(Football news) Manchester United have made public their second quarter results, revealing that they owe £969.6m through a combination of bank borrowings, outstanding transfer fees and gross debt. Unlike the previous years, there was no investor call afterwards due to the ongoing ‘strategic review’ going on at Manchester United which could result in a potential takeover. The review is centered around meeting the club’s long term capital needs with a focus on improving Old Trafford and Carrington training ground.
The principal debt remains at $650m but a change in exchange rate meant that Manchester United owes £535.7m compared to £477.1m from this time last year. Moreover, £206.2m has been taken from a rolling credit facility and £227.7m is owed in unpaid transfer fees. Concerningly, the club only has £31m in cash despite suggesting there are no problems in short term liquidity. However, reports also suggest that the improvement in on-field performance means that the matchday revenues have increased and season ticket sales show impressive figures.
It’s not all doom and gloom at Manchester United as sponsorship revenue has increased 43.2% to £50.4m over the prior quarter and the club have posted a profit of £6.3m for the quarter. The club have said the reasons for this is because of their training kit agreement with Tezos and a ‘one-off sponsorship credit’. Wages have also been reduced by £20.4m to £77.3m, a decrease of 20.9% due to Manchester United’s failure to qualify for the Champions League. It will be interesting to see how the second quarter results will affect the potential takeover of the club with the Glazer family expecting about £6 billion for the club which is considered an inflated value given the situation.