Our net spend. Can we end up like Barca?

[Andycoleno9]

Ok, i am little bit worried now. In last 8 years, our net spend is minus one billion. Can we afford that? Seeing Barca and some other big clubs in problems, i am worried that we will pay the price for all this spending in couple of years.
Glazers don't spend their own money. All these transfers will raise our dept more and more. Are we in danger to having huge financial problems?

This is not knee jerk thread or moaning thread. This is me truly panicking and trying to hear some positive view regarding this so i can truly enjoy in seeing Antony, Casemiro and others playing football for us.

 

[Skills]

I think we should be okay. We'll have to tighten the purses a bit next summer, but that's normal after having a massive like this.

 

[Amadaeus]

Don't care how much we are spending as long as we are winning something. With the amount we spend, there should be no excuse for our managers to win something.

Fans put blame on the board, but if any decent manager get as much to spend on players at United, they should have gotten to the champion league final by now.

To answer the question, yes we can especially if there is no return on these investments

 

[1DeGea1]

I think we should be okay. We'll have to tighten the purses a bit next summer, but that's normal after having a massive like this.

Is that definitely the case? We didn’t spend anything in January because we were waiting for confirmation on the manager and what his vision would be for the squad.

Are we not now just catching up on some of the spending we didn’t do last season?

 

[Andycoleno9]

I think we should be okay. We'll have to tighten the purses a bit next summer, but that's normal after having a massive like this.

But nearly every our transfer window is like this last 7-8 years. Only two times we ended summer under 100 mil spend.
I am hearing about that "quite next summer" every year but it doesn't come.
I am delighted with all new players but fear for club is killing my joy.

 

[Laurencio]

No. We are spending actual revenue, not getting ourselves into debt to spend more money. With Champions League our revenue is an astronomical £700M+ a season. We are nowhere close to spending ourselves into problems.

 

[Trequarista10]

Big overhaul was needed this summer. We couldn't afford not to, we couldn't afford to slip further behind the competition and face missing out on CL football again. Long term we need to find some cheap gems or develop our own. It's easier to bring through young players when they have quality, experienced professionals with the right attitude around them though.

Also net spend on transfers is irrelevant, only figures that matter are total income and total expenditure.

 

[Skills]

Is that definitely the case? We didn’t spend anything in January because we were waiting for confirmation on the manager and what his vision would be for the squad.

Are we not now just catching up on some of the spending we didn’t do last season?

We don't have a seperate budget for the winter and summer transfer window. That would be stupid.

We didn't plan on spending any money last January, because we'd exhausted that seasons budget in the summer (50m Varane, 20m for Ronaldo, 75m for Sancho + the massive wage increase on the books).

If we were to spend any money last January, it would've had to come from this summers transfer budget.

 

[Matthew84!]

No, Utd generate loads of money and spend it, that's the way it works,

 

[bosnian_red]

No we're fine. We spend well within our means and would be fine with La Liga's salary cap rules and don't need to sell future profits to fund transfers. This is just the first time in a while we are actually flexing our financial strength (and lost a feck ton in wages this year).

 

[RuudTom83]

Saved an absolute shit tonne in wages too…even more when Ronnie finally gets his path out of the club.

 

[Laurencio]

No we're fine. We spend well within our means and would be fine with La Liga's salary cap rules and don't need to sell future profits to fund transfers. This is just the first time in a while we are actually flexing our financial strength (and lost a feck ton in wages this year).

Exactly, we're not even doing a full flex because the lack of CL football and COVID has had an impact on finances lately.

 

[Tigersam]

No, Utd generate loads of money and spend it, that's the way it works,

Yes, this is true - I bet the yellow strip is selling very well, I think it looks great. I want to buy one and I'm not even a United fan!

 

[united_99]

Nah. Antony and Casemiro will sell enough shirts to pay for their transfer fee

 

[eselfor]

If the leeches in charge truly care, they could sell some shares to raise money for the club if we find ourselves in difficulty. Not worried at all. We make so much money.

 

[Skills]

But nearly every our transfer window is like this last 7-8 years. Only two times we ended summer under 100 mil spend.
I am hearing about that "quite next summer" every year but it doesn't come.
I am delighted with all new players but fear for club is killing my joy.

https://ir.manutd.com/~/media/Files/M/Manutd-IR/documents/2021-mu-plc-form-20-f.pdf

Page 7 will give you a decent overview of our finances.

 

[Jake]

Probably a question for our finance directors/finance executives which seem to have done a good job throughout this regardless of our football side. I’d hope they have the experience that they know what they are doing. Nothing would be sanctioned signing wise without future cashflow analysis etc.

I don’t think they will be going into this blind.

 

[Traub]

We all good, we have an extra lever over Barca - equity raising. Worst case, if any debt covenants are close to being breached, Glazers will need to issue shares and raise more equity.

 

[Traub]

https://ir.manutd.com/~/media/Files/M/Manutd-IR/documents/2021-mu-plc-form-20-f.pdf

Page 7 will give you a decent overview of our finances.

feck me Woodward owns 1.25% of Man United.

 

[Tyrion]

I think we should be okay. We'll have to tighten the purses a bit next summer, but that's normal after having a massive like this.

That often happens with us. Problem is that half the forum then insists the manager "wasn't backed". There are plenty of posters who think that Mourinho was screwed for not getting £200 million every summer.

 

[Skills]

feck me Woodward owns 1.25% of Man United.

I don't think so. I think he owns 1.25% of all the class A shares or else the numbers don't add up.

 

[JB7]

We don't have a seperate budget for the winter and summer transfer window. That would be stupid.

We didn't plan on spending any money last January, because we'd exhausted that seasons budget in the summer (50m Varane, 20m for Ronaldo, 75m for Sancho + the massive wage increase on the books).

If we were to spend any money last January, it would've had to come from this summers transfer budget.

That's all well and good but wasn't Sancho bought mostly with the funds set aside from the previous season's window?

 

[Niemans]

Ok, i am little bit worried now. In last 8 years, our net spend is minus one billion. Can we afford that? Seeing Barca and some other big clubs in problems, i am worried that we will pay the price for all this spending in couple of years.
Glazers don't spend their own money. All these transfers will raise our dept more and more. Are we in danger to having huge financial problems?

This is not knee jerk thread or moaning thread. This is me truly panicking and trying to hear some positive view regarding this so i can truly enjoy in seeing Antony, Casemiro and others playing football for us.

Barcelona's problem was the salary of the players, not the net spent on signings.

As long as United have balanced salaries I guess they will do well.
Then we will have to see if the signings perform well, otherwise the economic issue will be complicated a little.

 

[bond19821982]

We spent 50 + 60 + 100 - I don't think all of them are paid straight away. It will be a guaranteed payment but will be paid in years. So this narrative that all 200m is coming from our revenue this year has to stop.

One thing you can be sure is about the financial side of things. Our management is quite good at it as much as they are bad on the footballing side.

 

[Scarecrow]

No. We are spending actual revenue, not getting ourselves into debt to spend more money. With Champions League our revenue is an astronomical £700M+ a season. We are nowhere close to spending ourselves into problems.

So is Barca’s, to be fair.

 

[TheReligion]

Barcelona's problem was the salary of the players, not the net spent on signings.

As long as United have balanced salaries I guess they will do well.
Then we will have to see if the signings perform well, otherwise the economic issue will be complicated a little.

Exactly. it’s the wages that kills teams.

United have slashed the wage bill this season with the exits of Pogba, Cavani, Matic, Mata, Lingard, Bailly and even Henderson on loan.

That’s given us more scope to spend. Especially when you consider the bill will be reduced even further when Ronaldo goes either in the next few days or at the end of the season.

 

[Tallis]

We should try to take steps to balance the books - Ronaldo leaving. Finding deals for Shaw, Maguire, Henderson, VDB, Bailly, Telles, AWB. Letting DDG leave next summer is another painless cost cutting move.

 

[tenpoless]

Their owners are daft when it comes into money. As clueless Glazers are when it comes into football theyre business people, among the leaders in their areas in fact. So they are good with finance. The fact that they decided to sell shares, grade them and take dividends is a proof of this. They know they have to balance spending with lack of trophies. Its all calculated. They are parasites but the smart ones, they will not let the host die

 

[TheReligion]

We should try to take steps to balance the books - Ronaldo leaving. Finding deals for Shaw, Maguire, Henderson, VDB, Bailly, Telles, AWB. Letting DDG leave next summer is another painless cost cutting move.

Henderson is out on loan as is Telles. Bailly has also gone with a clause which is likely to become permanent.

Ronaldo will leave at the latest next summer and it seems AWB could move to Palace this window.

 

[RedOrange]

I think we should be okay. We'll have to tighten the purses a bit next summer, but that's normal after having a massive like this.

Not necessarily. Something like £1 million a week came off the books with Pogba, Cavani, Matic, Mata and Lingard being released this season. Releasing Ronaldo, De Gea and Jones next summer removes a similar amount in weekly wages.

If we get CL next season there will be more money to spend. If all the signings made this summer work out all that's needed might be a ball progressing midfielder and a centre forward though.

 

[Dargonk]

I don't see us ending up in the same situation as Barcelona. At this stage we are generating the money, and our actual wage budget is under control. In the end unlike Barcelona, we are run like a business firstly and football club secondarily, so are unlikely to spend our way into serious financial issues. Add to that, if we do start to get into issues financially, we would likely see the Glazers' finally sell, and cash out on the club, which would have plenty of bidders.

 

[Strelok]

If things go tits up financially the Glazers will sell. Oh wait, isn't that what we all want?

 

[ti vu]

Possibly: yes.

Likely: no.

Reason: Barcelona is involved in shady deal like Neymar where expense can go unaccounted on the surface, but ultimately negative affect the club when shite starts to hit the fan. And the second reason is that because Barcelona tries to delude themselves as some holy than thou club, they used to refuse shirt sponsor and leave money on the table. It prevents revenue growth at peak of their on pitch power. Now they're expected to compete on previous high standard while playing catch up with commercial infrastructure of other clubs. Basically gone from Messi to messy.

 

[McGrathsipan]

No. We are spending actual revenue, not getting ourselves into debt to spend more money. With Champions League our revenue is an astronomical £700M+ a season. We are nowhere close to spending ourselves into problems.

revenue doesnt equal spending power

Its operating income that needs scrutiny here - these transfer fees will spread over a few years so the books wont see such a shock today however I see trouble down the line if the CL return doesnt happen in the next two seasons.

 

[Lentwood]

I did a thread on this a couple of seasons ago. I went through the clubs' annual financial reports and showed that basically every spare pound we generate does at some point end-up getting spent on transfers or salaries.

That Data was a couple of years' old but it showed we had a budget of about £70/£80m net each season. Sometimes we spent more, sometimes less...but that was about the average profit before transfer ins' and outs'.

Therefore, unless there have been significant new revenue streams in the last season or two, this window is probably an over-stretch. I doubt we will see much (if any) action now next season - and people will whine about that and accuse the club of "penny pinching".

The major issue we have is that because our transfer business has been grossly mismanaged, we overpay to sign players and we are forced to shift players on for nominal fees. Therefore our net spend is always awful.

The likes of Chelsea and Liverpool are masters at making fast decisions and moving players on to recoup money on players or sell young players for inflated fees before other clubs realise that they're not actually that good.

We need to get far better at using our Academy to fund the 1st team. The likes of Henderson, Rashford, McTominay, Williams, Tuanzebe, Andreas, Janujaz, Garner, Elanga etc...could have generated huge profits if we had been able to accurately and honestly assess their abilities and move them on 'peak-hype'.

 

[Suedesi]

I don't think so. I think he owns 1.25% of all the class A shares or else the numbers don't add up.

What's the relation of Class A to Class B with respect to ownership? How many shares have been issued for each class?

I know Class B shares have 10x the amount of voting power vs Class A

 

[Skills]

What's the relation of Class A to Class B with respect to ownership? How many shares have been issued for each class?

I know Class B shares have 10x the amount of voting power vs Class A

There's circa 119m class B shares. And around 40m class A shares.

When the glazers want to sell more of their ownership, they can convert the Class B shares to Class A shares and sell on the market. Once they've been converted from Class B to Class A, they cant be converted back. Class A shares can't be converted to Class A shares.

 

[Oly Francis]

Exactly. it’s the wages that kills teams.

United have slashed the wage bill this season with the exits of Pogba, Cavani, Matic, Mata, Lingard, Bailly and even Henderson on loan.

That’s given us more scope to spend. Especially when you consider the bill will be reduced even further when Ronaldo goes either in the next few days or at the end of the season.

This. Barcelona actually generates more money than United (or roughly the same amount) but they never had the ridiculous wage bill Barcelona had, even taking into account overpaid players like Sanchez back in the day or De Gea.

 

[Charles Miller]

It has nothing to do with Barcelona. Top clubs sign expensive players. Real Madrid payed a fortune for Tchouameni. Are Madrid the next Barca? We are not doing obscure and strange deals, signing players that aren't asked by the coach, for some unknown reason like Barcelona did. We signed a top manager and are buying his players to develop his style. He wants those players. We are not just throwing money at random names as some apparently believe be the case.

 

[Ish]

Barcelona's wages is what did the damage.