Healthy accounts signal forward momentum for United?

Getting things right?
Getting things right?
It’s probably not escaped many of you by now but yesterday United revealed their latest set of audited accounts, and they make for pleasant reading.

The headline figure is that we made a small profit of £1.4 million, but it’s what has been done to get to that figure that is so impressive.

I know finances and football fans sometimes don’t mix but I like my numbers if I’m being honest. Of course some people will say that all that matters is what happens on the pitch, which is fair enough, but these days it must be realised that what happens in the boring world of accounts actually has an impact on what we see on the pitch, so with that in mind I’ll take a look and see how we are shaping up financially.

It’s important to consider the time period for which these accounts are, erm, accountable for. They essentially refer to the year end of June 2012 which basically means that they are figures from last season when we signed the likes of Demba Ba, Papiss Cisse, Sylvain Marveaux, Yohan Cabaye and Davide Santon. They don’t include our recent January purchases and it’s pretty standard for accounts to be so out of date by the time we get to find out about them.

Profit is actually down from the previous set of accounts (ending June 2011) where we made a profit of £32.6 million, which was boosted by the £35m sale of Andy Carroll to Liverpool. Look through the detail and we’ve turned what is basically a small loss of £2.4m into a small profit of £1.4m.

Turnover has increased to £93.3m (up 5.4% on the previous year) which will put us back into the top-20 clubs in the world in terms of revenue generation and means that we’ll have a detailed breakdown of all things when Deloitte release their football rich list. The main reason for the increase in turnover was a 14.6% increase in TV money brought about by a 5th placed finish last term and the increased merit payments dished out by broadcasters for such a high finish.

However it isn’t all a story of increases. Income from ticket sales has dropped by 7% due to initiatives such as the season ticket price freeze and other offers like packaged ticket deals where you buy a number of games for a discounted price. Attendances are up on the previous season (2010-2011) but tickets are cheaper.

Another area which has dropped is income from commercial revenue which fell by 12.7%. However this does not include the new deal with Wonga which will kick in next season along with another deal, that has yet to be announced but will be “the biggest in our history” according to Derek Llambias so that figure will improve dramatically.

One of the long-standing issues is the debt we owe Mike Ashley. Granted it’s an interest-free loan but it’s stayed the same for ages and increased during our Championship season. From this set of accounts we paid back £11m which now means our outstanding debt to Ashley now stands at roughly £123m, so still high but decreasing.

Going forward…

Derek Llambias has already said that there is cash to spend in the summer, and I’m not surprised. We’re going to see a large increase in TV revenue due to the new broadcasting rights distribution, plus we have the new Wonga deal AND that historically high deal that we don’t know about yet.

In summary…

All in all it’s good news. All the players we sign these days have their transfer fees paid up front so we signed the players mentioned earlier on, which in turn increased our wage bill by 20% (to £64.1m or a 68.7% wages-to-turnover ratio) and have managed to pay some of the money owed to Ashley back. Without us paying that back the finances would have been healthier but I get the feeling that was “spare” cash and was just paid back because everything was accounted for and the surplus balance wasn’t going to be used for anything.

Everything is heading in the right direction in terms of the finances of the club, and we seem to be getting towards having a competitive squad with good players in it on the pitch. Mistakes have been made and the club have admitted that they made a balls up by not investing in the summer but hopefully lessons have been learned and we can continue to improve, both on and off the pitch. If we can there is potential in this club that could finally start to be realised!

Well done to all at Newcastle United!

About toonsy

A lifelong Newcastle fan and current webmaster of this very 'blog who has the sole aim of creating a place by Newcastle United fans, for Newcastle United fans.

112 thoughts on “Healthy accounts signal forward momentum for United?

  1. Photo of supposedly Newcastle United’s new away and 3rd strip doing the rounds on twitter. Fake or real? #nufc pic.twitter.com/xgWqBPlHbd

    If is real… what’s your opinion about ti? 😯

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  2. Davide Santon and Cheick Tiote ruled out of Man City clash

    Oh dear me. Injuries again. 😥 😥

    And what’s worst, this is Santon first ever Injury in Newcastle. 😐

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  3. Should be an interesting team sheet for City. Jonas at left back? Simpson.
    Midfield? Cabaye, Perch, Sissoko, Front three Gouffran, Marv, Cisse. We’ll see.

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  4. Paying back Mike Ashley because there may have been ‘surplus balance’ and it wasn’t going to be used on anything? What about a new player? Get a hell of a player for £11m. Although I thought he wasn’t taking anything out of the club? He’s still the only owner paying himself back exc the Glazers.

    Delighted with the turn around in finances but would be happier once we see a successful team on the pitch.

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  5. Guess that if these accounts are to June 2012 they will also include Smith, Xisco, Ranger salaries – would they also include the paying up (all or some) of Rangers contract ?

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  6. AOD
    No it’s not he was injured in first couple of months when he first arrived. It’s the first PL game he’ll miss this season though.

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  7. Well it’s nice to see us sitting comfy-ish on the finance front ,I’d be more happy if we were sitting comfy on the points front 🙄 .

    So with Santon and Haidara crocked i imagine Jonas will be at LB and Anita or Bigi for Tiote I suppose 😕 Hopefully Cabs is fit to go .

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  8. Anyone know if Debuchy is fit to play ❓ If he’s out too and Simmo doesn’t seem to be around we need cover to both full back positions. Jonas or Perch LB and Anita or Perch RB . Where is Simmo ❓ 😕

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  9. Right so reports in the last hour Debbie won’t play due to his hammy strain .So that’s FB positions weak then . 🙄

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  10. if tav doesn’t find himself in contention this weekend he might aswell be out on loan somewhere playing

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  11. Nice round-up. Thanks, Toonsy.

    Not overly concerned about the City game, we can’t expect to get anything there. Best to look forward to Fulham.

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  12. Great news on the financial front. As the article points out, good news on the financials means good news on the pitch. Considering where we were under FFS to now being able to invest in the squad, pay Ashley back a bit of the loan, and still turn a profit is rather impressive.

    Looking forward to the summer as this is the most assured Llambiase has ever sounded about investment in the squad. A good summer and next year will be a lot of fun.

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  13. Cheers Wellington. I dare say if the accounts were bad then a lot more comments would have been left and a lot more people would be taking an interest 😉

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  14. Any profit is good profit. We are far better off than most clubs now as far as finances go. It all comes down to next season for me as this one was ruined by the lack of action last summer which many of us have commented on many times. Pardew should have a good squad and surely we will bring in a seccond striker and a CB at the very least. I’m convinced now that Cisse can’t go it alone in every match. He just isn’t consistent enough. His overall scoring rate should be decent at about 0.5 goals per game played but we won’t win anything or finish in the top 6 without a second excellent striker. A lot remains to be done to make us a consistent winner with a decent chance at a cup.

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  15. I think Lambias should be commended on what he is doing to make tickets more affordable. He is starting to shed his dodgy image a little at the moment; he actually looks like he is listening to the fans. He is talking more in the media and starting to look more like a football chairman. Credit where it’s due.

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  16. If Llambias spends his time deciding whether or not to give Shola a new contract it will tell me he and Ashley still have no proper ambition for the club. Forget Shola. He is the past. We need a future with a good young striker coming in. Ranger was a complete flop, as was Xisco. Campbell is very young and needs time and good competition. We have a huge hole to fill at the striker position. Let’s fill it in the summer with a good buy. Turn things over to Carr and then go out and get whoever he recommends.

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  17. Good points DJG @17 but what it mainly comes down to is seeing whether Ash/Llam can make us a consistent top 8 club with a chance at a cup for me mate. If not it’s just going to be more disappointment and lost seasons. None of us are getting any younger. Time to make the future the present and make a big push for some silverware.

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  18. I think Stuart’s “hell of a player” line was a worthy effort. It could have been improved by naming a few names – Douglas or similar – who were hanging around waiting to take us to the title. Maybe a 7/10, considering the difficulty? 😉

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  19. Oh, wait, I’ve worked out a better bad news angle for this:

    £12.4m that the club couldn’t spend because NO PLAYER IN THEIR RIGHT MIND WANTED TO COME HERE. Total shambles, as we have come to expect from the regime! I fully expect that our best players will look at these results and ask what the fat man did to deserve a bonus that they didn’t! Ashley, Llambias, Pardew: out out out!

    😀

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  20. Would love to see us get PEA with the 11M or more but is it too late with some big names being mentioned as after him now? Our main problem will continue to be the wage battle. Can we offer enough to bring in top players or is that the wrong way to go? Let’s push hard and make sensible moves. No contract extension for Shola. Part with Gosling. Get another first class CB. Bring in another excellent winger. Plan in case Ben Arfa leaves, don’t respond months after the fact. Those are the key tasks for Ash/Llam in my view.

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  21. G2 – I don’t think a move for Aubameyang is likely now. But there are other good strikers out there. Shola, for me, still offers something a bit different in terms of his playing skills, and is an important character. He seems to be a good influence on younger members of the squad – and sometimes it’s just good for a team to have a guy who has been through it all. Provided that he doesn’t want silly money – and Shola strikes me as a pretty realistic guy – we can keep him on for another season.

    Gosling is another matter. He’s still pretty young (just turned 23) and has time to get it together. There haven’t been reports of him shirking training or getting into trouble, and I doubt any suitor is going to throw big money at the lad. Why do you want to get rid of him?

    Agree on the central defender, we should see a move there. Douglas’ contract is up this summer. The days of Big Mike filling in at the back should be behind us!

    I’m not convinced that another winger is needed, and bringing someone in could close things off for Fergie (who I think can still make it). A similar argument might exist for HBA and Abeid/Vuckic, though the club has been linked to other advanced creative midfielders.

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  22. The club are losing revenue by not increasing season ticket prices every year. I feel if we start to get a successful team (big if) then the club should increase ticket prices – we need to compete with other clubs who have a bigger income.

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  23. STUART79 @24

    But apart from the Sunderland game we are not filling the stadium. In an age where it is cheaper, easier and often more convenient to simply watch every match on the telly, it is getting harder to fill the stadiums. Considering ticket prices are a surprisingly small percentage of revenue (compare to something like music concerts, theaters etc. it will be virtually 100%) then is it worth upping the ticket prices and having 5-10 thousand odd empty seats? We had a top 5 finish last season and attendance was down 2,190 on average. So is the problem the football, or peoples financial priorities?

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  24. Good write up Toonsy lad, I have to admit the fat c@nt is starting to get the hang of this football club ownership, about fuking time too 😆 😆
    Going by some snippets I think we will be buying in a couple of players for next year too which we will need, so I think if thats done the Regime will be going a long way to becoming a decent regime 😉 when you add to the fact that they have admitted that they made a major fuk up in the summer by trying to increase their profit by not strengthening the team, when anyone with any sense knew we needed strengthening.
    But for now they have to get a bit of credit 😉

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  25. Stuart and DJG- The lads on Skys soccer saturday were talking about our attendances for the home leg V Anzhi and how we put the other English sides to shame with a whopping 47,487 at ST.James’s. Compare to Chelsea at home to Steaua Bucharest attn 28,817 and Spuds home to Internazionale 34,353 at the same stage of the competition. When you consider we havn’t won owt for donkey’s that is some fan base there .

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  26. DJG – Last season the ticket prices were the same as this season and we have 2,000 more supporters on average than last season. That will have been due to last seasons relative success so the demand is there if success is there.

    We had nearly 30,000 on a waiting list under SBR when we were challenging for the league and in the CL. Get to that level again (extremely difficult) and we’ll fill the stadium and some!

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  27. If as looks like we’ll lose Colo and say we sale Tiote or HBA or Cabaye then we’ll need 2 purples just to maintain the status quo . We would still need another decent defender and a purple quality forward ,will the owner be willing to dig that deep I wonder. He has to have learn’t harsh lessons from this season and hopefully has realised he has to spend well just to stand still in this league.

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  28. Stu your right better footie and more success will get the punters in, I don’t buy this economic stuff, as I have people everyday paying reasonable money on something that they don’t need, but it makes them feel good and they get a feel good factor which I find over rides the bad economic situation.
    But rather than raise prices I think it’s more important to raise money from advertising in the ground, rather than giving it away for free

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  29. Kim I really can’t see Cabaye or HBA going, for me Colo is away for sure, so we will need to replace him and bring another 1 or 2 players in, as Big Al said you have to spend just to stand still

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  30. STUART79
    I get what your point is but I think your glossing over two things. 1) In SBR’s time we were not in the greatest depression since the early 20thC. 2) It has never been easier to stream football on the internet or rock up at your local pub/social club and watch nearly every match home and away. At one time people did have to actually buy a ticket or wait till it was on match of the day!
    Aside from that.. Is it right to expect the fans to pay for the spiraling costs of the English Premier League due to the insane over spending/ indulgence of Russian Oligarchs and Arab Sheikhs. Plus are we supposed to expect people to earn in Newcastle what people earn in London for example and compete with what they are paying for season tickets at Arsenal?

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  31. Dave very true ,I do think if HBA hadn’t been so injured he may of been off though ,don’t know why just a feeling really. Do you think Tiote will go ❓

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  32. from the info we have so far, this seems to be a very promising set of financial results. Factoring in that we’ve been able to pay off an 11m loan and that matchday revenue continues to be intentionally under-exploited as a short-term strategy (cheap deals a plenty), it’s encouraging that we’ve turned a profit all the same. I’m interested to see the full accounts to get an amortisation-free view

    wonder what this new commercial deal Llambias keeps referring to is all about…

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  33. A lot of the players coming in have remarked that they love playing in front of a big, enthusiastic crowd. None of them got offered silly money. Therefore, I put it to the worthies of the blog that the cheap tickets are a way of achieving cheap contracts.

    Thoughts?

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  34. We could never charge the same prices as the London clubs, but neither could Man Utd, Liverpool or Man City. But I just think that if we do get some success in the future we will need to increase prices as demand goes up and I do t thi k there should be an issue about that.

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  35. Wellington ,I think it depends on the player really . Some love the performance thing and the adoration of the fans for others it matters not one jot ,it’s all about the money ,as in Remy for example.

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  36. I think at the moment it’s a case of increase prices – less supporters – slightly more money (depending on how many less turn up) – lower crowd and atmosphere – less support for the team. Or keep prices as they are and ticket deals – fill the stadium – more support for the team – potentially better results and the progression and revenue tied in with that. If in the future it makes business sense for Mike and Dell boy to up ticket prices then they will, until then more ticket deals for the people who turn up and sit in the cold please. 🙂

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  37. Stuart @ 4 comparing Ashley to the Glazers… You clearly know nothing of Ashley or the Glazers then…

    As for the Accounts they look good. It will be good to see them next year if we remain in the PL 😀

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  38. bad timing…

    ‘Sergio Aguero, Yaya Toure and Vincent Kompany are all expected to return to the squad against Newcastle after recovering from various ailments.’ (from nufc.com)

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  39. @Stuart read up on the Glazers and their whole man united fiasco if you still think the same you must be an idiot.

    Honestly they are 100x worse than Ashley has ever been.

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  40. Santii – I think maybe you should learn to read or at least re- read what I wrote? I did NOT compare Ashley with the Glazers. I simply said that only he and the Glazers are owners who are taking money out of their respective clubs. I believe that’s true – but is it a comparison between the two? No!

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  41. Ashley is taking a small amount of money (in football terms of course) he is owed lol

    The Glazers have not spent a penny on united…

    Big difference

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  42. Big Dave
    March 28, 2013 at 22:13
    But for now they have to get a bit of credit 😉

    😯 😯 😯 😯

    Toonsy, you may want to do a bit of investigative work behind the scenes, I think someone positive has hacked into Big Dave’s online login details! 😆 😆

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  43. It doesn’t matter how you break down our finances, it is a good thing to have a club that is not hemorrhaging money. Even if we break even it is a great effort considering the high cost of players now days. I can’t really think of too many successful business models where employees are paid such a high percentage of the gross turn over. It seems it is only possible in the make believe world of high profile sport, any where else companies would be shutting up shop…. 😕

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  44. Santii – They’re both taking money out of their respective clubs – fact! I didn’t analyse it further than that, if you read more into than that fine, but the fact is I am right in what I actually said.

    Do I have a problem with it? Yes I think I do, I don’t think you should buy a football club if you’re not prepared to actually invest money and by invest I mean accept that you won’t get your money back until you sell, not take it back as and when you like to detriment of the club.

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  45. It’s got to make sense to price tickets to fill the ground. Football is all about the occasion. The best footballers want to play in front of the biggest, most enthusiastic crowds; I remember the reaction of the Barcelona players to the electric atmosphere at sjp when we beat them 3 – 2. Even fans paying top dollar are buying the atmosphere generated by the fans in the cheap seats. TV will choose those games over games at half full stadiums, like the STadium of Light and the Riverside.

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  46. I can’t believe anyone wants to nitpick over the advertising. It’s like a benefactor turns up at your dooor out of the blue and offers to pay off your mortgage for nothing in return, and you want to charge him for a cup of tea.

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  47. I think these accounts consolidate our position at number 7 in the financial league table. Still along way behind Spurs think they about 50% bigger. But opening a 10% gap on the pack.

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  48. B&B Silly me I didn’t know SD were paying the mortgage of in return for the ground full of advertising, I thought they were getting it free 😯 ,
    I take it you have proof to back that up as I haven’t seen nowt to back that up ?

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  49. I don’t think I’ve ever heard DL say so bluntly that we intend to spend in a window before. It seems now that Santon is definitely staying and it will take an absolutely massive offer to lose Cabaye. I think Collo, Obertan and possibly Tiote will go. It will certainly be an active summer and the first time I haven’t dreaded a window in quite some time.

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  50. I think Tiote could be the weak link in a “footballing midfield”. Not sure where we would replace his “bite” because aggression is also called for in midfield, otherwise you just watch the ball being passed around you. He is tuning it down somewhat, but this calmed Tiote is for sure affecting his game. That Tiote pirhouette on the half way line scares the pooh out of me, especially when we are so close to the bottom of the league at the mo.

    At the same time ….when Tiote is “on his game” he is amongst the best in the world imo…

    Or …. you just concede posession to the opponents, set out your stall to stifle them, and when you get the ball attack like flock and score brilliant goals. Not for the connosuers though 🙁 .

    Sounds like a typical Barca – Real Madrid game.

    At the end of the day, the team who scores the most goals wins the games 🙂

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  51. It did make me laugh when Dekka said Carr has a lot of company when he scouts now but not quite ready to don a disguise yet. 😆 . I think a lot of clubs have lazy feckers for scouts who just shadow Carr now tbh. 🙄

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  52. Dave – Ashley’s giving the club an interest free loan of £140M. If a bank would lend the money, and say charge 7.5%, it would cost the club over £10M a year. The club would only get a small fraction of that from advertising rights. I’m simply saying when someone gives you a major gift, you don’t go around carping about the fact they didn’t pay for their cup of tea. It would be petty, not to mention insulting, IMO.

    Would you prefer him to charge interest on a small part of the loan and use it to pay full value for the advertising rights just so you can say he’s paid full value and everything’s tidy in your mind? It may be more tax efficient overall for him to do it that way for all we know but no doubt people would criticise him for that too.

    The bottom line is that he’s sorted out the bottom line. Why nitpick about his ways and means?

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  53. If Inter or anyone are mental enough to pay 10 million for Santon I would absolutely snap there hands off …

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  54. B&B@63….

    “The bottom line is that he’s sorted out the bottom line. Why nitpick about his ways and means?”…..

    I suppose you need to quantify the term “nitpick” 🙂

    I suppose it’s like someone coming into your bedroom and rustling through your toy-box. We all hold NUFC close to our hearts, and have a high emotional interest, even though we haven’t invested millions :-).

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  55. MM- it sounds like Milan will be in for him, probably for about the amount you mention. But he is still young and can improve. I’d hold onto him another year.

    Kim- I’m pretty sure ‘arry’s scouting department is made up solely of three private investigators that follow Carr around plus a “techncial” guy with the ability to bug offices and vehicles…

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  56. B&B could you tell me where is the proof that SD is paying our mortgage, Incase you haven’t worked it out SD has fuk all to do with us so should be paying to advertise.
    As for Mike lending his own club money we have been over this hundreds of times, when he sells the club he will get his money back including the interest free loan he lent himself.
    So please show me your proof that SD is paying, and please be clear I’m asking about SD NOT Jabba as He doesn’t own SD outright so he is not the only one that is benefiting out of massive free global advertising hoarding he has turned SJP into

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  57. MDS, it stands to reason that Santon’s time on the Tyne is limited anyway. I still feel he has a few years in him playing in the black and white stripes though.

    I would imagine in a couple of years he will have learned how to defend 🙂

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  58. If AC Milan offer good money for Santon, he has said he will pack his bags tomorrow. Big IF but I would wish him well and re-invest the money wisely, he isn’t going to improve the defensive side of his game enough to take us into the upper echelon of the Premier League in my opinion and we should buy a proper winger and keep Haidara, Jonas, Anita, R Taylor and Fergie for LB. One of them will play there and defend better than Santon and we should get a proper winger. Having a non-winger plus and attacking full-back and the non winger going back to defend is what we seem to have at the moment, it’s bizarre. Yes you need them to work as a pair but the defender should defend primarily and the attacker be able to ATTACK!

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  59. MM yeah he is a Jabba fan and always seems to have an excuse for him, and normally defends the Regime I wonder what Jabba would think of him if he seen the dogs abuse he throws at his manager Pards 😀

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  60. On Santon and his ability to defend. The left back in the premier league that everybody raves about is a **** defender. Leighton Baines

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  61. Big D, even though he is Mike Ashley’s man, B&B gives Pardew some hammer, and would prefer to see one of those top managers at the club, like Laudrup, Coyle, MON or Brendan Rodgers 🙂 There are loads of them about who would do a much better job than Pardew with the resources he has available …

    There are loads of top managers who would do a lot better job than Pardew, but at the end of the day, no-one can talk the talk like our man 🙂

    Someone somewhere at the club has the wherewithall to get top French players to come to the toon. Now that is a great move, the fact that Ashley is, according to B&B, balancing the books superbly, we are forgetting the big issue that traditionally it was always difficult to get players to come so far up north. Whatever the strategy is, it has worked so far, long may it continue. We all know that the top players will move on eventually,it’s par for the course, and we would all do the same at the end of the day 🙂

    It’s just that some ex-toon players are remembered fondly, and others … not 😉

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  62. TLR, is Baines really a **** defender ? I wasn’t aware of that to be honest.
    I thought he had a great game at SJP a few months back, in fact in both games against us. He spent most of both games in our box, and scored an absolute screamer against in one game 🙁

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  63. DJG- I had figured Santon would be off to Milan in the summer but I saw this from his agent yesterday:

    “I believe that Davide will remain in England because Newcastle want to count on him next season too.” “The club believe that he still has great room for improvement.”

    Of course that doesn’t mean much. But Santon seem happy enough at Newcastle that I don’t think he’ll force a move. If Milan offer us something ridiculous that could obviously change. I really rate the lad and hope he stays but Hediera looks like he could handle the spot full time if called upon

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