United thread 2012/13 (inc merged IPO thread)

[moomba]

Even if they do make it out of the group stages, their share of TV money from the group stages will be much less than the year before as they're not going in as champions, and Chelsea's win last year gives them a percentage of the other teams share.

 

[Blootoof]

[youtube]http://www.youtube.com/watch?v=nPPRTBoleAk[/youtube]

LOL @ the cockney rag near the start... "Fackin ell!", not used to so much noise at the swamp.

"So then. Where should we stick the wheelchairs?"

 

[The Future's Blue]

[youtube]http://www.youtube.com/watch?v=nPPRTBoleAk[/youtube]

LOL @ the cockney rag near the start... "Fackin ell!", not used to so much noise at the swamp.

"So then. Where should we stick the wheelchairs?"

Wooooh, nastyyyyyy!

 

[Vienna_70]

Manchester United, owned by the Glazer family that owns the Buccaneers, just posted a much bigger net loss in financial records from the fiscal fourth quarter, according to the Associated Press.

Citing uncharacteristic early exits in the group stage of the Champions League and the English FA Cup (to which the non-soccer crowd reads as “blah blah blah blah blah”), Man U lost $24.2 million in the fourth quarter. Over the same span last year, the team lost $570,000.

The report was the first since the team’s disappointing start on the New York Stock Exchange. While they were hoping to sell shares between $16 and $20 a share, it opened at $14, and shares were trading at $12.72 Tuesday morning.

Man U is saddled with debt (hence the IPO), and revenues are declining, at least until a new sponsorship deal with General Motors kicks in in two years.

Meanwhile, the guys that own the prestigous soccer team have an American football team that can’t sell enough tickets to prevent blackouts at a reduced percentage, even after splashing $141 million worth of contracts on three players (Vincent Jackson, Carl Nicks, Eric Wright) in free agency. Meanwhile, the Bucs were carrying more than $13 million worth of salary cap room earlier this month, seventh-most in the league.

It doesn’t take an economist to realize it’s not a healthy mix.

Hopefully, that will mean the Glazers will have to take even more money out of their British 'franchise' to make up for the shortfall.

LGHU.

 

[allan harper]

 

[Stoned Rose]

Bit of a weird one here.

Had a rag at work trying to take the piss today because the radio adverts for the villa game were advertising cheap tickets.

YCNMIU he's a very rare match goer, less than once a season rare, whos main excuse is the price/availability and then takes the piss saying that we have to virtually give them away.

Theres no hope for some.

less than once a season rare

You could've just said he doesn't go then ;)

 

[cleavers]

What exactly is a "tax credit" to a football club ? Something that takes a £5m loss to a £23m. On the face of it, and I know next to bugger all about finance for major companies, these figures look pretty poor, would that be a good assesment ? (Prefer a reply from someone who knows finance, not an armchair rag.)

I'll ask again as I'm still curious as to what it means, if any of you financial guru's can tell me.

 

[bluemonday]

I'm liking this article from a U.S. shares and investment website

Fourth quarter and full year results out from Manchester United (MANU) on 18th September were marginally below forecast - to miss estimates just a few weeks after your IPO is pretty poor form. Talking of pretty poor form, Manchester United are currently 2nd in the English Premier League but have looked unconvincing against some weak sides so far. At $12.58 the shares are already well down on the $14 IPO price and also on the $13.35 price at which I explained in detail why this was a sell on 27th August. But there is worse to come: my target remains $7.

For the year to June 30th 2012 revenues fell by 3.3% to £320.3 million ($520.04 million) primarily because of United's failure to make the playoff stages of the European Champions League. EBITDA fell from £109.7 million ($177.7 million) to £91.6 million ($148.4 million) but net income increased from £13 million ($21.1 million) to £23.3 million ($37.7 million). Earnings per share came in at 15p (24.3 cents) up from 8p (13 cents). You will remember that this is meant to be a "growth stock" but the fact is that earnings do not grow consistently but can bounce up or down depending on the on-field success and that cannot be guaranteed.

Profits were boosted by a profit of £9.7 million ($15.7 million) on trading players (up from £4.5 million - $7.3 million). This year they have already offloaded one player bought for £30 million or $48.6 million (Berbatov) for £4 million ($6.5 million). So do not bank on a similar gain next time.

The balance sheet is, as ever, a bit of a worry. Net debt increased from £308 million ($499 million) to £366.3 million ($593 million) at the year end leaving net interest costs at an alarmingly high £49.5 million ($80.2 million). The cash flow generated from operations during the year was £80.3 million ($130.1 million ) - a decline of 35.8% - but that was more than swallowed up by capex of £22.7 million ($36.8 million), the aforementioned interest costs and by the net costs of buying and selling players (£49.6 million, or $80.4 million). If Manchester United is to win anything this year (it failed to win a single trophy last season) it has to spend on new players and indeed has already done so.

The bull case (explained here on Seeking Alpha earlier today) is predicated on guidance from United that it will generate revenues of £350-360 million ($567 million - $583 million) this year and that this will equate to EBITDA of £107-110 million ($173 million - $178 million) but this assumes that United makes it through to the Champions League playoffs and the quarter finals of both domestic cup competitions - this equates to earnings of $0.19 per share. I am far from convinced that it has a deep enough squad to fight for all three cups plus the English Premier League. If injuries, suspensions and the need to rest key players force it to field weaker sides in some UK cup matches, United may well (as has happened in previous years when its squad was stronger) suffer an unexpected reverse.

The following year a new shirt sponsorship deal with GM will help the picture. But United needs the cash. On the basis of its own (optimistic) forecasts for EBITDA this year it is hard to see how - even if it does not buy more players in the next transfer window, as it should - it will be able to repay any of its debt.

At $12.58 the company is still valued at $2.06 billion. It has debt of c$600 million. You are being asked to pay 66 times forecast earnings (on a best case scenario of cup success) for a company which is overborrowed, has erratic and unpredictable earnings, questionable corporate governance and - after a season of failure - an, arguably, diminishing brand value. Even at my target price of $7 the multiple is 37.

Tonight United starts its European campaign in Turkey. It needs to win if it is to convince doubters that it might just hit its on field targets (and thus financial targets) for this year. If the Red Devils lose in Turkey, shareholders will get roasted tomorrow. Even a victory it still looks the current valuation as indefensible.

<a class="postlink" href="http://seekingalpha.com/article/876681-manchester-united-poor-full-year-numbers-sell-down-to-7?source=email_rt_article_title&ifp=0" onclick="window.open(this.href);return false;">http://seekingalpha.com/article/876681- ... itle&ifp=0</a>

 

[JM Mcr]

What exactly is a "tax credit" to a football club ? Something that takes a £5m loss to a £23m. On the face of it, and I know next to bugger all about finance for major companies, these figures look pretty poor, would that be a good assesment ? (Prefer a reply from someone who knows finance, not an armchair rag.)

I'll ask again as I'm still curious as to what it means, if any of you financial guru's can tell me.

Well I am an armchair rag but doesn't look like anyone else is answering Cleavers, so I'll have a go and give you my take on it.

In their accounts Utd talk about the tax credit "primarily arising due to recognition of a previously unrecognised tax loss as a deferred tax asset.." Although I know next to nothing about Corporation Tax I know a little about Individual Tax Returns and from that it seems to me that Utd (or their accountants) have managed to get some or other expense in the previous tax year(s) classed as a taxable expense, rather than a non taxable expense. That would then allow them to have the earlier year(s) returns amended, reducing the tax payable for those years and giving rise to a tax credit. Presumably Utd would then have either received a tax rebate or carried the tax credit (or tax relief) into their 11/12 tax return to use against their income then.

I'm no accountant so may be way off with this (apologies if so) but, like I said, I am familiar with the Individual Tax Return process and that's how it works there..

 

[Stoned Rose]

What exactly is a "tax credit" to a football club ? Something that takes a £5m loss to a £23m. On the face of it, and I know next to bugger all about finance for major companies, these figures look pretty poor, would that be a good assesment ? (Prefer a reply from someone who knows finance, not an armchair rag.)

I'll ask again as I'm still curious as to what it means, if any of you financial guru's can tell me.

Well I am an armchair rag but doesn't look like anyone else is answering Cleavers, so I'll have a go and give you my take on it.

In their accounts Utd talk about the tax credit "primarily arising due to recognition of a previously unrecognised tax loss as a deferred tax asset.." Although I know next to nothing about Corporation Tax I know a little about Individual Tax Returns and from that it seems to me that Utd (or their accountants) have managed to get some or other expense in the previous tax year(s) classed as a taxable expense, rather than a non taxable expense. That would then allow them to have the earlier year(s) returns amended, reducing the tax payable for those years and giving rise to a tax credit. Presumably Utd would then have either received a tax rebate or carried the tax credit (or tax relief) into their 11/12 tax return to use against their income then.

I'm no accountant so may be way off with this (apologies if so) but, like I said, I am familiar with the Individual Tax Return process and that's how it works there..

Well I am an armchair rag