Franchise finance - year ended April 2011

It's that time of year again, when we see how the Franchise experiment is doing on the financial front. The accounts for the year ended April 2011 are available at Companies House and they make for predictable reading. So, let's not beat around the bush, headline statistics:

Turnover - £5.63m, down from £6.26m in 2010

Operating loss - £1.98m, up from £1.44m in 2010

Loss for the year (after player sales) - £1.69m, up from £0.94m in 2010

Creditors amounts due within one year - £11.04m, up from £10.04m in 2010

Shareholders' deficit - £9.70m, up from £8.01m in 2010

Now, one can do an awful lot of analysis on the figures, plus work in the relevance of the numbers for the parent property company (Inter MK), but the simple message is clear - Franchise continues to trade at a yearly operating loss of £2m per year. Those losses have to be covered by player sales or outside 'investment' from the parent company. There is absolutely no indication that the football club itself has made any progress at all in becoming financially viable. 10 years on from permission to move to MK being granted, Franchise trades at a huge loss, has accrued large debt and, without the guarantee of funds from the parent company through a bank loan, would be insolvent. These are the cold, hard facts of the matter and no amount of dressing them up will change them.

Why haven't they gone bust yet?

Franchise has become, out of necessity, a selling club. Ironically, if they want to stay alive they will have to do exactly what Wimbledon did to balance the books - nurture young talent and flog it off at a big profit. After the 2010-11 financial year closed, Franchise sold a striker to West Ham for an undisclosed fee thought to be over £2m and a 14-year-old youth player went to Liverpool for a fee suggested to be more than £1m. Those sales will register in the 2011-12 accounts, but virtually none of those funds was re-used in buying players, and for a very good reason. Amongst the notes accompanying the accounts is an updated explanation of why the accountants consider the club to still be a 'going concern' and not insolvent. The note reads thus:

"The Inter MK Group Limited ("the Group") is currently undertaking a significant development project of the plot of land known as "Site A", having completed the sale of the site in November 2011 to Crown Estates. Under the terms of the agreement, the Group will develop a new retail scheme and will be required to complete further works on the stadium site including adding a further 8,000 seats."

"The Group is financed by bank debt, including a £5m term loan which is due for repayment in July 2012. The prevailing market conditions delayed the completion of the above transaction by several months and as a result, the timing of the release of funds from the development of Site A are also delayed. The Group are currently in discussions with its existing bank lenders to renegotiate/extend the period over which the £5m term loan is due for repayment. The absence of a formalised agreement to reschedule the Group's borrowings represents a material uncertainty when considering the Group as a going concern, however based on current discussions with the banks, the directors are confident on concluding a new agreement with the banks prior to the term loan becoming repayable in July."

"Taking account of all of the above, the directors have prepared a forecast through to 30 June 2013 with the Group continuing as a going concern having successfully renegotiated the bank borrowings. Accordingly, the directors continue to adopt the going concern basis of preparation."

Heavy going, I know, but worth quoting because it demonstrates just how precarious a position not only the football club is in, but the parent company as well.

This also explains where the money from the two transfers is going - to pay off the bank loan.

Presuming Inter MK was able to restructure the bank loan (again! It already did that once at the back end of 2010), it keeps the football club going, but, as before, that is only on the basis that Inter MK continues to cover the huge losses the club is continuing to incur.

One thing to keep an eye on though is that the bank loan is with Clydesdale and only today we have this news:

http://www.bbc.co.uk/news/business-17890721 

Will the Clydesdale's retrenchment further affect Inter MK and thereby Franchise? Have to wait and see on that one, but I can't imagine they are keen to loan yet more money to a struggling football club that shows no signs of being able to balance its books except by selling off 14-year-olds!

There's more analysis to be done here and I'll return to the subject soon, but the bottom line for Franchise FC is as stark as ever - the numbers say the football club is still losing huge amounts of money. I don't think most Franchise customers realise just quite how much trouble the club is in and that it's currently surviving by the skin of its teeth. All it's going to take is one big financial hit and Winkelman simply won't have the resources to maintain a loss-making football club. It's at this point we should be hoping Winkelman HAS fallen in love with football and the club, because that way he might go down with it. There are only so many "Sites" on the land for him to sell off and only a fool would keep throwing that money into a failing football club, right?

Not very Bright

We are little more than four weeks away from the tenth anniversary of the FA Commission verdict that killed off Wimbledon FC, and the BBC's Late Kick Off show has provided yet another reminder of why Franchise FC should mark the anniversary by dropping Wimbledon's nickname from its team name. Speaking about Barnet's forthcoming fixture with Wimbledon, presenter Mark 'NV' Bright twice refers to 'MK Dons' instead of Wimbledon, even after being corrected by his co-host. (http://www.bbc.co.uk/iplayer/episode/b01glssc/Late_Kick_Off_London_and_the_South_East_2012_Episode_13/) Presuming it wasn't a deliberate wind-up - which really would have been stupid for a professional broadcaster - it demonstrates the continuing problems caused by Franchise FC using Wimbledon's nicked-name.

In this instance, I dare say the less smart among the Franchise customers are revelling in 'NV' Bright's mistake, but just as often the mistake gets made in the opposite direction and has them up in arms about it. The answer is simple - they should drop the 'Dons'. It might take a season for everyone to adapt, but then the matter will be done and dusted, leaving only the occasional fixture-list confrontation to drag up old wounds. The fact that this so obviously makes sense for all but a handful of ex-Wimbledon fans, who bizarrely think Milton Keynes has anything to do with their old club, will not stop the Franchise zealots wanting to continue flaunting Wimbledon's nicked-name around, but that's just the foolishness of bitter people clinging on to the past. Doubtless a few will even claim that blog posts like this one strengthen their resolve to continue denigrating Wimbledon's nickname, but that also reveals the smallmindedness of their position - refusing to do the right thing purely out of spite, the act of a spoiled child. It's time Milton Keynes' football club grew up, it's time it dropped the 'Dons'.

Still a town, still pretending to be Dons

I remarked previously on what sort of a city has a football team using the nicked-name of another town? And as it turns out the answer is... a place that stays a town.

http://www.bbc.co.uk/news/uk-politics-17364651

Now I'm sure that whoever decided on the towns being honoured with city status didn't snub Milton Keynes (for the third time) on the basis of the provocative suffix to its football team name. However, when the leader of Milton Keynes' council won't even agree to talk about trying to resolve the enmity that now exists between his town and Wimbledon (http://www.thezonemk.co.uk/phpbb3/viewtopic.php?f=107&t=6378&p=31429), then it's indicative of an attitude that maybe didn't sit well with those handing out city status.

Whatever you think about the use of a council's time on this issue (I've no strong feeling either way), you can at least say that by trying to resolve this matter Merton council is trying to improve the situation for both towns.

http://www.wimbledonguardian.co.uk/dropthedons/9571412.Council_leader_calls_for_Drop_The_Dons_talks/

Sadly, it seems, you can't say the same for the council leader of Milton Keynes. Those saying it is a waste of time and energy by Merton council and that none of the politicians or other interested parties should have got involved, should ask themselves why it had to come to that? When the 'Dons' nickname being used as a nicked-name by Franchise FC is so clearly an emotive and antagonising issue, why has the individual in a position to resolve the matter, Pete Winkelman, not taken a single step to do so? Winkelman caused this mess with his approach to move Wimbledon FC in 2000 and with his renaming of the team in 2004, so it's about time he did something to resolve a row that will simmer on otherwise. How far does the matter have to go before Winkelman will finally, for once in this whole sorry saga, step up and do the right thing?

So near yet so far

Game with Cheltenham postponed and the country in the grip of an icy blast from the north, so time to reflect on some things. The fallout from the Wimbledon Guardian's 'Drop the Dons' campaign has dominated the last couple of weeks and the dust is starting to settle from the initial uproar. But it's not going away. That's the first thing to bear in mind. When, in a few weeks time, the WG brings its campaign to a close and Franchise are still using Wimbledon's nicked-name in their team name, doubtless the Franchise customers will proclaim things to be over and settled, but they won't be. This is just the start.

As we build towards 28th May 2012 and the 10th anniversary of the FA Commission sanctioning of the end of Wimbledon FC and the start of Franchise FC, things are only going to get louder and louder. Ironically, some of the customers claim anything from 6-10 years ago was the time to bring up the 'Drop the Dons' issue, but they're mistaken. Franchise was only renamed in 2004 and how could one protest about the use of 'Dons' then, when Wimbledon fans weren't even aware of the name to be used for Franchise FC until after the Football League had approved the change! Besides, plenty of us objected to them even using 'Dons' at the time, so it's not like it was ever accepted by us then or since.

It has been claimed the 2006 Accord was the time to address the issue, but that is a simple attempt to rewrite history. The 2006 Accord came about because the MKSA wanted to be recognised by the Football Supporters Federation and a condition of that was returning Wimbledon FC's honours and patrimony to Wimbledon. It was never about names or anything else, just those two matters settled between supporters associations and sanctioned by the authorities. I have absolutely no doubt that those involved in the negotiations (I was not one of them) will have tried to bring up the naming issue, but that Accord was never intended to cover all matters and nor could it have.

So, when was the 'Dons' name issue supposed to have been brought up? The 10th anniversary of the FA Commission seems a good time to me. Far enough away that the raw emotions of the time can have dulled a little, but soon enough that things have not become written in stone... even if they have been written in white seats. Besides, just because the WG has launched a campaign, it ignores the fact that I and others have been calling for Franchise to 'Drop the Dons' for several years. This is an issue that has been around since the 2004 renaming and the WG's campaign is just the latest thing to have highlighted it - and in a very high profile fashion. It's completely disingenuous for Franchise customers to claim they weren't aware it was a problem or that the passage of time has made it any less of a problem than it has always been.

One of the more sane Franchise customers started a thread that bears reading, here:

http://www.thezonemk.co.uk/phpbb3/viewtopic.php?f=107&t=6129

In their initial post they make quite a lot of sense - more than has been seen in the entire response to the 'Drop the Dons' campaign elsewhere. Clearly at least some of the Franchise customers are capable of coming up with some sense on the issue, but the replies to the initial post are largely the same knee-jerk, blinkered and misguided views that predominate elsewhere. And they give a very misleading impression of the state of things. On that thread, there are less than 20 posters. Franchise has an average attendance of about 8,000 and Milton Keynes has a population of over 250,000. And of course those 20 posters are the ones most active and motivated to comment and have a strong opinion. The fact that they think that because THEY have expressed their opinion the matter is closed, reveals just how out of touch with reality they are. They give a number of 'reasons' why they believe the 'Dons' should be kept, but none stands up to scrutiny. I could spend all day pulling each point to pieces, but there's little point when the truth is that not one of their objections is relevant - Winkelman will decide what HIS football club is called and he'll do so based on commercial criteria, not the wishes of a handful of people he ignored in 2004 and has ignored ever since. He'll probably continue ignoring the wishes of Wimbledon fans and the Wimbledon community too, but at least we aren't deluding ourselves about what our opinion counts for.

And note one thing about what Winkelman has so far said about the 'Drop the Dons' campaign... nothing. Franchise customers have chosen to view this as a dignified silence and refusal to give the matter credibility, which could be true, but worryingly for them it also signals something else - by not commenting now he is keeping his options wide open to change the name as and when he chooses, without anyone being able to claim he's going back on his word. Karl Robinson may have mumbled some nonsense about "They had their chance" - virtually meaningless and frankly bizarre - but Winkelman hasn't committed himself at all. He had the ideal opportunity at a fans forum a couple of days ago and the reports from it show the subject wasn't even allowed to come up in the questioning. Franchise customers should bear it in mind before interpreting Winkelman's silence as a good thing. You can almost hear the words coming from him now... "We'll always be the Dons and I want our fans to always call us that, but in recognition of our new city being recognised as such we can all proudly get behind the Milton Keynes ???". And then the customers will chant 'Dons' for a couple of seasons, maybe name a fanzine after it, but before you know it that will go the way of 'Womble Army' too. It's not a prediction, but what Franchise customers should realise (the starter of the thread linked above clearly does) is that it is an all too plausible scenario.

And if Winkelman does come out and nail his colours to the mast in promising never to 'Drop the Dons', well, some might say that's what we wanted all along. Goad him into branding his rotten franchise with the 'Dons' tag in such a way that he can never back away from it without losing face. So that when the 20th anniversary comes around, we'll still be able to pick out Franchise FC as the pariah of English football, never really accepted and never really representing anywhere. I think they'd be stupid beyond belief to go down that route, but, as we've seen in recent weeks, common sense still seems to be a limited commodity amongst the Franchise customers who are vocal on the internet - but that's less than 50 people and the silent majority will speak to Winkelman's wallet more eloquently than they or anyone else can.

The real Dons

Want to know who the real Dons are? These guys... Roy Law, Les Brown, John Martin, Bobby Ardrey, Dave Willis, Mike Kelly. Why? Because they were part of Wimbledon's 1963 FA Amateur Cup winning side.

http://www.youtube.com/watch?v=EwyDcdJGnYs

http://en.wikipedia.org/wiki/List_of_FA_Amateur_Cup_winners 

The Dons beat Sutton United that day at the old Wembley Stadium, with Eddie Reynolds scoring all four goals of a 4-2 victory with his head.

There are Wimbledon fans around who still remember that day and their shared history, along with that of the players, continues to exist at AFC Wimbledon. Indeed, the 1963 cup winners are being honoured at the home game against Bradford on 11th February. This from the official AFC Wimbledon website:

"Thursday 26 January 2012
club news
FA Amateur Cup winners’ reunion at Bradford game

We are pleased to announce that as part of the club’s involvement in True Volunteer Foundation’s (TVF) project celebrating the history of sport in Wimbledon, several members of the 1963 FA Amateur Cup winning team will be attending the game against Bradford on Saturday 11 February. 

We are looking forward to welcoming the following players to the Cherry Red Records Stadium:

Roy Law 
Les Brown 
John Martin
Bobby Ardrey
Dave Willis
Mike Kelly

Also joining them will be regular attendees from the 1973/4 era Dickie Guy, Ian Cooke and Tom McCready."

http://www.afcwimbledon.co.uk/news.php?Psection_id=2&Psub_section_id=2&op=archive&monthID=0&yearID=2012 

So, what's all this got to do with Franchise FC? Nothing. That's the point. At AFC Wimbledon these guys are heroes, some of them still attend games and their achievements are recognised. If they were trotted out at Franchise, how many would know them, know what they achieved, or care? A handful of people, if any at all. And that's what makes them using the 'Dons' nickname in their club's nicked-name such a travesty. They claim it is to reflect their club's origins, but what a sham and a disgrace that is when they have given up all other pretences of a connection to Wimbledon. An ex-player like Roy Law could walk unrecognised and unappreciated through their crowd, pressbox and boardroom, without a soul either knowing or caring about what he and the others achieved.

If Franchise truly wanted to recognise its bastard birth from the ruins of Wimbledon FC, then it would be doing far more than clinging on to a nicked-name. For the sake of every Wimbledon fan and every ex-player who was proud to pull on a Wimbledon shirt, it's time Franchise dropped the 'Dons'.

In constant need of correction

I do wonder sometimes why it is that Franchise customers have to persist in repeating lies and misinformation that have long since been proved to be false? Do they think that by constantly repeating a lie enough times it will become the truth? It won't of course, particuarly when the things they are repeating are so easily disproved. Let's look at a few thrown up by the Wimbledon Guardian's 'Drop the Dons' campaign (http://www.wimbledonguardian.co.uk/dropthedons/)

All these quotes are taken from this thread: http://www.thefootballforum.net/index.php?/topic/209232-drop-the-dons-campaign/

Coining a name 
"Regardless of whether Kris Stewart(who interesting first publically coined the phrase MK Dons)..."

Kris Stewart did not coin the phrase 'MK Dons', how could he when it had already been reserved as a domain name by Winkelman in 2000! This from Whois.com:

"Domain name:
mkdons.co.uk

Registrant:
Pete Winkelman

Trading as:
MK Dons FC

Registrant type:
Other UK Entity (e.g. clubs, associations, many universities)

Relevant dates:
Registered on: 23-Jun-2000
Renewal date: 23-Jun-2012
Last updated: 16-Jan-2012"

How can Kris Stewart 'coin' something in 2002 that Winkelman had already registered in 2000? He couldn't, obviously.

Put it in the Accord 
"If they wanted it changed they should have put it in to the accord."

This one keeps coming up and it is utter nonsense. The Accord was an agreement that took considerable negotiation to achieve, it wasn't simply thrust in front of Franchise for them to sign. The fact is that the Accord could never have included a guarantee of Franchise dropping the 'Dons' because any name change requires approval by the football authorities. Unless one was party to the negotiations one has no idea of what was or wasn't put on the table for discussion. And regardless of that, simply because it wasn't agreed then does not stop the 'Dons' name being an issue or being subject to later scrutiny, because there's also nothing in the Accord that says the signing parties have no objection to the name 'Dons'. The club has to be listed as that in the Accord because it was their legal trading name at the time, but its use in the Accord does not confirm its acceptability to those signing, just an acceptance of it as the trading name at the time. If the company name had been 'Milton Keynes Cat-herders' would Franchise customers now be claiming that signing the Accord marked approval of that as their name? Absurd, of course, but that's the point.

What the Accord did say, as I've pointed out before, is this: "16. The FSF and WISA confirm that they do not expect MKDFC to implement the recommendations of the FA Appeal Commission relating to maintaining links with South London, and would support moves by the club to develop its identity as a new club within Milton Keynes." A clear indication that the signing parties support the club developing its NEW identity, not clinging on to an old one associated with Wimbledon. And don't forget the Accord also said this:

"17. In promoting the approval and acceptance of this accord all parties to it accept that there is no solution which will completely satisfy all concerned and that all parties have made some compromises to achieve this position which represents the best way forward in all the circumstances."

Again, a clear indication that the signing parties did not get everything they wanted and that things may change again in the future.

The clincher... If Franchise wanted an acceptance from others that they should remain using the 'Dons' nickname in their club's nicked name, then they should have put that in the Accord, right? Right.

Trading names 
"The fact that many of them saw (and some still do) the moniker Dons "as a permanent reminder of the shameful way we came to be" was always their philosophy and that seems to have backfired somewhat when they've realised the commercial implications of their being two Dons in the football league. That's all this is about underneath all the emotive bluster."

This one really takes the biscuit for delusional. There is no way you can trademark 'Dons' in this capacity when it's used as a nickname by so many clubs (Aberdeen, Hendon, Wimbledon). It's entirely about the offence caused to Wimbledon fans having to hear 'Dons' associated with a franchise in Milton Keynes. It makes the blood of many Wimbledon fans boil - it is a constant and needless reminder of having the club stolen away from us in 2002. Why would a Franchise customer find that so hard to understand that they concoct this nonsense about non-existent commercial implications?

Embarrassment 
"They seem to think we're embarrassed about our Wimbledon past when nothing could be further from the truth."

We don't think they're embarrassed. We think they SHOULD be embarrassed. The fact that some of them are not and revel in flaunting our nicked-name in front of us at every opportunity is what is really embarrassing. But some people have no shame.

Commission recommendations
"The FA recommended we retain the former identity of Wimbledon FC and MK Dons FC does just that."

What a horrendous re-writing of history that is! The Commission recommended the retaining of a large number of things, none of which were done and all of which were signed away by the Accord. Retaining one lousy nicked-name isn't 'retaining the identity of Wimbledon FC'. Need reminding of just how big a travesty it is to claim 'Dons' in that light? Here's what the Commission actually said:

"113. These measures would cover, in no particular order, and without being
prescriptive, (and these are essentially matters for the Football League rather than
ourselves) matters relating to:

* Continuity of:
· Club name and nickname
· Club logo
· Club colours
· Club playing strip and other merchandise
· Players
· Staff
· Shareholders
· Directors
· Academy
· Community schemes
· Club website(s)
· Club shop in Wimbledon;
* Subsidised/free travel to matches between Wimbledon and Milton Keynes (we
are told that trains can be chartered by the Club: the journey time is
approximately one hour); 

* Discounted tickets for existing fans at the new stadium in Milton Keynes;
* A ticket outlet in Merton;
* Continued communication with existing fans;
* Local press (Merton) coverage of WFC and its results; 
* Promotional material regarding maintenance of identity as WFC;
* Club museum at the new stadium in Milton Keynes;
* Stadium branding at the new stadium in Milton Keynes; and
* Re-naming of local areas/streets in Milton Keynes to associate with WFC.
 

114. We consider these measures vital to ensuring WFC’s identity and they should
be agreed to and put in place as soon as possible. The Football League will then be
able to monitor and approve the process of maintaining links."

And anyone is meant to accept that putting a nicked-name in the team name somehow satisfies all those expectations? Laughable.

The inaccuracies, lies and misinformation just keep on coming from the Franchise customers, getting worse all the time. And for what? To cling on to the absurd-sounding 'Dons' in their team name. Perhaps they really do deserve to be branded with it for life. It would serve many of them right for coming up with this sort of stuff.

Who wants to be a city?

A question that Franchise customers should be pondering - because you can bet Winkelman is - is what sort of a city has a football club named after an entirely different town? Milton Keynes will have, if it is successful in its bid for city status as part of the Queen's Diamond Jubilee celebrations this year. You know, the Queen who officially opened the stadium that Franchise play at.

With the pressure building from the Wimbledon area for Franchise to drop the Dons and with MK becoming increasingly desperate to achieve city status - and not forgetting Winkelman's close ties with MK council who submit the city status bid - the head of steam building for the name change is growing. Seriously, what sort of city has its main sporting team having a nickname in it that enrages many of the residents of another town? That's about as un-city-like behaviour as you can think of - and that will matter to both MK council and Winkelman, even if it doesn't to Franchise customers. There are plenty of candidates for city status and MK doesn't need any negative publicity holding it back from being granted it.

So, the small number of Franchise internet warriors loudly proclaiming they'll never let it happen or that they'll quit Franchise in protest, need to be aware that they are utterly irrelevant in the grand scheme of things. Protest all they like (and we are literally talking about less than 50 people here and there are tens of thousands more in MK who either don't care or would prefer the club renamed), it won't make the smallest bit of difference in the end. As I've pointed out before, their only choice is whether they want to be a part of creating a better future for all concerned by mounting their own campaign or whether they want to cling on to the past and another town's football club's nickname.

Winkelman is the only one who can change the name, but who's he going to listen to - a few dozen moaning Franchise customers or the council he still has huge amounts of business dealings with? We all know the answer to that one. It's probably time Milton Keynes' growth was recognised by officially becoming a city, so it can stop pretending it is one, and it's certainly time that Franchise grew up and stopped pretending it has anything to do with Wimbledon. The Franchise customers will continue to splutter their protests, but they know we're right and they know they have no way to stop Winkelman either. Tear up as many season tickets as you like, there are far more potential customers out there who will come to watch 'MK City' than will ever come to watch Franchise FC - and that bottom line is all that counts to those with the power to change things.