Liverpool and Manchester United
Posted by John Beech on October 14, 2010
I’ve been abroad for work and then taken a couple of days leave – the net result is a week of only occasional internet contact. A week is a long time in football it would seem.
All my standard searches to keep up with football management affairs have resulted in a total overkill on the Liverpool sale soap. Certainly it’s a fast-moving and ever-changing saga – I was interviewed on BBC News 24 this morning, and already there has been a development, oh, and a non-development.
It strikes me that the focus on Liverpool, understandable though it is, has meant that some very interesting football management stories have been largely ignored. For example, there are stadium stories at Bristol City and Worcester City, not to mention the 2012 stadium confrontation, and the Portsmouth CVA and Sheffield Wednesday’s plight should definitely not be ignored. I hope to blog on at least some of these shortly.
The oddest of largely ignored stories is, to me, the reporting of Manchester United’s financial results (1).
The club has certainly done stunningly well in terms of growing revenues and turning a profit. Turnover is more than twice that of cross-city rivals Manchester City. Wages have risen, but the wages/revenues ratio remains just a vague aspiration for most clubs.
All very commendable, but there is the other side to the coin – an £83.6million loss and overall debts of £521.7million. For all the success with growing revenues, debt management has been rather less successful. Given all the legitimate concerns of United fans regarding the Glazers, there is still room for a glance at Liverpool and the thought that things could be distinctly worse. The difference between the club’s financial positions is nevertheless not so great, even if the relatively small difference leads to quite different outcomes. Highly leveraged debt leaves a club worryingly exposed.
In the way that we are running out of ‘benefactors’ with deep enough pockets, we are also running out of ‘investors’ with sufficient finds of their own to invest. Clubs seem to be convinced that the scenario at Portsmouth could never possibly happen to them. First Portsmouth, now Liverpool. Just how many Premier League clubs to teeter on the brink will it take before Chairmen get a grip on club finances, before they take Mr McCawber’s advice. Unless spending is reined in to the extent that the business model becomes sustainable, we live in danger ultimately of only having a weekly exhibition match between Mansouri City and Abramovich Globetrotters to tune in and watch.
Meanwhile back at Liverpool, or rather at court rooms around the world…