First quarter losses widen at Manchester United, although full year forecasts improve
Manchester United reported better revenues in the first quarter to September 30, 2022, although pre-tax losses increased. However, the club has raised its forecasts for its full year financial results.
The Premier League giant, which parted company with star player Christiano Ronaldo last month, saw revenues jump by 13.6% to £143.7m. A pre-tax loss of £34.370m was up from a pre-tax loss of £19,820m the previous year.
For fiscal 2023, United said it is raising its guidance and expects total revenues to be within a range of £590m to £610m, driven by strong matchday revenues, and adjusted EBITDA to be within a range of £125m to £140m, as a result of reduced player wage costs.
The previous forecast was £580m to £600m for total revenues and £100m to £110m adjusted EBITDA.
Quarterly results have been impacted by the postponement of two Premier League games, which were due to be played in first quarter and were delayed due to the Queen’s passing, as well as the timing of the 2022 FIFA Men’s World Cup, which began November 20, and continues to December 18, 2022.
Commercial revenues were 35.7% better at £87.4m, broadcasting revenues of £35m showed a 19.2% reduction on the same quarter a year ago, due to the men’s first team participating in the UEFA Europa League compared with the UEFA Champions League in the prior year quarter, and matchday revenues improved by 13.3% to £21.3m, due to Old Trafford hosting the opening match of the UEFA Women’s European Championships and the Rugby Super League Grand Final.
Sponsorship revenue was £57.8m, an increase of £21.5m, or 59.2%, over the prior year quarter, primarily due to the men’s first team pre-season tour which took place in July. There was no tour in the prior year quarter due to COVID-19 travel restrictions.
Retail, Merchandising, Apparel & Product Licensing revenue was £29.6m, an increase of £1.5m, or 5.3%, over the prior year quarter, primarily due to an increase in e-commerce sales.
The club’s US Dollar non-current borrowings were $650m, which was unchanged from the previous year. As a result of the year-on-year change in the USD/GBP exchange rate from 1.3506 at September 30, 2021 to 1.1173 at September 30, 2022, the non-current borrowings when converted to sterling were £577.4m, compared with £476.2m at the prior year quarter.
The board has not approved the payment of the semi-annual dividend for fiscal year 2023.
The Glazer family, which bought United in 2005, revealed in November that they were exploring “strategic alternatives” for the club – one of which was selling it.
