PSR nerds thread

[AjaxAndy]

For obvious reasons people discussing PSR in every thread gets annoying so thought we could do with a separate thread.

We spent quite a bit this summer, somewhere around a £140m net spend, so how does that affect PSR?

Say the average contract length was 4 years and each transfer is split over that time does that mean from a PSR perspective we've made a loss of £35m on transfers for this accounting period?

I've not included things like increased stadium and commercial revenue in this, so obviously that'll impact things on a positive way, but trying to get an understanding of how this affects us moving forward.

[superpull]

It's a 3-year rolling period, so you can't take this summer and extrapolate what it means.

Also, there's a general consensus that new rules are coming in over the next year or two, so it's probably safer to look at standard p+l, wage as percentage of turnover and things like EBITDA when the next accounts come out.

Added to that, every figure you have seen for transfers is completely made up.
There's the figure given by the selling club, the figure given by the buying club and the amount one club actually sends to another. All 3 are different.

So until the accounts come out in 18 months it's very hard to have any idea what the impact is.

[NickNack]

I was suckered in by Moshiri being an “accountant” and wasn’t bothered at first until it became clear he didn’t have a fucking clue what he was doing. Although he gets some leeway for actually getting the stadium completed.

I’m still inclined to not be too bothered as I think the current incumbents might actually know what they’re doing.

Until they prove otherwise…

[Gary1878]

For PSR, you would have to include previous years transfers that have carried over, as well as transfers that have happened in this transfer window.

You need to take each players fee on purchase and amortise over the length of the initial contract. You can then work out how much that player is costing you per year from a PSR perspective. Add all of them up and that will get you close in terms of outlay on players.

Sales are a little more complicated. For example, the sale of Chermiti. We purchased for £11.5m on a 4 year deal in Aug 2023. Therefore we have already paid £5.75m in the 2 years he has been at the club in the previous 2 financial years. We sold him for £10m this summer, meaning that we have made a profit for this financial year of £4.25m on Chermiti (£10m - £5.75m Amortised value). That’s assuming that it was £10m - if it was £8m + £2m, then you might only be able to use the £8m against PSR as it isn’t contingent against him meeting performance targets.

Once you get a net position of how much the transfer activity is costing you each year, you need to offset that against operating P&L. That’s really tough to do for this year given all of the variables, although I am sure various people have had a stab at it.

Would be good to get a reminder on the interest costs that the club are having to pay under the new refinanced loan agreements. That could also have a big impact.

You would hope that the club has a team with a working system in terms of calculating live accounts of the latest PSR position.

[AjaxAndy]

I was suckered in by Moshiri being an “accountant” and wasn’t bothered at first until it became clear he didn’t have a fucking clue what he was doing. Although he gets some leeway for actually getting the stadium completed.

I’m still inclined to not be too bothered as I think the current incumbents might actually know what they’re doing.

Until they prove otherwise…

To me it feels a bit like a spend now figure it out later to an extent... Not that we've gone crazy with no worry of PSR, but maybe we expect we'll sell Branthwaite or Armstrong for good money in a year or two, or flip one of Aznou, Barry or Dibbling for double.

It's why I really like the Barry signing, we got him early before the striker market exploded. A double digits goal scoring season would see us sell for £50m - £65m, so it's really smart business.

[fxceltic]

It's a 3-year rolling period, so you can't take this summer and extrapolate what it means.

Also, there's a general consensus that new rules are coming in over the next year or two, so it's probably safer to look at standard p+l, wage as percentage of turnover and things like EBITDA when the next accounts come out.

Added to that, every figure you have seen for transfers is completely made up.
There's the figure given by the selling club, the figure given by the buying club and the amount one club actually sends to another. All 3 are different.

So until the accounts come out in 18 months it's very hard to have any idea what the impact is.

this is about the size of it from what i can tell

Having said that, I think our last few years have been broadly net positive, as theyve had to be, so we were probably reasonably safe to be spending this summer, but probably only working on the assumption that future summers will be lower (unless our income increases a lot, which it ought to with the stadium)

I think JB is probably expected to exit next summer, given the escape clause in his contract and the likelihood that we will need some incoming transfer revenue next year. Unless this year is fabulously successful with cup runs, euro place finish and excess stadium revenues

[777Kidnappings]

What's happening with burnley suing us over the previous breach. I'm inclined to believe it's not really true but the reports said we were going to be in arbitration this summer. Nothing since though

[StirlingBlue]

Also, there's a general consensus that new rules are coming in over the next year or two, so it's probably safer to look at standard p+l, wage as percentage of turnover and things like EBITDA when the next accounts come out.

I’ve seen it said in a few places that this is why Liverpool spent big this summer, their commercial revenue works really well for PSR but there’s no guarantee the next rules will favour them as much

[Matt1878]

Bit limiting not being able to discuss whether a particular sale is good value or not, without mentioning the 3 letters and someone wetting their knickers. If I pop a shit fish pun in there though, maybe it will appease people.

[The Doc]

I enjoyed the fish puns, some of them were trout of this world.

[Cereal Killer]

I’ve seen it said in a few places that this is why Liverpool spent big this summer, their commercial revenue works really well for PSR but there’s no guarantee the next rules will favour them as much

Nah they’re just buying the title, no more no less

[74Blue]

Nah they’re just buying the title, no more no less

I note with interest that no fewer than 3 of the top 5 earners in the Premier League are currently employed by Net Spend FC.

[Granite]

Was funny at the time seeing Newcastle fans lose their shit over the Isak situation, but now the dust has settled, it’s very apparent the likes of Villa and Newcastle have hit a glass ceiling. And they’ve both got wealthier owners than us.

I guess if we get to that level, it’ll be a nice problem to have - just makes me question what we’re actually building towards.

[superpull]

Was funny at the time seeing Newcastle fans lose their shit over the Isak situation, but now the dust has settled, it’s very apparent the likes of Villa and Newcastle have hit a glass ceiling. And they’ve both got wealthier owners than us.

I guess if we get to that level, it’ll be a nice problem to have - just makes me question what we’re actually building towards.

Wasn't that long ago that Liverpool had Roy Hodgson and would sell their best players.

Spurs aren't a historically bigger club than us or Villa and are considered part of the big guys.

It's not so much a glass ceiling, and more a different game you need to start to play. Newcastle need to go out and find another 2 or 3 Isaks (as opposed to us, who are looking for 1) knowing they will have to sell one or two a year. Eventually that turns into regular champs league qualification and you can then have a shit year or two (Spurs) without a dent to reputation.


United being the exception. Just how long do they have to be shit for before they stop being able to afford and attract anyone they want?

[Cereal Killer]

Wasn't that long ago that Liverpool had Roy Hodgson and would sell their best players.

Spurs aren't a historically bigger club than us or Villa and are considered part of the big guys.

It's not so much a glass ceiling, and more a different game you need to start to play. Newcastle need to go out and find another 2 or 3 Isaks (as opposed to us, who are looking for 1) knowing they will have to sell one or two a year. Eventually that turns into regular champs league qualification and you can then have a shit year or two (Spurs) without a dent to reputation.


United being the exception. Just how long do they have to be shit for before they stop being able to afford and attract anyone they want?

United have it on the fiddle though. Two business entities but only one gets assessed for PSR for some reason, the other that pays the massive interest payments on all their debts is apparently fine