Well he's their Chief of Staff and has been responsible for all their financing arrangements since the takeover, so I'd expect he would know.
ALL issues relating to the bond issue and club finances
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Well he's their Chief of Staff and has been responsible for all their financing arrangements since the takeover, so I'd expect he would know.
That's a backwards argument if ever I heard one. The reality is that we're always being told by the glazer fans that it's a case of "better the devil you know", and the last thing we need is a random new owner we know nothing about. But now we're being told that this is a risk that we have no place worrying about.
I've never advocated forcing the Glazers to default and let their creditors come piling in - the only time I've ever seen any point in discussing putting real financial pressure on by boycotting was when it was looking like a credible alternative was looking like emerging last season.
So that'll be £240m by May. Now, whilst you said revenue per year has increased by about £150m, I have an issue with this. Much of this was inevitable. Things like rising revenue from the TV deal, rising money from Nike. You can grant the money arising from commercial sponsorship improvements to the Glazers, but what has that amount been? About £100m in total? Much of the rest is from aggressive ticket price rises.
Now I may have muddled my point slightly, but here it is. The interest payments on the debt ALONE have only been covered by inevitable increased revenue/aggressive ticket prices rises/commercial improvements. Whilst the last one doesn't bother me at all, the first two do. They mean that a) there's an awful lot of money being wasted, and b) that the fans are suffering for the privilege of the Glazers owning the club.
Manchester United makes enough money for there to be one or more of the following: increased transfer spending, stadium expansion, cheaper tickets, increased investment elsewhere. Instead, whilst the club's revenue increases and increases, transfer expenditure is actually falling, ticket prices are rising and demand is falling. The increased amount of money is not doing the club any good, and merely servicing a debt whose only point is to facilitate the Glazers owning the club.
This is only talking about the interest of the debt, and not even the debt itself, (nor even the PIKs, which have probably just changed name) which still serves to be a large ongoing burden and worry for the club and sits largely untouched. Even if paying it off isn't the doom and gloom scenario painted in 2005, it will still serve as a massive waste of money. I guess in that, it summarises the Glazer ownership quite well - enormous waste of money whilst the fans get fecked in the ass with no lube just so the boys from Florida can say they own Manchester United.
Manchester United makes enough money for there to be one or more of the following: increased transfer spending, stadium expansion, cheaper tickets, increased investment elsewhere. Instead, whilst the club's revenue increases and increases, transfer expenditure is actually falling, ticket prices are rising and demand is falling. The increased amount of money is not doing the club any good, and merely servicing a debt whose only point is to facilitate the Glazers owning the club.
Feeky Magee speaky mucho senso.
This is the key area that most people cannot get their head around.
Basically, you are taking all that has happened over the last five/six years, removing the debt from the equation and saying, "And here's what we could have had".
What some of us have tried to say is that that is not necessarily the case.
Who knows if we really would have been able to compete over the last five years without the ticket price hikes (Chelsea were starting to pull away from us not long before the Glazers took over).
Who knows if the situation with the Coolmore thing and Fergie might have led to Fergie's position at the club becoming untenable and he had had to leave?
Who knows if we would have enjoyed the success and therefore the revenues if things had carried on as we were?
We can merely speculate at this juncture. Nothing can be "proved" one way or the other. Things could have been worse and things could have been better.
Personally, I like what the Glazers are trying to do with the commercial revenues, I like the fact that the Glazers stay the hell out of footballing matters and haven't brought in some "Director of Football" or worse, decided which players have been brought into the club themselves. I like that they have basically left Fergie to get on with what he does best.
Of equal importance, I feel, is to imagine how much better off we would be now if some people had not got straight onto the Glazers' backs from day one and advised/encouraged boycotting of tickets and merchandise. How much better off would we be now if we had not been on the end of such negative press and bad feeling from the fans about the owners because of things they were believed to be about to do... but which never transpired?
It's just not as simple as to say "The debt has cost us £x and so without the Glazers, we would be £x better off right now".
That's not really a valid argument. It's like stealing somebody's car then saying "who's to say you wouldn't have crashed it if I'd let you keep it? Then yould have no car and may be injured too!".
You're right that we can merely speculate, so there's little point in doing so. Instead we can focus on what has happened, which as Freaky rightly says, is that lots of money has been wasted to help the Glazers line their pockets.
You made a funny!
Wait... are you seriously trying to make out that this talk only started once the RKs showed up?
Except I tried to give some reasons and justification to back up my argument.
And we've won shitloads of trophies and are currently top of the League (again).
How much have the Glazers took in order to line their pockets?
Well of course you can speculate, just as people are doing about the likely non-bid from the Qataris, but the fact is that most of the things you have listed are quite unlikely. I would prefer to concentrate on what has actually happened, which is that hundreds of millions of pounds have been wasted to keep them at the helm, which suits no-one but themselves.
I would draw particular attention to the point you made about the hike in ticket prices and how it's allowed us to keep up and surpass Chelsea. I see no evidence of that.
Also, you can credit them for staying away from the football matters and rightly so, but it's rather a small achievement, given how obvious it was to do. You can point to various other interfering owners, but none of them, barring Abromovich who is an idiot, had such an obvious decision to make to leave things to the people already doing such a phenomenal job. I doubt they could have interfered if they wanted to, they know nothing about the sport.
I would contend that most of their "achievements" can be put down to the fact that we are a fantastic club, with a worldwide fanbase and a brilliant manager. One merely has to look at the Tampa Bay Buccaneers and their blackouts to see what things could be like if the fans decide they are fed up of getting absolutely fecked.
The cumulative increase in commercial revenue, excluding the built in rises from the Nike deal, has been c. £170m over the last six years. The interest payments (and accrued interest on the PIK debt) have saved the club an additional c. £100m in corporation tax over the same period. I don't even have to include the c. £55m dividend payments that would have been made had the club remained a PLC.
EDIT - Oh and one other point. That increased revenue that you're ludicrously dismissing as ''not doing the club any good'', has for example in the first half of this financial year covered a c. 10% increase in wages, the vast majority of which relates to the first team squad. There's a very clear example of the upside of the Glazers ownership. Glazer inspired commercial revenue increases paying for first team squad investment. A squad that currently sits top of the league.
A bit more than that has happened though, hasn't it? What you're saying is that you would prefer to concentrate on one aspect of what has happened without putting it into any kind of context.
We have kept up and surpassed Chelsea despite all these millions that have been wasted.
Chelsea were threatening to run away with English football, Arsenal's "invincibles" won the title then Chelsea won the title two years running. We were something like 18 points behind them at this stage.
Then we win it three years on the bounce, missed out on it by a point last season and are now top of the league with Chelsea all but out of the equation.
If the Glazers had been such a massive handicap over this last six years then surely we should have just been pissing the title every year prior to their arrival?
Tell that to the numerous other owners who don't seem to understand it. A lot of clubs have owners who are on TV spouting shite every ten minutes. Arsenal, Chelsea and United don't have owners who say very much and they have been the most successful for years now.
Abramovich has seemingly started to feck about with things behind the scenes - the appointment of Avram Grant shortly before the departure of Mourinho, the dismissal of Ray Wilkins shortly before their descent into their worst form in years. I have heard rumours that Abramovich was behind the purchase of Shevchenko that also precipitated the departure of Mourinho.
It might seem like a small thing but an owner who leaves the football to those who know it best and don't tinker to much with a winning infrastructure are the best owners in my eyes and it shouldn't be ignored or underestimated.
So you haven't noticed how many owners have bought clubs in recent years and sacked the manager within months of arrival? It happens all the time.
Well, yes, we do have all of those things and that's why the Glazers bought the club in the first place.
I suspect that if all this stuff had happened and we hadn't even come close to winning anything over the last six years then the protests against the Glazers would have received an awful lot more backing.
The fact is though that what we have at United now is success on and off the pitch. Both sides are working very well together. I honestly don't see why United fans are getting "absolutely fecked". We're not being charged miles more than any other Premier League club supporter to watch mid-division mediocrity. We're being charged roughly the going rate to see a team which is always challenging for top honours.
The obvious thing to do when they took over was not interfere with the management? Really? During that period when we hadn't won the league for nearly four years?
The 'obvious' thing to then was to not interfere?
Aside from Arsenal, I think there are very, very few examples of that point being substantive. Almost all other chairman, Abramovic included, would have fired Ferguson before the 2006/7 season. So sticking with the boss wasn't the obvious thing to do for the majority of chairman you would care to name, in that circumstance. It was the right thing to do however but we only got that with owners who are happy to take a longer-term approach.
The 'obvious' thing to then was to not interfere?
Aside from Arsenal, I think there are very, very few examples of that point being substantive. Almost all other chairman, Abramovic included, would have fired Ferguson before the 2006/7 season. So sticking with the boss wasn't the obvious thing to do for the majority of chairman you would care to name, in that circumstance. It was the right thing to do however but we only got that with owners who are happy to take a longer-term approach.
Look, I agree. It is my main criticism of the Glazer ownership too. It's one of my main problems with football as a whole. Have you seen how expensive it is to get tickets for this years CL final?
The argument over whether all that has happened is simply that supply has met demand I think is slightly disingenuous and the fact that a lot of fans have been priced out of the game, included at Manchester United, I think is an issue.
I think that if the campaign about keeping our ticket prices to a comparatively modest level was as ferocious as the campaign to overthrow the Glazers, perhaps some movement may have come in that area. Unfortunately campaigning for lower ticket prices doesn't get you on TV that much, so the interest wasn't really there...and still isn't by the looks of it. The concern seems to be the fawning over fantasy billionaires.
Top of the league 
One thing I have noticed here: One group is taking great pains to stress the rise in profits, revenue to the club. But, as Feeky observed, this benefits the owners alone, who use this extra income to pay off the interest on the loans taken by them. But the fans get their asses fecked without any lube!
And this group is very happy and smug about it. Maybe the owners use lube, liberally, in their case, making it less painful, for the selected few.
Weekend for me, mates. Getting off.
And this group is very happy and smug about it. Maybe the owners use lube, liberally, in their case, making it less painful, for the selected few.
Weekend for me, mates. Getting off.
Strange statement, no one is happy with the increase of the ticket prices.But if you compare what one pays to watch United with other teams it is'nt really that much more and in some cases a lot less.
What confuses me is that a lot of people that complain about the increase in the ticket prices to watch United and then moan when United have not spunked 30million pound on a player. I mean Wayne Rooney was totally concerned about the debt we are in when he went to the renegotiate his little pay rise.
If you want to see these quality of players at United, then I'm sorry your going to have to dip a little deeper into your own pockets to keep the likes of Rooney and John O'shea at our club.
If you want to see these quality of players at United, then I'm sorry your going to have to dip a little deeper into your own pockets to keep the likes of Rooney and John O'shea at our club.
Perhaps we're just happy that the team we support is so successful and we like watching them win?
Just saying, like.
And tbh, anver, isn't discussion of profits/revenue etc. what this thread is for?
But how much noise is being made about ticket prices?
It has been barely anything but a peripheral after thought for the groups who allegedly are there to represent the fans. Instead they have been caught up in this fantasy tactical war-game with the owner.
So it is a bit much to focus on ticket prices when those who should have been focusing on ticket prices and the fans concern of them have been running around trying to sound important like lay city financial analysts.
The silence over issues which actually concern the fans such as ticket prices has been deafening.
But whilst they're relatively uninterested in a small matter like ticket prices, some however will happily sell for profit a nice green and gold shirt or scarf to you, so you can really hit the owners wear it hurts. If where it hurts is presumably in their fashion senses.
170m???
With a rebased commercial revenue of 46m for 2005 (allowing for the 11 month financial reporting year) and commercial revenue of 100m for 2011, I get a cumulative increase of 144m. Excluding the Nike step-ups, that figure reduces to c. 130m. And this figure assumes that a phantom PLC over the same period would return zero growth in commercial revenue- an absurd assumption given that the PLC from 1992 onwards produced year-on-year revenue growth of c. 16%.
Even allowing for a modest increase of 6% pa (inclusive of the Nike increases) in commercial revenue during the phantom PLC’s tenure, the cumulative difference falls from 144m to 80m. At 7% pa, the difference falls to 68m. On that basis, you overestimate the performance of the Glazer ‘inspired’ commercial machine by at least 100%.
You mention the phantom dividend of 50m, but neglect to mention the interest related swap loss of 40m+, around 30m of which will have been paid by 2011 YE. There are other bits and bobs- management fees and loans of around 23m. It’s a bit ‘selective’ of you not to consider those real costs but allude to the phantom savings of 50m in dividends.
I just wonder how well the ‘Glazer inspired’ commercial machine would do with Brand Millwall FC. The club brand predated the Glazers; they leveraged it, they didn’t create it.
The primary driver of revenue growth is on-field performance. Success on the pitch feeds through to the three revenue streams. The playing squad(s), and management, have been fantastically successful and highly cost efficient (with total salaries less than 50% of turnover) since the inception of the PL. Their efforts produce the successful on-field performance that leads to the higher revenues; and for their efforts they receive appropriate remuneration. Players’ salaries are a necessary positive expense; they pay their own way and then some; as expenses go, the polar opposite of acquisition debt costs.
Yet, you would have us believe that the Glazers have had to raise commercial revenue, using only their own inspiration, just to pay a bunch of greedy players. This perspective doesn’t accord well with the views of the Glazer’s banker. JPM note that:
JPM said:
Fair enough point, but I can't afford it, so let's go back to the 90s and early 00s when we had cheaper tickets and had to make do with shit players.
No, I was talking about myself in that paragraph. The clue was in the words I typed.
Every penny that has gone on debt repayments, plus their consutlancy fees, plus bits and pieces like the payments the kids. I haven't got the exact numbers to hand, but I'm sure there's plenty on here that do if you need them.
You're suggesting we start paying wages of the 1990s level?
I'm suggesting that higher wages and prices don't lead to better football.
If you want to take the constant increase in both as fait accomplis and say things like your previous "sorry, you're just going to have to accetp that" then that's your watch, but I'm going to continue to state my objections to the situation, and continue to support any ideas aimed at changing the situation.
Thanks redjazz, you've said a lot of things that I suspected and many more that I knew. Great post.
It almost flies in the face of those who criticise the owners then for not splashing huge amounts of cash, doesn't it?
It seems as if you're siding with those of the opinion that spending money isn't necessarily a necessity for us?
Nobody suggests that only the Glazer's can make money and generate revenue but the fact they have shouldn't be ignored or fail to be acknowledged.
I wasn't for one second arguing that all the cumulative commercial revenue increase was down to the Glazers themselves. Having said that, clearly a very substantial amount can be attributed to their planning and expertise. As I'm sure you're aware I have in the past carried out a cash outflow analysis of the Glazers period in charge and compared it to what would most likely have happened had they not taken over and with the PLC structure continuing post-2005. The analysis showed that the actual negative net cash impact to the club on an annual basis was just c. £10m. Or to look at it another way, just 3% of the club's turnover in the current financial year. Peanuts in other words. I went on to argue that the benefits to the football club of the private ownership structure compared to that of the PLC, in terms of a far more streamlined decision making process coupled with a vast improvement in Fergie's position at the club, have more than outweighed the negative impact of having c. £10m pa less cash available.
The dividends aren't 'phantom' savings. Unlike the Glazers, who no doubt much to your disappointment haven't and won't take any dividends out of the club, the PLC paid dividends to shareholders year after year. You mention the nominal management fees but neglect to mention the PLC related running costs that the club is no longer burdened with (AGM, listed company etc). How awfully 'selective' of you.
And if you really want to go down the road of 'phantom' figures then shall we revisit your own 'analysis' which claimed the club would have little to no cash available for transfer expenditure after the Glazers had taken out an annual dividend to pay down their PIK debt? That hasn't worked out very well now has it?
Yes, they've leveraged the brand, and they've leveraged it bloody well! I don't disagree with your point about the significance of on-field performance. I was merely pointing out that the rising player wages clearly demonstrate that the Glazers have provided the manager with the necessary resources to maintain a very high level of on-field performance.
It'd be interesting to see a graph similar to the season ticket price one previously posted but regarding commercial revenue (exc. inevitable increases such asthe Nike deal etc), for the past decade or 2.
No, you've totall missed the point.
I'm siding with those of the opinion that spending the amount of money currently being spent on footballers isn't necessarily a necessity for any club.
There is no benefit for the supporter, it's a zero-sum game in terms of the actual football on offer. Players, agents, and in some cases club owners are the winners financially, fans and certain other club owners are the losers.
Buying players and paying wages has changed so much in the last ten years that for a club to complete with out a sugar daddy, that club has to raise those funds from some where and that some where has to be the fans.
BTW where have you taken that from?
So the only thing of interest in Friday's results was the news about buying back the Bonds - I remember there were rumours a few months ago about Glazers asking permission to do that, makes sense when you have that much spare cash in the bank.
The rest is business as usual - higher revenue, higher profit, plenty cash in the bank etc.
The rest is business as usual - higher revenue, higher profit, plenty cash in the bank etc.
Interesting that Arsenal have just announced a loss of around £2m for the last section. They're explaining that away to lack of player sales. Is a business plan that relies entirely on selling assets to generate cash, really that enviable?
As people in this thread are so fond of pointing out in other contexts, you can't compare us to a club like Arsenal. We've been creaming money in hand over foot for decades, and never have and never will have to rely on selling assets to generate cash. That mob have been skint ever since building their Islington palace.
Glad to see you recognise that!
Last year many of our fans were under the mistaken impression that we needed to sell Ronaldo to pay our debts - amazingly there are still some who seem to believe this bullshit myth.
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