Manchester United reveal debt has SOARED by £127.4m to £429m, with revenues slumping and TV companies in line for a £15m rebate because of the coronavirus shutdown
- Old Trafford club’s latest figure show a stunning 42 per cent rise in net debt
- United’s debt has increased £127.4m to £429.1m over course of the past year
- Revenues have dropped 19 per cent year-on-year up until March 31 to £123.7m
- United will also have to pay £15m back to Premier League broadcasters
- Financial figures show only initial impact of the shutdown caused by Covid-19
- United say they will revise predicted revenues of up to £580m amid the crisis
- Here’s how to help people impacted by Covid-19
Manchester United have revealed the extent of the coronavirus crisis on their finances in the latest quarterly results with the club’s debt rising by £127.4million or 42 per cent.
United announced on Thursday that they are withdrawing their previous forecast for 2020 ‘given ongoing uncertainty due to COVID-19 and the evolving related economic and financial consequences’.
But the latest figures show just how much United and other Premier League clubs have been hit by the two-month football shutdown and also confirmed they will have to repay £15m to broadcasters.
Manchester United have seen debt soar by 42 per cent to almost £430m in recent months
Executive vice-chairman Ed Woodward is bracing for a heavy impact from the Covid-19 crisis
The standout figure is that the club’s net debt has shot up to £429.1m due to loss of income and the pound weakening against the dollar.
Broadcasting revenue is down more than 50 per cent on the previous quarter, a decrease of £27.7m due to the estimated £15m rebate due to Sky Sports, BT Sports and international broadcasters.
Matchday revenue was down by £2.6m due to United’s remaining home games in the Premier League and Europa League being postponed.
Retail revenue also dropped by £1.1m due to the closure of the club’s megastore, although there was still a small increase in both commercial (£2m) and sponsorship revenue (£3.1m).
United’s executive vice-chairman Ed Woodward insisted that financial results take second place to the more wide-ranging impact of the pandemic.
‘Our focus remains on the health and well-being of our colleagues, fans and partners around the world and we are extremely proud of how those connected to the club have responded during this crisis,’ said Woodward.
United’s finances will take another hit with any remaining games this season set to be played behind closed doors
United owners Avram Glazer (left) and Joel Glazer will take a heavy hit amid the Covid-19 crisis
‘Since the start of the pandemic, Manchester United and our Foundation have provided assistance to hospitals, charities and schools in our communities, as well as support for frontline workers and vulnerable fans.
‘These actions reflect our core values as a club and the resilience through adversity that we have demonstrated many times throughout our long history and will do so again to weather these current challenges.
‘In that spirit, we look forward to the team safely returning to the pitch and building on the exciting momentum that Ole and the players had previously achieved, while taking all necessary steps to protect public health. Our thoughts remain with all those affected during this unprecedented time.’
United’s financial statement further explained how the club have reacted to the worldwide crisis.
It read: ‘Manchester United has taken a range of measures to support its communities in response to the COVID-19 pandemic, including donations to food banks and outreach to elderly and disabled supporters.
‘In addition, the Manchester United Foundation has committed over £1M to community initiatives, including the supply of 60,000 meals for health workers in local hospitals and support for schools and vulnerable children across Greater Manchester. The Club has also used its media platforms to deliver public health messages and to support frontline workers around the world.
Ole Gunnar Solskjaer’s team had played themselves into good form when the season stopped
‘Operationally, the impact of the pandemic and measures to prevent further spread continues to disrupt its businesses in a number of ways, most significantly in Broadcasting and Matchday operations.
‘Old Trafford and its flagship Megastore operations have been closed to visitors since 20 March 2020 and Museum, Stadium Tour and Red Café operations have been closed since 17 March 2020.
‘Government imposed restrictions have also resulted in the postponement of the Premier League, UEFA competitions and FA Cup competition since 13 March 2020.
‘Postponement of the Premier League and changes to match scheduling has resulted in a reduction in the total broadcasting revenue expected for the season and has impacted broadcasting revenue during the quarter for matches played to date.
‘In addition, during the quarter, Broadcasting and Matchday revenues were impacted due to the postponement of three matches: one away Premier League match, one home Round of 16 Europa League match and one away FA Cup quarter-final match.’