Football's Magic Money Tree
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Re: Football's Magic Money Tree
The embargo was part of the punishment for the breach of FFP - the rest was to be determined at the hearing - the transfer deal just exacerbates the previous FFP misdemeanour - all in the article
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Re: Football's Magic Money Tree
Thanks for this thread Chester, i like the updates and am so glad that it hasn't been hijacked and gone off at a tangent.
Good work.
Good work.
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Re: Football's Magic Money Tree
Cheers Goody - glad you like - seems this thread doesn't attract too many readers - though a fair number of posts get duplicated into their own threads - c'est la vie
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Re: Football's Magic Money Tree
There are a number of posts on this thread about farming of Players - Man City and Watford being examples of the multi-club approach. t seems that the Premier League is fearful that Brexit means that they will not be able to recruit 16 and 17 year players from EU nations after the January window - speculation is mounting that a shopping frenzy is coming in the Jan window. I suspect that more clubs will just buy a European club to establish their own farm
https://www.telegraph.co.uk/football/20 ... nt-brexit/" onclick="window.open(this.href);return false;
https://www.telegraph.co.uk/football/20 ... nt-brexit/" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
Can we buy Trelleborg for a laugh?
This user liked this post: IanMcL
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Re: Football's Magic Money Tree
This might interest a few on here - CIES Football Observatory explain their model for calculating fare transfer fees.
http://www.football-observatory.com/IMG ... te01en.pdf" onclick="window.open(this.href);return false;
Using this model they calculate that Man City overpaid by £25m for Mahrez and Chelsea lost out twice by overpaying for their new keeper and underselling Courtois to Real
Some might even say it is what our club use - given our reluctance to pay premiums
http://www.football-observatory.com/IMG ... te01en.pdf" onclick="window.open(this.href);return false;
Using this model they calculate that Man City overpaid by £25m for Mahrez and Chelsea lost out twice by overpaying for their new keeper and underselling Courtois to Real
Some might even say it is what our club use - given our reluctance to pay premiums
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Re: Football's Magic Money Tree
Interesting aside quote from the Juventus chairman included in today's Guardian piece about the possibility of a 3rd European club tournament
"As well as the future of Europe’s club competitions, Agnelli told ECA members that Uefa’s revised Financial Fair Play rules “will be even more effective than the ones we had in place which delivered astonishing results” - this being a reference to the dramatic reduction in club debt since the cost-control measures were introduced in 2011."
Are these the measures that his club (notorious for bribing referees and league officials amongst other things) are using to dominate their domestic league
"As well as the future of Europe’s club competitions, Agnelli told ECA members that Uefa’s revised Financial Fair Play rules “will be even more effective than the ones we had in place which delivered astonishing results” - this being a reference to the dramatic reduction in club debt since the cost-control measures were introduced in 2011."
Are these the measures that his club (notorious for bribing referees and league officials amongst other things) are using to dominate their domestic league
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Re: Football's Magic Money Tree
More on that CIES Football Observatory formula and its application to this Summers big transfer
https://www.telegraph.co.uk/football/20 ... d-signing/" onclick="window.open(this.href);return false;
imagine if FFP was applied to transfer fees and breaches were determined by such a formula
https://www.telegraph.co.uk/football/20 ... d-signing/" onclick="window.open(this.href);return false;
imagine if FFP was applied to transfer fees and breaches were determined by such a formula
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Re: Football's Magic Money Tree
So Man City become the 2nd English club to break the £500m revenue barrier - amazing what the injection of a couple of billion sterling together with trying to convince the world you are Barcelona plus *much more than a....." is a thread that could run for eons in some quarters when attached to the regime that own city - and yet in Manchester at least it appears their efforts have been exemplary by virtually any measure.
https://www.bbc.co.uk/sport/football/45512733" onclick="window.open(this.href);return false;
The guardian tell you more about the financial input - just don't forget about all the added state related sponsorships
https://www.theguardian.com/football/20 ... kh-mansour" onclick="window.open(this.href);return false;
https://www.bbc.co.uk/sport/football/45512733" onclick="window.open(this.href);return false;
The guardian tell you more about the financial input - just don't forget about all the added state related sponsorships
https://www.theguardian.com/football/20 ... kh-mansour" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
FIFA seem to have come up with an intriguing approach to the much talked about farming of players - while not directly addressing the multi-club owning problem it does deal head-on with the Chelsea approach of turning the loan system into a revenue model - the proposal is for a club to loan no more that 8 players aged over 21 - they are still able to loan players under 21 that are home-grown (remember Brexit will severely hamper that issue as well for British clubs used to recruiting young scholars from across the EU
https://www.dailymail.co.uk/sport/footb ... elsea.html" onclick="window.open(this.href);return false;
https://www.dailymail.co.uk/sport/footb ... elsea.html" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
We all know agents like to make money from football - but I am hugely surprised by the number of deals in which they are able to get fees from both club and player (known as dual representation) even our club seems to find it difficult to avoid if this report is true.
https://www.dailymail.co.uk/sport/footb ... la-Co.html" onclick="window.open(this.href);return false;
https://www.dailymail.co.uk/sport/footb ... la-Co.html" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
The loan cap can only be a good thing.
40 players out on loan and 24 of them over 21 is staggering.
Better control of agents fees and representation will also be a good thing.
40 players out on loan and 24 of them over 21 is staggering.
Better control of agents fees and representation will also be a good thing.
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Re: Football's Magic Money Tree
A Wage bill in excess of £260 million, simply a staggering figure. Almost four times the size of ours which puts their players on an average of £200k per week.Chester Perry wrote:So Man City become the 2nd English club to break the £500m revenue barrier - amazing what the injection of a couple of billion sterling together with trying to convince the world you are Barcelona plus *much more than a....." is a thread that could run for eons in some quarters when attached to the regime that own city - and yet in Manchester at least it appears their efforts have been exemplary by virtually any measure.
https://www.bbc.co.uk/sport/football/45512733" onclick="window.open(this.href);return false;
The guardian tell you more about the financial input - just don't forget about all the added state related sponsorships
https://www.theguardian.com/football/20 ... kh-mansour" onclick="window.open(this.href);return false;
In fact their Wage bill is virtually twice the size of our Total Income and yet we will report a Net Profit five times the level of City. We must be doing something right.
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Re: Football's Magic Money Tree
Roy, fully concur with you, Sheik Mansour doesn't, still thinks they are only half way there
https://www.bbc.co.uk/sport/football/45534570" onclick="window.open(this.href);return false;
https://www.bbc.co.uk/sport/football/45534570" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
There has been a lot of angst on here this season - unsurprising really - but imagine having a net spend of £750m in 8 years and still not progressing any further in Europe - it is all relative really but I am glad I don't support PSG
https://www.theguardian.com/football/20 ... l-football" onclick="window.open(this.href);return false;
https://www.theguardian.com/football/20 ... l-football" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
I have posted a few times abut the ever increasing costs of Stadia even as they are being constructed - Spurs, naturally have been mentioned a few times - that initial £5-600m forecast is looking mighty wishful at the moment with the club saying they can bring it in for just under £1billion and industry analysts suggesting that it could be as high as ££1.2billion or £12,000,000,000.00 in real numbers.
Difficult to believe that Levy of al people has found his fiscal control limits, did not get a fixed price contract and did not listen to companies about completion dates during the tender process - Multiplex (who know a thing or two about building on an existing Stadium site in North London under tight fiscal boundaries said Levy's targets were unobtainable.
https://www.telegraph.co.uk/football/20 ... naccurate/" onclick="window.open(this.href);return false;
still it is nice to know that those working on the site are earning enough to fuel their alleged daily cocaine habits
https://www.thetimes.co.uk/article/spur ... -dnmckpttx" onclick="window.open(this.href);return false;
Difficult to believe that Levy of al people has found his fiscal control limits, did not get a fixed price contract and did not listen to companies about completion dates during the tender process - Multiplex (who know a thing or two about building on an existing Stadium site in North London under tight fiscal boundaries said Levy's targets were unobtainable.
https://www.telegraph.co.uk/football/20 ... naccurate/" onclick="window.open(this.href);return false;
still it is nice to know that those working on the site are earning enough to fuel their alleged daily cocaine habits
https://www.thetimes.co.uk/article/spur ... -dnmckpttx" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
Won't be anything alleged about it, most builders will tell you drug and drink abuse is rife in their industry.
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Re: Football's Magic Money Tree
So following on from Man City's record breaking financial year - United have released their figures
Rvenue £590m
Wages £296m
Profit £40m
Cash position makes the debt look higher but their is really no change in that (and if you equate that with the loans by the Sheik and the Oligarch their debt is quite low in comparison
https://www.dailymail.co.uk/sport/footb ... -300m.html" onclick="window.open(this.href);return false;
Still we should at least match them for profit and a better return on the £5m plus wages on Nahki Wells than the £500k a week they are giving Sanchez (even if Sanchez has scored for the 1st team)
Rvenue £590m
Wages £296m
Profit £40m
Cash position makes the debt look higher but their is really no change in that (and if you equate that with the loans by the Sheik and the Oligarch their debt is quite low in comparison
https://www.dailymail.co.uk/sport/footb ... -300m.html" onclick="window.open(this.href);return false;
Still we should at least match them for profit and a better return on the £5m plus wages on Nahki Wells than the £500k a week they are giving Sanchez (even if Sanchez has scored for the 1st team)
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Re: Football's Magic Money Tree
Here's a thought - the 2 Manchester Clubs probably earnt more between them last year than we have in our entire history
- this just a few years after United fielded a player against us in a PL match that cost more than our total transfer spend in history up to that point (we have since tripled historic that spend)
- this just a few years after United fielded a player against us in a PL match that cost more than our total transfer spend in history up to that point (we have since tripled historic that spend)
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Re: Football's Magic Money Tree
Our Net Profit will be in the region of £58m/£60m, including the profit on sale of Keane and Gray.
Annoyingly, and for a reason known only to our BoD, confirmation of that figure will not be available until the end of March next year. A situation that has only become the case within the last four years since they cancelled the AGM in early December each year.
Annoyingly, and for a reason known only to our BoD, confirmation of that figure will not be available until the end of March next year. A situation that has only become the case within the last four years since they cancelled the AGM in early December each year.
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Re: Football's Magic Money Tree
How can you claim to have any idea what the profit will be nevermind narrowing it down to a £2m difference ?
I know you know a bit about figures but you have no idea on the wage bill until it comes out new players wages renewed deals and other expenses you aren't privvy too until the accounts are released.
I know you know a bit about figures but you have no idea on the wage bill until it comes out new players wages renewed deals and other expenses you aren't privvy too until the accounts are released.
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Re: Football's Magic Money Tree
Turnover.......£140m
Wages......£70m
Overheads........£15m
Amortisation.......£28m
Profit on Sale of Keane & Gray......£31m
Net Profit......£58m
The above figures will not be a million miles away.
Wages......£70m
Overheads........£15m
Amortisation.......£28m
Profit on Sale of Keane & Gray......£31m
Net Profit......£58m
The above figures will not be a million miles away.
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Re: Football's Magic Money Tree
I know you like to dig at how we do business and have a better idea of what we should be spending but probably wise to let the accounts be released that start guessing at figures.
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Re: Football's Magic Money Tree
Are you just guessing at the wages though?
Surely nobody has any idea of what bonuses they had in place for higher league finishes for example.
Surely nobody has any idea of what bonuses they had in place for higher league finishes for example.
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Re: Football's Magic Money Tree
A bit more on those financial results at Man Utd - their early exit from Europe cost them the chance of breaking the £600m revenue for the year and Woodward exerts the pressure in regards of trophies while slyly putting one over on City re the amount of time their Academy graduates play in the first team
https://www.bbc.co.uk/news/business-45641326" onclick="window.open(this.href);return false;
Meanwhile the Guardian focus on the debt - understandably given how little of the initial borrowings from 15 years ago have been reduced yet as we know the club have paid out over 100's millions in Interest and restructuring in that time never mind payments to Glaziers that have effectively repaid their financial stake to them - That is the true benefit of the Sheik and Oligarch from a fans perspective
https://www.theguardian.com/football/20 ... s-football" onclick="window.open(this.href);return false;
https://www.bbc.co.uk/news/business-45641326" onclick="window.open(this.href);return false;
Meanwhile the Guardian focus on the debt - understandably given how little of the initial borrowings from 15 years ago have been reduced yet as we know the club have paid out over 100's millions in Interest and restructuring in that time never mind payments to Glaziers that have effectively repaid their financial stake to them - That is the true benefit of the Sheik and Oligarch from a fans perspective
https://www.theguardian.com/football/20 ... s-football" onclick="window.open(this.href);return false;
Re: Football's Magic Money Tree
It's very unlikely that wages will be above £70m as that will run into issues with the Premier League's equivalent of FFP, could be lower though.
My back of a fag packet calculation came out at nearer £50m, it'll be somewhere in the £50-£60m ballpark.
My back of a fag packet calculation came out at nearer £50m, it'll be somewhere in the £50-£60m ballpark.
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Re: Football's Magic Money Tree
Speaking of the Oligarch it has come to light that he tried and failed to get a Visa to live in Switzerland during the summer when he was struggling to renew his UK one - strongly suspected money laundering was one of the main reasons for the Swiss refusing - fit and proper persons test anyone!!
https://www.theguardian.com/world/2018/ ... olice-said" onclick="window.open(this.href);return false;
https://www.theguardian.com/world/2018/ ... olice-said" onclick="window.open(this.href);return false;
Re: Football's Magic Money Tree
Although pretty expensive, it's interesting to ponder how quickly that will be recouped. Arsenal are a pretty ideal comparison and they get £50m-£60m or so per season more than Spurs in terms of matchday revenue.Chester Perry wrote:I have posted a few times abut the ever increasing costs of Stadia even as they are being constructed - Spurs, naturally have been mentioned a few times - that initial £5-600m forecast is looking mighty wishful at the moment with the club saying they can bring it in for just under £1billion and industry analysts suggesting that it could be as high as ££1.2billion or £12,000,000,000.00 in real numbers.
Difficult to believe that Levy of al people has found his fiscal control limits, did not get a fixed price contract and did not listen to companies about completion dates during the tender process - Multiplex (who know a thing or two about building on an existing Stadium site in North London under tight fiscal boundaries said Levy's targets were unobtainable.
https://www.telegraph.co.uk/football/20 ... naccurate/" onclick="window.open(this.href);return false;
still it is nice to know that those working on the site are earning enough to fuel their alleged daily cocaine habits
https://www.thetimes.co.uk/article/spur ... -dnmckpttx" onclick="window.open(this.href);return false;
On that basis, the increased revenue could pay for the stadium in about 20 years which would be a pretty good return for this kind of thing.
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Re: Football's Magic Money Tree
Aggi that rule doesn't kick in until you break the threshold - we have been below previously so can smash it (much like Wolves will this year) but will be held by it in subsequent years - and as discussed earlier in the thread there are ways round it by increasing your commercial incomeaggi wrote:It's very unlikely that wages will be above £70m as that will run into issues with the Premier League's equivalent of FFP, could be lower though.
My back of a fag packet calculation came out at nearer £50m, it'll be somewhere in the £50-£60m ballpark.
I think Roy is about right on wages - though not profit - he was £10m+ over on his prediction at the last results - he is usually in the ball park on most things though
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Re: Football's Magic Money Tree
Earnings like that will be sucked into wages (it is a legitimate route round the PL's FFP) and how they were able to give Kane, Ali and others such big pay rises -- look how Arsenal's spending came to a standstill for over 10years at the Emirates and they made £200m+ from redeveloping Highbury.aggi wrote:Although pretty expensive, it's interesting to ponder how quickly that will be recouped. Arsenal are a pretty ideal comparison and they get £50m-£60m or so per season more than Spurs in terms of matchday revenue.
On that basis, the increased revenue could pay for the stadium in about 20 years which would be a pretty good return for this kind of thing.
It will go one of 2 ways
- they will be a couple of big player sales in the next year or so if they don't win something big
- or the club will be sold (there are rumours of a £2billion bid in the offing)
Re: Football's Magic Money Tree
Fit and proper persons test? Are you suggesting that the FA ought to have better investigators than the UK government?Chester Perry wrote:Speaking of the Oligarch it has come to light that he tried and failed to get a Visa to live in Switzerland during the summer when he was struggling to renew his UK one - strongly suspected money laundering was one of the main reasons for the Swiss refusing - fit and proper persons test anyone!!
https://www.theguardian.com/world/2018/ ... olice-said" onclick="window.open(this.href);return false;
All the "fit and proper persons test" is doing is stopping convicted criminals from owning clubs. It isn't designed to test their competence, and it isn't designed to carry out criminal investigations of people who have never been convicted. How much do you think the FA would have to pay to defend itself against Abramovich, if they had banned him from buying Chelsea for no better reason than they didn't like him?
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Re: Football's Magic Money Tree
It's the reluctance of our Club to disclose financial results that really irritates me. I've been told the accounts are not only complete but also have been audited and yet the policy remains to withhold the information until the last possible moment in six months time.Chester Perry wrote:Aggi that rule doesn't kick in until you break the threshold - we have been below previously so can smash it (much like Wolves will this year) but will be held by it in subsequent years - and as discussed earlier in the thread there are ways round it by increasing your commercial income
I think Roy is about right on wages - though not profit - he was £10m+ over on his prediction at the last results - he is usually in the ball park on most things though
In terms of "right on wages - though not profit", that comment has me intrigued. There are three main elements, Income, Wages and Profit on player sales. Within Income the merit payment for finishing 7th was £119m and from previous years accounts we know the balance containing Match-day receipts, catering, sponsorship, retail etc is circa £18m so the £140m total estimate for the year to Jun'18 seems realistic. Wages - we agree at £70m and Profit on sale Keane and Gray is based as near as possible on fact.
Other than those figures, Overheads and Depreciation remain and are both relatively easy to predict based on previous years figures.
So, Chester Perry all that said, what would be your Net Profit prediction?
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Re: Football's Magic Money Tree
Roy I think it will be around the £45m mark - I have a hunch the profit on Gray and Keane while significant isn't as high as many presume and I reckon we will have a few surprise spends on infrastructure booked in the year - The BoD should also be conscious that regularly posting huge profits not only winds up large sections of the support but also has selling clubs and agents demanding more for players. Though for all our posted profits I am sure they are looking to substantially increase our cash position (some - like you - are aware profit does not mean cash, though many don't realise it will be years before we see the cash), the reason being that they want a back stop for the inevitable relegation when it comes (any time in the next 10years is the likely scenario) so we have a good chance of getting back up at first or second goRoyboyclaret wrote:It's the reluctance of our Club to disclose financial results that really irritates me. I've been told the accounts are not only complete but also have been audited and yet the policy remains to withhold the information until the last possible moment in six months time.
In terms of "right on wages - though not profit", that comment has me intrigued. There are three main elements, Income, Wages and Profit on player sales. Within Income the merit payment for finishing 7th was £119m and from previous years accounts we know the balance containing Match-day receipts, catering, sponsorship, retail etc is circa £18m so the £140m total estimate for the year to Jun'18 seems realistic. Wages - we agree at £70m and Profit on sale Keane and Gray is based as near as possible on fact.
Other than those figures, Overheads and Depreciation remain and are both relatively easy to predict based on previous years figures.
So, Chester Perry all that said, what would be your Net Profit prediction?
cannot back-up my feelings with numbers which is why have not posted these thoughts before, but you asked.
Re: Football's Magic Money Tree
I'm pretty sure you can't (although documentation is sparse). We can get up to £67m but if we exceed £67m then it is reverting to the increase on last year (which would be lower than £67m).Chester Perry wrote:Aggi that rule doesn't kick in until you break the threshold - we have been below previously so can smash it (much like Wolves will this year) but will be held by it in subsequent years - and as discussed earlier in the thread there are ways round it by increasing your commercial income
I think Roy is about right on wages - though not profit - he was £10m+ over on his prediction at the last results - he is usually in the ball park on most things though
(I can't find a more recent version of this but so far as I'm aware it's in place until 2019).
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Re: Football's Magic Money Tree
Fair enough...... the only disappointment is that, unlike the financial results for United and City, we'll have another half a year to wait for the answers.Chester Perry wrote:Roy I think it will be around the £45m mark - I have a hunch the profit on Gray and Keane while significant isn't as high as many presume and I reckon we will have a few surprise spends on infrastructure booked in the year - The BoD should also be conscious that regularly posting huge profits not only winds up large sections of the support but also has selling clubs and agents demanding more for players. Though for all our posted profits I am sure they are looking to substantially increase our cash position (some - like you - are aware profit does not mean cash, though many don't realise it will be years before we see the cash), the reason being that they want a back stop for the inevitable relegation when it comes (any time in the next 10years is the likely scenario) so we have a good chance of getting back up at first or second go
cannot back-up my feelings with numbers which is why have not posted these thoughts before, but you asked.
Let's just examine the Profit on Sale of Keane and Gray for a minute. The cost for Keane was undisclosed, but thought to be £3m, whilst we sold him to Everton for an initial £25m which could rise to £30m. Gray came to us for a Club record £6m and left to Watford for an undisclosed fee but suggested as between £15m and £18m.
After depreciation there's a minimum Profit on Sale for the pair of £31m.
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Re: Football's Magic Money Tree
Roy both Keane and Grey were subject to sell on clauses,
- with Grey all the bonus payments taking our fee up to £9m then sell on clause on top (all confirmed by Luton)
- with Keane we also don't know if we had to pay United a bonus on promotion and for his England appearances
I would be surprised if we are close to £23m profit on both of them as things stand.
- with Grey all the bonus payments taking our fee up to £9m then sell on clause on top (all confirmed by Luton)
- with Keane we also don't know if we had to pay United a bonus on promotion and for his England appearances
I would be surprised if we are close to £23m profit on both of them as things stand.
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Re: Football's Magic Money Tree
I don't see any reference to a sell on clause for Michael Keane.
I'd be looking at a £23m profit on Keane alone.
From memory I do recall Luton rubbing their hands at the prospect of a cut when we sold Gray to Watford.
I'd be looking at a £23m profit on Keane alone.
From memory I do recall Luton rubbing their hands at the prospect of a cut when we sold Gray to Watford.
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Re: Football's Magic Money Tree
Roy - Keane's sell on clause
https://www.telegraph.co.uk/football/20 ... ael-keane/" onclick="window.open(this.href);return false;
https://www.telegraph.co.uk/football/20 ... ael-keane/" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
Re: Post 261 - FIFA have agreed in principle on a loan cap - this will be interesting to see in action as will the plan to regulate the actions of Agents and the payments for youth players
https://www.bbc.co.uk/sport/football/45643965" onclick="window.open(this.href);return false;
https://www.bbc.co.uk/sport/football/45643965" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
Chester Perry wrote:Roy - Keane's sell on clause
https://www.telegraph.co.uk/football/20 ... ael-keane/" onclick="window.open(this.href);return false;
If we have received the full £30m now then the amount paid to Manchester United would be £6.75m, seeing a profit on the whole deal of £20.25m
At £25m it would see us paying United £5.5m and a profit on the whole deal of £16.5m
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Re: Football's Magic Money Tree
suspect we have received none of the £5m in bonuses at this time
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Re: Football's Magic Money Tree
The link suggests a 20% sell on clause for Andre Gray seeing a profit on the deal of £7.6m
https://www.getwestlondon.co.uk/sport/f ... d-13455402" onclick="window.open(this.href);return false;
https://www.getwestlondon.co.uk/sport/f ... d-13455402" onclick="window.open(this.href);return false;
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Re: Football's Magic Money Tree
again you are assuming a flat fee rather than one subject to a range of bonuses over the period of his time at Watford - we may have got one given that Watford stayed up last season
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Re: Football's Magic Money Tree
I may well be but i can only give calculations based on the facts at hand, the deal is reported at £18.5 Million, so the figures are based on that.Chester Perry wrote:again you are assuming a flat fee rather than one subject to a range of bonuses over the period of his time at Watford - we may have got one given that Watford stayed up last season
The idea was to give an estimation of what we would expect to receive and what profit we would have made on the whole deal in both instances, if people wish to they can take them as a maximum possible return.
Last edited by Goody1975 on Tue Sep 25, 2018 10:37 pm, edited 1 time in total.
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Re: Football's Magic Money Tree
Worth remembering also that the initial fee paid for each player is reduced in the calculation by each year they had served on their contract.
So, if Andre had served two years of his three year contract the £6m is reduced to £2m for purposes of calculating the profit on sale.
So, if Andre had served two years of his three year contract the £6m is reduced to £2m for purposes of calculating the profit on sale.
This user liked this post: Goody1975
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Re: Football's Magic Money Tree
That's a fair point
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Re: Football's Magic Money Tree
A further look suggests that Keane had served two years of a three year contract with us signing in Jan'15 and leaving in Jul'17.
Similarly with Gray who signed in Aug'15 and left in Aug'17.
So on departure each would have had a net book value of one year of the three years transfer fee paid.
So, for Gray, £18.5m minus 20% to Luton minus £2m nbv = £12.6m Profit on Sale.
Keane, £30m minus £7.25m to United minus £1m nbv = £21.25 Profit on Sale.
Similarly with Gray who signed in Aug'15 and left in Aug'17.
So on departure each would have had a net book value of one year of the three years transfer fee paid.
So, for Gray, £18.5m minus 20% to Luton minus £2m nbv = £12.6m Profit on Sale.
Keane, £30m minus £7.25m to United minus £1m nbv = £21.25 Profit on Sale.
Re: Football's Magic Money Tree
The problem with profit as a marker is that the accounting rules nowadays are designed to be logically correct, not to be useful. If we sell players for £40m and buy players for £40m, then have we broken even? Yes in cash terms, yes in real footballing terms, no in accounting terms. In accounting terms, we have made £30m profit - but we don't have the cash to show for it.
If we spend £40m on new signings each year for three years, all on players on 4 year contracts, then at the end of the three year period there is £120m gone out of the club. But the accounts show that only £60m has gone out and that we have made profits of the other £60m. If we then spent enough money so the accounts showed no profit at all, we would have to borrow and spend a further £60m on wages and other expenses.
If we spend £40m on new signings each year for three years, all on players on 4 year contracts, then at the end of the three year period there is £120m gone out of the club. But the accounts show that only £60m has gone out and that we have made profits of the other £60m. If we then spent enough money so the accounts showed no profit at all, we would have to borrow and spend a further £60m on wages and other expenses.
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Re: Football's Magic Money Tree
DSR - That effectively provides reasoning for my believing the club want to build up their cash holding significantly
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Re: Football's Magic Money Tree
Further to Post 275 and how much has been drained out of Man Utd since the takeover - The Guardian have it at over a £1billion now with a net reduction in debt of less than £50m - it is no wonder the bankers love Woodward. By way of comparison that is reasonably close to what The Sheik has pumped into Man City - Just imagine if utd had had that additional spending on players and their development on top of what they have already spent in the period - beyond credulity for most of us I think
https://www.theguardian.com/football/20 ... ter-united" onclick="window.open(this.href);return false;
https://www.theguardian.com/football/20 ... ter-united" onclick="window.open(this.href);return false;