How will that £35m be spent?The transfer market is a strange and sometimes scary place, with confusion abound by exactly how much money we apparently have, others have the knowledge only provided by Football Manager and FIFA and you’d be surprised how correct that actually is. The long and short is, we have never had £35m to spend – never.
There’s a lot of confusion around exactly what we have to spend since the sale of local lad and full time thug Andy Carroll to Liverpool for £35m with £30 of that being handed over in cold, hard cash – just how we like it. Alan Pardew himself stated that the money was to be reinvested in the squad and even went as far as to say that he wanted it solely for players but unfortunately, that isn’t how it works.
At the start of the season, the manager and the chairman sits down and discusses season targets, contracts, incoming players, outgoing players and everything else you’d come to associate with a professional football club. (more…)
Brace yourselvesMike Ashley’s ‘5 year plan’ is to create a self sufficient business model, this is the aim for his Newcastle United project. Now, this should be the aim for any business, and especially where football clubs are concerned with the financial rules set to take effect, and the current state of the economic climate. This of course will take time to achieve and will not happen overnight, but will it work at all with Ashley at the helm, and is long term success on the pitch part of his true intentions?
This ‘5 year plan’, which I assume has been extended every year since he took charge after some abject failings (like relegation in 2009), has some positive factors incorporated. I like the idea of young, home grown players running out at St James Park and the focus on youth and development should be welcomed by many of us.
If you refer to Ashley’s statement back in 2008 it declares:
“My investment in the club has extended to time, effort and yet again, money being poured into the Academy. I want Newcastle to be able to create its own legends of the future to rival those of the past. This is a long term plan. A long term plan for the future of the club so that it can flourish”.
I think we all want to see that don’t we?
Ashley has also created an extensive scouting network, spearheaded by Graham Carr and his band of merry men, instructed to scour France and the rest of the continent, in search of diamonds in the rough, unheard of players, those who’s career is in front of them and not behind them. In the same 2008 statement Ashley stated: (more…)
Not only does it save money, but it's also French!Mike Ashley bought Newcastle United to much fanfare in 2007 via St. James Holdings. Opting against doing the sensible thing and lodging a formal bid, he just went out and bought the stocks, forcing the then hospitalised Freddy Shepherd into advising shareholders to sell, sell, sell!
Thus came an end to Shepherd’s reign of terror over our club. He inherited a wonderful thing from Sir John Hall and promptly ran it, head first, into the ground. That was to end with our new chairman. A young man, famed throughout the great maze of Eldon Square for his cheap sportswear and throughout the business world as being reckless in his deals.
It was all roses for a while as Mike Ashley enjoyed a [many] pint [pints] with the fans in the Strawberry and even snubbed the directors box in favour of the Leazes End. Had Freddy Shepherd had done that, he’d have been hog tied, placed on a spit and spun over an open flame in the centre circle with his, rather ample, meat donated to third world areas of our great Earth such as Sunderland and Liverpool. (more…)
Pardew: Can't compete with the big boys on wages.Speaking to North East weekly, the Sunday Stun, Newcastle United manager, Alan Pardew has claimed that the club cannot compete with big clubs such as Tottenham or Liverpool on in terms of transfers or wages.
This is something which seemed obvious to many fans when promising stroker, Andy Carroll, was spirited away to the latter club for a transfer fee of up to £35 million, and a contract which dwarfed anything which Newcastle were willing to offer him. However, the Magpies’ supremo has assured us that despite the imbalance in finances, we can compete with the likes of Tottenham and Liverpool on the pitch.
Pardew said of the imbalance:
“I don’t think we’re anywhere near Spurs in terms of the wage bill. Theirs is double ours, so you can forget about Spurs.(more…)
Ouch - me head hurts!Much recent discussion about Newcastle United’s profits and/or losses in the transfer market has convinced one writer that a tedious post about amortisation is necessary.
I’ve noticed discussions in the comments on this ‘blog lately about players sold v players bought and the profit or loss that club makes as a result.
If, however, you try to tally this up with club accounts you have to bear in mind something called amortisation, which distorts things a bit.
I’ll demonstrate how it does so in possibly to most boring ‘blog article ever written.
Let’s say we buy a player for £12m in 2011 and he goes up in value playing for Newcastle (of course) and we sell him one year down the line for £24m. Without amortisation, it’s simple: we’d just record -£12m in 2011 and +£24m in 2012 against that player, giving us an over all profit on that player of £12m:
2011
2012
Profit On Player
(£12m)
£24m
£12m
However, in the real world – at least the one inhabited by accountants – it doesn’t work like that because of amortisation. If a player has signed a two year contract and is sold after one year, he is valued by his amortised book value, not by how much he cost in the first place. (more…)
