midnightmare
Full Member
I just did go through the financials and my interpretation is that while we're not "struggling", we don't have the money to spend without selling. And selling a lot. We had a net outflow on player acquisitions of 135 Mn for the year ending 30 June 2019. The acquisition costs cover (largely) Pogba, Fred, Lukaku and Dalot - and do not include Maguire, AWB. For the next (ongoing now) year, excluding any bonus-linked payments (75 Mn potentially, excluding Maguire, AWB and James), we already have 225 Mn due in payments already. That's 225 Mn over and above wages (332 Mn last year) that we have to pay. Our forecast is that revenue will drop to 560-580 Mn for this ongoing year.No. We do not have financial trouble.
The MUFC financial statements and obligations are publicly available and they show no signs of a struggling enterprise. The club is managing its debt just fine and has a healthy overhead.
Now, regardless of all else, our financials are also clear that:
1. We need to maintain an EBITDA level of 65 Mn+
2. We need to maintain a D/E of <2
If we don't do this, our interest (financing) costs rise - across the term facility as well as on the senior secured notes.
You need to look into the financials in more detail if you're to assess spending capability. All the numbers above are there in the annual report and this is before I delve into the schedules. Note also that this is not everything - since the club isn't forced to make disclosures to the extent demanded by the SEC from an American firm. Fact remains that unless the club decides to dip into reserves (thereby hitting EBITDA and also D/E) or draws down significantly more debt, we can't buy without selling significantly.
PS - managing debt just fine? We have gross debt of close to 650 Mn GBP. This is after the club took on 660 Mn nearly fifteen years ago, refinanced and has paid 800 Mn in financing costs in the last 10 years alone. I don't think that is (by any measure) a sign of the club "managing its debt just fine".