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Chelsea Announces Annual Profit


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Can you please explain it in detail. I mean how can Roman call a company if and when required? What are external debts? And how can a company not be in a company's books but present in company's books. I am not at all a finance guy so i would love if you could just clarify these things. Thanks.

When Roman bought the club, he channeled money to the club through a company called Chelsea Limited (name changed to Fordstam later). So the 'debt' people speak of as Chelsea being under is the money loaned by Roman to Fordstam who in turn loaned it to Chelsea PLC (ie company which owns Chelsea Football Club). These loans are interest-free and were converted into equity by Roman a couple of years back (ie he coverted the loan into 'capital'; the money transformed from being money owed to an outsider to money invested by a benefactor). Here's the catch - this happened at the level of Chelsea PLC, but not in the books of Fordstam. That is to say, Chelsea does not owe money to Roman any longer, Fordstam does. Roman still retains the right to ask for his money back from Fordstam any time he wants on giving 18 months' notice. Say tomorrow he wants to sell the club and calls back his money, then Fordstam ( not Chelsea FC) is bound by law to return it within 18 months.

Roman Abramovich -> Fordstam (formerly Chelsea Limited) -> Chelsea plc -> Chelsea FC.

We've got smart guys running this club.

P.S - 'External debts' is a term I used to describe loans owed to 3rd parties like banks. I did so to avoid confusion with loans owed to Fordstam, who is the holding company of Chelsea plc and hence an 'internal' group undertaking.

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Loads of discussion going on regarding this announcement on Danish forums. Other fans are pretty much rambling about Chelsea using every single technicality available to 'manipulate' this fine profit.

Can someone who's decent at economics tell me if anything about this seems suspicious? And it is allowed to turn the intergroup debt into equity in compliance with the FFP regulations? Thanks :halo:

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Loads of discussion going on regarding this announcement on Danish forums. Other fans are pretty much rambling about Chelsea using every single technicality available to 'manipulate' this fine profit.

Can someone who's decent at economics tell me if anything about this seems suspicious? And it is allowed to turn the intergroup debt into equity in compliance with the FFP regulations? Thanks :halo:

I'm an accountant and whilst not well versed with accounting in football clubs, things seem to be above board.

Other clubs are just bitter because they thought FFP would fuck us up. They can point to £60m+ spent in the summer but the money is not fully realised within the first year, but over the players contract. Also these new partnerships, etc with Sauber, etc will have not kicked in the accounts just published.

Very good start to the weekend - time for City to show their cards now lol!

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I'm an accountant and whilst not well versed with accounting in football clubs, things seem to be above board.

Other clubs are just bitter because they thought FFP would fuck us up. They can point to £60m+ spent in the summer but the money is not fully realised within the first year, but over the players contract. Also these new partnerships, etc with Sauber, etc will have not kicked in the accounts just published.

Very good start to the weekend - time for City to show their cards now lol!

Cheers mate! I'm also emphasizing the importance of preparations for FFP. And this is one big step on the way. I'm sure the club board is working their ass off to ensure that we are fit and ready for it. Plus, Arsenal are not alone in making a profit now :halo: Hahaha, nah, it's great to see this positive development. May it long last! KTBFFH!

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Cheers mate! I'm also emphasizing the importance of preparations for FFP. And this is one big step on the way. I'm sure the club board is working their ass off to ensure that we are fit and ready for it. Plus, Arsenal are not alone in making a profit now :halo: Hahaha, nah, it's great to see this positive development. May it long last! KTBFFH!

Am i wrong in thinking there is a new tv deal kicking in from next season for even more money?

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This was a profit based more on luck than on good management. The only reason we made money, is winning the CL which made us 47M pounds. Had we not gotten to the finals, we'd have recorded a significant loss. The trick is building long-term sustainability based on smart planning and spending. I think we're heading in that direction, but this profit was based on a highly unlikely success beyond the board's control rather than good planning.

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This was a profit based more on luck than on good management. The only reason we made money, is winning the CL which made us 47M pounds. Had we not gotten to the finals, we'd have recorded a significant loss. The trick is building long-term sustainability based on smart planning and spending. I think we're heading in that direction, but this profit was based on a highly unlikely success beyond the board's control rather than good planning.

It's football, it's a game afterall. That's not something you can predict because anything can happen. Luck is therefore very important in the 'business'. Although I agree about the what could have happened part.

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hmm.gifFrom soccernet.com today:

Their record turnover of 255.7 million pounds ($406.9 million) sees Chelsea leapfrog Arsenal and secure further bragging rights in the capital.

so let me get this straight, le arse is ran like a bank & CFC still has a better business model Now that is fuckin' comedy :Goober:

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hmm.gifFrom soccernet.com today:

Their record turnover of 255.7 million pounds ($406.9 million) sees Chelsea leapfrog Arsenal and secure further bragging rights in the capital.

so let me get this straight, le arse is ran like a bank & CFC still has a better business model Now that is fuckin' comedy :Goober:

So le arse is ran like a bank & CFC still has a better business model

I am gonna wait til everything in full is released and confirmed but if so that is jokes, and theres gonna be some long old journeys for my arsenal mate, who keeps telling me that we will be bankrupt in a few years lol.

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