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Ed Woodward

Manchester United announce £92m losses for financial year but point to Cristiano Ronaldo transfer as proof of ambition

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The commercial importance of Cristiano Ronaldo’s return to Manchester United has been made clear by the club’s final set of “Covid” accounts.

United have ramped up the arrival of their latest star asset believing the Portuguese ace will have a massive impact both on and off the pitch.

United have announced a loss of £92m during the last financial year

United have announced a loss of £92m during the last financial year credit: Getty
But the club hope Ronaldo's arrival and the sale of his shirts will boost their profits

But the club hope Ronaldo’s arrival and the sale of his shirts will boost their profits

Unveiling figures that showed United lost £92.2m in the financial year to the end of June, executive vice-chairman Ed Woodward conceded: “There is little doubt that those 12 months were among the most challenging in the history of Manchester United.”

United note that much of that loss was due to a change in UK corporation tax rates, with an operating loss of £36.9m.

But the figures show commercial and sponsorship revenue was massively down as a result of the pandemic, with almost £47m less coming into the club.

Gate receipts were, of course, impacted more than anything by a year of fan-free football, with the club taking just £7.1m through the Old Trafford gates compared to £89.8m in the 12 months to June 2020.

And the Champions League participation bonuses boosting player salaries, United’s total wage bill rose £38.6m to £322.6 million, up 13.6 percent.

Woodward, though, in remarks due to be made to investors and analysts added: “Everyone associated with the club can be proud of the resilience we have shown through these most testing of times.

“The most important part of this recovery is the return of fans to Old Trafford and it has been fantastic to see and hear the stadium full for the first time in almost 18 months.

“The amazing atmosphere during the opening home games of the season demonstrates that fans are the lifeblood of the game, and we’re so glad to have them back.

“On the pitch, the team has made a strong start in the league, and everyone at the club is feeling excited about the rest of the campaign.”

Everyone associated with the club can be proud of the resilience we have shown through these most testing of times

Ed Woodward

“Furthermore, we recently sold Dan James to Leeds for a fee of £25 million, plus add-ons.

“We have been clear in our strategy to build a squad with a blend of top-class recruits and homegrown talent, comprising a balance of youth and experience, with the aim of winning trophies and playing attacking football the Manchester United way.

“As part of this, we have continued to strengthen our recruitment and scouting processes, and we have also increased our investment in the Academy, to ensure that this success is sustainable.

But Woodward sought to sidestep the Super League controversy, despite United having played a key role alongside Real Madrid and Liverpool in driving the failed £4.6bn breakaway scheme.

He did not mention Super League directly in his comments, although he did seem to accept that the club was wrong to push on with a scheme that met with such a universal backlash.

BUILDING FOR THE FUTURE

Woodward said: “It remains clear that football as a whole faces major financial challenges caused by years of material inflation in wages and transfer fees, exacerbated by the impact of the pandemic.

“But no club can succeed on its own.

“We want to be part of healthy, vibrant domestic and European football pyramids, working together with our governing bodies and, most importantly, the fans, to preserve and enhance the magic of our game.

“As a club, we are committed to those objectives and we look forward to pursuing them in the months and years ahead.”

They said: “Manchester United’s financial results came out negative relative to last year, as their adjusted earnings before tax fell by more than a quarter.

“The decreased commercial activity was primarily because the previous season (2019/2020) ended late due to lockdown, which cancelled the entire pre-season tour where the club usually travel the globe to play friendlies and market the red jersey.

“Matchday activities fell by more than 90% because of no audiences to the games, while broadcasting revenue increased by 80%.

“Leading up to this summer’s transfer window, it was reported that Ole Gunnar Solskjaer’s transfer budget was between £100 and £150 million. Paying out for three of the club’s acquisitions, Jadon Sancho (£73 million), Raphael Varane (£34 million) and Cristiano Ronaldo (£12.8 million), Manchester United’s total spend amounted to roughly £120 million.

“While most fans probably would agree that the team is stronger than last year, it shouldn’t come as a surprise if Manchester United will look for further support in the Winter window as they have never really shied away from new acquisitions in this period.

“Despite today’s report, the club still remains a top tier football club both domestically as well as internationally when looking at its financial value in comparison to their biggest rivals around the world.”

About Charles Igbinidu

Charles Igbinidu is a Public Relations practitioner in Lagos, Nigeria

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