A rise in commercial and media revenue helped English Premier League champions Manchester United to report growth of almost 8 percent in first half earnings on Tuesday, underlining the cash-generating power of the American-owned club.
United, the most successful soccer club in the English game, said earnings before tax, interest, depreciation and amortisation (EBITDA) increased 7.7 percent to 64.2 million pounds ($102 million) in the six months to the end of December.
Though United's on-field supremacy is being challenged at home by crosstown rivals Manchester City, backed by cash from Abu Dhabi, and they suffered an early and costly exit from the Champions' League, Europe's premier club competition, their brand remains attractive.
Deals with kit supplier Nike, shirt sponsor Aon Corp and delivery company DHL, which sponsors the club's training kit, contributed to a 16 percent rise in commercial revenue to 58.6 million pounds.
Total revenue grew to 175 million pounds in the period, up 11.8 percent. Media revenues contributed 60.9 million pounds, up 13 percent, while matchday revenues at 55.5 million made up less than a third of the total.
United now employ almost 700 people, up almost 100 on a year ago. However, staff costs account for only 43.7 percent of revenue, a relatively sober figure in the spendthrift world of British soccer.
A recent report by Deloitte put United in third place for soccer revenues in 2010-11, behind Real Madrid and European champions Barcelona.
FLOTATION ON HOLD
United declined to comment on plans for a stock market flotation after putting plans for a $1 billion listing in Singapore on hold last September because of volatility in global markets.
The American Glazer family, who bought the club in 2005, had been expected to use some of the proceeds from the listing to bring down debt, which supporters believe has held it back.
Gross debt was 439 million pounds as of the end-December, down from 508 million pounds a year earlier.
United are currently second in the English Premier League, behind Manchester City.
United's second half financial performance is certain to be hit by their early exit from the Champions League this season after they reached the final last May. They have also been eliminated from the FA Cup, the main domestic knockout competition.
"On-pitch performance always has an impact on revenues, but the underlying strength of the business is there for all to see with the continued growth on the commercial side, which we expect to continue in the next few years," a club spokesman said.
United are now playing in the Europa League, the secondary European tournament, and media income for their last 32 tie with Ajax Amsterdam was only 200 000 euros, against 3 million euros ($4 million) for the first knockout stages in the Champions League.
