AGM

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Joined: April 18th, 2014, 12:12 am

February 26th, 2017, 7:34 pm #21

From page 3 of Annual Report and Accounts:

"TWENTY TWENTY in 2020

....we are supportive of the new initiative....please remain open-minded about the proposed new competition."

In view of the last clause quoted, the Club might at least pretend to be 'open-minded' itself!!

We're invited to join in the debate at the AGM. Not much point when the Club has already signalled its position!
From page 3 of Annual Report and Accounts:

"TWENTY TWENTY in 2020

....we are supportive of the new initiative....please remain open-minded about the proposed new competition."


No doubt the board will go down the blackmail route if members are remotely against the new Twenty20 tournament. Yorkshire members should have the right to vote for or against the new Twenty20 proposals.

Members should have every right to voice their concerns about the new Twenty20 competition as the proposals only marginalise County Cricket. Already the County Championship is reduced by 2 matches, which was designed to ease fixture congestion and pace bowlers workloads but the schedule looks as congested as ever. Next the 50 over competition is being devalued as the best players are either on England duty or playing in the flagship T20 tournament.

At the end of the day, we are Yorkshire COUNTY CRICKET Club and not a feeder club of the ECB.
No Pyrah, no party
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Joined: April 2nd, 2009, 12:57 pm

February 26th, 2017, 8:18 pm #22

But the risk is carried by those who lend, rather than by those who borrow. If the borrower can no longer service the debt, then the lender has to decide whether or not to foreclose. If he decides to do so, he then owns a cricket ground, and presumably, will look to put it to use.

It seems to me that YCCC would no longer own the ground, but would look to rent it from The Graves Family Trust, as opposed to doing so from Caddick, as it did in the past. And, of course, The Graves Family Trust would own a city-based international cricket venue outright.

Um!
Well my suspicion is that at some point the debt will be reduced or written off altogether.
Colin Graves is no idiot. This wasnt a commercial agreement - i think he knows that the club will never be able to repay £25m.
I wonder what it says in Colin's will.....
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Joined: November 6th, 2013, 9:50 am

February 26th, 2017, 10:23 pm #23

The question was raised rather delicately some years ago at an AGM. Mr. Graves replied that this eventuality was covered. In any case, the debt has been transferred subsequently to a Graves family trust to avoid a conflict of interest, so there should be no cause for concern on this account.
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Joined: March 7th, 2014, 11:28 am

February 27th, 2017, 10:48 am #24

Yes, we have had a discussion on this before. Whatever our views about Graves, if he wanted to maximise his return on the money he wouldn't be lending it to the club - he would be investing in the stock market or buying property. I think Graves wanted the club to stand on its own two feet, but when push comes to shove I cant seem him allowing the club to go under.
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Joined: September 3rd, 2014, 1:34 pm

February 28th, 2017, 5:12 pm #25

A couple of points.

First, From Reading The Annual Report:

The Club continues to be well-managed financially. A balanced reading of the three key financial statements -- Balance Sheet, Income and Expenditure Account, and Cash Flow Statement -- entirely justifies the opening line with which the Director of Finance opens his report: "Financially 2016 has continued to show a steady improvement over previous years."

The good points:
1) EBITDA was over £ 1 million -- probably for the first time ever.
2) The capital write-off and interest deals with Leeds City Council and HSBC last year put us in a much better structural position for debt service.
3) The bank's willingness to hold £ 3 million of our debt, at 2.5%, with capital repayment deferred until Oct 2018 indicates their confidence in the club's finances. Unless things change radically, it probably also indicates their willingness to roll that debt over after Oct 2018 - this does not represent a 'cliff edge' that we face at that time. If they won't, a competitor bank almost certainly will.

4) Not strictly a financial matter, but one other good point is the way that Domestic ticket sales are now a much more important part of our revenues than they were four years ago. These have increased steadily and significantly from £442,000 to £1 million. In the same period, international ticket sales have increased only a little -- from £2.2 million to £2.4 million. In other words, a few years ago Test match revenues were FIVE TIMES more important than Yorkshire's own games -- but now they are just two and a bit times more important. If you add Members' subs -- you and me, and all the members who value YCCC way ahead of the national team -- that is now another £ 3/4 million that can be put in the 'Domestic' column. The Tests are still crucial to our financial stability, but these things have gone in the right direction from our point of view, not the wrong direction.

The bad points:
1) Cash flow was negative over the full year 2016. There are specific reasons for this, and it is well within bounds of normal prudent cash management. Still, it's nicer to end a year with cash at the bank than with an overdraft.
2) The number of non-playing full time staff increased by four over the year. Salaries and associated costs (NI & pension contributions) are the majority of YCCC's costs. If we were just two or three salaries lighter it would make a big difference to the bottom line. The CEO and CFO need to focus on this, and not to let non-playing staff numbers creep up just because there is a bit of financial leeway.
3) Our commercial income (sponsorships etc.) has not increased
4) We depend heavily on ECB money, to the tune of £ 2.6 million last year, which has increased substantially since 2013.


Second, A Note On The Graves Trust Position:

Not quite true that "if (Mr Graves) wanted to maximise his return ... he wouldn't be lending it to the club", as Martin suggests above. The Graves family BOTH makes money out of the club AND has leverage over the future ownership.

Of note is that £13.4 million of the Graves loan pays interest of 4.625%. That is a cash income of £619,000 per year. A further £5.5 million Graves loan is interest free. So the weighted average interest on the Graves' loans is just over 3.25 percent. That is a very decent return in today's interest rate environment, for a loan that is fully-secured (by the legal charge over the ground, which it shares with HSBC). I expect (but do not know) that the Graves Family Trust has other assets -- property, stocks and shares, perhaps other commercial bonds. A commercial bond like this, secured and paying an acceptable interest rate, probably makes up part of a good balanced portfolio. It is not charity, and while Mr Graves is and has been an important benefactor of the Club, we should note that this is now on a commercial basis.

The term of the loan -- capital repayment of the £13.4 million envisaged by end 2020 (the Accounts are silent on repayment for the zero-interest loan) -- seems to imply only one of three options. A) The loan is renewed in 2019 and 2020. Perfectly possible, as long as the interest rates remains acceptable (see above) which will depend on conditions at the time. B) Someone else provides an equivalent loan, or grant to pay it off. C) The Graves Family Trust converts its debt to equity, buying out the Members' ownership of the Club and receiving a future stream of (uncertain or zero) dividends instead of the £600,000 interest. Buying out Members would be pretty damn easy as there is a 'Capital Redemption Reserve' which can easily cover the nominal value of 5 penny shares for each of the 4,000+ members. in order for our shares to have more value than that, we would have to vote to sell Headingley. Pretty unlikely.


Accountants on the Forum may be able to add to my perspective or to correct errors and oversights. I'd be pleased to see such corrections. I am not an accountant, just a careful reader of the information the Club provides, concerned to keep an eye on the long-term health of YCCC and the county championship.
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Joined: October 22nd, 2013, 1:13 pm

March 1st, 2017, 9:31 am #26

Article in the Yorkshire Post:http://www.yorkshirepost.co.uk/sport/cr ... -1-8414672

I'm sure this is deliberately downbeat to try to stir up the Powers That Be to sort out the funding for the new stand, but still alarming.
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Joined: August 14th, 2007, 12:51 pm

March 1st, 2017, 12:47 pm #27

If, as reported, delays in the building of the new stand means Headingley may not host one of the eight 'franchise' teams, then my grief would be extremely restrained!
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Joined: March 7th, 2014, 11:28 am

March 1st, 2017, 12:58 pm #28

I just hope that the club have moved away from seeing Leeds City Council as the key to unlocking the new stand. The planning arrangement on the table was always a bit of a flight of fancy (and the delays weren't really anything out of the ordinary for schemes such as these), and I cannot see the Council dipping into Council Tax Payers pockets again. Funding will have to be found in another way. Easier said than done we know!
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Joined: January 13th, 2015, 7:59 pm

March 1st, 2017, 2:41 pm #29

I was a little confused by the YP article.
Do "we" want Leeds Council to approve the building plans, so that we can finance the New Stand ourselves?
Or do "we" want Leeds Council to come up with some money for us as well?
As it happens, I'm not minded to sway from my long held position.
1. It's all fundamentally mad. We are told - YCCC need to pay for a New Stand so that supporters of two other cricket teams (England & New T20 Franchise) can sit in it.
2. No mate, THEY need to pay for it (is my view).
3. I subscribe to cock up (not conspiracy). When the ECB implored Counties to upgrade Test Match Ground facilities & capacities, they never for one moment intended to drive Counties like Durham & YCCC into unsustainable debt. But, that has been an unfortunate & (go on then, I'll help them out) unforeseen consequence.
4. That needs to be said to the ECB. (They can have my words for free). And, a way needs to be found that does not drive Counties into debt or Sugar Daddies.
5. The cycle of Blackmail - take on debt to upgrade, or this other team won't play at your ground - needs to end.
6. It cannot be endless - upgrade for the next World Cup, upgrade for the next Ashes, upgrade for new Franchise T20.
7. If the ECB won't call a halt - I'm happy for YCCC to do so.

You can't vote for my proposals at the AGM.
You can't vote for me at the AGM.
You can, however, vote for more of the same.
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Joined: October 20th, 2013, 8:03 pm

March 1st, 2017, 2:59 pm #30

Phil, I agree with so much of that. However...

It's not YCCC's games, but those of the two visitors, England and the t20 circus, that will make the club any big money. So we have to do whatever it takes to get them in the ground.

Superficially at least, I was very attracted to the opposite approach, a scaled down set-up which aimed to cater for county cricket in all its forms and no more. Not every club without international cricket is facing financial crisis. However, we have embarked on the development+debt policy instead, and I'm not sure now there's much alternative to gritting our teeth and keeping going. God and Graves (if they aren't the same bloke) help us.
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