Record revenues for Manchester United, despite £20m Mourinho costs

Manchester United

Premier League giants Manchester United reported record second quarter revenues and adjusted EBITDA today, despite exceptional costs of almost £20m for terminating the contract of former manager Jose Mourinho and his team.

The club also hailed the positive impact that interim manager Ole Gunnar Solskjaer and his assistant Mike Phelan have had on the club.

Today’s announcement revealed that revenues for the quarter came in at £208.6m, while adjusted EBITDA (earnings before interest, tax, depreciaiton and amortisation), were £104.3m.

The operating profit was £44m.

United’s pre-tax profit of £37.648m fell slightly from the £37.813m recorded in the same period last year.

These results followed a poor first quarter performance when the club suffered a 6.1% fall in total revenues of £135m, while an adjusted EBITDA of £29.4m was 25.2% below the previous year.

The £13.9m operating profit level was a 22.3% decline on the same period last year.

Exceptional items for the quarter to December 31, 2018, were £19.6m, relating to compensation to the former manager and certain members of the coaching staff for loss of office.

That compares with zero exceptional items for the same quarter last year.

Ed Woodward, executive vice chairman, said today: “The appointment of Ole and Mike as caretaker manager and assistant manager,
working with Kieran, Michael and Emilio, has had a positive impact throughout the club.

“We are delighted with the improvement in the team’s performances since December and we look forward to a strong finish to the 18/19 season.”

Commercial revenue for the quarter, to December 31, 2018, was £65.9m, an increase of £600,000, or 0.9%, over the prior year quarter.

Sponsorship revenue was £40.3m, an increase of £1m, a 2.5% improvement, although retail, merchandising, apparel and product licensing revenue for the quarter was £25.6m, a decrease of £400,000 (-1.5%).

Broadcasting revenue for the quarter was £103.7m, an increase of £28.5m, or 37.9%, primarily due to the new UEFA Champions League broadcasting rights agreement and playing one additional UEFA Champions League game.

Matchday revenue for the quarter was £39, an increase of £2.1m, or 5.7%, over the prior year quarter, primarily due to playing one additional UEFA Champions League home game.

Net debt, as of December 31, fell by £10.9m to £317.7m. The gross US Dollar debt principal remains unchanged.

Among the highlights reported by the club were a partnership with Harves to open a series of Manchester United Entertainment and Experience Centres in China, as well a global partnership deal with US-based electrical goods giant Remington.

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