Read on Twitter
1/ Lots of #NUFC fans asking whether FFP will restrict spending by NUFC post-takeover (hopefully). There have also been other fans suggesting NUFC won& #39;t compete because of FFP. For once, there might actually be something to thank Mike Ashley for... #nufctakeover @RedRoseMichelle
2/ FFP rules mean that a club cannot spend over €5m more than they earn in any given year. However, owners can also cover up to €30m “losses” on top of that, so that would allow NUFC a total loss of €35m per year. Also in line with the Premier League’s own rules on spending.
3/ However, FFP is not calculated per year, it& #39;s every three years. NUFC’s net spend has been low under Ashley, the 2018 accounts permitted a £6m net spend on transfer deals, that’s without considering any other income. Even with Joelinton & Almiron, NUFC’s net spend is very low.
4/ Different rules apply to sponsorship deals which are related to “owners”. A related company will be investigated on a case by case basis, according to market prices. It’s unclear how Ashley approached this but it shows the limits on companies linked to PIF sponsoring NUFC.
5/ Importantly, spending on Youth Development and Infrastructure – so SJP and Training facilities - are excluded from FFP calculations. That means we can expect substantial investment – goodbye paddling pool.
6/ In 2017/18, NUFC’s commercial income was £26.7m. If you compare that to Everton for the same period, you get an idea of the problem under Ashley – they received £42.9m in commercial income. Financial spending power under FFP is driven by how much the club earns.
7/ Looking at estimates on player spend. 2019/20 had a net spend of £32m; 2018/19 was £7m. So a total of £39m. For comparison over the same period: Spurs - £58m spend / Everton - £100m spend / Man Utd - £175m spend. That shows how much room NUFC have to work with.
8/ These satisfy FFP because of substantial commercial incomes. NUFC have spent very little in comparison. Worst case they have a budget of £70m. Without taking into account other expenditure/income. Based on 18/19 there was £18.6m profit which can be added to the transfer budget
9/ NUFC fans can expect big investment in facilities / SJP and finally a decent youth set-up. But they can also expect, due to chronic under-spending, decent signings short term & increased focus on commercial income long term to balance the books for the next three year period
10/ Podcast to follow... @GallowgateShots
