Club announces record turnover

[francozola 2,040]

The latest reported loss won't include the full transfer fee paid for Fernando Torres because player transfers are capitalised onto the balance sheet and amortised over the remainder of the contract. So, in Torres' case, his annual amortisation, which is shown as a cost in the profit & loss account will be £50m spread over the 5.5 years of his deal = £9m per year The true cost of Torres per year will also include his wages which at what is estimated to be £150k per week, works out at a cost of £8m per year. Therefore the total annual cost of having Torres on the book is £17m per year until midway through 2015 (assuming we don't offer him a contract extension) or unless he is sold.

Dear lord.

Another reason why we need to get rid of him ASAP. We aren't spending 17m a year on him to get a couple of assists every month.

[TrueBlue1905 5]

Dear lord.

Another reason why we need to get rid of him ASAP. We aren't spending 17m a year on him to get a couple of assists every month.

One problem with getting rid of him ASAP would be that we would have to recognise upfront, a very big loss on the sale as his current market value is way below the £50m we paid for him.

Right now, his book value should be at around £41m (£50m fee less one year's amortisation). Let's say we can recoup £20m by selling him now, which I realise is unlikely but Liverpool paid £35 for Andy Carroll so is not beyond the realms of possibility. We would have to recognise a loss of £21m immediately! On the other hand, we would save ourselves £8m per year in wages for the next 4.5 years.

[francozola 2,040]

One problem with getting rid of him ASAP would be that we would have to recognise upfront, a very big loss on the sale as his current market value is way below the £50m we paid for him. Right now, his book value should be at around £41m (£50m fee less one year's amortisation). Let's say we can recoup £20m by selling him now, which I realise is unlikely but Liverpool paid £35 for Andy Carroll so is not beyond the realms of possibility. We would have to recognise a loss of £21m immediately! On the other hand, we would save ourselves £8m per year in wages for the next 4.5 years.

Yeah, that's true in a financial sense. But at the same time, keeping him at the club means that we can't sign another top class striker (one that can actually score goals) because neither would be happy at sitting on the bench.

I think it would be better to just sell him. It is possible that we can get Malaga, PSG or Anzhi to pay 20m for him.

We should just move on from this Fernando Torres fiasco and get in a new striker in the summer since we are going to be rebuilding the rest of the team as well.

[LDN Blue 7,903]

TheChels have done an excellent comparison over the last decade of Chelsea FC Limited & Chelsea PLC's profit/loss, turnover & wages.

http://www.thechels..../club/finances/

[eldo 868]

http://swissramble.blogspot.com/2012/02/chelsea-look-good-in-blue.html

[Fernando 6,375]

http://swissramble.b...od-in-blue.html

Great read, but this one part should be made big in the face of all Chelsea supporter and Board personal:

Although the severance payments are described as “exceptional items” in the accounts, it’s actually pretty much business as usual for Chelsea, as they have made such payments in three of the last four years (£23 million in 2008, £13 million in 2009 and £28m in 2011), costing them an amazing £64 million to rid themselves of a succession of “failed” managers: Claudio Ranieri, Jose Mourinho, Avram Grant, Luiz Felipe Scolari and Ancelotti. That’s a staggering amount, especially if you consider how successful Mourinho has been since leaving Stamford Bridge.