Yahoo Finance Man Utd Revenue Up Despite On-Field Struggles
Manchester United (NYSE: MANU - news) has recorded record revenues for the second half of 2013, despite the club admitting a "disappointing" on-field performance.
Total (NYSE: TOT - news) revenue before expenses was up 18.8% to £221.4m, compared to the same period in 2012.
Vice chairman Ed Woodward said: "We once again achieved a record revenue quarter with strong contributions from our commercial and broadcasting businesses despite the current league position, which everyone from the team manager down has acknowledged is disappointing."
However, operating income did not reflect the headline revenue result.
Once exceptional items such as debt interest and tax credits were removed, operating income was up only 3% to £45.4m for the six months.
Operating income for the quarter ended December 31 was down 4%.
Profit after tax, including exceptional items, was down 49% to £18.7m during the six months to the end of December.
Shares in the New York (Frankfurt: HX6.F - news) -listed company were down almost 4% in early Wednesday trading.
It also reported a fall in matchday revenue of 3.7% in the last quarter of the year and the club said this was due primarily to playing one fewer home Premier League game - offset partially by one more Capital One cup game.
The results come as the club struggles to qualify for the Champions League, a competition it has contested every year since 1995.
It has been a lucrative and reliable revenue stream for the team.
The decline in matchday revenue to £33.7m was, however, offset by increased commercial and broadcast revenue of £89.2m.
The club, which is majority-owned by the Glazer family, saw staff costs at Old Trafford jump by 16.7% in the second quarter, up to £51.6m.
The leap in outlay was put down to "the impact of player acquisitions and renegotiated player contracts" in the second half of the year.
The outlay by the club does not include its most recent expensive player purchase, Spaniard Juan Mata, who joined the club in January for a record £37.1m.
Manager David Moyes has struggled to maintain the successful record left by previous boss Sir Alex Ferguson.
The Red Devils most recently suffered a defeat in Stoke and draw at Fulham and are languishing in seventh place in the Premier League.
Sponsorship was up 39.4% in the second quarter of the reporting period due to global and regional contracts being activated.
But other operating costs were up 29.3% in the second quarter to £20.3m, a result partially blamed on foreign exchange losses.
In a conference call after the results were released, the club said it had not seen any impact on the business from the team's current on-pitch performance.
It added that it was still in talks with manufacturers about a new kit supply deal and that spending on new players to be above average.
Total debt dropped 3% year-on-year to £356.6m. The club liabilities are still significant but have almost been halved from a high of £716.5m recorded in the 2008-09 financial year.
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