UNITED ANNOUNCE INCREASE IN PROFITS

Last updated : 30 September 2002 By Editor

‘United have announced a 48 per cent rise in annual profits, boosted by the sale of players and success in keeping its wage bill under control,’ report the FT.

The club reported pre-tax profits of £32.3m ($50.3m) for the year to the end of July, up from £21.8m last year, and ahead of market expectations. The rise was partly due to a £17.4m profit from the sale of players, including Japp Stam, Andy Cole and Dwight Yorke. The profit compares with a £2.2m gain from player sales last year.

At the same time, staff costs, including players' wages, rose by £20m to £70m, reflecting new player signings, including Juan Sebastian Veron, Ruud Van Nistelrooy, and Roy Carroll last summer, and Diego Forlan in January. The recent signing of Rio Ferdinand in record deal worth up to £33.3m will keep pressure on wages.

Wages now represent 48 per cent of turnover, up from 39 per cent last year, but in line with expectations. In March the club had reported a 80 per cent increase in six-month profits but warned that the rising wage bill would damp growth in the second half. The board said it remained committed to limiting wage costs to 50 per cent of turnover.

Turnover at the group rose 13 per cent to £146.1m, mainly reflecting the value of a new three-year deal with British Sky Broadcasting for rights to live UK games, as well as the team's progress in the UEFA Champions League.’

With the Nike deal kicking in this season and a 9 per cent increase in match day turnover to £53.3m United are streets ahead of any so called rivals yet financial investors have been taking flight in record numbers.

Instead of making the sensible decision to ditch the City investors the Plc are trying to coax them back by offering increased dividends.

‘The board proposed a final dividend of 1.46p per share, as well as a special dividend of 1p per share reflecting the profits from player disposals and a lower tax charge. If approved the total dividend for the year would be 3.1p per share, a 55 per cent increase on last year,’ adds the FT.

‘United have announced a 48 per cent rise in annual profits, boosted by the sale of players and success in keeping its wage bill under control,’ report the FT.

The club reported pre-tax profits of £32.3m ($50.3m) for the year to the end of July, up from £21.8m last year, and ahead of market expectations. The rise was partly due to a £17.4m profit from the sale of players, including Japp Stam, Andy Cole and Dwight Yorke. The profit compares with a £2.2m gain from player sales last year.

At the same time, staff costs, including players' wages, rose by £20m to £70m, reflecting new player signings, including Juan Sebastian Veron, Ruud Van Nistelrooy, and Roy Carroll last summer, and Diego Forlan in January. The recent signing of Rio Ferdinand in record deal worth up to £33.3m will keep pressure on wages.

Wages now represent 48 per cent of turnover, up from 39 per cent last year, but in line with expectations. In March the club had reported a 80 per cent increase in six-month profits but warned that the rising wage bill would damp growth in the second half. The board said it remained committed to limiting wage costs to 50 per cent of turnover.

Turnover at the group rose 13 per cent to £146.1m, mainly reflecting the value of a new three-year deal with British Sky Broadcasting for rights to live UK games, as well as the team's progress in the UEFA Champions League.’

With the Nike deal kicking in this season and a 9 per cent increase in match day turnover to £53.3m United are streets ahead of any so called rivals yet financial investors have been taking flight in record numbers.

Instead of making the sensible decision to ditch the City investors the Plc are trying to coax them back by offering increased dividends.

‘The board proposed a final dividend of 1.46p per share, as well as a special dividend of 1p per share reflecting the profits from player disposals and a lower tax charge. If approved the total dividend for the year would be 3.1p per share, a 55 per cent increase on last year,’ adds the FT.

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