and Birmingham's. One player on a free might have done it, 6 players at a million a piece might not have done.

The fact that Birmingham squeaked in ahead of us on the last day of the season doesn;t really prove that we shoul dhave spent millions. After all look what Birmingham had to do to be almost the same as us !

[W&E Royal]

I was told that our wage bill last season was £18million, Burnleys on the other hand was £8million. Getting rid of Murts, USA, Leroy, Dubes and Doyle will have massively brought this down, also once we get rid of Huntys reported £30k and perhaps Bikeys then our wage bill will be a lot healthier.

[Vision]

Can't be arsed to look but there was a thread somewhere that showed the last set of yearly figures indicated a profit of 6.7m. I could be wrong but I thought this was for season 06/07 when we finished 8th. If this was the case then for place money the following season would have seen a shortfall of 5m on that basis alone.

People continually talk about the 11m parachute money but that really is there to ensure that you don't have to sell all your Premiership earners the moment you're relegated.

This season is a great opportunity to see some return for the 10 years of solid investment (easily forgotten about it would seem) in the Academy and a team run by a new management team (bought on a not inconsiderable compensation package by the way).That in itself marks considerable progress for this football club as far as I'm concerned and as long as those players continue to progress and have a season of consolidation then with the finances back on an even keel it will afford us the opportunity to really have go at promotion in the seasons following.

The long term signs are really good but if some people simply want to beat themselves and the club up simply because we haven't bought a player in July then thats their choice i guess.

[Vision]

I was told that our wage bill last season was £18million, Burnleys on the other hand was £8million. Getting rid of Murts, USA, Leroy, Dubes and Doyle will have massively brought this down, also once we get rid of Huntys reported £30k and perhaps Bikeys then our wage bill will be a lot healthier.

No way to tell for sure of course but if our wage bill was 32m in the prem then 18m in the championship would be about right takeing into account the 40% wage reduction.. That would still have been significantly higher than the last time we were in this Division. I'm not sure but did we still run at a loss in the 106 season?

[Royal Rother]

Vision this was the thread...

viewtopic.php?f=2&t=82605&st=0&sk=t&sd=a&hilit=parachute

and this one...

viewtopic.php?f=2&t=82605&start=140#p2220450

[Vision]

Vision this was the thread...

viewtopic.php?f=2&t=82605&st=0&sk=t&sd=a&hilit=parachute

and this one...

viewtopic.php?f=2&t=82605&start=140#p2220450

Thanks for that. i'm not gonna read through 16 pages of what amounts to the same arguments but it does seem to confirm basically that we made a 7m (ish) profit 2007 with a wage bill of 32m that first Prem season. I'm also sure that the Deloittes figures for the relegation season had that wage bill having risen to circa 35m.

[papereyes]

You conveniently forget the wages. We need to budget for that and that does seriously bite into the income the club receives.

Not really, it peanuts comapred to what the clubs made in the last 3 years- absolute peanuts.

Are you really sure about that? Are you really an expert on Reading's finances - do you really know how much profit Reading makes? I would imagine that Reading's wage bill is in excess of something like £3m. And that's not peanuts. And even with Doyle, Hahnemann, Murty and a few others having left, the wage bill is still not peanuts.

Spacey,

in 05/06 it was £14.2 million.

So yes, it is in excess of £3 million.

[Woodcote Royal]

This season is a great opportunity to see some return for the 10 years of solid investment (easily forgotten about it would seem) in the Academy and a team run by a new management team (bought on a not inconsiderable compensation package by the way).That in itself marks considerable progress for this football club as far as I'm concerned and as long as those players continue to progress and have a season of consolidation then with the finances back on an even keel it will afford us the opportunity to really have go at promotion in the seasons following.

The long term signs are really good but if some people simply want to beat themselves and the club up simply because we haven't bought a player in July then thats their choice i guess.

Apart from the fact that I believe promotion remains a distinct possibility in this campaign, I completely agree.................and I'm looking forward to it so much more than the last 2 seasons.

[Vision]

in 05/06 it was £14.2 million.
.

Thanks for that. Thats actually a little higher than I would have thought.

[Vision]

This season is a great opportunity to see some return for the 10 years of solid investment (easily forgotten about it would seem) in the Academy and a team run by a new management team (bought on a not inconsiderable compensation package by the way).That in itself marks considerable progress for this football club as far as I'm concerned and as long as those players continue to progress and have a season of consolidation then with the finances back on an even keel it will afford us the opportunity to really have go at promotion in the seasons following.

The long term signs are really good but if some people simply want to beat themselves and the club up simply because we haven't bought a player in July then thats their choice i guess.

Apart from the fact that I believe promotion remains a distinct possibility in this campaign, I completely agree.................and I'm looking forward to it so much more than the last 2 seasons.

You weren't looking forward to the 2nd Premiership season? You were missing Sidwell afterall you daft old softy

[papereyes]

in 05/06 it was £14.2 million.
.

Thanks for that. Thats actually a little higher than I would have thought.

The deloitte stats for 05/06, 06/07 and 07/08 are readily available.
I think you can quite easily get last seasons as well.

In 05/06, we weren't the biggest spenders in the league - Sheffield United were on £15.2 million - but we were in and around the playoff places.

[Vision]

in 05/06 it was £14.2 million.
.

Thanks for that. Thats actually a little higher than I would have thought.

The deloitte stats for 05/06, 06/07 and 07/08 are readily available.
I think you can quite easily get last seasons as well.

In 05/06, we weren't the biggest spenders in the league - Sheffield United were on £15.2 million - but we were in and around the playoff places.

Yeah I'm sure I've seen this somewhere before (probably posted by you)

From here http://www.footballeconomy.com/stats2/eng_reading.htm

Year Turnover Pre-tax profit Wages / Turnover ratio (%) Employees
Year 2007/08
Turnover 57.698
Pre-tax profit 6.706
Wages/turnover ratio (%) 57.4
Emplyees 503

2006/07
49.909
6.573
59.7
444

2005/06
17.768
-6.465
80.2
435

2004/05
15.118
-4.554
73.1
438

2003/04
15.590
-1.850
60.4
391

2002/03
14.903
-1.616
59.9
403

2001/02
12.915
-2.762
63.3
409

2000/01
10.786
-4.570
69.2
421

1999/00
2.426
-2.569

248

-

[brendywendy]

We made a pretty decent profit last year, so revenue falling at a greater rate than the wage bill (within reason) shouldnt be too much of an issue really

Yes, the club should be budgetting to keep the wage bill in check for the next few years, but thats what the big incoming transfer fees will be going towards covering

I still dont think we have gone from making a decent profit one year to wages being greater than income (even excluding incoming transfer fees)

the championship season saw us lose 6 million, with lower wage bill that currently, and with bigger crowds too. without the parachute, and player cash wed be losing around that much, or probably more.

if we dont go up this season, we will be making a loss again next season and the one after that etc etc,
perhaps they are keeping back some of this years profit for that eventuality?