Manchester United full-year losses widen

11th Sep 2024 15:27

(Sharecast News) - Manchester United reported a net loss of £113.2m for the year ended 30 June on Wednesday, although the football club maintained that it was in compliance with both the Premier League's Profitability and Sustainability Rules (PSR) and UEFA's Financial Fair Play regulations.

The rules allow certain 'allowable' losses, such as those related to infrastructure, youth, and women's team expenditures.

Its losses followed previous deficits of £115.5m in the 2022 financial year, and £42.1m in 2023.

PA Media cited sources within the club as claiming that spending on transfers and wages had contributed to the recent financial downturn.

However, Manchester United said it was confident that it was adhering to financial regulations, in contrast to other clubs like Everton and Nottingham Forest, which faced points deductions last season for breaching PSR limits.

A large portion of the club's losses - £47.8m - was attributed to costs associated with the strategic review initiated by the Glazer family in late 2022, which ultimately led to Sir Jim Ratcliffe acquiring a 27.7% stake in the club.

The club's revenue for the year reached £661.8m, setting a new record.

In response to the financial challenges, Manchester United had implemented a series of cost-saving measures, including a redundancy programme that cut 250 jobs across departments by the end of August.

The severance costs related to the layoffs were estimated at £10m.

Overall, the measures were expected to save between £40m and £45m and were anticipated to positively impact the club's financial performance in the next two financial years.

The club said it saw the strategic review and restructuring as essential steps toward securing investment and long-term sustainability.

Sir Jim Ratcliffe had committed to investing $300m in the club's infrastructure by the end of the year, with $200m already paid.

Chief executive Omar Berrada emphasised that Manchester United was focussed on becoming more financially sustainable while improving on-field performance.

The club was also reportedly in the process of strengthening its executive team, with Paris Saint-Germain's Marc Armstrong said to be a leading candidate for the role of chief business officer.

At 1148 EDT (1648 BST), shares in Manchester United plc - which owns 72.3% of the club - were down 5.43% in New York, at $15.51.

Reporting by Josh White for Sharecast.com.