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Sep 25, 2018 39 tweets 30 min read Twitter logo Read on Twitter
Manchester United are the second Premier League club after #MCFC to publish 2017/18 financial results, covering a season when they were runners-up in the league and FA Cup, but were eliminated by Sevilla in the Champions League last 16. Some thoughts in the following thread #MUFC
#MUFC profit before tax down from £57m to £26m, mainly due to higher player costs, as wage bill shot up £32m and player amortisation rose £14m, while revenue only up £9m. Tax bill increased from £17m to £63m as a change in US corporate tax rate led to a £49m non-cash write-off.
#MUFC revenue only grew £9m (2%). Only meaningful increase was broadcasting, up £10m (5%) to £204m. Commercial income was basically flat at £276m, while match day dropped £2m (2%) to £110m. Profit on player sales rose £7m to £18m.
#MUFC wage bill climbed £32m (12%) to a Premier League high of £296m, while player amortisation increased £14m (11%) to £138m. Other expenses were slightly down at £117m, but net finance costs were £6m (26%) lower at £18m (due to unrealised foreign exchange gains).
Despite the fall in profit, #MUFC £26m would still have been around mid-table in 2016/17. Worth noting that thanks to TV money and wage controls, the Premier League is now very profitable with only one club reporting a loss, while many had huge profits (#LCFC £92m, #THFC £58m).
The #MUFC strategy has not been overly reliant on player sales and 2017/18 was no exception with only £18m earned from this activity, mainly Januzaj to Real Sociedad and sell-on fees. For perspective, this would have been one of the lowest in the 2016/17 Premier League.
#MUFC have reported profits for three years in a row, averaging £44m in that period. In fact, £57m in 2017 and £49m in 2016 are among the highest profits in the entire history of the Premier League (5th and 7th respectively). Loss in 2015 was due to lack of European football.
#MUFC results have hardly ever been boosted by player sales with 2009 being the last year where this made a meaningful contribution (Ronaldo’s £80m sale to Real Madrid). Since then, only one year has been above £20m, namely 2015, and that was just £24m.
Of course, #MUFC profits would have been substantially higher if they did not have to bear the cost of the Glazers’ leveraged buy-out. In fact, in the last 10 years they made operating profits of £651m, which have been largely offset by net financing costs of £523m.
The good news is that the cost of #MUFC debt has reduced following a series of refinancings from a horrific £117m in 2009 to “only” £18m in 2018. Coupled with explosive revenue growth, this means that financing costs have been cut from 42% of revenue in 2009 to just 3%.
#MUFC EBITDA (Earnings Before Interest, Tax, Depreciation & Amortisation), which can be considered as a proxy for cash operating profit, fell by £23m from last season’s record £200m to £177m, though this is still around double the £92m in 2012. Forecast is £175-190m for 2018/19.
However, #MUFC EBITDA of £177m is still excellent, underlining their incredible ability to generate cash. To place this into context, #MCFC are £52m lower with £125m, while #AFC are likely to fall from £138m due to lack of Champions League in 2017/18. Only 4 PL clubs above £100m.
Although #MCFC revenue “only” increased by 2% in 2017/18, this is not unusual in the second year of the Premier League TV deal. Since 2013 revenue has grown by an incredible £227m (62%) from £363m to £590m, due to commercial £124m and TV £103m. Forecast is £615-630m for 2019.
#MUFC revenue of £590m is the highest in England, £90m more than the closest challenger #MCFC £500m. There is then a fairly sizeable gap to the next clubs (#AFC £423m, #LFC £364m, #CFC £361m & #THFC £306m), though some of these will increase when 2017/18 results published.
Based on 2016/17 figures, #MUFC had the highest revenue in the Deloitte Money League for the second year in a row, with their £581m revenue just above Real Madrid £580m, followed by Barcelona £557m and Bayern Munich £505m, though will be overtaken by Madrid in 2017/18 (€751m)
Somewhat disappointingly, #MUFC commercial income was basically flat at £276m, despite 7 new sponsorship deals including their first sleeve sponsor. That said, this revenue stream has grown by an impressive £124m (81%) since 2013.
However, to place this into context, #MUFC £276m commercial income is still £44m higher than #MCFC £232m. It is also at least £140m more than their next closest challengers (2016/17 figures): #LFC £136m, #CFC £133m, #AFC £117m, #THFC £73m and #WHUFC £35m.
#MUFC Chevrolet shirt sponsorship worth £58m a season ($75m at current exchange rates), while Adidas kit deal is an amazing £75m (though cut by 30% if fail to reach Champions League for 2 or more seasons). Aon pay £15m for training kit/facilities, Kohler £10m for sleeve sponsor.
The importance of commercial business to #MUFC is clear, as 47% of their 2017/18 revenue came from this revenue stream. The only comparable club is #MCFC 46%, while #LFC and #CFC are only at 37% and other clubs are significantly lower.
#MUFC TV money from the Premier League increased £9m to £150m, boosted by finishing 2nd versus 6th the previous season (meaning a higher merit payment). They actually received more than champions #MCFC £149m, as they were shown live 28 times (compared to 26 for City).
Assuming that English TV pool was unchanged in 2017/18, #MUFC earned €39m from Europe for reaching the Champions League last 16, €6m less than the previous season when they won the Europa League by beating Ajax in the final. Champions League winners Real Madrid received €87m.
#MUFC Champions League revenue of €39m was much lower than runners-up #LFC €78m and quarter-finalists #MCFC £62m. Also below #CFC €64m and #THFC €62m, even though all 3 clubs fell at last 16, because United only got half the TV pool, having qualified via the Europa League.
#MUFC relatively poor performance in Europe, including not even qualifying 2014/15, means that they have “only” earned €170m in the last 5 years. That’s not too shabby, but it is a hefty €107m less than #MCFC €277m. Also below #CFC €216m and #AFC €214m.
#MUFC match day income fell £2m (2%) from £112m to £110m, as they staged 5 fewer home games (3 in Europe, 2 in domestic cups). However, this was still easily the highest in the top flight: £10m above #AFC £100m, £36m more than #LFC £74m (though this will grow in 17/18).
#MUFC 75,000 average attendance was again the highest in the Premier League, around 7,000 more than #THFC following their use of Wembley. Season ticket prices have been frozen for 7 consecutive years, while £15 tickets for 18 to 25-year-olds have been introduced in 2018-19.
#MUFC wage bill grew £32m (12%) from £264m to £296m, mainly due to player salary uplifts related to Champions League participation plus 5 months of Alexis Sanchez, resulting in an increase in the wages to turnover ratio from 45% to a still very respectable 50%.
Not only is #MUFC wage bill just shy of the £300m barrier, but it is the highest ever reported by a Premier League club. In the last 3 years, it has grown by an incredible £93m (46%). It is now £36m above #MCFC £260m, the highest gap for many years.
Of course, #MUFC £296m wage bill is also miles above the other leading clubs: Chelsea £220m, Liverpool £208m, Arsenal £199m and Tottenham £127m (though in fairness these are all 2016/17 figures).
Despite the increase in #MUFC wages to turnover ratio from 45% to 50%, this is still one of the lowest (best) in Premier League, though not as low as #THFC 41% and # #AFC 47%. This important ratio has been maintained in a tight range between 45% and 51% for the last few years.
#MUFC player amortisation, the annual charge to expense transfer fees over the length of a player’s contract, continued to rise, up 11% (£14m) from £124m to £138m, reflecting further investment in the squad (Lukaku, Matic, Lindelof & Sanchez in 2017/18).
As a result, #MUFC player amortisation of £138m is again the highest in the Premier League, just above #MCFC £134m. Both Manchester clubs are way ahead of #CFC £88m and #AFC £77m.
#MUFC averaged around £110m net spend for 4 years up to 2017/18 (purchases £158m, sales £47m), but only £53m to date in 2018/19 (mainly Fred and Diogo Dalot), giving some justification to Mourinho’s complaints. In the last 5 seasons net spend is £495m, only behind #MCFC £580m.
#MUFC net debt increased by £41m from £213m to £254m, mainly due to £48m reduction in cash balance from £290m to £242m. In Sterling terms, gross debt was down £7m from £503m to £496m, though the USD debt remains unchanged. Amounts owed on transfers not disclosed (£179m in 2017).
So, even after all the Glazers’ various refinancings, #MUFC still owe the best part of half a billion pounds, more than twice as much as #AFC £227m (the Emirates Stadium loan). Worth noting that #CFC have around £1.2 bln debt in their holding company.
Although it has reduced, #MUFC annual interest payment of £19m is a lot more than any other Premier League club with Arsenal being the only other club with a double-digit interest payment of £12m. To place that into perspective, Manchester City and Liverpool only pay around £3m.
On the other hand, #MUFC also have the highest cash balance of £242m, much more than most Premier League clubs. Tottenham’s £200m is misleading, as this is largely due to advances for their stadium development, leaving only Arsenal £180m as anywhere close.
#MUFC cash decreased by £48m, mainly because of a steep fall in cash generated from operating activities, due to timing of cash receipts on commercial contracts. Net £108m spent on players (purchases £155m, sales £47m). Another £22m paid out in dividends.
In last 9 years #MUFC have had an incredible £1.6 bln cash: operating activities £1.3 bln plus £318m share issue. £653m has been spent on players and £91m on infrastructure, but £784m used to finance Glazers’ investment: £461m interest, £248m debt repayments & £75m dividends.
Ed Woodward spoke of “continued strong long-term financial performance, which underpins everything we do and allows us to compete for top talent in an increasingly competitive transfer market.” That’s undoubtedly true, but will #MUFC now deliver on the pitch?

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More from @SwissRamble

Oct 4, 2018
#RealMadrid 2017/18 accounts cover a season when they finished third in La Liga, but won the Champions League for a third consecutive year, the fourth time in 5 years, plus the Club World Cup and European and Spanish Super Cups. Some thoughts in the following thread.
#RealMadrid profit before tax increased by €17m from €26m to €43m (profit after tax up €10m from €21m to €31m). Revenue (Madrid’s definition) rose 11% (€76m), their largest rise since 2000, to a record high of €751m, while profit on player sales was 4% (€2m) up at €54m.
All #RealMadrid revenue streams increased with the largest growth in marketing €41m (16%) to €295m, followed by international & friendly matches €13m (17%) to €100m, broadcasting €13m (8%) to €178m and membership fees & stadium revenue €8m (5%) to €174m.
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Sep 17, 2018
Ten years after Sheikh Mansour acquired the club, Manchester City’s 2017/18 financial results covered a season when they won the Premier League in some style, won the League Cup and reached the Champions League quarter-finals. Some thoughts in the following thread #MCFC
#MCFC profit before tax up from £0.1m (£1.1m after tax) to £10.4m, as previous season was adversely impacted by change in year-end resulting in an extra month’s costs with minimal revenue uplift. Revenue rose £27m (6%) to £500.5m, only second English club above £0.5 bln.
All #MCFC revenue streams up: commercial income rose £14m (7%) to £232m; broadcasting increased £8m (4%) to £212m; and match day was £5m (9%) higher at £57m. Profit on player sales was up £4m to £39m.
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Sep 10, 2018
Prize money for UEFA club competitions significantly increases in 2018/19, including a new coefficient ranking payment that better rewards historically successful clubs rather than those with larger national TV rights deals. Some thoughts follow on Champions League distribution.
The amount distributed to clubs in UEFA Champions League (group stage onwards) will rise €681m (54%) from €1.269 bln to €1.950 bln in 2018/19. This is split: participation €488m (25%), performance €585m (30%), TV pool €292m (15%) and coefficient rankings €585m (30%).
In 2018/19 each of the 32 clubs qualifying for Champions League group stage gets €15.25m plus €2.7m for a win and €900k for a draw. Additional prize money for each further stage reached: last 16 €9.5m, quarter-final €10.5m, semi-final €12m, final €15m and winners €19m.
Read 15 tweets
Sep 4, 2018
Atletico Madrid’s 2016/17 accounts cover a season when they finished third in La Liga and reached the semi-finals of the Champions League under coach Diego Simeone. Some thoughts on their finances in the following thread #Atleti #AúpaAtleti #AtleticoMadrid
#Atleti profit before tax improved from €1m to €5m (profit after tax up from €4m to €5m), as revenue rose €48m (21%) to a record high of €281m, though profit on player sales fell €7m to €37m. No repeat of the 15/16 €27m extraordinary charge linked to stadium development.
The main driver of the #Atleti revenue increase was the La Liga TV deal, up €31m to €99m, though Champions League TV money was €9m lower at €61m. Commercial rose €22m (41%) to €76m, while match day was €4m (11%) higher at €45m.
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Aug 27, 2018
A long-suffering Newcastle United fan asked how their financial performance compared with Tottenham Hotspur since Mike Ashley bought the club in July 2007, so here’s a few thoughts in the following thread #NUFC #THFC
Both #NUFC and #THFC have focused on profit. #NUFC have essentially broken even during Ashley’s tenure with £4m aggregate profit, while #THFC have reported an impressive £215m. Worth noting that £188m of that came in last 4 seasons, when #NUFC had a £47m loss in Championship.
#NUFC revenue has fallen by £1m since Ashley’s arrival from £87m to £86m, deflated by the lower money in the Championship. In the same period, #THFC revenue has tripled, rising £203m from £103m to £306m. In fairness, #NUFC 2018 revenue will be much higher (£175-180m estimate).
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Aug 23, 2018
As talk intensifies of a potential move of Arsenal’s chief executive, Ivan Gazidis, to Milan, I thought it would be interesting to look at how the club’s financials have developed since he arrived in January 2009. Some thoughts in the following thread #AFC #Milan #ACMilan
#AFC revenue has grown by an impressive £198m under Gazidis, only outpaced by #MCFC £366m & #MUFC £303m in absolute terms. However, this was the 2nd smallest % growth of Big 6. Furthermore, 2017/18 revenue is likely to be £40-50m lower, due to not qualifying for Champions League.
Analysing #AFC £198m revenue growth under Gazidis, most (£125m) is from TV, due to central Premier League deals. As Warren Buffett said, “a rising tide lifts all boats”. Commercial up £69m, but this was a slam dunk after long-term sponsorships linked to stadium funding expired.
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