Transfer spend can't really be looked at in isolation any more. You need to look at a number like 'football spend' which includes wages. Your increase in wages over the last 5 years dwarfs net spend on transfers.
ALL issues relating to the bond issue and club finances
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In the latest episode of the United Hour Podcast, Nik (@Rood) is joined by CEO Duncan Drasdo and Financial Director Andy Green from the Manchester United Supporters Trust for a special episode on all things behind the scenes at Old Trafford including a brief history of MUST and their aims today, views on INEOS and Sir Jim Ratcliffe so far, and the Old Trafford regeneration.
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It is undeniable that, in accounting terms, the Ronaldo sale is an 'extraordinary item'.
But anyway Im not actually interested in that argument because, like Impey says above, I think net spend is pretty irrelevant anyway.
Who cares if net spend is low when you won the league 3 times in a row and are top of the league?
In fact I prefer that we have success with a low net spend because it proves that we didnt just try and buy success like Chelski, Real or City.
If our squad was crap and we were struggling to compete with the top clubs then I could understand complaints about level of spending, but in my opinion we have one of the best squads we have ever had so I have no idea what people are complaining about.
If it aint broke, dont fix it.
This is a good point and also shows how irrelvant the 'net spend' stat really is.
This is bizarre Impy
Obviously there are more fundamental issues at stake in the grand scheme of things, but given so often the pro Glazer retort is to point out how successfully we've been since they've been here, and claimed they haven't affected the football side of things... it's really quite pertinent
Look at it this way. In the initial leaked Glazer business plan, they built in an annual budget of around £25million, with an extra one off pot of £25million available for a 'special player'. So in five seasons, that's potentially £150milion of transfers. What did they actually spend? £5-10million. Imagine what our accounts would look like now if they'd actually spent what they'd initially outlined. Next summer it'd be £175million, and all the talk is about how we've got the remainder of the Ronaldo cash to spend. Damn right we should have it to spend, and a lot more too (although I believe there's evidence to suggest in fact we're taking out another loan to provide transfer funds?). Even with that cash saved, with season tickets going up in price around 60%, with record turnover and growth... they still struggled to even service the debt, never mind pay off the debt itself, leading to the bond issue where all the details came out that's led to this latest sustained protest and media pressure
They're leaches, and it's things like this that put that into it's proper context
When they sold Ronaldo, they shifted out the player on the highest wages at the club
What is the increase on wages then Peter? I'd like to see the source you're quoting please
Your wage bill was £77M 12 months to June 2005. It rose to £123M 12 months to 30 June 2009. Ie you spent roughly £120M in incremental wages over 4 years. Average net spend of £30M a year in wage increases.
I think you missed the point - which is that transfer spend only shows part of the picture of how much is being invested into the squad.
For example, we could pick up Joe Cole this summer for free - so that would not make any difference to our net spend but obviously we will have signed a top quality player and might have to pay him a big sign on fee and maybe £70k a week in wages.
Why leave net spending out?
That's like leaving costs out when declaring your profit.
Even before the Ronaldo sale, they weren't putting any of their own money in. Sales and ticket price increases covered the net difference.
My point it's is not clear whether or not they have intentionally kept net spend low or whether or not it's a consequence of the Ronaldo sale.
I said that at the time and I'm sticking to my guns on this one.
I'm not denying they are leeches.
If you add back the Ronaldo sale net spend would be about 100-120m which isn't that far off their target.
It's not something conclusive.
There are far better sticks to beat them with.
We can't add it back because we sold him. Our squad is minus one World player of the year. It says something about this club that we could do that, and still compete at the very top. It says a lot about the manager (there pre Glazers) and the players (many of whom were there pre Glazer, those that have been brought in were funded via selling players brought in pre Glazer). That's not a normal situation
Oh and for someone who works in the financial field, your maths is awful!!!
I took the 10m net spend then added on the 80m Ronaldo transfer, 20m for Valencia and 10m for Smalling which adds up to 120m as a worse case scenario.
It was a rough and ready approach.
I think we need to start accepting that Ronaldo wanted to go rather than thinking the Glazers 'cashed in'.
We also sold the likes of Beckham, Stam, etc, pre-Glazer under the Plc.
Like I said we should be concentrating on the negatives that stick better rather than keep bleating on about net spend.
Their are far worse consequences of the Glazer ownership than a low net spend which is ambiguous to say the least.
I think we all already do accept that Ronaldo wanted to go
We all knew that for a number of years, Glazers included
Clubs budget according to money they won't get for a year or two all the time. Remember how many clubs went into administration when ITV digital collapsed, it was only their first season of coverage, but many had already spent the money they were promised over the course of three seasons. There's no reason to think transfer activity from the past year or two was made with Ronaldo's departure in mind. Remember our net spend after two seasons of Glazer ownership was only just better than break even, and that's at a time you'd expect them to be making signals of intent to appease the supporters
We all knew that for a number of years, Glazers included
Clubs budget according to money they won't get for a year or two all the time. Remember how many clubs went into administration when ITV digital collapsed, it was only their first season of coverage, but many had already spent the money they were promised over the course of three seasons. There's no reason to think transfer activity from the past year or two was made with Ronaldo's departure in mind. Remember our net spend after two seasons of Glazer ownership was only just better than break even, and that's at a time you'd expect them to be making signals of intent to appease the supporters
It'd be pretty foolish to buy players on the premise that we could sell Ronaldo for £80m to make up the deficit.
A career ending injury would mean noone would be interested any more and the club would have bought those players with no money coming in to cover it.
Not to mention all the other variables such as Real losing interest, or finding themselves in financial problems, or Ronaldo deciding he wants to stay.
Flip side is we'd still have Ronaldo, wouldn't have spent the money on Valencia, paid the tax on Ronaldo's sale and would still have the revenue that Ronaldo, like Beckham, brought in.
We are where we are. Take Berbatov's value off because we might not have bought him. If my aunt had a cock, she'd have been my uncle.
They're not all in the same direction though!!!
We got 80m, but spent 30m
I'm quite aware of that, I said it was rough and ready.
I've got better things to do with my evenings than argue with Brad and work out sums that I don't think are the most pertinent gripes with the Glazer ownership.
I'd rather concentrate on what we do know about ACS, price hikes, corps being offerered extra final seats, interest payments, PIKs , etc.
Much more important than working out whether or not the Glazers saw the Ronaldo money coming or not.
I still think myself that everything when in Madrid's favour, Ronaldo expressed a further desire to leave and the weak sterling meant Real could add a further 15m quid into their valuation and not be out of pocket.
I just don't think the Glazers would have taken that risk.
Imagine the club bought Berbatov, Tosic etc on the premise we'd be getting £80 for Ronaldo. Then Ronaldo's leg snaps in 3 places at the end of 08/09, noone's interested, and the club can no longer get the money earmarked to cover the Berbatov deal etc.
I don't think the Glazers would have allowed that. They're too tight. The money on Berbatov et al must have come from existing transfer budgets.
Naive on your part if you ask me Kraft
The Glazers are taking all kind of risks with their business plan. It depends on us remaining at the top for a start, in a sport where you just can't make such guarantees
According to Calderon and a Real Madrid director the Ronaldo deal was already agreed before we signed Berbatov.
They took massive risks but they've probbaly got away with it post bond. The rainy day business plan probably assumes CL football 7 years out of 10 and no major trophies.
Haven't we learned by now that we can't trust a thing these feckers say. Mercia reckon they they are signing Vidic and Rooney in the summer are we to believe that as well?
I propose we all listen to imps and ignore everything that every other spastic with an agenda and no capacity for independent thought says in this thread.
I'd heard the Rooney thing was just to grab the attention away from their CL Exit
Dwarfed by the increases in income between 2005 and 2009 though.
You say that like it is a bad thing ?!
The lower your wages as a percentage of turnover the better, it is the sign of a financially secure club.
Not like you to be supporting the Glazer business plan!
Yes, because a lot of it's come through massive ticket price increases!!
Normally it would be the sign of a financially secure club.
Unfortunately in this case it is a result of our club becoming less financially secure.
I prefer to seperate out the different issues when discussing the detail - the financial well being of the club / level of investment in the club / ticket prices etc - but I guess inevitably it all gets mixed together.
You must be living in a parellel universe
So you are denying that we are less financially secure now than we were in 2005?
Basic stuff -
1. The Glazers put us £700m in debt.
2. The banks tell the Glazers that they have to increase income and reduce expenditure.
3. Therefore the reduction in wages as a % of turnover following 2005 is not a sign of financial strength, it is a result of financial weakness.
ffs just wrote a longish response and managed to close the window before posting it - brief summary:
I havent made any comment about our current financial security vs 2005 - in fact I dont think I ever have.
Your list of 'Basic stuff' is not the way it works at all - you seem to get cause and effect mixed up - resulting in a backwards conclusion in my opinion.
I havent made any comment about our current financial security vs 2005 - in fact I dont think I ever have.
Your list of 'Basic stuff' is not the way it works at all - you seem to get cause and effect mixed up - resulting in a backwards conclusion in my opinion.
There isn't a reduction in wages as a percentage of turnover it's the same (56%) in 2005 and 2009.
That's right I think both have increased by around 10% per annum. They've done quite well to contain costs - I suspect Chelsea's wage bill as a % of turnover must be over 60%. But they are a different case - until Roman gets tired of running it at a loss.
My gut instinct was that the figure was about 84% but after a quick Google it looks like it's about 70%.
Fair enough - should have checked myself really!
In which case both my and ralphie's arguments are irrelevant
Anyway whichever you spin it - a low wage to turnover ratio is a good thing not a bad thing!
Fans group Red Knights delays bid for Manchester United
The Red Knights consortium has revealed it is not planning to make a bid for Manchester United before the end of this season.
The group of United supporters has been vocal about a change of ownership at Old Trafford and is considering the feasibility of making a proposal.
A statement said: "We will continue to work on it but do not expect it to be done before the end of the season."
United are owned by the Glazer family, who paid £800m for the club in 2005.
But the level of debt United are in - now at £716.5m - has prompted unease over their ownership and supporters' groups have vented their frustration at the Americans.
The Red Knights, made up of wealthy United fans, has recruited the Japanese investment bank Nomura to help it put together a bid which will interest the Glazers, who for their part have said United are not for sale.
But the group, which includes Jim O'Neill, chief economist at Goldman Sachs, lawyer Mark Rawlinson and financier Keith Harris, says the number of fans willing to invest in a takeover bid is growing.
Their statement added: "The Red Knights have been liaising with the Manchester United Supporters Trust, and their representatives were at our first meeting on 2 March. They remain closely involved with our plans.
"On 12 March we involved Nomura as our adviser. Since then they have been speaking to and meeting many potential Red Knights who have contacted us since our interest was made public.
"These potential Red Knights have offered ideas and support and, with the help of this input, our plans have been developed further."
The Glazers, meanwhile, have insisted that the club is not for sale and manager Sir Alex Ferguson has been publicly supportive of the Americans.
But the 'Green and Gold campaign' has seen thousands of supporters wear the colours of United under their original guise of Newton Heath, with former United hero David Beckham donning a scarf after AC Milan's Champions League defeat at Old Trafford.
The Red Knights believe they will need to raise between £800m and £1bn to lauch a serious bid for the club.
BBC Sport - Football - Fans group Red Knights delays bid for Manchester United
The Red Knights consortium has revealed it is not planning to make a bid for Manchester United before the end of this season.
The group of United supporters has been vocal about a change of ownership at Old Trafford and is considering the feasibility of making a proposal.
A statement said: "We will continue to work on it but do not expect it to be done before the end of the season."
United are owned by the Glazer family, who paid £800m for the club in 2005.
But the level of debt United are in - now at £716.5m - has prompted unease over their ownership and supporters' groups have vented their frustration at the Americans.
The Red Knights, made up of wealthy United fans, has recruited the Japanese investment bank Nomura to help it put together a bid which will interest the Glazers, who for their part have said United are not for sale.
But the group, which includes Jim O'Neill, chief economist at Goldman Sachs, lawyer Mark Rawlinson and financier Keith Harris, says the number of fans willing to invest in a takeover bid is growing.
Their statement added: "The Red Knights have been liaising with the Manchester United Supporters Trust, and their representatives were at our first meeting on 2 March. They remain closely involved with our plans.
"On 12 March we involved Nomura as our adviser. Since then they have been speaking to and meeting many potential Red Knights who have contacted us since our interest was made public.
"These potential Red Knights have offered ideas and support and, with the help of this input, our plans have been developed further."
The Glazers, meanwhile, have insisted that the club is not for sale and manager Sir Alex Ferguson has been publicly supportive of the Americans.
But the 'Green and Gold campaign' has seen thousands of supporters wear the colours of United under their original guise of Newton Heath, with former United hero David Beckham donning a scarf after AC Milan's Champions League defeat at Old Trafford.
The Red Knights believe they will need to raise between £800m and £1bn to lauch a serious bid for the club.
BBC Sport - Football - Fans group Red Knights delays bid for Manchester United
It was quite funny watching you drawing opposite conclusions from a premise that was false to begin with. I think the point is that despite healthy increases in turnover that are probably not sustainable the wage bill has matched them.In which case both my and ralphie's arguments are irrelevant
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