Manchester United Counts Cost Of Covid
Manchester United has announced its financial results which show the impact Covid-19 has had on its revenues.
The figures which cover the twelve months up to 30th June 2020 show the club earned £509m, down more than 18% from £627m in 2019.
Driving the loss was the impact on broadcasting and matchday revenue due to the pandemic which saw games from March postponed until the Premier League and Cup games for the 2019/20 season resumed in June.
Because of this, broadcast revenue fell by more the 41% for the period to £140m whilst matchday revenue fell 19% to £89.9m due to the enforced closure of Old Trafford in response to the pandemic from March.
Speaking of the results Executive Vice Chairman, Ed Woodward, commented: “Our focus remains on protecting the health of our colleagues, fans and community while adapting to the significant economic ramifications of the pandemic.
“Within that context, our top priority is to get fans back into the stadium safely and as soon as possible.”
Despite the losses, United’s commercial revenues remained resilient, posting an increase of 1.4% to £279m on the previous year.
Sponsorship revenue was £182.7 million, an increase of £9.7 million, or 5.6%, over the prior year, primarily due to increased sponsorship deals and additional pre-season tour revenue.
However, retail, merchandising, apparel & product licensing revenue was £96.3m, a decrease of £5.8m, over the prior year, due to the closure of the Old Trafford Megastore from mid-March 2020 to mid-June 2020.
The club have been linked in recent days to a proposed break-away European league and were instrumental in producing Project Big Picture which aimed to shake up the way football is structured and financed in England along with Liverpool FC and EFL Chairman, Rick Parry.
In his statement, Woodward, continued: “We are also committed to playing a constructive role in helping the wider football pyramid through this period of adversity, while exploring options for making the English game stronger and more sustainable in the long-term.
“This requires strategic vision and leadership from all stakeholders, and we look forward to helping drive forward that process in a timely manner.”
Key Financials (unaudited)
|
£ million (except (loss)/earnings per share) |
Twelve months ended |
Three months ended |
||||
|
2020 |
2019 |
Change |
2020 |
2019 |
Change |
|
|
Commercial revenue |
279.0 |
275.1 |
1.4% |
59.4 |
66.7 |
(10.9%) |
|
Broadcasting revenue |
140.2 |
241.2 |
(41.9%) |
16.6 |
40.9 |
(59.4%) |
|
Matchday revenue |
89.8 |
110.8 |
(19.0%) |
5.5 |
23.8 |
(76.9%) |
|
Total revenue |
509.0 |
627.1 |
(18.8%) |
81.5 |
131.4 |
(38.0%) |
|
Adjusted EBITDA(1) |
132.1 |
185.8 |
(28.9%) |
(2.7) |
10.9 |
– |
|
Operating profit/(loss) |
5.2 |
50.0 |
(89.6%) |
(39.0) |
(22.1) |
76.5% |
|
(Loss)/profit for the period (i.e. net (loss)/income) |
(23.2) |
18.9 |
– |
(36.5) |
(22.2) |
64.4% |
|
Basic (loss)/earnings per share |
(14.14) |
11.48 |
– |
(22.36) |
(13.49) |
65.8% |
|
Adjusted (loss)/profit for the period (i.e. adjusted net (loss)/income)(1) |
(12.9) |
39.6 |
– |
(35.3) |
(21.5) |
64.2% |
|
Adjusted basic (loss)/earnings per share (pence)(1) |
(7.83) |
24.06 |
– |
(21.59) |
(13.06) |
65.3% |
|
Non-current and current borrowings |
525.6 |
511.2 |
2.8% |
525.6 |
511.2 |
2.8% |
|
Cash and cash equivalents |
51.5 |
307.6 |
(83.3%) |
51.5 |
307.6 |
(83.3%) |
|
Net debt(1)/(2) |
474.1 |
203.6 |
132.9% |
474.1 |
203.6 |
132.9% |
(1) Adjusted EBITDA, adjusted (loss)/profit for the period, adjusted basic (loss)/earnings per share and net debt are non-IFRS measures. See “Non-IFRS Measures: Definitions and Use” on page 8 and the accompanying Supplemental Notes for the definitions and reconciliations for these non-IFRS measures and the reasons we believe these measures provide useful information to investors regarding the Group’s financial condition and results of operations.
(2) The gross USD debt principal remains unchanged. The increase in net debt is predominantly due to a £256.1 million reduction in cash and cash equivalents, which reflects the impact of deferred sponsorship payments (in excess of £80.0 million); loss of 2020/21 season Matchday advance cash receipts (typically in excess of £50.0 million ahead of a Champions League season) with new seasonal facility sales currently on hold due to the uncertainties around fans returning to the stadium; and increased player investment in fiscal year 2020 (£56.4 million increase in net capital expenditure on intangible assets compared to the prior year).
Image: PA Images
