United confirm significant losses

• zocoss

  8 Oct 10, 22:58

  MANCHESTER UNITED NEWS

  United confirm significant losses

  By ESPNsoccernet staff

   

  October 8, 2010

   

   

  

  Many United fans have been keen to oust the Glazer family

   

   

  Manchester United have confirmed their full-year operating profit stands at a record £100.8 million - but their overall losses are £83.64 million.

  United became the first English club to generate over £100 million in operating profits in the results, believed to be down to the Glazer family's global marketing initiatives, but the owners have created a heavy debt burden.

  Interest payments accounted for £40 million, while there was also a hefty one-off cost for the successful £504 million bond issue earlier this year.

  The statement on the club's official website also pointed to the signings of Javier Hernandez, Chris Smalling and Bebe, as well as new contracts for several first-team players, and wages rose by 7% to £131.7 million.

  The club's overall turnover has grown 2.9%, from £278.4 million to £286.4 million, while media revenues rose by £5.1 million to £104.8 million.

  However, match-day revenue dropped 7.9% from £108.8 million to £100.2 million during the financial year, with United playing fewer games after suffering a quarter-final exit to Bayern Munich in the Champions League and a third-round FA Cup exit to Leeds United.

  Perhaps the most significant factor in the results is that there is no mention of funds being taken out of the club by the owners to pay their £200 million-worth of PIK notes, which are now attracting interest at 16.25%.

  The record operating profits, though, indicate that the club is still a hugely attractive proposition in terms of its global brand, and suggest there is little truth to the notion that companies are reluctant to be involved with the Glazers after repeated negative headlines.

• zocoss

  8 Oct 10, 23:03

  Manchester United's £100m profit turned into £80m loss as debt repayments bite
  

   

  

  Taking a stand: Fan anger at the Glazer regime has manifested itself into protests over the last 12 months

   

   

  Manchester United have become the first English club to crash through the £100million profit barrier - while at the same time posting an £83.6m loss.

  The figures will be of huge concern to supporters who believe that the club's debts are a barrier to competing with Barclays Premier League rivals such as Chelsea and Manchester City.

  United's latest accounts show that they have spent £40m on interest payments - more than £22m net spend on new talent this summer at a time when rivals City splurged more than £100m on talent.

  The losses are in part down to a hefty one-off cost for the £504m bond issue earlier this year. But hefty revenues show how the club  remain one of the world's most attractive sporting organisations.

  A vocal section of United supporters have become increasingly angry at how the club has been run since the Glazer family took over in 2005.

  But United will point to the massive commercial growth in the latest figures, following the implementation of their 'territory specific' approach. The £11.5m increase in turnover to £81.4m proves how successful that plan has been.

  It also debunks the idea that the negative headlines the Glazer family ownership has caused have deterred companies from associating themselves with United.

  Media revenues have also risen by £5.1m, to £104.8m, making it the largest area for the club now matchday revenues have fallen to £100.1m.

   

  

  Slow start: Manchester United haven't enjoyed a particularly fast start to the Premier League campaign

   

   

  Wages rose by seven per cent to £131.7m, while United's overall debt rose to £521.7m.

  United's overall turnover is £286.41m, which contrasts sharply with Manchester City, who seven days ago celebrated hitting a turnover figure of £125m. It shows the vast gulf that still exists commercially between the neighbouring clubs and the work City must do to get somewhere close.

  There was a massive reduction in revenue gained from the disposal of players following the world record sale of Cristiano Ronaldo to Real Madrid in the summer of 2009.

  Manager Sir Alex Ferguson continues to tell United supporters that there is money to spend on players if he wants to use it and has indeed invested £7m on the Portuguese prospect Bebe in recent weeks.

   

  But another summer passed without a stellar signing, as Ferguson instead turned to other young prospects such as Mexico striker Javier Hernandez and defender Chris Smalling in a year that saw cash raised from the departures of players like Zoran Tosic, Fraizer Campbell and Ben Foster.

  The Glazers themselves have certainly never given any indication of being unduly worried by the huge debt burden and the successful bond issue earlier this year provided far greater flexibility with their financial dealings, even if the bond, to which United are committed to paying an annual interest rate of 8.75per cent, has to be paid back in 2017.

  Crucially, there is no mention within the accounts of any money being taken out of the club by the Glazer family to pay their £200m-worth of PIK notes that are now attracting interest at 16.25per cent.

  Supporters who are opposed to the entire Glazer regime will seize on the losses as proof of their claim that United are being deprived of transfer funds due to the debt the club acquired as part of the process in which their owners took control of the Old Trafford outfit.

• zocoss

  8 Oct 10, 23:26

  GILL: UNITED RESULTS ARE `VERY GOOD

  

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  Manchester United chief executive David Gill has insisted the club are under no pressure to sell the likes of Wayne Rooney despite announcing a major loss.  

  On Friday, the Red Devils revealed a post full-year operating profit of £100million, but an overall loss of £83.64million. 

  The figures have raised concerns over the Glazer family's ownership of the club, but Gill insists they are 'very good results'. 

  He said: "We are not a club that needs to sell. We have money in the bank so there is zero pressure on that, no pressure at all to sell any star player whether it is Wayne Rooney or X,Y or Z. I can categorically say that. 

  "There was no desire at all from anyone at the club to sell Cristiano - he wanted to go and as a result we managed to extract a world record fee. 

  "These philosophy is to retain and attract the best players. We have £165million in the bank but in some ways we would prefer to have £80million in the bank and Ronaldo on the pitch. 

  "There are very good results for the club with records here, there and everywhere but they are complicated with non-cash items and exceptional one-off hits." 

  Gill also eased fears of parallels with Premier League rivals Liverpool, who are facing administration unless their current American owners clear their unpaid debts. 

  He said:"I can't speak for any other club but the United fans should not be concerned, we have a long-term financing structure in place, excellent revenues that are growing, we are controlling our costs - total wages are 46% of turnover - and we can afford the interest on our long-term finance. 

  "In our opinion if something changed in the ownership this club will survive and continue - it is covering the financing cost more than adequately. 

  "We still have cash to invest in players and to give good contracts to players and we are comfortable with the business model."

  
  

• Yihooo13

  9 Oct 10, 11:44

  this post features a loser.