If a buyer isn’t going to happen, would you rather?

[Snowflake Royal]

It's not hard to see how we could have gotten somewhere close to cost neutral under Dai as well.

We refused about £15m worth of transfer fees, instead of actively trying to sell a high value asset a season.

We spent crazy fees on Aluko, Joao, Puscas, Ejaria etc worth about £20m

We gave out excessive wages on excessive lengths to Moore, Ejaria, Aluko, Puscas, Baldock etc.

Dai added almost £10m to our wage bill in his first year, when he should have been taking £5m- £10m off of it.

A good owner, like Madejski in his day, could easily have had us performing just as well, but with a net finance improvement of about £50m. Probably more. That's almost £10m a season.

[WestYorksRoyal]

Because all the players got big promotion bonuses.

Taking one year in isolation is meaningless.

I could pick any year and we'd make a loss, except one, which people have mentioned below. So its actually the other way round. When we had parachute payments, plus a play off final and player sales. We bought Lita For £1m the year we got promoted, we would have made a loss with or without the promotion bonusses. And if you can't make a profit when your team is filling the stadium each week, then you will not make a profit.

Reading used to be run as a "sensible club" which meant building slowly, and still making losses. That is the minimum we expect of the new owner which are:

1) Start picking up the tabs on the losses straight away this season
2) Get us a "competitive squad for next season" i.e, more losses than this season
3) Hopefully we get promoted. If not. Lots more losses.
4) If we do get promoted, "invest" to make the club competitive for the Championship. i.e. more losses.
5) Consolidate in championship for a few years. More losses
6) Then begin to assemble squad and manager for potential play off push. More losses.

Obviously you're struggling here, because that's three years that have been mentioned, with about another 3-5 as roughly break even. Which adds up to about a decade cost neutral.

I've done the research to settle it for you both.

From c. 2000 - 2006 it was a story of consistent, modest losses in the £2m - £5m ball park. 2006 would have been a loss even without the promotion bonuses. In our 2 PL seasons we made c. £6.5m p.a., essentially recouping the losses up until then.

In 2009, we made a £12m operating loss offset by £16m net transfer revenue, so £4m profit. Similar story in 2010 with a £2m net profit. We then made a modest £5m loss in 2011 before a big £12m in 2012 due to promotion and AZ's influence.

Edit: I should add losses included c. £2m p.a., of depreciation on the infrastructure SJM invested in, which is purely accounting loss and says nothing about the sustainability of the club.

[Snowflake Royal]

I could pick any year and we'd make a loss, except one, which people have mentioned below. So its actually the other way round. When we had parachute payments, plus a play off final and player sales. We bought Lita For £1m the year we got promoted, we would have made a loss with or without the promotion bonusses. And if you can't make a profit when your team is filling the stadium each week, then you will not make a profit.

Reading used to be run as a "sensible club" which meant building slowly, and still making losses. That is the minimum we expect of the new owner which are:

1) Start picking up the tabs on the losses straight away this season
2) Get us a "competitive squad for next season" i.e, more losses than this season
3) Hopefully we get promoted. If not. Lots more losses.
4) If we do get promoted, "invest" to make the club competitive for the Championship. i.e. more losses.
5) Consolidate in championship for a few years. More losses
6) Then begin to assemble squad and manager for potential play off push. More losses.

Obviously you're struggling here, because that's three years that have been mentioned, with about another 3-5 as roughly break even. Which adds up to about a decade cost neutral.

I've done the research to settle it for you both.

From c. 2000 - 2006 it was a story of consistent, modest losses in the £2m - £5m ball park. 2006 would have been a loss even without the promotion bonuses. In our 2 PL seasons we made c. £6.5m p.a., essentially recouping the losses up until then.

In 2009, we made a £12m operating loss offset by £16m net transfer revenue, so £4m profit. Similar story in 2010 with a £2m net profit. We then made a modest £5m loss in 2011 before a big £12m in 2012 due to promotion and AZ's influence.

So basically cost neutral over about a decade.

[Greatwesternline]

Obviously you're struggling here, because that's three years that have been mentioned, with about another 3-5 as roughly break even. Which adds up to about a decade cost neutral.

I've done the research to settle it for you both.

From c. 2000 - 2006 it was a story of consistent, modest losses in the £2m - £5m ball park. 2006 would have been a loss even without the promotion bonuses. In our 2 PL seasons we made c. £6.5m p.a., essentially recouping the losses up until then.

In 2009, we made a £12m operating loss offset by £16m net transfer revenue, so £4m profit. Similar story in 2010 with a £2m net profit. We then made a modest £5m loss in 2011 before a big £12m in 2012 due to promotion and AZ's influence.

So basically cost neutral over about a decade.

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

[WestYorksRoyal]

I've done the research to settle it for you both.

From c. 2000 - 2006 it was a story of consistent, modest losses in the £2m - £5m ball park. 2006 would have been a loss even without the promotion bonuses. In our 2 PL seasons we made c. £6.5m p.a., essentially recouping the losses up until then.

In 2009, we made a £12m operating loss offset by £16m net transfer revenue, so £4m profit. Similar story in 2010 with a £2m net profit. We then made a modest £5m loss in 2011 before a big £12m in 2012 due to promotion and AZ's influence.

So basically cost neutral over about a decade.

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

After 2012 it's irrelevant. We all know we've had shitty owners who couldn't run a bath since then. The question is whether it's possible for a good owner to run us sensibly, and the SJM era says yes.

As noted, the landscape has changed in the past decade and I think running sensibly while still competing on the pitch is even harder now.

[Snowflake Royal]

I've done the research to settle it for you both.

From c. 2000 - 2006 it was a story of consistent, modest losses in the £2m - £5m ball park. 2006 would have been a loss even without the promotion bonuses. In our 2 PL seasons we made c. £6.5m p.a., essentially recouping the losses up until then.

In 2009, we made a £12m operating loss offset by £16m net transfer revenue, so £4m profit. Similar story in 2010 with a £2m net profit. We then made a modest £5m loss in 2011 before a big £12m in 2012 due to promotion and AZ's influence.

So basically cost neutral over about a decade.

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

2003 - 2011
Profits - £16m
Losses - £19m

Quite how you think a £3m loss over an 8 year period, with 4 years in profit, isn’t sustainable is baffling.

[WestYorksRoyal]

So basically cost neutral over about a decade.

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

2003 - 2011
Profits - £16m
Losses - £19m

Quite how you think a £3m loss over an 8 year period, with 4 years in profit, isn’t sustainable is baffling.

And depreciation on the stadium and training facilities would have driven that, which is accounting losses but not cashflow. In reality we would have made money in that period.

[Snowflake Royal]

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

2003 - 2011
Profits - £16m
Losses - £19m

Quite how you think a £3m loss over an 8 year period, with 4 years in profit, isn’t sustainable is baffling.

And depreciation on the stadium and training facilities would have driven that, which is accounting losses but not cashflow. In reality we would have made money in that period.

Not to mention that if you shift it just 1 season back you swap a £5m loss for a £1.8m loss and see a small profit over the same duration.

[Greatwesternline]

So basically cost neutral over about a decade.

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

2003 - 2011
Profits - £16m
Losses - £19m

Quite how you think a £3m loss over an 8 year period, with 4 years in profit, isn’t sustainable is baffling.

Because it relies on getting into the promised land of the PL. And for many investors they dont have the time commitment to get into the PL. You can't call a football team sustainable if it relies on getting to the PL and staying there a while. That literally the hole problem with the Championship. Every owner running at a loss on the hope they get there one day and stay there.

[WestYorksRoyal]

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

2003 - 2011
Profits - £16m
Losses - £19m

Quite how you think a £3m loss over an 8 year period, with 4 years in profit, isn’t sustainable is baffling.

Because it relies on getting into the promised land of the PL. And for many investors they dont have the time commitment to get into the PL. You can't call a football team sustainable if it relies on getting to the PL and staying there a while. That literally the hole problem with the Championship. Every owner running at a loss on the hope they get there one day and stay there.

Of course there is execution risk in football like no other industry. But it was still sensible, manageable losses and had we needed to, there was loads of value within the squad. Kitson, Shorey, Sidwell, Harper. We could have got a load of cash for them and made a profit, but we chose to have a go at promotion. It worked.

[Snowflake Royal]

2003 - 2011
Profits - £16m
Losses - £19m

Quite how you think a £3m loss over an 8 year period, with 4 years in profit, isn’t sustainable is baffling.

Because it relies on getting into the promised land of the PL. And for many investors they dont have the time commitment to get into the PL. You can't call a football team sustainable if it relies on getting to the PL and staying there a while. That literally the hole problem with the Championship. Every owner running at a loss on the hope they get there one day and stay there.

Of course there is execution risk in football like no other industry. But it was still sensible, manageable losses and had we needed to, there was loads of value within the squad. Kitson, Shorey, Sidwell, Harper. We could have got a load of cash for them and made a profit, but we chose to have a go at promotion. It worked.

Precisely, no promotion in 2005/06 and we had lower costs and £20m worth of saleable talent in the squad.

There's no way we wouldn't have sold at least a couple of Kits, Sids, Shorey, Doyle, Lita etc and broken even.

[Greatwesternline]

Because it relies on getting into the promised land of the PL. And for many investors they dont have the time commitment to get into the PL. You can't call a football team sustainable if it relies on getting to the PL and staying there a while. That literally the hole problem with the Championship. Every owner running at a loss on the hope they get there one day and stay there.

Of course there is execution risk in football like no other industry. But it was still sensible, manageable losses and had we needed to, there was loads of value within the squad. Kitson, Shorey, Sidwell, Harper. We could have got a load of cash for them and made a profit, but we chose to have a go at promotion. It worked.

Precisely, no promotion in 2005/06 and we had lower costs and £20m worth of saleable talent in the squad.

There's no way we wouldn't have sold at least a couple of Kits, Sids, Shorey, Doyle, Lita etc and broken even.

We had just bought Lita for £1m and everyone was like....ooooh big spenders. People didnt routinely buy championship players for £1m. And we didnt have 20 players of that ilk.

Reading were a club criticised by others for being bank rolled by Madejski, and looking back at it now with today's numbers it looks manageable, but back then, it was unsustainable, but we got away with it because we had a rich local millionaire who didnt mind wasting his money because his business world was still going great. Financial crisis hits in 2008, his business empire went down the swanny cash flow wise, and we would have been a fire sale operation too, we just got away with it because we had been promoted 3 years prior.

Anyway back on topic, people are kidding themselves if they would be happy with the new owner making us sustainable. RFC breaking even requires a massive reduction in fan expectations. RFC breaking even in today's world requires a bottom third championship team. We'd be happy with that now, but not indefinitely.

[Snowflake Royal]

Of course there is execution risk in football like no other industry. But it was still sensible, manageable losses and had we needed to, there was loads of value within the squad. Kitson, Shorey, Sidwell, Harper. We could have got a load of cash for them and made a profit, but we chose to have a go at promotion. It worked.

Precisely, no promotion in 2005/06 and we had lower costs and £20m worth of saleable talent in the squad.

There's no way we wouldn't have sold at least a couple of Kits, Sids, Shorey, Doyle, Lita etc and broken even.

We had just bought Lita for £1m and everyone was like....ooooh big spenders. People didnt routinely buy championship players for £1m. And we didnt have 20 players of that ilk.

Reading were a club criticised by others for being bank rolled by Madejski, and looking back at it now with today's numbers it looks manageable, but back then, it was unsustainable, but we got away with it because we had a rich local millionaire who didnt mind wasting his money because his business world was still going great. Financial crisis hits in 2008, his business empire went down the swanny cash flow wise, and we would have been a fire sale operation too, we just got away with it because we had been promoted 3 years prior.

Anyway back on topic, people are kidding themselves if they would be happy with the new owner making us sustainable. RFC breaking even requires a massive reduction in fan expectations. RFC breaking even in today's world requires a bottom third championship team. We'd be happy with that now, but not indefinitely.

Championship players regularly got bought for more than £1m especially when sold to the PL. We bought Lita when he was early 20s off the back of an excellent L1 season.

You're deluded.

[Clyde1998]

I've done the research to settle it for you both.

From c. 2000 - 2006 it was a story of consistent, modest losses in the £2m - £5m ball park. 2006 would have been a loss even without the promotion bonuses. In our 2 PL seasons we made c. £6.5m p.a., essentially recouping the losses up until then.

In 2009, we made a £12m operating loss offset by £16m net transfer revenue, so £4m profit. Similar story in 2010 with a £2m net profit. We then made a modest £5m loss in 2011 before a big £12m in 2012 due to promotion and AZ's influence.

So basically cost neutral over about a decade.

not at all. with the exception of being in the PL. an almost constant loss. i.e. unsustainable.

Profit / loss
-17 2021-22
-35 2020-21
-41 2019-20
-30 2018-19
-20 2017-18
4 2016-17 Dai wrote off a 9m loan, so the actual club made a 5m loss
-15 2015-16
2 2014-15 Club made 11m profit from selling off land to the Thai owners. So the club lost 7m from football related activities
-7 2013-14
-2 2012-13
-11 2011-12
-5 2010-11
1 2009-10 4m player sales offset a 2m loss
3 2008-09 16m player sales offet 12m loss
6 2007-08 Genuine day to day profit
6 2006-07 Genuine day to day profit
-7 2005-06
-5 2004-05
-2 2003-04
-1.8 2002-03
-3 2001-02
-4 2000-01 made a 4.6m loss on 6.3 revenue. Impressive largesse that season
-0.5 1999-00

2006 and 2012 would both include promotion bonuses, possibly 2002 as well (albeit 2002's would've been much smaller relatively speaking).

Incidentally, our 2022-23 accounts must be very close to appearing on Companies House. They usually go up around this time of year.

[SCIAG]

Our £1m Lita signing was very unusual in being a Championship signing not funded by a larger sale.

Some transfers of top-end Championship players the following summer or shortly after:

Joleon Lescott - £4m
Matthew Kilgallon - £2m
Madjid Bougherra - £2.5m
Claude Davis - £3m
Danny Shittu - £1.6m
Greg Halford - £2.5m
Gary McSheffery - £4m
Seol Ki-Hyeon - £1.5m
David Nugent - £6m (! - hugely overpriced compared to what we got for Kitson/Doyle/Long)
Rob Hulse - £2.2m
Cameron Jerome - £4m

Not including players with recent Premier League experience like Matt Upson, Emile Heskey, Andy Johnson, or Rob Green.

Most of them were sold to the top flight, the rest of them to sides who had themselves made large sales.

If we somehow missed out on promotion without our form suffering, we could probably have got £2m-£3m for Sonko and Shorey, £3m-£4m for Convey, Sidwell, and Kitson, and probably slightly more for Doyle. Let's say we sold Shorey, Sidwell, and Kitson for a total of £10m. We could have made adequate, if not like-for-like, replacements for Shorey and Kitson within the squad (Halls/Golbourne and Long), Then we'd have had £3m to sign a new midfielder to compete with Bryn and a back-up centre back, and still break even.

Fair to say Madejski was bankrolling us until after our relegation, when we started selling senior players. Then Dai took things to a whole other level when he should have been selling players.

Let's be real... if FFP didn't exist we'd still be running into trouble now that Dai's having liquidity issues. He poured far more into the club than was sustainable.

[Lower West]

Dai plainly does not have the money to fund the club on an going basis.

That leaves another option.

3. The club goes into administration. Dai loses control over events. Relegation to L2. New buyers steps in and fund the rebuild of the club. (Bearwood gets sold as part of the adminstration process).

Painfull but all the baggage can be discarded in one fell swoop. Potential buyers aren't going to want to become embroiled in Dai's own problems that in some way are financially connected to the club.

[Snowflake Royal]

Dai plainly does not have the money to fund the club on an going basis.

That leaves another option.

3. The club goes into administration. Dai loses control over events. Relegation to L2. New buyers steps in and fund the rebuild of the club. (Bearwood gets sold as part of the adminstration process).

Painfull but all the baggage can be discarded in one fell swoop. Potential buyers aren't going to want to become embroiled in Dai's own problems that in some way are financially connected to the club.

There has to be enough debt owed to people other than Dai for that to be an option. And most of the debt is owed to Dai.

[Lower West]

Dai plainly does not have the money to fund the club on an going basis.

That leaves another option.

3. The club goes into administration. Dai loses control over events. Relegation to L2. New buyers steps in and fund the rebuild of the club. (Bearwood gets sold as part of the adminstration process).

Painfull but all the baggage can be discarded in one fell swoop. Potential buyers aren't going to want to become embroiled in Dai's own problems that in some way are financially connected to the club.

There has to be enough debt owed to people other than Dai for that to be an option. And most of the debt is owed to Dai.

There's no way of knowing how Dai funded the venture. Dai's business affairs outside of China all lead back to the non disclosure world of the Cayman Islands. Bearwood was built with borrowed money. Be surprising if RFC wasn't in some way funded by debt. Secured by Chinese assets such as his quoted shareholding in the (now long suspended ) China Dili Group.

[yuomi]

Likely, given how Kia has been known to operate, that Dai was the face for a group of owners/investors - and, disturbingly, the one they thought most likely to pass the fit and proper test. We've never properly got rid of the Thais, who Kia was also responsible for - being very close to Thaksin and Pairoj when they were at Man City. The toxic root at the acceleration of our decline is Joorabchian.

[Snowflake Royal]

Dai plainly does not have the money to fund the club on an going basis.

That leaves another option.

3. The club goes into administration. Dai loses control over events. Relegation to L2. New buyers steps in and fund the rebuild of the club. (Bearwood gets sold as part of the adminstration process).

Painfull but all the baggage can be discarded in one fell swoop. Potential buyers aren't going to want to become embroiled in Dai's own problems that in some way are financially connected to the club.

There has to be enough debt owed to people other than Dai for that to be an option. And most of the debt is owed to Dai.

There's no way of knowing how Dai funded the venture. Dai's business affairs outside of China all lead back to the non disclosure world of the Cayman Islands. Bearwood was built with borrowed money. Be surprising if RFC wasn't in some way funded by debt. Secured by Chinese assets such as his quoted shareholding in the (now long suspended ) China Dili Group.

It'd have to be debt openly owed to them, not through shadows via Dai.