I believe the ENIC business model is to increase the value of THFAC as an asset with a view in the long term to eventual sale. Profitability would not be an aim as such -- dividends aren't paid.
Hopefully I'll be corrected if this is wrong, but Increasing the value of THFAC will occur if we can enter the virtuous circle in which on-field success leads to increases in prize money, match day income, commercial revenues and media rights money. The increase in revenue enables higher wages and better recruitment and squad strength, which, in turn, leads to greater success on the pitch. The virtuous circle. If wages are pegged too low, then that breaks or slows that circle of progress.
If anything, this is where Levy conservatism in wages could conflict with the ENIC model
The purpose of buying young players is to develop them into much better players. Like academy products, they may start on a lower wage but, if successful, they will graduate to a higher wage. You want your players to be as successful as possible so that they climb up the wages ladder. If the academy output and recruitment is good, if the player trading is calibrated correctly, and if luck is going in the right direction, then the players surplus to squad requirements can be sold at a profit -- which is recycled.
