United score a second quarter win with revenues and profits both improved

Manchester United's Old Trafford stadium

Manchester United reported better revenues and profits for the second quarter of the club’s fiscal year, to December 31, 2020.

The club revealed turnover of £172.8m for the three month period, despite grounds being empty due to the coronavirus pandemic. Revenues for the same period last year were £168.4m.

Increased sales have been helped by the club’s participation in this season’s Champions League competition and the extra games and broadcasting revenue this brings.

Commercial revenues for the quarter were £62.6m, down from £70.6m the previous year. Broadcasting revenues of £108.7m showed an improvement on last year’s £64.7m figure, and matchday revenues of £1.5m, compared against £33.1m reflected the absence of fans due to lockdown regulations.

Pre-tax profits for the three month period were £68.171m, up from £51.745m a year ago.

Employee benefit expenses for the quarter were £81.7m, an increase of £10.8m, or 15.2%, over the prior year quarter. This is due to contracted increases in player salaries due to participation in the Champions League and continued investment in the first team playing squad.

Other operating expenses for the quarter were £20.8m, a decrease of £4.6m, or 18.1%, over the prior year quarter, primarily due to reduced business activity as a result of COVID-19. This includes the impact of all matches being played behind closed doors.

Net Debt, as of December 31, 2020, was £455.5m, an increase of £64.2m over the year,reflecting the loss of 2020/21 season matchday advance cash receipts, and the impact of deferred sponsorship payments, partially offset by increased broadcasting receipts.

The club said the impact of the pandemic and measures to prevent further spread continues to disrupt its businesses.

The Old Trafford stadium, museum and stadium tour operations remain closed. The Old Trafford-based Megastore was closed to footfall on December 31, 2020, and currently remains closed.

Absence of fans at games has badly hit club revenues, but United said it has been more than offset by broadcasting revenues, given the first team’s participation in the Champions League competition.

Among the key points the club has flagged are that the staggered return of fans in the UK is expected from May as lockdown measures ease.

The men’s squad has been strengthened by the addition of Amad Diallo, and the women’s team by Norwegian international Maria Thorisdottir, while Mason Greenwood signed a new contract to 2025, with an option to extend for an additional year.

In addition, increased digital engagement, both sequentially and year-over-year, drove record-breaking club e-commerce sales of all three 2020/21 men’s kits, and the club’s November launch on TikTok achieved the fastest growing following of any football club on the platform.

Executive vice chairman, Ed Woodward, said: “As we approach a full year since our last game with fans at Old Trafford, we reflect on an extraordinarily challenging 12 months for football and society as a whole.

“The rapid rollout of vaccines in the UK and beyond gives us confidence that we are now on a path towards normality, including the return of fans to stadia.

“While the disruption to our operations remains significant, we are pleased by the tremendous resilience the club has demonstrated through the pandemic, underpinned by the dedication of our people and the strength of our commercial business.”

He added: “We have been reminded of the importance of football as a source of community, entertainment and pride to fans around the world, even as we have sorely missed them at Old Trafford.

“The progress made by Ole and the players this season is clear and our thriving Academy and Women’s team are also adding to the optimism we feel about the future on and off the pitch.”