Champions League exit hits Manchester United earnings
MANCHESTER United’s early exit from the UEFA Champions League last season hit operating profits by 30% to £44.8m.
Turnover in the year to the end of June fell 3% from £334m to £320.3m. Ebitda was down 16% to £91.6m, and after finance costs a loss of £4.6m was declared, compared with a bottom line profit of £12m last year.
The club, which recently listed on Wall Street, said it expects revenues to rise in the next financial year to between £350m and £360m and adjusted ebitda to be £107m to £110m.
Ed Woodward, executive vice chairman commented, ‘We are delighted to announce our first results as a NYSE listed company; fiscal 2012 was the best year ever for Manchester United’s commercial business.
“Our world-record $559m shirt sponsorship deal with Chevrolet and the Premier League’s new £1bn a year UK television rights deal (a 70% increase) highlight the outstanding growth prospects for the future. We also expect a substantial increase in the value of the Premier League’s international television contracts scheduled to be announced later this year.
“In addition, we continued to strengthen our team by signing world-class players such as Robin van Persie and Shinji Kagawa over the summer. We also opened a new commercial sales office in Hong Kong (our first outside the UK) to better position ourselves for growth in a region that represents 325 million of our 659 million followers.”
Underlying the club’s commercial might, commercial revenues surged 13.7% to £117.6m driven by a number of new sponsorship deals including the training kit deal signed with DHL.
Broadcasting revenues for the year decreased 11.3% to £104m as a result of the Champions League exit. Having reached the Champions Leageu Final in 2011, comparative year fourth quarter, revenues werw down 37.4% to £27.5m.
Last month’s IPO raised around $230m (£150m) of which half was used to pay down debt related to the Glazers’ leveraged buyout of the club in 2005.
Since the listing at $14 per share the stock has fallen to $12.96, despite a fund owned by investor George Soros buying 3.1 million shares.
