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Feb 24 25 tweets 6 min read
An attempt to explain the impact of FFP upon NUFC 💰🧵
1/ Simply put, FFP regulations stipulate that a PL club can lose up to £35m per year over a three year period. Therefore taking the total to £105m of losses over three years.
2/ However, due to Ashley’s frugal ownership, NUFC have actually been left with around £100m FFP profit. This means that NUFC could actually afford to lose £205m over the next three years (£105m allowed PL losses + MA era profit of £100m).
*To summarise so far … we are in the best possible position to reap the rewards of investment under FFP in modern day terms as we can spend significantly beyond (double) what any other PL team of similar stature could afford to … however it gets even better later on*
3/ FFP broadly takes into account: A) player transfers, B) player wages and C) club overheads

(of course in theory it’s more complex than just that but for this sake of this thread that’s all we need to concern ourselves with)
4/ FFP does NOT take into consideration funds allocated to infrastructure (ie stadium improvements and training ground upgrades), academy and women’s team improvements or community schemes. As far as FFP is concerned, NUFC can plough limitless amounts into upgrading these aspects
5/ So how do we calculate losses and where does transfers come into this? Our new friend is something called “Amortisation”. This allows a player’s transfer fee + wages to be spread over the duration of a contract.
6/ An example would be a player bought for £9m on £100k per week wages on a 3yr contract would cost the club £4.2m per year

*£9m transfer fee dived by three + total wage of £3.6m divided by three = £3m fee +£1.2m wages = £4.2m per year*

So let’s put this into practice for Jan:
7/ Jan signings:-

KT - circa £15m wages+fee = £6m p/y
CW - circa £28m wages+fee = £11m p/y
BG - circa £41m wages+fee = £9m p/y
DB - circa £15m wages+fee = £6m p/y

*worked out as Trippier, Wood and Burn on two and a half year contracts. Bruno on four and a half year contract*
8/ So if you add all above players total p/y cost together you’re left with roughly £32m per year over the next three years.

As NUFC are allowed £205m losses over next 3yrs you can split this evenly which comes to allowed losses of £68m per year roughly.
9/ so in theory, NUFC have £36m left to lose this year to stay on track for spending £68m amortisation for the following two years (£68m-£32m=£36m)

HOWEVER, there’s nothing stopping NUFC from spending their entire 3yr FFP limit this summer should they wish (although not advised)
10/ A more sensible way to look at it would be to say that NUFC have £173m buffer left to lose for the next 3yrs.

If NUFC were to buy three £50m players on £100k p/w 5yr contracts over the next 2 seasons then that would equate to losses of £32.8m per year
11/ Therefore the January business of £32m p/y + £32.8m p/y for the next 2 years = £194.4m losses over a three year period. This still comfortably leaves further allowed losses of £10m spread throughout some of those windows.
12/ Are player sales spread over a period? The good news is no! Any player sales are immediately offset against that years FFP losses. For example … selling an Almiron for £25m will instantly free up wiggle room.
13/ ie the £32m cost incurred this year in January would suddenly become just a £7m loss when the fee received is detracted from that years loss. Therefore the £25m fee received could be reinvested without further FFP repercussions (it’s all very mind boggling I know).
14/ of course this FFP figure is all based upon NUFC’s revenue staying stagnant during the next three years. Baring in mind that our commercial income was £28m in 2007 and also £28m in 2019 there’s HUGE room to boost revenue at the club (thus taking FFP losses beyond £205m).
15/ Over the last 14yrs NUFC have grown commercial income by JUST 5%. By comparison, Manchester City have grown theirs by 500%. The likes of Everton are bringing in rev of £70-£80m per season - which is significantly more than double NUFC’s income.

In short there’s room to grow
16/ So how could we grow revenue? The first obvious place to look is named shirt sponsors and stadium naming rights. Brighton have recently signed an 11 year deal with Amex worth circa £10m per season combined. Man City have a similar deal with Etihad worth £35m per season.
17/ With gambling not being allowed in Saudi Arabia it’s expected that NUFC will imminently change sponsors. Perhaps something similar to the above deals could be in the pipeline with the likes of an Aramco or other MENA based company. NUFC could realistically look to £10-15m p/y
18/ There’s also the possibility of partaking in MENA-based pre season tournaments with large prize pots which legitimately count towards FFP. There’s also the opp. to grow merchandise sales, contracts with manufacturers (ie castore or other), hospitality, conferencing and events
19/ Then there’s the sporting side of the project. With each ascending league position in the table the club pockets £2m extra per year. A good year in the Europa Conference bags £30-£40m extra each year. Europa is £60-£70m p/y and a good Champs League campaign is £150m+ p/y.
20/ So it’s clear to see just why our owners are targeting the heights of European football as a sustainable source of income and growth.
21/ As alluded to previously, the exciting news is that a brand new academy and training complex built from the ground up could consume any amount of millions deemed necessary by the owners and will not affect FFP at all. These facilities are vital & will attract the big hitters
22/ Funnily enough, you could even have the training ground complex renamed by a sponsor (as Everton have done) and CAN include this in your FFP forecasts.

The bottom line is that there’s tonnes of opportunity to grow that £205m FFP loss figure way beyond what it sits at.
Finally, a massive shout out to @KieranMaguire and the boys who run @LoadedHQ1. Their pod’s have underpinned a lot of this thread and it’s definitely worth a watch 👍🏼
Another shout out to @SwissRamble for the facts and figures too ⚫️⚪️ #nufc #FFP #PL

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