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Wenger: £15-20m Profit Required

Discussion in 'Arsenal' started by The Bonstar Wandit, Feb 7, 2012.

  1. The Bonstar Wandit

    The Bonstar Wandit Well-Known Member

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    "You should know that each season, it is imperative to show a profit of between fifteen and twenty million pounds," said Wenger.

    Why?
     
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  2. lazarus20000

    lazarus20000 Well-Known Member

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    They must be making close to that profit with selling out our 60k stadium and high ticket prices. Also we have been selling our best players and making money on all of them. All the Champions league profit and merchandising. Maybe its time to revisit our wage bill if they can't make the £20m profit...
     
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  3. PeterRICK

    PeterRICK Well-Known Member

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    Really?! Christ. Someone needs to let the rest of the league know.
     
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  4. lazarus20000

    lazarus20000 Well-Known Member

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    Don't worry im sure the billionaires and the equally dodgy, Barca and Real, will find some loophole. Probably along the lines of the team getting their underpants sponsored for £50m a year.....
     
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  5. TheBear

    TheBear Well-Known Member

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    Just goes to prove Wenger has been finacially restricted by the board.
     
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  6. PINKIE

    PINKIE Wurzel Gummidge

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    Any link to this ? would be good to see what context it's in.
     
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  7. ToledoTrumpton

    ToledoTrumpton Well-Known Member

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    What is the purpose of a company, if it is not to make a profit?

    A profit is essentially what the owners of the business are paid. You don't expect the players to play for nothing, why do you expect the owners to invest their money for nothing?

    It shows just how much the rich millionaire owner is the "normal" state of football. Owners are expected to invest their money, for no return on their investment.
     
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  8. There is profit and there is profit.

    Would a club like us require to show £15 to £20m profit? Possibly in terms of future investment but we do not seem to invest that way. At least not to me and not it appears to many others either.The club could certainly be run at a very healthy profit BUT solely for the purposes of a business and indeed someone else's business. Someone, who bought us solely for the purpose of making a profit and to whom, sporting excellence is neither here nor there. Just look at his other sporting concerns. If what has been reported here is entirely accurate, none of Mr K's sporting concerns excel in the sporting arena. They turn over a profit though.

    While an element of profit is necessary in any business, we need to in the case of a sporting entity, balance profit with sporting success. Without the latter and because a sporting entity is reliant on it's following, profitability may not be something that will readily ensue in the absence of sporting success. Would for instance Utd be enjoying it's stature and financial worth if not for it's sporting successes? Worth thinking about perhaps.

    IMHO
     
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  9. ToledoTrumpton

    ToledoTrumpton Well-Known Member

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    I'm not sure what the total capitalization figure is at Arsenal (60K shares trading at about 10-15K?, so about 600-900M?), but I would expect that 15-20m would represent a very modest annual return (1%-4%?). You could probably earn more sticking it in a savings account and taking hardly any risk at all.

    I think it shows how difficult it is for a business, competing with what are essentially hobby clubs. The 15-20M profit that is expected, represents one player, and not a really top player either. Hardly likely to make the difference between success and failure. I thiink we also have to remember that we as fans attribute far more certainty to success based on buying players than is really justifiable. The real question is if Arsenal bought the players and still lost whether fans would be happier than they are now, and whether that would be reflected in increased income.
     
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  10. theHotHead

    theHotHead New Member

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    Total rubbish Toledo. Do club owners for lower league teams own make a profit ? Nope. What about club owners of semi pro clubs ? They don't make a dime, it is just spend spend spend ! Owners ARE expected to invest their money in football clubs, if you can make some money thats a bonus.Do you think Sam Hammam was making money at Wimbledon ? Why do you think he moved the team to Milton Keynes !! What about Al Fayed ?
     
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  11. ToledoTrumpton

    ToledoTrumpton Well-Known Member

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    Probably why buyers are so scarce for football clubs. I mean as philanthopy goes, giving your money to benefit a bunch of mega-rich players and fans that will call you all kinds of names if the team doesn't win, probably isn't the most rewarding or worthwhile cause.
     
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  12. theHotHead

    theHotHead New Member

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    You just answered your own question <doh>

    A rhetorical question was asked whether or not a company, in this case a football club, is here to make profit. One of your 2 answers shows that it is not, therefore my point is proved. I would suggest in most cases sports companies do not make profits - certainly those who are not at the highest stage. If you look at F1 some teams get a lot of sponsorship but then you have teams like Force India where the owner pumps in lots of his own money, Tony Fernandes at Caterham too. Teams in lower leagues do not get the sponsorship or the attendances to cover their outgoings so for those owners it is a labour of love.
     
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  13. The Bonstar Wandit

    The Bonstar Wandit Well-Known Member

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    Profits can't evaporate in a Public Company. They have to be declared etc. and any money taken out is paid as Dividends. Unless Kroenke is paying himself a whopping great salary, and then paying tax on it, which I can't see happening.

    Perhaps the 15-20m a year is to service the debt?
     
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  14. theHotHead

    theHotHead New Member

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    What are you talking about ? What about Ken Bates at Chelsea ? He pumped his own dosh into them for years. What about Matthew Harding ? What about Mike Ashley at Newcastle ? There are loads of owners of top clubs that put in theior own money because they love the club knowing full well they won't see that money again. How3 much did Alan Sugar make from Tottenham compared to how much he put in ?
     
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  15. Bergkamp a Dutch master

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    Kroenke is very happy watching Arsenal being valued higher every year.
     
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  16. theHotHead

    theHotHead New Member

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    Shwan, your graph proves nothing at all. I already gave you numerous examples where clubs are not run to make profit - or at least they don't make a profit, in which case the owners who are not sugar daddies like the oil sheikhs etc, have to pump their own money into the club knowing they won't get a return.
     
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  17. ToledoTrumpton

    ToledoTrumpton Well-Known Member

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    This is a slightly strange sort of argument to my thinking. It is fairly well known that football clubs (just like everyone else) are facing a very severe financial crisis. The problem being that they are not companies run on their own merit, they only exist due to the charity of a rich benefactor. Take that rich benfactor away and you have no club. A football league club does not require as much investment as a premier club and perhaps there are more people willing to invest, but equally there are a lot of clubs up against the wall right now, because rich owners can't afford to keep bankrolling their clubs.

    Mike Ashley at Newcastle is a very good example of what happens when you have a normal rich owner. He simply couldn't keep paying money to the club and gave up, the club got relegated. They are back now, but for how long? We have a proper businessman as an owner. He doesn' get involved in the club, doesn't tell the manager to buy his favorite russian superstar player, and doesn't sack managers in a fit of pique.

    For me 15M/Year is a small price to pay for that.
     
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  18. robin_van_ fiberglass

    robin_van_ fiberglass Active Member

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    The thing about that statement is that it really needs a follow up question. For example why is it that we have to make a profit that high? And how can he say that when Gazidis says 'All of the money we make is available to us, and to spend.' http://news.arseblog.com/2012/01/ivan-gazidis-interview-with-fox-sports/

    I really wish a reporter would actually ask these type of questions so that we know where we stand.
     
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  19. theHotHead

    theHotHead New Member

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    Oh dear <doh>
    Regarding Mike Ashley, read the link:
    http://www.mirrorfootball.co.uk/news/Newcastle-owner-Mike-Ashley-has-spent-a-staggering-285-8million-on-the-club-so-far-it-can-be-revealed-today-article718115.html

    Read this link to find out what Bates got from selling Chelsea:
    http://www.telegraph.co.uk/sport/football/2406994/Bates-sells-off-Chelsea-to-a-Russian-billionaire.html

    Bates got a share of £30m by the look of it but Abramovich took on the near £100m debt. Take into account all the money Bates ploughed into a club over 22 years that was losing money, it is clear he didn't make money from the sale.

    Argue facts not nonsense. Your argument is based on a few top clubs who have massive wages, many other clubs don't have that problem, Mike Ashley's Newcastle are a classic example of football ownership - or have you been hiding. Most clubs DO NOT make a profit. See below:
    http://www.independent.co.uk/sport/football/premier-league/the-debt-league-how-much-do-clubs-owe-1912244.html
     
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