Another fan-packing quarterback at Old Trafford helped Manchester United boost third-quarter revenue, but higher funding costs pushed the club to a bigger net loss for the period.
The English soccer club reported total revenue of £152.8 million ($192.7 million) for its third quarter, ending March 31, Thursday morning. That was up 29% on last year, mainly because the Premier League club were able to sell all nine of their home games; its 74,000-seat venue was empty last year due to pandemic restrictions. Compared to the same period in 2019, revenue increased by £700,000.
Despite the increase in revenue, Manchester United posted a larger net loss for the quarter. The club recorded a net loss of £27.7 million ($35.93 million), up 53% from 2020. Net funding costs of £14.1 million ($17. $8 million) was much higher than in 2020, contributing to the wider loss. Manchester United have long been criticized for their indebtedness – the club ended the period with a net debt of around $625 million at the end of March, 12% more than a year ago. Managing that debt was the culprit, with the club making a big foreign exchange loss on loans taken out in dollars, having previously benefited from exchange rates.
The results were also affected by the Red Devils’ historically poor season, in which they scored the lowest points on record in the Premier League. Manchester United ended this Premier League season in sixth place, their worst result since finishing seventh in 2013-14. The relatively poor play has hurt the club as they have played five fewer home and away games compared to 2020 after being knocked out of various tournaments earlier.
“It has clearly been a disappointing season for the men’s first team,” CEO Richard Arnold said in the earnings release. “Off the pitch, our revenue has continued to recover from the pandemic, reflecting the enduring strength of our business operations, which in turn supports our ability to continue to invest in the club.” Management did not hold a Q&A with stock analysts during this period.
The team struck an optimistic note for the future, pointing to the hiring of a new manager, Erik ten Hag; the performance of its youth teams, which have won various national tournaments; and ‘fair play’ provisions for UEFA teams, which should help level the financial playing field between clubs.
Manchester United is listed on the New York Stock Exchange. After the earnings release, the shares were trading up about 3.5% in premarket activity at $13.47 per share. Pre-market trading takes place with much lower volume than normal trading and is not necessarily a reliable indicator of broader market reaction.