It means what I put in the post, United EBITDA is way above 65m. United post way more than 65m before all expenses. This year is a bit different due to the pandemic but shareholders can fund the club and put the EBDITA at 65m or above.
The Athletic: Why Man Utd's profit must not drop below £65m
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So there was an article last week by the mysterious 'Football Bureau of Investigation' which highlighted this £65m clause and The Athletic cite that article as their source of info but it has now been deleted and the associated Twitter has also been deleted so something shady going on: https://medium.com/football-bureau-of-investigation/jadon-sancho-the-circus-strategy-2904b788999e
anyway I would guess that clauses like that dont apply due to the extreme circumstances but, either way, lack of matchday revenue will definitely be hurting our finances - probably more than any other club bar Arsenal who also rely on it
Season ticket money alone would probably have bought in around £50m this summer which has not come
anyway I would guess that clauses like that dont apply due to the extreme circumstances but, either way, lack of matchday revenue will definitely be hurting our finances - probably more than any other club bar Arsenal who also rely on it
Season ticket money alone would probably have bought in around £50m this summer which has not come
Why would next quarter be any better financially?That seemed to be what Luckhurst indicated I think.. That if the deal was to be done. then it'd be 'official' between 1st and 5th October. Unless I completely mis-understood it
Maybe it is after the anniversary of when the loan was taken? Beats me.
Well there are no rules against debt in the PL, most clubs have some - its really nothing to do with the fit and proper test, perhaps it should be but thats another discussion
No idea.. Wouldn't have VDB's transfer in? I genuinely don't know.
Yeah all I’m saying is I don’t know what is included in those figures but as you say, and as the Tweet I posted also points out, it is evident this isn’t just about making a ‘profit’.
I feel there is a lot of misinformation quickly being spread regarding this article. People are even talking about Administration (And immediately confusing that with liquidation).
If I remember correctly, this only applies to senior secured notes which have been refinanced in May 2015, they are due in 2027.
I listed what is included, that was the point of my first response.
Think in a nutshell, it means Administrators will be brought in if we fall below this.
Have a word with yourself!
Thought the athletic were meant to be reputable as opposed to this kind of click baity rubbish articles.
I love getting financial statement analysis from forum posters with zero accounting and finance knowledge. It’s the best type of analysis.
Just to state the obvious: Waivers are only likely to be granted to offset financial difficulty over income loss. As example: Airlines who many are now entirely dependant on loans from states or investor funding to survive. I don't see a good excemption ground based on a need for investments. The company would have to provie an outside guarantee for the waiver exemption in that case. Showing that income will decrease if x investment is not made could be a good reason for an evaluation but thats a though sell in a sporting company.
But that's just an educated opinion, the bank might very well think differently.
2020 journalism
The Athletic Bollocks, Strong Bollocks.
Yeah, thats true too.
I'm no financial expert in the slightest I'll readily admit but I can't see how us going into administration would be a bad thing. It would almost certainly mean no more Glazers, no more Woodward and no more debt. What am I missing? There's no way we'd fold all together. Plenty of people would snap this club up at the prices Administrators would sell at. Plenty.
I'd take a few years rocking around midtable and out of Europe if it meant we could get them parasites out. We'd be back competing sooner than people think. And a new buyer would get the club considerably cheaper from administrators than they will from the Glazers directly. In fact we'll never be sold directly from the glazers as long as fans keep going and the share price remains fairly strong. We're not a good investment for anyone at 4bn and the Glazers know it. We're stuck with them forever unless our fanbase grow a backbone.
I'd take a few years rocking around midtable and out of Europe if it meant we could get them parasites out. We'd be back competing sooner than people think. And a new buyer would get the club considerably cheaper from administrators than they will from the Glazers directly. In fact we'll never be sold directly from the glazers as long as fans keep going and the share price remains fairly strong. We're not a good investment for anyone at 4bn and the Glazers know it. We're stuck with them forever unless our fanbase grow a backbone.
Well clearly it should be. Look at what Hicks and Gillette's debt did to Liverpool. Sent them into liquidation if it wasn't for the court systems.
No team should be allowed to be bought using a leveraged buyout and also Prem should bring in transfer restrictions for debt over a certain amount too imo.
It's not as black and white as that. What it says is there could be penalties but it is unlikely. To quote the article.
“Manchester United are different. They are as copper-bottomed an investment prospect as you could expect. They have regular cash flows; quite an attractive proposition. But the covenants are there as protection.
“Just in case Man United go a bit mad in terms of spending money, these act as penalties for poor use of cash as far as the lenders are concerned.”
United aren’t insolvent. United are mega rich.
Don't think we are 'mega rich' as you and some others think we are. And over 1bn has left the club though non footballing reasons since 2005. How can that ever be a good thing?
That can only happen when you are mega rich.
What we do with our money is one thing but there’s a fecking lot of it.
No need to go full crazy!
Dude, the entire debt is just 400 million. The club is valued at a bit more than 3 billion. At worst possible scenario when the bank would like to take over cause we would be unable to pay debt etc, the Glazers would just sell as little as 15% of their stocks and be able to pay the entire debt.
This United going into administration has always been a MUST propaganda. It had less chances than me banging Scarlett Johansson.
Sure, though most of the debt (in fact all, except the recent 150m) was not taken to benefit the club, but to buy the club and then put the debt on the club. So the previous debts are essentially for our ‘privilege’ to be owned by Glazers, which IMO should have been illegal (for a football club).
No problem at all with the latest 150m debt to cover Covid losses.
We Didn't get our debt from investments, so there has been no future gain for us.
This means it's acted in the opposite way that normal debt does, it's only lowered our investment. We have basically become smaller because if it.
Yeah, the only thing could really be player wages. I'm pretty sure all wages are going to see a material bump this season due to now being in the champions league. Coupled with much lower revenue and our inability to offload the deadwood (these guys probably have great champions league clauses too), we may be getting much closer to our wages to revenue limit thus resulting in no further purchases.
15% of their stocks?
One important thing being missed is ‘It is important to note here the £65 million EBITDA does not include transfers — given it is before amortisation, which is how player acquisitions are recorded in the books — but wages do come into the equation.‘
Sorry if it’s already been posted.
Having read it, it’s a pretty nothing article in terms of United because of how attractive we are to banks as a prospect
Sorry if it’s already been posted.
Having read it, it’s a pretty nothing article in terms of United because of how attractive we are to banks as a prospect
I'm not sure myself, i was asking as I'm not sure how accounting works. I thought EBITDA was a rolling figure so it would be the same from 1 quarter to the next unless we had aged items drop off the book. I'm sure one our resident accountants can tell us.
It is earnings so there is no rolling figure, it’s completely different every quarter based on that quarter’s revenue.
Transfer fees will also have no affect as they are amortized so are added back in
OK dude. I'm relaxed.
In 2016 man utd received 131m Euros in gate receipts. With 2nd half of last season and next season's games looking to be played in empty stadiums, one can assume thats close to 200 million euros of revenue potentially lost over 18 months. I dont think we are as rich as you think
Of course it's not. But you've sort of answered yourself. We didn't take this debt to manage working capital (player fees) or create new assets (stadium/ facilities). We did it to pay for ourselves in a leveraged buy out.
Don't get me wrong, I have no issues with us not spending more given the current finances that we have. But we continue to be run as a business (a badly managed one which is 80pct of the problem, really) whereas really United should be a social club with all cash flow getting reinvested back with no surpluses generated for equity holders. Not only do we have to generate surpluses for Glazers but also compete against clubs whose equity holders are happily burning cash for status or scale. It's.like trying to run a mom and pop shop against Amazon
This is a fair point.
And then you have to consider the way United structure all our player purchases in instalments over a number of years.
If United have financial obligations in 2020 that rely on the aforementioned 200 million euros of revenue, removing that revenue is going to stop us from being able to pay initial fees on transfers in this window.
Comparing United to Villa is not necessarily like for like. We don't know how much of our revenue is tied up in our short term liabilities compared to them.
Well I’m not saying that’s not going to happen but we are regularly the richest football club in the world. We’re not just going to casually enter Administration.
And I’m not talking about money for transfers either.
This reminds me of that movie, I think it was called 'The Bus That Couldn't Slow Down'.