💸📈📉
#PSR
– Protectionist or prudent? 💸📈📉
🧵...
As
#NUFC
,
#EFC
and
#AVFC
amongst others are exasperated with PSR rules (
#UEFA
rules implemented ’09,
#EPL
in 2013), we compare on-pitch performance of
#Spurs
, NUFC and EFC and how it was funded.
·
#Spurs
: £1.2bn self funded,
🚨👹
#MUFC
3Q24 Results: Devil’s in the (red) detail 👹🚨
🧵
· 23/24 PSR: I see £1.8mn headroom vs.
#PSR
allowable losses. Alvaro sale,
#Sancho
loan windfalls, cup final win all play a role. Likely not all exceptional costs to be added back for
#PSR
.
· Cash still king: £205mn
@RohanJivanAFC
I like that you're forward looking, but please be consistent. Total reported fee for
#Calafiori
€45mn.
Total reported fee for
#Zirkzee
€42.5mn
🧱A Noussair double transfer DeLig(h)t🧱
Saturday night is alright for
#MUFC
, finally getting their Bayern Brothers
#DeLigt
and
#Mazraoui
to complete the first stage of their defensive rebuild...mini 🧵
· Total deal value is £60.1mn for both players (incl. “easy” add-ons).
·
@Malachians
Phil, about £23mn positive impact to 24/25 PSR position from deals completed so far. And by the sounds of it some more sales in the works too. Makes a difference having some proper operators in place! 👇
💥⚽️Everything about you so
#Zirkzee
⚽️💥
Mini 🧵
#Zirkzee
the next deal off the rank for
#MUFC
. Another interesting dynamic for cash flow (see links below for my extensive work) which is in sharp focus post 3Q24 results.
#MUFC
chose to pay an additional £2.1mn total transfer fee
👱♂️ Donny not so Darko? 👱♂️
#vandebeek
deal is interesting on a stand alone basis, only upside from here.
£6.3mn
#PSR
loss on initial transfer fee is all offset by saved wages.
Add-ons structure means likely £4.2mn net benefit for PSR in 24/25;
Potential for up to £16.9mn
@TenHagEra
They may value Ugarte at €60mn but in a world where PSG have bought Neves for €60mn + €10mn + Sanchez one year loan, aren’t playing Ugarte and club knows he wants
#MUFC
, I’m not sure how they can justify such a high valuation.
👋🇺🇾Farewell Facundo, but what can
#MUFC
afford now?🇺🇾👋
· Pellestri leaves generating another modest c.£5mn PSR gain, trimming the squad fat.
· Phase 1 of squad restructure has been done for a c. £11mn accounting profit.
· Solid cash conservation but still costing c.£40mn.
·
#MUFC
’s current financial position (rather than
#PSR
per se) doesn’t allow for too many big $ signings and with Yoro already in, new leadership showing some restraint and not following same mistakes of prev regime. €60mn fee (c. £52mn) with a significant chunk of cash up front
🚨 EXCL: Man Utd switch midfielder search away from Manuel Ugarte & onto other options.
#MUFC
don’t intend to meet ~€60m fee + will only revisit if
#PSG
price drops. No progress yet, talks cooled + exploring other top targets for right deal
@TheAthleticFC
🏟️99 Problems, but a not so (B)old Trafford ain’t one🏟️
At least a £125mn incremental matchday revenue per year opportunity for
#MUFC
but costs could be as high as £3bn
Three funding sources:
1. Equity (up to £1bn)
2. Debt (up to £2bn)
3. Government funding (TBC)
Stadium
Is SJR going to fully takeover in 2027? The spotlight is shining on MUFC; esp the playing style, playing squad and manager. But to understand what might happen there its worth revisiting what’s likely to happen to the ownership structure… 🧵
💥🚨 One for today and one for tom-Yoro 🚨💥
Seemingly out of nowhere, this Yoro-KO for Madrid is a statement signing for
#MUFC
. The financials from a
#PSR
perspective can make sense (
#Yoro
‘24/25 PSR cost of £25.4mn incl. agent fees; £18.9mn ongoing annual cost vs. Varane annual
💥🚨
#MUFC
Summer Transfer Update; still raising the floor affordably but marquee sales still the unlock for significant squad and financial rebuild 🚨💥
🧵...
· Extension of revolving facility alleviates near term cash pressures.
· Squad rebuild will take time; lowering age
🚨Updating
#MUFC
Summer '24 transfer forecasts🚨
Mini 🧵...
- Retaining £320mn gross transfer spend
- £220mn Player Sales (factoring in a sale of Rashford to support
#MUFC
financials position)
- £148mn FSR transfer profit.
- 57.5% Squad cost ratio
Building the foundations for
@NostalgicNUFC85
An alternative angle…
#villa
can sell a player for a hefty profit which can then be reinvested into the squad/ stadium which needs a reboot…which is how most businesses work…
@UtdDistrict
SJR owns 28.9% of
#MUFC
;
#INEOS
owns 100% of Nice so this will be a non-issue. Precedent has been set with City and Girona, as long as a multi-club owner can show they do not have deciding control then UEFA will allow United and Nice to compete in the same European comp. Same is
💥⚽️Everything about you so
#Zirkzee
⚽️💥
Mini 🧵
#Zirkzee
the next deal off the rank for
#MUFC
. Another interesting dynamic for cash flow (see links below for my extensive work) which is in sharp focus post 3Q24 results.
#MUFC
chose to pay an additional £2.1mn total transfer fee
🕷️🕸️SpiderWan Bissaka: No Way Back to MUFC🕸️🕷️
#MUFC
are finally selling
#WanBissaka
to
#WestHam
for £15mn.
· The c. £3mn balance sheet value implies £12mn profit and total wage cost savings of c. £6.3mn drive an £18.3mn total ‘24/25 PSR benefit from the sale.
· Interesting
Balance sheet value on
#Antony
is about £49mn. Total annual salary costs for
#MUFC
are c.£14mn. Would need a £35mn initial fee to have a net nil impact to
#MUFC
#PSR
position in ‘24/25.
But more importantly a deal could 1. Be another step to restructure inflated Men’s team wages
🚨 JUST IN:
Beşiktaş have made a move for Antony. Manchester United want to sell the player, but Antony wants to stay.
#MUFC
[
@ertansuzgun
via
@bjkhabers
]
The Esquire (
@ole_was_right
) with a lovely little summary of SJR's latest hire below.
#MUFC
fans want best in class? To quote an enigmatic Portuguese man, he is not "one from the bottle". Also interesting when you think about
#MUFC
as a global super brand, and driving further
Just for shits and giggles, I looked into this guy. And holy shit, he has a career that makes me envious-- albeit, at the expense of having significant ties with governments. But, in any case, is what "best in class" fucking looks like:
His background is actually as an attorney
💸Does
#Rashford
have a final £100mn gift for
#MUFC
? 💸
🧵...
United are low on cash (£65mn) but have transfer bills (£276mn total transfer payables); debts to repay (£150mn due in April ’25 and £480mn in Jun 27) and the squad needs rebuilding.
- Another £200mn is needed to
✌️🔴Peace out, Big Willy and Evans is still Red ✌️🔴
Mini 🧵
#MUFC
’s first fortnight continues to move faster than Lewis Hamilton down the Hangar straight.
·
#Kambwala
to
#Villareal
for initial £4.73mn; add-ons and sell-on clauses provide future leverage, whilst Evans signed a
💸Does
#Rashford
have a final £100mn gift for
#MUFC
? 💸
🧵...
United are low on cash (£65mn) but have transfer bills (£276mn total transfer payables); debts to repay (£150mn due in April ’25 and £480mn in Jun 27) and the squad needs rebuilding.
- Another £200mn is needed to
Initial Defence restructure for £5mn net
#PSR
benefit
#MUFC
have let Varane, AWB, Kambwala and Fernandez all go and brought in Yoro,
#DeLigt
and
#Mazraoui
. Net, they have likely upped the floor of the defence that fit to a style of play. From a
#PSR
perspective the profit from
💥And then there were 6…Ashworth and Vivell join
#MUFC
💥
Mini 🧵
A huge day for
#MUFC
off the pitch as more cogs in Jim and Dave’s master football structure are in place.
SJR has moved at lightspeed as the biggest shareholder of
#MUFC
. 6 new names in 4.5 months and almost a
Old negotiating habits die hard for legacy
#MUFC
players…an AWB deal effectively freed up
#PSR
capacity for both De Ligt and Mazraoui deals.
£18mn fee (assuming all up front) is a c.£13.5mn
#PSR
profit. This means
#MUFC
has the room under PSR to sanction 5yr deals for a total
🚨 Aaron Wan-Bissaka is demanding a multi-million pound pay-off from Manchester United to leave the club this summer. West Ham are willing to meet United’s £18m valuation for Wan-Bissaka but they cannot afford his wage demands leaving the deal in limbo.
#MUFC
[
@MattHughesMedia
]
@cmwinterburn
Phrase you might be looking for, Chris, is phase 1 of restructuring a defence under a cohesive footballing direction for a P&L gain of £5mn 👇
🧱A Noussair double transfer DeLig(h)t🧱
Saturday night is alright for
#MUFC
, finally getting their Bayern Brothers
#DeLigt
and
#Mazraoui
to complete the first stage of their defensive rebuild...mini 🧵
· Total deal value is £60.1mn for both players (incl. “easy” add-ons).
·
A tough but necessary measure from
#MUFC
for long term on and off-pitch success.
My full forecasts had £65mn staff cost savings for 24/25; £12.7mn from non-playing staff (c. 300 employees).
Notably, rev per employee (assuming 2023 revs) would move back well ahead of many peers
EXCLUSIVE
🔴Manchester United to make close to a quarter of its workforce redundant
⚫️Up to 250 employees to go after cost review
🔴Money saved will go on first team
⚫️PSR restrictions also impacted
🖋️
Agree with
@Malachians
, here. In the post Fergie-Gill era, this window is set to near the most number of deals (for a fee) for one of the lowest “Net spends” (hate the term but paints the picture). In the backdrop Phil describes. Will it be perfect and solve all problems, no (SJR
Yoro, Mazraoui, Zirkzee, De Ligt and Ugarte is a fantastic window for a club with no Champions League football and who just had their worst PL finish in history.
Will MUFC have a
#PSR
problem?
It might be a tight squeeze. 2024 revenue guidance of £660mn was a welcome boost for
#PSR
but the profit expectation was about the same, so the extra revenue is being spent. I see
#MUFC
under the
#PSR
allowable loss threshold by just £1.8mn. The key
👱♂️ Donny not so Darko? 👱♂️
#vandebeek
deal is interesting on a stand alone basis, only upside from here.
£6.3mn
#PSR
loss on initial transfer fee is all offset by saved wages.
Add-ons structure means likely £4.2mn net benefit for PSR in 24/25;
Potential for up to £16.9mn
Somewhat disingenuous comparison. SJR has all but put a new sporting infrastructure in place, from scratch.
#LFC
/
#FSG
have gone back to a similar structure they used to have in place.
The review has taken longer than some
#MUFC
fans expected but retaining true perspective is
Since Klopp’s announcement of leaving Liverpool, Liverpool/FSG have appointed FSG CEO of football (Edwards), FSG Technical director (Ward), FSG Director of football development (Marques), Liverpool sporting director (Hughes), and Liverpool football club head coach (Slot)
INEOS
@stv_ncl
Saint-Maximin was 26 with 2 years left on his deal.
Diaby is 25 with 4 years left on his deal.
I’m not sure it’s that out of kilter for
#NUFC
or
#AVFC
@cmwinterburn
I’m fairly sure
#MUFC
are well aware of their
#PSR
position. This is trimming the squad and maximising profit for a player unlikely to play (barring another injury fiasco) before his contract runs out and no value can be obtained.
🚨👹
#MUFC
3Q24 Results: Devil’s in the (red) detail 👹🚨
🧵
· 23/24 PSR: I see £1.8mn headroom vs.
#PSR
allowable losses. Alvaro sale,
#Sancho
loan windfalls, cup final win all play a role. Likely not all exceptional costs to be added back for
#PSR
.
· Cash still king: £205mn
@Malachians
Agree with the sentiment but by this definition the Glazers really weren't that successful either (see underlying profit (EBIT) margin graph below). Their success was their cash on cash return through dividends with no personal investment.
📈📉Does football and the
#EPL
have a growth problem? 🧵
In the light of
#MCFC
’s complaints about constraints from
#FFP
, let’s look at an underlying financial driver for all clubs.
- Domestic Broadcasting growth has slumped, limitations internationally, “Netflix of football” can
Dog-gone Debt
Debt is still an issue, a £654mn issue, to be almost precise. Recent news of extended terms to existing debt facilities is interesting when considering the aforementioned cash issues. Remember these debts have to be paid down and with what we currently know the
Laying the foundations for better future financials
#MUFC
’s 5% general admission season ticket price increase is less than other
#EPL
but noteworthy from a revenue and cash perspective. Combined with the “raising the floor, affordably” transfer strategy will see amortisation and
🚨Greenwood: Going, Going...Finally Gone?🚨
Another day, another apparent
#MUFC
deal with
@David_Ornstein
reporting a deal agreed with
#Marseille
for
#Greenwood
– pending player approval.
Another interesting deal, here maximising near term profit and creating long-term leverage
Cash (Flow) is still king 👑
#MUFC
’s cash position remains low at £67mn, and the all important free cash flow (how much cash the Club generates before debt or equity investment funding) remains stark. The Club lost £205mn in free cash flow in the first 9 months of the year; how
@Lea_EFC
Unfortunately for
#EFC
this position is a product of financial mismanagement of current owners. And for
#MUFC
they’re new definition of player valuation is not determined by their historic standards - it’s based on the reality of the current industry, slowing growth and inflation
💸📈📉
#PSR
– Protectionist or prudent? 💸📈📉
🧵...
As
#NUFC
,
#EFC
and
#AVFC
amongst others are exasperated with PSR rules (
#UEFA
rules implemented ’09,
#EPL
in 2013), we compare on-pitch performance of
#Spurs
, NUFC and EFC and how it was funded.
·
#Spurs
: £1.2bn self funded,
#Deligt
and
#Mazraoui
in numbers
De Ligt
Initial fee £38.62mn
Add-ons £4.29mn
Total potential deal fee: £42.91mn
Mazraoui
Intial fee £12.87mn
Add-ons £4.29mn
Total potential deal fee: £17.16mn
Double Deal Total
Total initial fee: £51.49mn
Total add-ons: £8.58mn
Total potential
@hbrooks_coach
It’s good business for
#spurs
, my friend.
He’s 28 (soon 29), 1 year left on his deal.
About £3mm balance sheet value so c. £8.4mn
#PSR
profit and £6.5mn annual wage costs savings (high earner at spurs) so £14.9mn
#PSR
capacity opened up.
Of the £100mn ongoing cost savings I think might be available, £65mn came from staff (incl. wages); £35mn from other savings. To put
#MUFC
's staff numbers into context, they have the highest staff out of any "Big 6 Club" and the lowest Rev/ Employee ratio (on par with
#LFC
but
Whilst this is clearly a tough time for those impacted, this speaks to the volume of cost and cash savings the club needs to make. This is one of the first steps in the process of filling the £200mn hole 👇
@Muppetiers
@FabrizioRomano
Pretty standard negotiation tactic. Key question is with
#Bruno
approaching 30 and 2 years left on his contract (plus 1 yr option), do
#MUFC
and SJR need to sign him to a new deal? Especially when that would push him towards £300k/ week at a time Squad cost is being restructured.
Cash saving initiatives balanced with investments
I wrote earlier this summer on
#MUFC
’s cash position being their biggest near term financial hurdle whilst they fix on pitch performance (and everything that subsequently flows from that). The latest financials are a stark
@DeadlineDayLive
@CraigHope_DM
These two things don't tally. Removing FA Cup final perks and banning working from home are club/ company policies - nothing related to the football industry.
This is the cultural reset in action.
🚨⚒️ Official, confirmed. Aaron Wan-Bissaka joins West Ham from Man United on £15m fee.
Contract will be valid until June 2031 as his salary will be spread over 7 years.
↪️🔴 Next: Mazraoui (and Matthijs de Ligt) to Man United.
@TenHagEra
Isn’t the fact he’s a sellable asset (in your opinion), the entire reason why
#MUFC
should be holding out for the best price. Esp when historic transfer dealings have been so shambolic?
@KieranMaguire
@ParkTheBus15
@KieranMaguire
My £65mn includes player salaries.
Savings from players leaving (6) on a free: £43.2mn
Completed/ Expected sales (Fernandez, Sancho, Casemiro, MG: £34.1mn
Replacement cost (6 players on £80k/ week): £25mn
Net Savings from squad rebuild: £52.3mn
So £12.7mn staff
@SwedishRumble
There’s a £200mn hole to regain some financial security that needs to be plugged through cost savings and a silver bullet player sale. That should happen before any significant outlay happens this summer. Irrespective of FFP.
💸Does
#Rashford
have a final £100mn gift for
#MUFC
? 💸
🧵...
United are low on cash (£65mn) but have transfer bills (£276mn total transfer payables); debts to repay (£150mn due in April ’25 and £480mn in Jun 27) and the squad needs rebuilding.
- Another £200mn is needed to
#PSR
impact
#DeLigt
Annual amortisation: £7.72mn
Estimated salary cost: £10.77mn
Estimated agent fees: £5.06mn
Total ‘24/25 est PSR cost of Player purchase: £23.55mn
Ongoing annual PSR cost of player purchase: £18.49mn
#Mazraoui
Annual amortisation: £2.57mn
Estimated salary
My mind’s telling me no, but my body, my body is telling me also no.
Such a pay off would eat into about 25% of the benefits of selling AWB (from a
#PSR
perspective). Chancing arm from old school
#MUFC
leadership behaviour. Not sure even AWB camp believe they’d get such a
BREAKING: Aaron Wan-Bissaka wants a £7m pay off from Manchester United to agree a move to West Ham, it has been confirmed this morning.
He wants the £7m pay off because he would be a free agent in a year.
@westhamfootball
Can't see this happening. Greedy.
More sales still needed to fund squad overhaul
Total trading this window has
#MUFC
at a £3.21mn
#PSR
profit. The defence has seemingly had its main reset now and whilst in
#PSR
terms
#MUFC
have done well, it has a net cash cost of c. £75mn (net fees and wages). Whilst 3 year
#PSR
Succinct summary as always by Kieran on
#MUFC
#PSR
position. Reminder I had them as passing 23/24 3 yr PSR position (👇) by £1.8mn which incl. the £40mn Covid allowance. Still a question on the exceptional fundraising costs but don’t see anything to change view at this point.
I’ve been asked by a few people to investigate £40m Covid allowance that Man Utd have in 21/22 accounts. Have spoken to senior sources at Club & elsewhere. The reasons are
1: Cancellation of Summer 2021 tour
2: Bad debts caused by commercial partner insolvency
💸Does
#Rashford
have a final £100mn gift for
#MUFC
? 💸
🧵...
United are low on cash (£65mn) but have transfer bills (£276mn total transfer payables); debts to repay (£150mn due in April ’25 and £480mn in Jun 27) and the squad needs rebuilding.
- Another £200mn is needed to
🥶📉Is inflation in football finally set to cool?📉🥶
🧵...
- Growth for the Traditional
#EPL
"Big 6" is slowing.
-
#FFP
focus moving to squad cost ratio 70% of revenue.
- Cash metrics are at their weakest for many (near term transfer payables c. £1bn).
- Amounts owed for
@mufcMPB
@CrackDeportivo_
No idea if this kid is good or fits the profile
#MUFC
are looking for under the new philosophy, but financially fits the bill. “Low cost” (£4-5mn/ year amortisation), sensible wages, supports a healthier squad structure.
@Malachians
Not sure it’s quite that simple here, Phil.
#Bruno
’s side clearly looking to renegotiate with upcoming contract expiry (and potentially last big contract given his age). Are
#MUFC
actually under any pressure to hand out an extra contract given the financial challenges (£200mn
Statements made, delivery key
SJR and
#MUFC
’s new football hierarchy have not been afraid to make big statements since beginning their reign.
#Yoro
’s transfer is another. On one hand the deal has been reassuringly quick. But the significant fees were required to get it done,
#Yoro
in Numbers
£52.1mn Fixed Fee
£6.72mn Add-ons
Total Potential Deal Fee: £58.80mn
Note: this reflects most cautious reported deal structure for
#PSR
purposes
No owner can outrun their total finances. Historic choices determine your current financial position. That doesn’t reflect on who you are as an owner or what you want to be. Tough financial decisions need to be made that set the platform for future success.
#MUFC
have stopped
Briefs dropping about a severely restricted transfer budget...if true. Remind me what's different about INEOS? This is their first window. They have to make a splash. If we stand still we'll fall off
@TenHagEra
Very clever private equity led financial engineering doesn't mean you have more ambition. It's simply a high risk - high reward approach. SJR taking a more sustainable approach at
#MUFC
, this summer's squad rebuild likely similar and could pay dividends (not literally) in 2-3
@GeordieMAG_
Saint-Maximin was 26 with 2 years left on his deal.
Diaby is 25 with 4 years left on his deal.
I’m not sure it’s that out of kilter for
#NUFC
or
#AVFC
If you want to look at some playing stats:
Diaby - 140 goal involvements in 293 games (incl 20 in 28 in Europa League and 14 in
#PSR
impact
£35.7mn over 5 years implies a £7.14mn annual amortisation charge
Limited reports on wages but assuming wages are doubled vs. Bologna would imply c.£2.6mn total salary costs
£9.72mn total annual PSR cost from Player purchase
🚨 Donny van de Beek to Girona, here we go! Deal in place with Man United, permanent move for €500k fixed fee plus several add-ons.
Easy add-ons to bring fee up to €4/5m plus extra add-ons can make it €15m.
Contract until June 2028.
#MUFC
will also have sell-on clause.
🌇 Swap season about to reconvene? Acquiring
#Ugarte
and Selling
#Sancho
🌇
#PSG
don’t really need to worry about
#PSR
(or FSR for
#UEFA
) with
#Mbappe
leaving as they shifted a reported £170mn from their annual cost base.
But for
#MUFC
, reducing cost and turning a profit is
So will SJR ever be a majority/ complete owner of MUFC? Probably. There’s effectively a cliff edge built into the Agreement 3 years after the Closing Date. There are a lot of ways this could play out but realistically I see a couple of options:
Of the £100mn ongoing cost savings I think might be available, £65mn came from staff (incl. wages); £35mn from other savings. To put
#MUFC
's staff numbers into context, they have the highest staff out of any "Big 6 Club" and the lowest Rev/ Employee ratio (on par with
#LFC
but
Ratcliffe on Bloomberg – the breakdown
A feature length interview from SJR on Bloomberg last week shone a light on a number of ST and LT areas of focus for
#MUFC
, the
#EPL
and broader football landscape (mini 🧵...)
·
#MUFC
fans: reason for hope but clear indications this is
@JanAageFjortoft
It’s actually called how to run a proper operation
@JanAageFjortoft
. Speak to your network to understand the lay of the land.
Mr Bloom and Brighton (just one e.g.) have rightly been lauded for great succession planning historically. How do you think they did that?
Phase 1 of squad restructure £11mn in the (accounting) red
#MUFC
’s squad restructure is underway in earnest. This summer, they are in the red by c.£33mn (£11mn incl. all agent fees) on a PSR basis. The much needed initial Defensive restructure has been completed for a net £5mn
Updates to SPG tracker
· The SPG transfer tracker has been updated to show
#MUFC
's live estimated 3 year
#PSR
position for ‘24/25 season and associated headroom.
· The tracker therefore shows the significant impact of Varane/ Martial wage savings on
#PSR
position (c. £41mn)
·
Nice summary from
@SwedishRumble
below. From my POV, point two here is a result of current football finance regulations and why the rules need to be changed.
#PSR
#FFP
🚨Martin Samuels covers the issue that one of Ipswich and Southampton might be assured to not be relegated, if City is expelled plus one of Leicester, Everton and Chelsea are demoted after point deductions — all out of the public eye.
The argument — ‘should you be punished for
@ole_was_right
People hearing what they want to hear, Esq.
#MUFC
have big Covid allowable losses that have already been agreed because they played by the rules. A non story.
Will the government help?
A project like this with clear local economy benefits could well attract funding from local or even national government. Funding amounts are difficult to predict given the nature and sheer scale of the project (“Regeneration of Southern Manchester…with
(1) Glazers start an auction to sell their remaining shares – SJR/ INEOS (they can get involved too) match any offer on the table (take a guess on the price)
(2) Glazers try to play hard ball; SJR just starts issuing new shares to dilute the Glazers to take majority ownership
Key themes from
#MUFC
’s window so far
#MUFC
have sold 4 players, bought 1 and renewed 2 expired contracts so far this window.
· Club clearly trimming fat from squad – maximising short term player trading profits and optimising the cost base.
· Players bought to raise the squad
@iansumm03608301
It’s definitely a flaw in the system, Ian, but also a challenge of enforcing such a scheme in the middle of seismic landscape change in football. Football clubs, in general, are not profitable and PSR solves for that - which in theory solves the capital structure issue, LT. But
📈📉Does football and the
#EPL
have a growth problem? 🧵
In the light of
#MCFC
’s complaints about constraints from
#FFP
, let’s look at an underlying financial driver for all clubs.
- Domestic Broadcasting growth has slumped, limitations internationally, “Netflix of football” can
🤑💸
#Spurs
are seeking a £3.75mn Enterprise Value for a 10% equity stake in the club
This Enterprise Value (EV) puts it at the top table of football club valuation and reflects a multi-year cycle of excellent financial management by Daniel Levy. But he’s not stopping here, this
£3bn cost and 3 different funding streams
Reported costs have started at £2bn, but the nature of these projects can mean costs as much as 50% above initial estimates. For those with dolphin like hearing, SJR has already given us a clue for new stadium funding options (22:20-23:00
Revenue
#Spurs
invested smartly, drove a 5x increase in revenue, through all income streams: matchday, broadcasting and commercial
#NUFC
: barely invested but 3x revenue growth driven by broadcasting income (for now…)
#EFC
: doubled revenue, again, driven by broadcasting income.
Introing agent fees in SPG
#MUFC
‘24/25 Transfer Window
#PSR
Tracker
· Agent fees are significant part of incoming transfer deals.
· FIFA regulation stipulates for transfers over £161k, agents can make up to 6% of a Player’s compensation (if representing both Player and Buying
(2) Issue new shares: Article IV of the agreement says that as long as a Minority Shareholder has at least 15% of the Shares (at this point that’s SJR), no new shares can be issued that change how things currently work for the next three years (important)
@SwedishRumble
Interesting summary, Swedish. I’ve seen other companies include these types of cost in the P&L before. Don’t forget the report published this week is unaudited. And financial accounting vs. tax accounting.
My view on the c.£35mn being an allowable add-back for
#PSR
is based on
How much more debt
#MUFC
handle?
Cash piles are low but SJR is taking a knife to costs and
#MUFC
could be back to break even EBIT in 24/25 (SPG est) before profit from Player sales, so the Free Cash Flow drain should stop from next season.
Incremental matchday revenue has add'l
The SPA (Share Purchase Agreement) is defines two parties, The Glazers and Trawlers (i.e. Sir Jim or SJR) and outlines all elements of SJR’s purchase of shares. By the end of 2024 he will have paid c. $1.65bn for 28.6% of MUFC.
Voting rights: Remember there’s a difference between Class A and B shares, Class B shares have 10 voting rights vs. 1 vote for every Class A share; this means that by the end of 2024 SJR and 28.9% of the Voting rights vs. the Glazers 67.9%
#PSR
impact
£424k initial fee implies a c. £6.27mn upfront PSR loss (£6.7mn of initial transfer fee left on the balance sheet).
This is offset by c. £6.3mn in saved annual wages
Net nil immediate impact on PSR
Likely further £4.2mn benefit later this season
Potential for
Let’s take it back to 2008:
#Spurs
,
#NUFC
and
#EFC
wanted to vye for Europe. Since then, on-pitch performance has diverged with Spurs competing at the top table, Newcastle suffering relegation and now bouncing back whilst Everton steadily declined. But how has that happened and