A debt-free fresh start for Latics?

Posted by JJ (Tony) in Reflections and tagged with , , , ,

Why did Au Yeung Wai Kay waive his rights to the £25.3m “loan”?

We may never know the real reason but there is no shortage of opinions from Latics fans on the social media, with conspiracy theories abounding. But whatever the reason it is great news for the survival of the club.

There remains a £6m debt to be paid off to football creditors and another £4m to non-football creditors. To avoid a 15-point deduction for the coming season Latics need to pay the football creditors in full and pay 25% of the other £4m.

When the change of ownership is completed the administrators will need to be paid off and a figure around £2m could be needed.

There has been consternation among some fans regarding the fire sale that we have seen in recent weeks. Three outstanding youth players were sold off, ifollowed by regular first team starters Kieffer Moore, David Marshall, Antonee Robinson and Joe Williams. Sheffield Wednesday’s purchase of Joss Windass was no surprise, given that he had been on loan there. However, although those players have been released for sums well below their normal market values, the combined revenues will go a long way towards paying off the creditors.

The fire sale may well continue until the ownership issue is resolved. With the debt much reduced than it was a couple of weeks ago the club is now a more attractive package for purchase. However, although five major earners have departed there will need to be more shed if the wage bill is to be commensurate with the division Latics find themselves in.

There have been rumours of other clubs interested in Cedric Kipre and Jamal Lowe. However, it remains to be seen whether the administrators would sell them off in the current buyers’ market or if they would allow the future owners to make such a decision. If a new owner were to come in and continue to fund the wage bill in the short-term it would allow them more time to get better fees for assets yet to be sold off. The administrators have needed ready cash to pay off the club’s debts, rather than following the usual route of transfer fees being received in instalments. Selling any further player contracts by means of instalments would surely provide a higher return and money coming in during the future.

Once the ownership issue is dealt with Latics can expect revenue coming in from the EFL and instalment payments due to them from previous player sales.

It remains to be seen what Latics and other clubs will do about season tickets and televising of matches. Reports suggest that fans will be welcomed back in October but with stadium capacity reduced to 25%.  The capacity of the DW Stadium is listed at 25,138 meaning they would be allowed to accommodate just less than 6,300, a figure close to the number of season tickets they have sold in recent years. However, the new rules are unlikely to include away supporters who pay at a higher rate per game than season ticket owners. Revenues will be relatively small, but at least there will be some money coming into the club.

The UK economy is in recession and football clubs, like other businesses, will be under pressure. More football clubs will most likely go into liquidation over the coming months.

The Swiss Ramble figures for 2018-19 show Wigan Athletic with a lower gross debt – £21m – than most Championship clubs, being dwarfed by the £142m of Blackburn Rovers. Given the recent actions of the administrators that debt is being reduced.

Some clubs are under benevolent ownership, as were Wigan Athletic to a large degree under Dave Whelan. Other clubs have owners willing to allow a club to go into considerable debt in search of a potential Premier League pay off. It is a dangerous path that is being followed by so many clubs.

During the coming week we most likely learn that Wigan Athletic have new owners. Whoever it is they will be taking over a club that has lower debts than many. Following the rocky period that the club has been through in recent months there is a need for stability and a long-term plan sustainability. Let us hope the new owners will be able to provide those things.

 

Why relegation to League 1 might not be such a bad thing for Wigan Athletic

Posted by JJ (Tony) in Specials and tagged with , ,

Wigan Athletic’s wage bill in the 2018-19 season amounted to some £19.4m. The club’s revenue was £11.5m. The figures for the 2019-20 season recently completed are likely to be even more stark, given the impact of the Covid-19 pandemic on football revenues.

Were Ian Lenagan and his associates to take over Wigan Athletic we could expect a wage budget somewhere between 10-15% of what was paid last season. Lenegan would run the club within its means, in a stark contrast to what has happened over the recent years.

Stats courtesy of The Swiss Ramble

The Rugby Union’s Premiership has a salary cap of £7m per club whereas that of rugby league’s Super League is of £2.1m.

Clubs in the EFL are about to vote on salary caps for their three divisions. A cap of £2.5m is proposed for clubs in League 1, with £1.25m for League 2 clubs. The figure being quoted for the Championship is £18m.

The caps for the lower two divisions might well be accepted by the majority of the clubs involved, although a club like Sunderland, desperate to get out of League 1 and with a wage budget over £10m might not be happy about it.

Were Latics to continue with even a handful of players who regularly appeared last season and remain under contract there would be no way of staying within that £2.5m figure. We can therefore expect almost all of the current senior squad players to depart. Many of those players will already be considering their next move. It is typical to have relegation clauses in contracts which lower player salaries in the event. However, on the flip side players can have clauses inserted which give a maximum price for a transfer. Reports suggest that Antonee Robinson can leave for £1.5-£2m due to such a clause, whereas he was due to move to Milan in January for some £6m.

Existing players’ wages would be regarded as the divisional average as far as the salary cap is concerned. The average League 1 salary is around £1,800 per week. Latics could therefore keep some of their higher paid players without breaking the salary cap, although the big fall in revenues involved in dropping down a tier makes it unlikely that such luxuries be afforded. The last time Wigan were in League 1 they spent £11.7m on salaries in a bid to get out of the division. They made a loss of over £9m over that 2017-18 season as a result.

For the moment the administrators must bring in as much cash as possible through player sales. Transfer fees are typically paid in instalments, but Latics currently need cash upfront in order to pay salaries and repay their football debts of £6m. If salaries are not paid the club runs the risk of losing players without receiving transfer fees through not fulfilling contractual obligations. Given the situation we can expect players to be sold for fees well below market value or even released for free.

A period of austerity is coming for all clubs in the lower divisions. For Latics the situation is exacerbated by the extraordinary actions of the previous owners. In the long-term it is going to be of paramount importance that the academy is funded as it has been previously. The salary cap proposals exempt players under the age of 21 from the calculations.

The short-term picture for Wigan Athletic is grim as they struggle against the impact of the actions of the previous owners and the pandemic. The first step will be for new owners to take over and steer the club through a difficult 2020-21 season. Avoiding relegation to League 2 would be an achievement.

However, in the long-run the prospect of a club living within its means, producing home grown talent, is to be welcomed in terms of stability. Given the excellence of the academy it is to be hoped that new owners would not only continue to support it financially, but also employ a manager willing to give young players opportunities to a degree that we have rarely seen in recent years.

Building up a solid base in the lower levels of the EFL  over a period of years is essential to the survival of the club. It could well prove a blessing in disguise that the appeal against the 12 point penalty did not succeed. Another season in the financial lunacy of the Championship would not have been easy. But who knows – maybe in time even the Championship clubs will come to the agreement that things cannot continue as they have over these years.

 

 

 

Our thoughts, and those from social media, after another tough day for Wigan Athletic

Posted by JJ (Tony) in Specials and tagged with ,

Supporting Wigan Athletic has been such a rollercoaster ride. The highs have been marvellous: the lows have tested the resilience in us all.

Until the closing matches of the restarted season I had resigned myself to not worrying about what division Latics would be in next season. My main concern was for the survival of the club.

But I got hooked by the wonderful reaction of Paul Cook’s squad. Despite not having received their normal pay for months they played so well, making a wonderful effort to nullify that horrible 12-point penalty. Not having the fortune to get that second goal against Fulham was heart-breaking for players and fans alike.

Today’s decision by an appeal court regarding the 12-point deduction rubbed salt into the open wound.

Like many fans of “smaller” clubs I have become disillusioned with the way football in England has been going. Put simply, the rich are getting richer and the poor are getting poorer. There was always a “feeling” in the Premier League days that they really didn’t want a club like Wigan mingling with the elite and bloated. Since Latics have returned to the jurisdiction of the EFL that feeling has never gone away. Feelings are what they are: hard to substantiate, but one remains sceptical about the people in power in English, and indeed world, football.

Sometimes the heart can speak more loudly than the mind. The bottom line is that Latics still exist and long may that continue. It is heart-breaking to see staff laid off and players being sold for meagre prices, but other clubs have been through administration and come out of it stronger.

Paul Cook has gone and we can expect almost all of the senior squad to be on their way. The wage bill over summer must be drastically reduced so some players who would normally command a significant transfer fee will be freed from their contracts to get them off the wage bill.

Let’s take a brief look at how fans reacted to today’s news through the message boards and social media.

Our thanks go to the Cockney Latic Forum, the Vital Wigan – Latics Speyk Forum and Twitter for providing the media for the posts below to happen. Thanks go to all whose contributions are identified below.

Th10 on the Latics Speyk Forum commented:

It’s what we all expected, an absolute joke.

I really fear for the future of the club now. Only a few weeks till the start of the new season. We don’t have owners or a manager and won’t have many players left. What will the EFL do next when we’re not in a position to start the season? They’re going to destroy the club.

FrancosLoveChild on the Latics Speyk Forum said:

I wont stop loving Wigan, but I have fallen out with the sport, football was/is a big part of me, but as the years go on, you see how the sport is becoming more and more about keeping the big clubs happy for revenue than the integrity of the sport.

Cupwinners on the Cockney LaticForum said

I’m afraid this could be the final nail in the coffin for Wigan Athletic.

We need to find a new owner yesterday with mega deep bottomless pockets. We have no money, no crowd, no match day money, no manager, players leaving daily, TV funding slashed, players fire saled and clauses to allow them to leave cheap or free. Players been sold for nothing.

A new owner? J—s !! , as a business you would have to have your head seeing to take us on. I fear for our future truly fear. We need someone in asap or we will for sure be the new Bury.

Zeb2 on the Latics Speyk Forum said:

I don’t hate the DW/JJB but it will never feel the same to me as Springfield Park did.

All your childhood/teenage experiences are more intensely felt and burned into your memory than what comes afterwards.

The prospect of returning to L1 or L2 if we were at Springfield wouldn’t faze me one bit but is far more concern8ng rattling round a largely soulless stadium …..though to be absolutely fair we have had some cracking matches/atmospheres there as well, it’s just that you generally need 15k plus to generate that at the DW.

Of course we deserve a club, absolutely, it’s just profoundly more difficult for us as a 40 odd year ’League club’ to be located in this area which is a cauldron of English football.

It isn’t the Rugby that’s a problem for me it’s the born and bred Wiganers strutting around in their Utd/Liverpool/Everton/etc shirts (most of whom have never been)….I know Wiganers who are season ticket holders at Bolton, Burnley (fkn Burnley ?) and Blackpool , what’s that about ?

Clubs like Burnley, Stoke, Norwich, even Leicester enjoy the distinct advantage of being substantial towns/cities that are slap bang in the centre of “nowhereinparticularshire” ….draw a 20 mile radius round their grounds and who are they competing with ?….maybe one rival of a similar or bigger size or more likely none at all. Draw a 20 mile radius round Wigan and ….well !

Ideally we should be in a 12/15,000 stadium but we Can’t make that happen unfortunately.

Lets get past this current crisis and press on from there ….Onwards (but maybe not upwards for a bit just yet !)

 

Five talking points following a tired-looking performance at Charlton

Posted by JJ (Tony) in Match reactions and tagged with , , , , , ,

Charlton Athletic 2 Wigan Athletic 2

The fight shown by Wigan Athletic’s players since the announcement that the club was going into administration has made the fans proud. They showed the same kind of fighting spirit yesterday at The Valley, but their legs were getting heavier and heavier as the second half wore on. It looked a matter of time before Charlton would eventually get the equaliser. It was to come in stoppage time.

After the game Paul Cook commented: “They’ve probably put more crosses into our box than any team we’ve played against for a long, long time, they kept asking the question. You can break down their equalising goal certainly, and we’re massively disappointed a striker can find himself in 10 yards of space in the penalty areas in the 92nd minute. We had three centre-halves on the pitch, they had two strikers, so that’s not right. But while we want to be self-critical, these players have been absolutely magnificent for our football club, that’s the brutal reality of the situation.”

Let’s look at some points arising:

It was another of those disappointing six pointer performances

Latics have been a revelation since February, moving from the relegation zone to what is a mid-table position until the 12 points are deducted. Much of the improvement has been down to relying less on the long-ball and building moves up from the back. Moreover, the whole team has played its role in developing a more solid defence, every player contributing to the improvement.

Since Paul Cook arrived Latics have not coped well with the “six pointer” games. Despite their dominance in League 1 they did not always impress against other teams in the promotion zone. Their record against clubs near the bottom of the Championship table has been mediocre. The win against Hull in midweek was welcome: it was a stunning performance and scoreline.  But the defeat at Luton and the insipid goalless draw with them at the DW together with two draws against a poor Barnsley side were certainly underwhelming.

What a pity the ghost of the 6 pointers could not have been laid to rest today at The Valley.

Would relegation to League 1 be so tragic?

Whether Latics stay in the Championship depends on results in the final games on Wednesday. It is by no means unlikely that Wigan Athletic will beat Fulham, but even if they did, they could still go down if other results do not go their way. But is it so crucial that Wigan stay in the second tier?

The bottom line for us too at Amigos is that we want the club to survive, whether it be in the second tier or the third next season. Despite the positive spin taken by much of the media regarding new owners coming in there remains a worrying possibility that the club will become defunct. There is validity in the comments made by several fans who ask who would want to take over a club with a wage bill that is more than 160% of its revenue and has made an operating loss in four of the last five years.

Should new owners be found could we expect them to pump in some £1m a month to keep the team competitive in the Championship? There clearly must be a rethink about matching expenditure with revenue.

Player salaries in League 1 are dwarfed by those in the Championship. To survive financially long-term, the club would be better placed in the third tier than the second. Granted, there is a difference of some £4m in broadcasting revenue for clubs in the Championship and League 1. Moreover, a potential owner would more likely be tempted to buy a club in the second tier rather than the third.

Were Latics to stay in the Championship for another season the outlook with a much-trimmed squad on a lower wage bill would be bleak. But the revenues for player sales would be higher.

What a blow for Rioch and the Academy

Perhaps the most welcoming sign for the future during the IEC reign was that they (through the chairman) had a plan to develop homegrown talent as a means for the club to be sustainable. Investments were made to improve academy facilities, leading to a welcome rise to Category 2 status.

For Latics to have young players making the youth teams of England, Scotland and Wales has been an indication of the progress made by Gregor Rioch and his staff. Reports of the 17-year-old Jude Bellingham about to be sold by Birmingham City for £40m are not far-fetched. But while Bellingham has made 31 starts and 9 substitute appearance in the Championship this season Wigan’s Joe Gelhardt has made just 2 starts and 15 as a substitute.

The impending departure of Jensen Weir to Brighton for £500,000 is a bitter pill to swallow. Weir was captain of the Scotland U16 team prior to switching to England at U17 and U18 levels. Although the funds to be received will be important in keeping the club afloat for the moment it is sad to see him go at such a low fee, although it is reported there will be add-ons involved. The transfer value was very much affected by the club’s financial situation, although the player had just one brief Championship appearance as a substitute.

It appears that 15-year-old prodigy Alfie Devine will be going to Tottenham, possibly Gelhardt too.

Given the wealth of young talent that has been coming through it is of paramount importance for the future of the club that Rioch and his key staff are retained despite the swingeing budget cuts that will be coming. The departure of likes of Weir, Gelhardt and Devine will hardly help their morale.

Is Paul Cook on his way out?

Reports of other Championship clubs’ interest in Paul Cook are certainly credible. Although his time at Wigan has been a rollercoaster ride his CV is looking impressive. On top of a wealth of experience in the lower divisions he kept Latics in the Championship on a relatively low budget. Only the 12-point deduction will prevent them from finishing in mid-table this season.

Should Cook stay next season he would almost certainly be facing an uphill task. Most of the players he has closely nurtured will most likely be gone over the summer. Put simply, Cook’s future career prospects would most likely be better served by a move to a bigger club, rather than stay and start a large rebuilding project.

Can Latics raise their game for Wednesday’s clash with Fulham?

Although history might suggest otherwise it is by no means unlikely that Wigan Athletic will beat Fulham on Wednesday. With victories over the top two teams in the table they have shown that they can raise their game against strong opposition.

Stats courtesy of WhoScored.com

 

Ready for Brentford? The challenge for Paul Cook and his squad

Posted by JJ (Tony) in Other and tagged with , ,

What a tempestuous week it has been.

A wonderful performance by the Latics team in blowing away Stoke City raised our hopes of at least a mid-table finish, with lots of optimism for the coming season. Then it was all turned upside down by that stunning announcement of the club going into administration. The Wigan Athletic community is still reeling from that news.

Brentford away is hardly the fixture that one would choose following the turbulence of the last three days. They outplayed Latics at the DW Stadium in November to the tune of a resounding 3-0 scoreline. They have won their last four games and still have a chance of automatic promotion.

Latics were on the crest of a wave following the Stoke game on Tuesday evening. Hopes were high that they could go to west London and give the Bees a run for their money. But now we learn that the players, who had deferred 30% of their salaries in the lockdown period, will only receive a fraction of their salaries today. Paul Cook must somehow lift his players to concentrate on the here and now, despite the uncertain futures at the club that they all now face.

Sam Morsy’s rallying call was admirable and we can only hope that captain, manager and coaches can maintain morale in this difficult hour.

The news and social media have been awash with stories about what has happened to the club.

The EFL’s prompt notification that there will be an automatic 12-point deduction did not go down well with Latics fans. Questions abound how their “Fit and Proper Persons” criteria allowed a shady change of ownership leading to administration within a month of Next Leader Fund taking ownership.

The reasons for NLF opting for administration remain unknown although there is no shortage of conspiracy theories being put forward.

Fans have been putting forward their views on the social media and message boards. Some fear for the very existence of the club. Others are concerned that the points deduction will lead the club back to League 1, although there are optimists who believe the team can gather some 13-14 points from the last 6 games to avoid that happening.

In the meantime, Latics must find the funding to help them complete the season, by no means an easy matter with no money coming into the club from the owners and minimal revenues available from playing behind closed doors.

Should the club manage its way to complete its fixtures and somehow gather enough points to avoid relegation it would be a big step forward. A Championship club is more attractive to a prospective buyer than one in League 1. Moreover, the broadcasting revenues and larger away supporter attendances make it financially more viable, even if the club were going to run on a shoestring budget for a period.

My concern is that the very survival of the club is at stake. After following them to places like Congleton, Winsford and Oswestry I can deal with the likes of Rochdale and Oldham should the club manage to get through this sticky period.

It is a stressful and difficult time for us all who care so much for our club. The game at Brentford tomorrow pales in comparison with the mountain the club must climb to stay in operation. However, a win could really lift our spirits and give us a little more hope for what lies ahead.