The Financial Situation (40 Viewers)

[pavluska]

That ridiculous EPL deal.

Too bad that deal wasn't signed this season.

http://www.totalsportek.com/football/expensive-kit-contracts/
Football’s 10 Most Expensive Kit Suppliers Deals

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.

The result is the same as the current situation, though. Upper/mid table English clubs become a stepping stone for Champions League teams. That's already the case. Lemina, for example, decided he'd be more likely to get picked up at Tottenham than at Roma. That move was funded by Bale who was signed by Madrid from Spurs.

They can't sign and hold on to every player at that level, though. As a result you'd expect to see players of the same level playing in Italy, Germany, Spain and some in France. That's what we have now.

- - - Updated - - -

Sorry not Lemina I meant Lamela :knockonwood:

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.

Here are some updated financial metrics I calculated

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.

We already did. If we earn >-15 million change this next quarter than we did the same quarter a year earlier, we will hit 400. If we earn <-15 million change, we will be under 400.

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.

 

Buy on AliExpress.com

[napoleonic]

so repeating my previous question, what's the status on the j village project? and how much will we expected to generate from it? and when?

 

[italiacalcio10]

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.

 

[Siamak]

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.

honestly i dont care about adidas and nike and it doesnt matter to me that which of brand are our sponsor.it's good to know what other brands can do for our Financial but i think adidas can help to us to sell Juve merchandise.

 

[pavluska]

Cool, @italiacalcio10. Yeah, figured our transfers+salaries budget would be about the same as this year's. We're making around 20m less from CL, but that's offset by the amount we didn't spend. Operating costs increased but so did commercial revenue. They're expecting us to finish with a loss (was +2.3m after last season), so the increase in operating cost is prolly slightly higher compared to growth in commercial rev (can't be by a lot), meaning our budget for next season is about the same or is a tad lower than this season's.

so repeating my previous question, what's the status on the j village project? and how much will we expected to generate from it? and when?

I don't know exactly how much they're expecting, but it's supposed to be a big deal and is a big investment.

Here's some info on J Village:

http://www.ilgiornale.it/news/sport/sede-centro-sportivo-e-hotel-signora-ha-sua-citt-1183745.html

honestly i dont care about adidas and nike and it doesnt matter to me that which of brand are our sponsor.it's good to know what other brands can do for our Financial but i think adidas can help to us to sell Juve merchandise.

Meant how much they're paying us.

We need other Serie A clubs to become top teams and do well in Europe to increase our rate of commercial revenue growth. Serie A as a whole doing well means greater attraction and more viewership, which means more following for the league and, as a result, our team.

And of course, that would also generate a better TV deal. At this rate, it'll remain stagnant (that too thanks to us, would be worse otherwise) despite greater disposable income and more money in footie nowadays.

Lack of two more top Serie A teams is affecting both our TV revenue and commercial revenue.

 

[campionesidd]

Who edits this stuff?
http://www.calciomercato.com/en/new...right-list-inter-barely-above-west-ham-663931

 

[Cerval]

Who edits this stuff?
http://www.calciomercato.com/en/new...right-list-inter-barely-above-west-ham-663931

Lol at the title.

 

[AFL_ITALIA]

Much work needs to be done. At the very least we need to overtake those shit English clubs in front of us.

 

[Ahmed]

Marketing is the key, that is the only truly flexible sector.

TV deal and CL revenue can only go so much.

 

[Xperd]

Marketing is the key, that is the only truly flexible sector.

TV deal and CL revenue can only go so much.

TV deal can go much higher especially globally if we can get a competitive long term rival.If Milan get bought by Chinese,then those chances look bright.

 

[zizinho]

We need a strong rival and Milan is the only one capable of being that in the long run. A large fanbase worldwide, a great history especially in Europe and potential in revenue increase, as well as being potentially an attractive destination for top players. Roma and Napoli as 3rd and 4th strongest teams are fine so we don't even need a strong inter for a strong Serie A. Hope they get relegated for being so much in the red

 

[Ahmed]

TV deal can go much higher especially globally if we can get a competitive long term rival.If Milan get bought by Chinese,then those chances look bright.

perhaps but they bargain collectively, right? not individually like Barca and Madrid.

can only rise so much.

 

[Emmet]

Commercial revenue is the biggest issue for Juve. That's where Bayern makes a killing.

Yet more $$$ from that sector will only come with more appearances in the latter stages of the CL. Bayern reached the SF in 2010, 12,13,14,15,16.

That's the consistency Juve need.

Stadium money plus TV money have a glass ceiling that has now been reached.

Juve would need Milan to become very good again plus Napoli and Roma to keep at their decent levels to drive up a bigger TV deal.

 

[Paid-off-Ref]

Has anyone seen any ball park projections of what we are expected to make annually from J-Village?

 

[Valerio.]

TV deal can go much higher especially globally if we can get a competitive long term rival.If Milan get bought by Chinese,then those chances look bright.

Serie A international deal suck so much compared to la Liga and EPL.
Serie A right now earns only 200m from international tv rights

 

[Emmet]

Serie A international deal suck so much compared to la Liga and EPL.
Serie A right now earns only 200m from international tv rights

Not even 200m, it's around the 186m a season figure, runs to 2018 iirc.

 

[Scottish]

I'm actually surprised more overseas billionaires haven't been buying Italian clubs. Seems like an obvious sell, you'd not have to build up the international prestige with Milan or Roma to the same extent as with Man City or PSG. Italian clubs already have worldwide recognition. They just don't have the team to play in the Champions League all the time.

 

[Valerio.]

I'm actually surprised more overseas billionaires haven't been buying Italian clubs. Seems like an obvious sell, you'd not have to build up the international prestige with Milan or Roma to the same extent as with Man City or PSG. Italian clubs already have worldwide recognition. They just don't have the team to play in the Champions League all the time.

italian clubs are in deep debts. So to buy them you'd have to spend more than what they're worth.
I mean would you pay milan 1b euro?

 

[1251alex]

I'm actually surprised more overseas billionaires haven't been buying Italian clubs. Seems like an obvious sell, you'd not have to build up the international prestige with Milan or Roma to the same extent as with Man City or PSG. Italian clubs already have worldwide recognition. They just don't have the team to play in the Champions League all the time.

Wasn't there a billionaire owner in Serie A about 5-6 years ago who bought a mid table club, I wanna say Cagliari, but then sold them because the stadium situation in Italy is fucked? I might be wrong.

 

[Valerio.]

Wasn't there a billionaire owner in Serie A about 5-6 years ago who bought a mid table club, I wanna say Cagliari, but then sold them because the stadium situation in Italy is $#@!ed? I might be wrong.

who knows but ye this is another reason why international bilionaires don't buy in Italy... bureaucracy toons of it! no freedom to do anything.
I mean it's not like Us. You find a place,buy it and then build whatever you want. Not at all. I mean you can't even open shops unless you have license.

I mean look at us we were supposed to hold a multiplex cinema and a bowling but it went straight to the trash bin cause others multiplex and bowling went to Tar claiming that if it was allowed they would suffer losses and so it was cancelled.

Would you as investor buy in Italy? being allowed only to splash money without return? What italians want's are mecenates like Berlusconi/Moratti were.
Sadly this is a model only if the investors were arabs oil lords who want to make a name for themself.

Going for the business model (unless you're juventus) won't work