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United make loss of £83.6 million

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Manchester United made a full-year loss of £83.6 million due to managing the cost of debt, giving more ammunition to the many critics of the Premier League club's American owners.

The club, third in the Premier League, posted a record operating profit of £101m due to increased broadcasting and commercial income but made a loss when interest charges and the cost of restructuring debt were added on.

The club also marked down value due to the fluctuating exchange rate and a reduction in the value of the playing squad.

They had lower matchday revenues on last year due to the side's exit from the Champions League in the quarter-finals and the FA Cup in the third round.

The news will add to a debate in Britain about club ownership after rivals Liverpool agreed a sale to new owners in a bid to rid themselves of millions of pounds' worth of debt which had limited their ability to buy new players.

Many fans of Manchester United also believe their club have been limited in the transfer market, at a time when fierce local rivals Manchester City have spent heavily on new players under wealthy new owners.

"Ostensibly we are the best-run football club in the UK for the last 20 years, generating amazing revenue, but the problem is that that under the current ownership that's all being wasted because it's going into paying interest on debt," said Duncan Drasdo, chief executive of the Manchester United Supporters Trust.

"We could be competing with Man City and Chelsea for the best players. Instead of squeezing spend on players and pushing up ticket prices we could be giving supporters who are being priced out, those that have supported the club for many years, the opportunity to watch their team.

"All of this is because one family decided they wanted to own our football club. The problem is that the model of ownership we have should never have been allowed.

"There is an underlying anger that has been there for some time and every time these results come out we see how much money is being wasted.

"It sickens people that they are paying increased ticket prices every season under the Glazers but the money is just being wasted and not invested in the playing squad."

The Glazer family bought Manchester United, one of the most famous football clubs in the world, in 2005 for about £790m against a wave of protest from fans who feared they would load it up with too much debt.

United's buy-out by the Glazer family left some fans so disenchanted that they formed a breakaway club FC United which is currently working its way through the minor leagues.

Hundreds of fans arrive at Old Trafford dressed in green and yellow, the colours which have come to symbolise opposition to the owners. Green and yellow were the colours worn by the original Manchester United, then known as Newton Heath.

Anti-Glazer banners have been unfurled at home and away matches as the club's debts have swelled.

An attempt by wealthy supporters, known as the Red Knights, to mount a takeover stalled earlier this year however and the owners have said they have no intention of selling.

For the year to end June, gross debt attached to the club rose slightly to £522m, according to the results.

The club also have so-called payment-in-kind loans of around £200m, which have a higher rate of interest.

 

Reuters

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