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Manchester United Commercial Prowess Continues

Thu 14th Nov 2013 | Money & Finance

Manchester United have today announced their financial results for the 2014 fiscal first quarter ended 30 September 2013.

The results show that total revenue was up 29.9%, with record first quarter revenue of £98.5m.

Twelve new sponsorship deals activated in the first quarter saw sponsorship revenues increase 62.6%, with commercial revenues increasing by 39.3% and retail, merchandising apparel and product licensing revenue up 13.8%.

The new Premier League domestic and international TV rights deal gave United a 40.9% lift in broadcasting revenues.

Ed Woodward, Executive Vice Chairman commented, “We are pleased to have achieved another record first quarter, driven by the strength of our commercial business and increased broadcasting revenues.

“Our unique approach to the commercial business will continue to drive future growth. We are also excited by the continuing rise in the value of sports content, evidenced, amongst other things, by the recently announced BT deal for the UK rights to broadcast the Champions League and Europa League matches for three seasons from 2015/16.

“This deal represents a meaningful increase over the current arrangement, which should translate into higher broadcasting revenues for the participating clubs.”

Matchday revenue for the quarter was £19.3 million compared to £19.6 million in the prior year quarter, which included one-off fees earned from the staging of Olympic Games football matches at Old Trafford whereas the current year quarter included fees earned from participating in this season’s Community Shield match which we did not participate in last season.

Total operating expenses for the quarter were £90.2 million, an increase of £15.4 million, or 20.6%, over the prior year quarter whilst staff costs for the quarter totalled £52.9 million, an increase of £12.6 million, or 31.3%, over the prior year quarter. This increase was primarily due to the impact of a full period of wage costs relating to players signed part way through the prior year quarter, contractual player wage increases and bonuses associated with the growth of our commercial business. Additionally, the prior year quarter benefitted from a one-off receipt of £1.3 million in respect of players on International duty at Euro 2012.

United’s net finance costs for the quarter were £9.8 million, a decrease of £2.6 million, or 21.0%, over the prior year quarter. The decrease was primarily due to a £4.1 million reduction in interest payable on our secured borrowings and a £7.8 million reduction in premium paid and accelerated amortization related to the senior secured note repurchases in the prior year quarter; partially offset by a £7.6 million gain on re-translation of our US dollar borrowings in the prior year quarter.

Net cash generated from operating activities for the quarter was £23.2 million, an increase of £13.9 million, primarily due to a £15.4 million reduction in interest paid.

Capital expenditure on property, plant and equipment for the quarter was £4.1 million, £0.7 higher than the £3.4 million in the prior year quarter. Net player capital expenditure for the quarter was £26.8 million, a decrease of £2.7 million from the prior year quarter.

 

Posted by: Aaron Gourley

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