PBC lost 444 million dollars since March.

You know someone's been double dipping.

 

I'm not surprised, Haymon overpays his fighters and I have a feeling that PBC hasn't been such a resounding success either, mostly because the boxing itself has been in a bit of a decline this/last year it feels.

 

your a grade a hater.... i'm waiting for that other guys response.


You've ruined your credibility in even attempting to be objective

 

Also correct.

The timeslots themselves are assets, but it's going to take more cash to pay the fighters to fight on them and for the expenses of running the show. The only exception would be if cash has already been paid to the fighter up front for the fight, in which case that fighter's bout would also be considered a pre-paid asset. As would any advances paid to the fighter, site fees paid in advance, etc.

Because of the nature of the writedown, this isn't the case. If it were, the carrying value of PBC wouldn't be affected (pre fight accounting would look like this: money moves from the cash to the pre-paid assets, but total assets would remain the same). This is true even though the cash supply decreased. The asset of having the fight owed to PBC would still be on the books.

And yes, Al's too smart to offer up any of his money to subsidize any pay cuts .

It doesn't take a forensic accountant to catch on to what's happened. Al spends a lot on fighters because then his managerial fees (an expense to PBC) goes up. He makes more on that than by paying lower purses, so he's incentivized to overpay.

It also doesn't look good that the fellow that brokered the deal from W&R's end and approved the deal left them and now works for Haymon. It's dirty business, but not uncommon.

 

That is nothing new. Black people making business here. 444 million dollars down the toilet. :rofl

 

No problem dude, if you need any more explanations, don't be afraid to ask. I'm not here to shame anyone :good

1) There's a difference between cash flow and profit. Cash flow is the lifeblood of the business because it's how much cash gets generated. Cash flow is how you pay your bills and keep things running.

Though profit and loss is important, it can be misleading at times because certain things are expensed that don't actually cost more cash. For example: PBC buys a film camera for $10,000. That's an asset. But each year, as the camera ages, its value will depreciate. For ease, we'll say 20%.

That means it's carrying value the next year is $8,000, and that $2,000 difference is marked off against earnings. But, you didn't actually spend that $2,000 again. So, it'll get added back to cash flow. There are other "non-cash" charges, but that's a key one. That's the easiest way to demonstrate the difference between earnings and cash flow. This is where the phrase "it takes money to make money" comes in.

2) What that means is that money spent on assets like cameras (and time buys) doesn't disappear. It's still under the asset column, just not under cash anymore. Overall value of the firm shouldn't be affected. Ideally, that camera is used to generate cash flow, so the company's assets are generating more cash.

3) Using a model called a discounted cash flow model is one way to value growing firms that would be considered unprofitable from an earnings standpoint due to depreciation, and the costs of launching the company. That's built into it, so the costs of launching the business, if done prudently, won't wreck the value of it.

The fair value can get written down for a number of reasons, but a chief one is that expected cash flow is slashed from the original targets. This could be from PBC not being able to sell as much ad space, needing to take a lower rate, or spending too much (directly rated to "cash burn": the rate that cash is leaving the company. You either produce cash flow or have cash burn).

In a nutshell, the written-down carrying value posted doesn't mean that PBC has $82 million left. It means that the expectations plugged into the model determine that its future cash flows are only worth $82 million today. Big difference. That means that the company isn't expected to make nearly as much money as it was.

I know that's a lot to throw at ya, but let me know if there's any more follow-ups. :thumbsup

 

To put the math in perspective, let's be conservative and throw out a hypothetical:

Let's say only $250 million of that goes to in-house fighter purses.

Al Haymon just made at least $50 million personally regardless of how the event did or how much PBC made.

That ratio IS NOT made up. That's assuming a flat 10% management fee for each fighter, and Al gets both sides since the fight was in house. That's 20% of each fight purse going straight to him.

 

Props to Rock0052 for the accounting 101

 

Not privvy to the breakdowns of who pays for what so I couldn't say either way, that's just an example for accounting purposes. Odds are they lease it in reality, but there are a number of routes that it could've taken :good

 

That would also make sense. :thumbsup

 

Even if he personally gets some wealth I don't think that's a smart business move, why not go for bigger profits by actually having a viable business model.

Assuming these figures are correect.

 

here we go :rofl:rofl:rofl

 

OP, you're an hater, because you ain't gobbling Ghaymon's ****.

You aren't supposed to say anything bad about a tranny goer that dumps tons of moneys on inactive or obscure fighters, never letting them fight anyone decent.

 

Managers can get 10-30% per fighter per fight. Haymon has scale due to managing so many fighters and having managed Floyd, so he can charge a lower % than others. I used the lowest typical rate for the sake of being conservative.

As far as motivation, he's at heart, a guy who keeps to himself and likes to stay behind the scenes. People don't even know exactly how old he is. He may just be looking for a cash out from the looks of how PBC is structured and how he's ran it. And considering how much he stands to make, it wouldn't surprise me a bit if that's what this is. I agree with you that he could've made more long term, but with the cards he helped deal himself here, it wouldn't surprise me if he just let the rest of boxing fight over the fallout once he's done.