Too bad that deal wasn't signed this season.
We're 8th or 9th in like every list. Consistent.
How much less did we get from Nike?
The Adidas deal is better, so that's good, but we're already worth 50% more than that. And 6 yrs is a long time. We'll be worth way more than 20m pounds in 2021-22.
The United deal is ridic.
It'll basically make it harder for the Milans and Inters to sign decent players with mid-table EPL clubs having even more spending power.
Nice one, but a couple of things:
Juve does accrual-based accounting not cash-based, right? Like most large organizations. So, cash flow doesn't tell us exactly what spending power or budget we have. We've to look at total transfer fees and not individual payments and factor in credit.
And that's cash available after 3rd quarter. A pro forma of the 4th quarter would need to be done which would give us a cash available estimation. Both CL elimination and Q4 commercial rev have to be factored in. Compared to last fiscal year's Q4, we've no further CL earnings in this Q4. And commercial revenue in Q4 can be projected by looking at Q3's commercial gain and historical change from Q3 to Q4.
Don't forget about the difference in CL revenue from last Q4 to this Q4. Some of that will be offset by greater commercial revenue.
Yeah - it uses accrual-based accounting. My adjustments were to offset some of these accrual issues. For example: subtracting out player gains, adding back D&A, etc. It is essentially (1)Revenue - (2)Gains from Sales - (3)Operating Costs excluding Depreciation & Amortization* - (4) Current Tax Expense - (5) Interest Expense. That gives a decent, but imperfect proxy for Cash Flow from Operations. I'm assuming it is run-rate for 12 months, which won't be the case, of course as it will likely grow over a full year.
*You do not want to include depreciation/amortization or writedowns of player rights, because that is just as incorrect as using a gain from sale in revenue since that number is derived off the depreciated asset value.
The next thing I factor in is net working capital. We do not know what will and won't reverse other than short term payables and receivables related to transfers. These are the previous installment payments.
If you subtract this from my cash flow proxy, you essentially get a projection for Operating Cash Flow less payments that should be due within the next year, which is Cash Flow from Operations after Working Capital Changes.
From there, assuming minimal physical CAPEX, the remainder should be available from investment in players. It is essentially a forecast of the 1 year cash flow, but once again imperfect. You can combine that with the current cash of 42 million and get a sense of cash that will be available throughout the next one year. Also, it is important to consider the low leverage metric, which also allows from the balance sheet to be used to make strategic purchases.
As for Cash Flow vs. Accrual:
An accurate cash flow would tell us how us how much we could spend because it would give us a 1 year projection of cash coming in before new transfer payments. Of course, you need to know which accruals will reverse. I assumed that the short term transfer instalments receivable and payable would reverse, which would be net working capital. That being said, likely Marotta would use delayed payments and those payables and receivables wouldn't completely reverse, making the outlay in the first year lower.
And yes, I agree. We do not know the fourth quarter number. Depending on how much revenue is recognized immediately from UCL, this will impact the 4th quarter more or less, with an offset from commercial revenue.
Without spending hours projecting all the accruals, this should provide a decent idea of how much cash is available.
At minimum, we know that we have 42 million in cash on the balance sheet, as well as a balance sheet that can handle a bit more debt. We also know that our cash flow situation is healthy since it is positive.
As I have said before, I think we have a decent amount of financial capacity to invest in players, partially because we underspent last summer.