Carlisle United Football Club is dying
CUFC is dying. The Polyannas have no evidence whatsoever for their attitude. There is conclusive evidence for the accuracy of the attitude of the Private Frazers.
Let's examine a positive point, the incoming transfer fees and add-ons. In the absense of the plain truth about such money both the supporters and the more crass media exaggerate these amounts of money. In a few years the truth will emerge, or if you are exceptionally good at reading accounts you may be able to piece together a credible estimate. The figures will not be simply stated in the accounts.
Even when the club is being run in a necessarily parsimonious manner it makes trading losses in excess of £500,000 per accounting year. So, the transfer fee money is being used to keep the club alive. It is not available for any other purpose except doing the bare minimum to keep the ground up to basic EFL / local authority / fire brigade rules and laws. Of course there is no guarantee of long term transfer fee income nor even that all the add-on clauses for past transfers will be triggered.
The accounts are always filed at Companies House 9 months after the end of the period that they cover. In fact the latest accounts were allowed to be filed a year after the end of the period that they cover, for reasons of Covid. In these accounts the debt at the time to EWM, now Purepay, was £2.25 million. When this went from £2.15 million to £2.25 million this was not as a result of EWM giving the club £100,000. It was interest charged on the debt.
Who can read Philip Day's mind? Of course nobody can, but it is widely known that he has no interest in football. Contrary to belief the discussions that occurred in the Spring of last year did not feature the slightest hint that Philip Day / EWM wanted to own the club. Holdings holds 93% of 1921 shares. The talks were merely a crass attempt by the Holdings shareholders to get approval to convert their 1921 B shares to A shares. Given that CUOSC do not own any B shares the result of such conversion would be that the CUOSC shareholding in 1921 would fall below the 25% level, which everyone knows would be very significant. CUOSC opposed this conversion and thus it did not occur.
So in summary the transfer fee money is being used to counter the routine annual losses of more than £500,000. Such money will not last for ever. The debt to EWM, now Purepay, was £2.25 million as at the end of June 2020 and it is subjected to ongoing interest. There is a not negligible debt to Pioneer. The club has no means to trim any of these debts and clearly at least the Purepay one will increase with interest. Purepay have a Charge on every club asset including money in bank accounts and incoming money. Purepay also have Personal Guarantees from Jenkins, Nixon and Pattison for the full amount.
No prospective new owner is going to pay the probable nearly £3 million of debt and also find money for the desperately needed new ground. That amount of debt represents total failure by the Holdings board and nobody is going to be daft enough to pay for their folly. PD is the sort of man who will want his money back. He is not known to be a pleasant chap and there is evidence that he has utter contempt for Jenkins, Nixon and Pattison. He has them comprehensively strapped in and that adds to the negative prospects. Amongst supporters there is a mistaken belief that Jenkins, Nixon and Pattison are clinging on to their Holdings board shares and directorships. They own 93% of something that has a significantly negative value (1921) which is getting worse at an alarming rate. The truth is that they are desperate to leave but they are prisoners of PD. No substantial Cumbrian company will provide revenue in terms of sponsorship, advertising or free goods / services whilst the current Holdings shareholders /directors are in place.
CUFC is dying.
