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Manchester United profits plunge 84%(LONDON, England)
Manchester United has reported a sharp fall in annual profits despite record revenues for the year.
The football club said net income plunged 84% for the year to 30 June to £23.8m, from £146m a year ago.
Manchester United said its 2013 net income benefited from a tax credit of £155.2m, which it received from “US deferred tax assets”.
Had it not received that tax credit, the club would have made a loss of £8.8m in 2013.
The club, majority-owned by the American Glazer family, said revenue increased 19% to £433.2m, compared with £363.2m a year earlier.
It expects revenue in 2015 to fall to between £385m and £395m, suggesting its failure to qualify for the Champions League for the first time in 20 years may be to blame.
Underlying profits were £130.1m for the year to 30 June, compared with £108.6m a year earlier.
It said it expected annual profits would fall next year to between £90m and £95m.
The results also showed that David Moyes and his back room staff received a total of £5.2m in compensation following the former Manchester United manager’s sacking in April after less than a year in the job.
Ed Woodward, executive vice chairman of Manchester United, said: “With Louis van Gaal at the helm as manager, and the recent signing of some of the world’s leading players to further strengthen our squad, we are very excited about the future and believe it’s the start of a new chapter in the club’s history.
“Louis’ footballing philosophy fits very well with Manchester United and he has an impressive track record of success throughout his career, winning league titles with every club he has managed.”
In July, Manchester United announced a record breaking £750m 10-year shirt manufacturer sponsorship deal with Adidas, after Nike decided to end its association with the club at the end of the 2014-15 season.
Nike had been given a period of exclusivity to negotiate an extension with United and also retained the right to match any other offer.
But the company decided against exercising either option, claiming the terms “did not represent good value for Nike’s shareholders”.
Champions League winner Real Madrid’s £31m-a-year deal with Adidas was previously the biggest club deal.
Adidas will provide training and playing kit to all the club’s teams and will have the exclusive right to distribute dual-branded merchandising products worldwide.
(BBC)
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