Member Article

Missing Europe to cost Manchester Utd ‘over £30 million’ but Chevrolet deal may cushion blow

Manchester United executive vice-chairman Ed Woodward has revealed the failure to secure European football will cost the club more than £30 million.

Mr Woodward says the club will ‘compete for trophies’ next season after announcing a 60 per cent increase in quarterly profits. In the season just ended, the Reds ended without any silverware and outside the European competition qualifying places, finishing in seventh, place - their lowest final position since the start of the Premier League in 1993.

David Moyes was sacked as manager last month with Netherlands national team coach Louis van Gaal expected to be named as his replacement next week.

Despite the upheaval, the club has reported promising set financial results.

Mr Woodward said: “Everyone at the club is working hard to ensure the team is back challenging for the title and trophies next season.”

“We once again generated record revenues as all of our businesses delivered impressive year over year growth. This puts us in a healthy financial position to continue to invest in the squad. We will be active in the transfer market and deals will be done.

“The club’s expectations - and you will see this reflected in the transfer market and what we have recently done from a managerial perspective - are absolutely to get back into the Champions League.

“Everyone at the club is working hard to ensure the team is back challenging for the title and trophies next season.”

United’s revenue in the three months to March rose by 26% to £115.5 million and operating profit reached £40 million.

This increase was primarily driven by a rise in income from Premier League broadcasting money and sponsorship deals.

Broadcasting revenue was up by £13.9 million to £35.6 million while sponsorship income rose 43.5%.

This ensured profits tripled to £10.9m in the quarter, and debt dropped 4 percent to £351.7m.

United’s wage bill rose by 19 per cent to £53.4m following the arrivals of Marouane Feillaini in the summer and £37m record signing Juan Mata.

New deals for Nani and Adnan Januzaj also contributed to the rise but it is believed Wayne Rooney’s contract extension made no significant difference to wage costs as he has a separate arrangement in place for image rights.“

United’s absence from European competition next season is expected to cost the club over £30 in lost revenue, according to Woodward.

He added: “Due to relatively high broadcasting revenues we estimate that the isolated impact for not qualifying for European football will be in the mid £30 millions which includes a 15% reduction in the price of executive facilities next year.”

It is anticipated the impact from that loss of revenue will be offset by a new sponsorship deal with Chevrolet who will replace insurance giant Aon as United’s shirt sponsors.

The record-breaking deal with the American car manufacturer is due to begin from next season and is worth £53 million per season.

This was posted in Bdaily's Members' News section by Simon Malia .