ALL issues relating to the bond issue and club finances

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Rood said:
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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I would comment that, while you're right that the debt could be managed, we wouldn't have been able to afford any major signings without the Ronaldo sale, but there haven't been any major signings so it's something of an irrelevancy.

No, the Ronaldo sale was a happy coincidence, enabling the Glazers to get richer off the back of the club's success in a way they could never have foreseen. Praise be to God!

To be fair to Arsenal, Cashburden Grove (as it doesn't get called nearly enough anymore) is kind of their equivalent to our acquisition debt. If it wasn't for that they would have been a perfectly good profitable club for years. Their turnover is immense and they certainly don't need to rely on player sales for general income.
 
I'm not comparing ourselves to Arsenal at all but they have been held up as a prestige example of financial competence by many, including UEFA officials if memory serves me rightly.

Obviously a small loss is no disaster but if they do rely on asset sales to make money, I don't really see justification of the pedestal.
 
Aaron said:
Obviously a small loss is no disaster but if they do rely on asset sales to make money.
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I'd have to see more details of their accounts, but I doubt they do over a normal business cycle, given that they have the 5th highest turnover in Europe but aren't amongst the biggest salary payers. I presume the loss is either down to continued costs for the stadium, or some other exceptional items?
 
Aaron said:
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?
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I've not seen the figures and probably wouldn't understand them if I did but if there's one thing I have learned during my discussions on this topic it's that the words "made a loss" doesn't always mean that they actually "made a loss".

To be fair, I believe Arsenal are in slightly better shape financially than us.

It's just a shame for them that they can't win anything. :lol:
 
Just had a glance through the Arsenal stories, and they are still making an operating profit from football related activities. The losses were down to property deals etc.

Still seems odd to come out and say "The reduced profits for this interim year reflect the positive fact that the club did not sell a first team performer", mind. Makes you sound pretty small time!
 
How much of Arsenal's 'recent' (last two years) financial performance can be attributed to the real estate sales on the site of the old stadium, selling off of assets and little investment in the first team?
 
A1Dan said:
Just had a glance through the Arsenal stories, and they are still making an operating profit from football related activities. The losses were down to property deals etc.

Still seems odd to come out and say "The reduced profits for this interim year reflect the positive fact that the club did not sell a first team performer", mind. Makes you sound pretty small time!
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Their operating profit has near enough halved though from what I've read.

Two fewer home matches in the first half of this season compared to the previous year also contributed to the reduction of football operating profits from £18m to £9.3m.
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Arsenal's accounts reveal £2.5m loss | News Article | klikFC
 
Aaron said:
Their operating profit has near enough halved though from what I've read.



Arsenal's accounts reveal £2.5m loss | News Article | klikFC
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I'd estimate that the two fewer home games impacts EBITDA to the tune of c. £5m but even taking that into consideration these are a pretty poor set of results.

That £9.3m EBITDA (or £14.3m) for their half-year results compares to United's c. £60m EBITDA for the first six months of our financial year. Their half-year end date is November 30 2010 compared to ours at December 31 2010, which does have an impact on the results, but even so there's a huge difference between the two club's ability to generate cash.

It's well worth mentioning that Arsenal's net increased investment in the first team squad was just £3m in that period (£4.5m higher wages minus £1.5m net cash transfer expenditure) compared to United's net increased investment of £18m (£6m higher wages plus £12m net cash transfer expenditure).

So what allows United to invest so much more in the first team squad than Arsenal whilst at the same time reporting a very solid, positive set of financial results compared to Arsenal's weak financial performance?

Quite simply, in two words, it's our good friend ''Commercial Revenue''. Or in the case of the comparison between United and Arsenal, it's the fact that whilst our commercial revenue grew by a staggering 30%, Arsenal's actually fell slightly!

So whilst there may be some truth in Andersred's description of our financial performance as akin to ''only running on one engine'', it would also be true to say that the engine in question is a fecking gold plated, exceptionally high-powered and tremendously well performing Rolls Royce engine.
 
TheMancRedDevil said:
To be fair, I believe Arsenal are in slightly better shape financially than us.
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Don't believe the media hype, TMRD, it's simply not true. Our turnover will be c. £80m higher than Arsenal for the current financial year, we're able to sustain/support a significantly higher wage bill than Arsenal (£25m-£30m higher), and we also have vastly more cash available for transfer expenditure (£20m-£25m more than them).

And significantly, the financial gap between the two clubs is only going to increase further in the years to come.
 
GCHQ said:
Don't believe the media hype, TMRD, it's simply not true. Our turnover will be c. £80m higher than Arsenal for the current financial year, we're able to sustain/support a significantly higher wage bill than Arsenal (£25m-£30m higher), and we also have vastly more cash available for transfer expenditure (£20m-£25m more than them).

And significantly, the financial gap between the two clubs is only going to increase further in the years to come.
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How so? They have a pretty small deal with Nike and Emirates shirt sponsor (worth a measly £7m per season) right now, due to them, needing to raise cash for the stadium, surely if anything when they renogiate that, they have far more room for growth than us.
 
GCHQ said:
Don't believe the media hype, TMRD, it's simply not true. Our turnover will be c. £80m higher than Arsenal for the current financial year, we're able to sustain/support a significantly higher wage bill than Arsenal (£25m-£30m higher), and we also have vastly more cash available for transfer expenditure (£20m-£25m more than them).

And significantly, the financial gap between the two clubs is only going to increase further in the years to come.
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It may have been 12 months when I last looked at brief figures and it just seemed like our profit, minus the debt outlay would have brought us below Arsenal profit - at the time.

They were/are our nearest challenger financially though, right? (I mean if you remove the sugar daddy impact of clubs like Chelsea/City).
 
Devil_forever said:
How so? They have a pretty small deal with Nike and Emirates shirt sponsor (worth a measly £7m per season) right now, due to them, needing to raise cash for the stadium, surely if anything when they renogiate that, they have far more room for growth than us.
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Those deals with Nike and Emirates expire in June 2014, so whereas they might well temporarily close the gap in the 2014/15 financial year it's worth noting that our AON deal also expires in June 2014 and more importantly we can expect a significant increase in revenue when our own agreement with Nike expires in 2015.

Put simply, we have a much larger global fan base than Arsenal, particularly in the fast growing and emerging markets of Asia, and I've every confidence that the financial gap will continue to increase over the next few years in the form of further second tier and telecommunication partnership agreements due to our ever increasing appeal to multi-national companies.
 
Excellent - so we should see the result of this improved financial position manifest itself in one or more of increased transfer spending, frozen ticket prices or stadium expansion then?
 
TheMancRedDevil said:
It may have been 12 months when I last looked at brief figures and it just seemed like our profit, minus the debt outlay would have brought us below Arsenal profit - at the time.
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That was purely due to exceptional items though, which negatively impacted our results and positively impacted on Arsenal's. In our case there was £65m of exceptional items relating to the refinancing and Arsenal benefited from £38m profit on player sales as well as c. £15m EBITDA from their property development business.

The respective operating results from purely football operations in 2009/10 were:

United - £100.8m EBITDA

Arsenal - £57m EBITDA

Going forwards our annual financing costs will be c. £45m compared to Arsenal's c. £20m.

Given that we'll continue to grow revenue and EBITDA faster than Arsenal, then you can appreciate that we're financially considerably stronger than them.

TheMancRedDevil said:
They were/are our nearest challenger financially though, right? (I mean if you remove the sugar daddy impact of clubs like Chelsea/City).
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Yes, nearest challenger, but in reality not actually that near at all.
 
The Nike deal will be interesting. I was speculating earlier whether or not the club would wish to lock itself into such a long term deal again as it did before. Surely a disadvantage with that is whilst you get income stability, you could well be in a position in four or five years time when you feel that compared to your competitors you're not getting a great deal anymore each year yet be unable to do anything about it for another five.
 
Aaron said:
The Nike deal will be interesting. I was speculating earlier whether or not the club would wish to lock itself into such a long term deal again as it did before. Surely a disadvantage with that is whilst you get income stability, you could well be in a position in four or five years time when you feel that compared to your competitors you're not getting a great deal anymore each year yet be unable to do anything about it for another five.
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Yes, it certainly won't be a 13 year agreement. We can thank the daft old PLC for that. They were so busy congratulating themselves on that deal back in 2000 that they failed to leverage the brand further on the back of the 1999 treble triumph.
 
GCHQ said:
Yes, it certainly won't be a 13 year agreement. We can thank the daft old PLC for that. They were so busy congratulating themselves on that deal back in 2000 that they failed to leverage the brand further on the back of the 1999 treble triumph.
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France's deal is worth around £40m a year over seven years, I think. It's hard to see why we wouldn't be able to at least double that if we're using that as the precedent.
 
GCHQ said:
That was purely due to exceptional items though, which negatively impacted our results and positively impacted on Arsenal's. In our case there was £65m of exceptional items relating to the refinancing and Arsenal benefited from £38m profit on player sales as well as c. £15m EBITDA from their property development business.

The respective operating results from purely football operations in 2009/10 were:

United - £100.8m EBITDA

Arsenal - £57m EBITDA

Going forwards our annual financing costs will be c. £45m compared to Arsenal's c. £20m.

Given that we'll continue to grow revenue and EBITDA faster than Arsenal, then you can appreciate that we're financially considerably stronger than them.



Yes, nearest challenger, but in reality not actually that near at all.
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Thanks for all that GCQH. Appreciate you taking the time.
 
Aaron said:
France's deal is worth around £40m a year over seven years, I think. It's hard to see why we wouldn't be able to at least double that if we're using that as the precedent.
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There's is around 35m euros iirc and you've got to be having a laugh if you think we can get anything like £70m-£80m PER YEAR for our kit deal. Like GCHQ has said before, the £45m mark sounds realistic.
 
UnitedRoadRed said:
Stop eating so much. Stick to licking Glazer's ass instead.

fecking ridiculous that there's a new shirt out every year.
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Thanks for the advice.

To be honest, I agree with you. It wouldn't be so bad if they released the new kits at Xmas because at least then you could kill two birds with one stone but you feel a bit of a tight-wad buying your son a new kit in July and telling him, "Now that's for Xmas!"
 
His blurring of the lines between support for the Glazers and support for the club would have been funny if it wasn't so transparent and desperate.
 
GCHQ said:
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.
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These streamlined decision making processes have brought us which players recently? Bebe? Obertan?


GCHQ said:
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.
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:lol::lol::lol:
 
A1Dan said:
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.
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eighty million laffs to that one :lol:
 
Feeky_Magee said:
Parliamentary Football Review:

Player

United stuff starts at 10:59am. Note David Gill lying at 11:02:58.
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One interesting point is that even after the sale of Ronaldo our net spend on players post takeover is higher than the pre-takeover, according to Gill. Yet people will ignore that point and resort to the usual points to bash Gill with.
 
Heardy said:
I don't think the sale of Ronaldo classes as a cash generating exercise.

We didn't sell him on monetary grounds. We sold him because he no longer wanted to be at United.
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Some things in life are bad
They can really make you mad
Other things just make you swear and curse.
When you're chewing on life's gristle
Don't grumble, give a whistle
And this'll help things turn out for the best...

And...always look on the bright side of life...
Always look on the light side of life...
 
Devil_forever said:
One interesting point is that even after the sale of Ronaldo our net spend on players post takeover is higher than the pre-takeover, according to Gill. Yet people will ignore that point and resort to the usual points to bash Gill with.
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Yep! it's that streamlined decision making process that has brought in all those brilliant players recently.
 
Devil_forever said:
One interesting point is that even after the sale of Ronaldo our net spend on players post takeover is higher than the pre-takeover, according to Gill. Yet people will ignore that point and resort to the usual points to bash Gill with.
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According to Andersred, that's not actually true, what's more it should actually be true, given the inflation of the transfer market which Gill and Ferguson are always talking about.
 
robertsons a bit pointless, best to ignore him... maybe then he'll post something of substance, as opposed to mildly amusing ramblings followed by green smilies...
 
kietotheworld said:
According to Andersred, that's not actually true, what's more it should actually be true, given the inflation of the transfer market which Gill and Ferguson are always talking about.
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The same andersred who got it completely wrong about the PIKs, whilst Gill was proved to be telling the truth all along? Is there a link to where Andersred says that btw?
 
Devil_forever said:
Do you contribute anything else than that? Look up our gross and net spend in recent years and come back instead of reading typical scaremongering rubbish.
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You must be aware of which way the wind is blowing.... another couple of bad results and this will be all you'll hear.
 
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