Manchester United have released their financial figures for the first quarter fiscal of 2024 and there has naturally been a drop in the profits the club expects to make after an unexpected early exit from the Champions League
According to the club’s official press release on the matter, it is stated that the club “achieved record total first quarter revenue driven by record Matchday and Commercial revenue”.
Furthermore, the club continued to paint a rosy picture by asserting that United “continues to achieve record ticket sales and attendance while paid global memberships recently surpassed a record 400K, the largest membership program of any global sports team”.
Another success referenced was that the Old Trafford outfit “achieved record Megastore turnover during the quarter driven by a strong finish to the 2022/23 season and record 2023/24 kit launches”.
From the sponsorship end, it was reported in the official press statement that the club had “signed a new multi-year global partnership with WOW HYDRATE, and renewed partnerships with Konami, Concho Y Toro and Mlily”.
Naturally, the club will want to put a positive spin on things and there are some impressive achievements packed into the statement no doubt.
However, more neutral sources have picked up on some other interesting aspects of the report.
The Manchester Evening News claimed that the club posted “record first quarter revenues of £157.1m for three months ended September 30 2023. Wages also went up 9.7% to £90.3m due to signings and Champions League qualification”.
In less positive news, the club also made a £25.8m loss for the period. Premier League clubs can afford a loss of £105m over a three-year period under the profitability and sustainability rules.
News aggregators, Reuters, also claimed that the Old Trafford club had to “cut its annual revenue and profit forecasts on Wednesday, after the English Premier League club was knocked out of Europe’s top tier Champions League tournament in the early stages this season”.
It was commented that this will be a blow to newly put in place major shareholder, Sir Jim Ratcliffe.
“Broadcasting revenue for the first quarter of its financial year rose 12.3% to £39.3 million ($49.9 million), thanks to its participation in the group stage of the Champions League.
“But that revenue is expected to fall after the club’s 1-0 defeat to Bayern Munich last month ended its hopes in Europe this season, piling pressure on manager Erik ten Hag”.
“The club now expects fiscal 2024 revenue of £635-665 million pounds, versus its previous forecast of £650-680 million pounds, and adjusted core profit of £125-150 million, compared with £140-165 million previously”.
It has been reported that the club harbours an ambition of breaking the £1 billion revenue barrier in the future, but they will need to sort out their wretched form on the pitch before they get anywhere near a target such as this.
So all in all, it is a mixed bag of financial news. There is nothing unexpected with the loss in revenue due to the Champions League exit but it is still a blow to see it laid out on paper.
It has been suggested that INEOS will aim to invest heavily in the summer to counteract the Financial Fair Play issues the club is facing and they will need to if the club’s financial documents are to appear in a rosier state in the future.