Net losses of £92.2 million were reported for the 12 months ended 30 June 2021 by executive vice-chairman Ed Woodward, a rise of roughly £60 million from the previous financial year “most difficult” in the club’s long-running history.
Due to an increase in the UK’s corporation tax rate in comparison to the US’s, the loss is estimated to be in the region of £66.6 million. United made a net loss of £23.2 million in the fiscal year ended June 2020. Last year, the company’s net debt dropped from £471.1 million to £419.5 million, while an operating loss of £36.9 million was racked up.
“Manchester United’s financial results over the last 12 months have been among the most difficult in the club’s history, according to Woodward. “Despite the pandemic’s financial impact, our fundamental strength is evident to see and everyone affiliated with the club can be proud of the fortitude we have showed through these most challenging of times.
“It was stated during the pandemic’s peak that we could expect the club to emerge stronger than before, and I feel that we are beginning to see that happen as we work our way back to health.”
A 13.6 percent increase in United’s salary cost was reported “The accounts indicated that 322.6 million “mainly owing to higher contracted player wages” for participation in this season’s Champions League.
The group’s managing director, Richard Arnold, disputed that Cristiano Ronaldo was signed for business purposes. “Our goal is to get players who can perform on the field and then take advantage of the opportunity that comes with them,” he stated.
What is Man Utd current debt?
According to Manchester United’s second-quarter financial data, net debt has increased by £64.2 million to £455.5 million.
Approximately £1.5 million was lost in matchday revenue over the months of October, November, and December 2020.
“I am thrilled with the great resilience the club has exhibited through the pandemic,” executive vice-chairman Ed Woodward said in a statement accompanying financial results.
Why are Manchester United in so much debt?
The Glazer family’s acquisition of Manchester United in 2005 has resulted in the club’s massive debt. Since it was a ‘leveraged buyout’, the Glazers’ takeover of Premier League giants was controversial since it heaped £525 million of debt onto them through loans secured by their assets.
How much is Liverpool in debt?
Currently, Liverpool’s debt is believed to be £386 million. The club’s total debt as of 2020 has been calculated based on the club’s current financial situation. Liverpool is one of the most indebted Premier League teams. As a result, the club may have been eager to join the European Super League.
In a 2021 Deloitte research, the richest football clubs produced 12% less money in the 2019/2020 season than they did in the previous year. A significant portion of such decrease was due to the pandemic’s effect on match-goers.
Deloitte’s analysis indicated that top teams’ revenue fell by 17 percent due to a £218 million drop in revenue due to a lack of fans. It was compounded by the fact that most Premier League games for the 2020/21 season were closed to the public.
Are Barcelona in debt?
An attempt to sell a $58.1 million interest in Barca Studios, FC Barcelona’s media company, is in the works. He claims that after 18 months the team’s finances will be in line.
Is Manchester United profitable?
Loss/Gross for Manchester United from 2010 to 2021 Manchester United’s net profit/loss from 2010 through 2021 is shown in this graph. During the club’s fiscal year 2021, it had a loss of over 92.22 million pounds.
How is Manchester United so rich?
Sponsorship, retail, merchandising, apparel and product licensing as well as mobile and content are the three revenue sources via which we monetize our global brand in the Commercial revenue area. Other licensed products, such as coffee cups and bed sheets, also include the Manchester United brand and trademarks and are available for purchase.
How much profit does Man Utd make a year?
At 580.4 million euros for the 2019/20 Premier League season, Manchester United is one of the most successful football teams in the league.
Is Real Madrid in debt?
IN THE 2020/21 SEASON, THE CLUB’S NET DEBT WILL BE 46 MILLION, DOWN FROM 240 MILLION IN THE 2019/20 SEASON. As of 30 June 2021, the club’s equity totals 534 million and its cash reserves total 122 million.
Is Manchester United debt free?
Manchester United’s ownership has come under heightened scrutiny as a result of the European Super League’s failure. The demonstrations at Old Trafford last weekend showed that the anti-Glazer movement is more powerful than it has ever been.
United’s finances have been examined in great depth by Telegraph Sport, which delved into the nitty gritty.
Revenue
Under the ownership of the Glazers, United have become a money-making machine in Japan, despite the fact that they have an official noodle partner there. Before the coronavirus crisis erupted, their yearly revenue had more than tripled from $173 million in 2006 to $627 million in 2019.
That growth, which was fueled in large part by an increase from £55 million in commercial revenue 15 years ago to an annual high of £279 million last year, has been barely damaged by their absence of Premier League title since 2013 and periodic failure to qualify for the Champions League.
Unless the Glazers took possession, it’s doubtful that United would have been able to get 53 sponsorship deals that have taken use of the club’s global brand recognition. However, their recent trophy drought has corresponded with a flattening of that commercial revenue coupled with gluts for its largest rivals.
They have not only narrowed the deficit, but they are also on the verge of overtaking Manchester United in the next seasons.
Debt
The source of the opposition to the takeover by the Glazers from the supporters. In order to purchase United, hundreds of millions of pounds in bank loans were used. Their debt now stands at more than £550 million, and they’ll have to pay tens of millions in interest every year as a result of that.
In 2010, the anti-Glazers green-and-gold campaign began, and their net debt soared to £773 million. The family had raised a £500 million bond issue to pay off more than a fourth of the debt. Even in 2019, the club’s debt almost fell below the £200 million barrier after the club was listed on the New York Stock Exchange and shares were sold to outside investors. However, the pandemic has pushed it up to £455.5 million.
Only £6m of the £244m in loan repayments since 2005 has been made in the last five years. Furthermore, interest payments totaling £704 million, of which £496 million has been made in the last decade, dwarfs it. By the time the debt is settled, the entire amount might be in excess of $1 billion if the obligation is ever returned at all.
Dividends
The Glazers have received a total of $125 million in dividends since their ownership of Manchester United. In the last five years, when debt repayments have all but ended, nearly all of that money has been pocketed. However, it featured a £23 million payout that was signed off on prior to the outbreak of Covid-19 in the UK.
Only Manchester United pays monthly dividends of any kind, a normal corporate practice that the Glazers contend is countered by the club’s tremendous increase in earnings and multiple prosperous years under their leadership. That’s a lot of money if you add interest and mortgage repayments to the total cost of owning them.
How much is Arsenal debt?
Barcelona’s net debt increased from 488 million in June of last year to 354.3 million for Real Madrid.
Manchester United has a net debt of £455.5m, while Tottenham has a net debt of £604.6m, and Arsenal has a net debt of £108.2m, according to the most recent numbers.
Are Chelsea FC in debt?
Since Abramovich’s takeover in 2003, Chelsea has had a EUR 1.4bn intercompany debt since he has loaned the club a considerable amount of money. Despite the large debt exposure to connected parties, Chelsea does not owe interest-bearing financial obligations to any other parties, such as banking institutions. In the midst of the global downturn last summer/autumn, most clubs were compelled to apply a spending review to their transfer operations because of the club’s debt structure, which allowed the club to aggressively enter into the transfer market.
The KPMG Football Benchmark’s Club Valuation report, in which Chelsea is routinely listed among the most valuable clubs by Enterprise Value, summarizes the progress of the business promoted by Abramovich. At its highest point in January 2019, the club’s value stood at EUR 2.2 billion, a 53% increase from its first valuation in 2016. The club was ranked sixth in the current 2021 rankings, with a valuation of EUR 1.9 billion, mostly due to the pandemic’s impact.
Why is Barcelona in debt?
Barça’s $1.5 billion in debt is a wake-up call about player wages. Pique, Messi, and other long-term players’ salary are frequently mentioned in headlines.
Over the course of four years, Messi’s contract earned him more than 500 million euros. Gerard Pique had to take a 50% pay reduction in order for Barcelona’s new acquisitions to play.
About 280 million euros per year was spent on the issue of salaries. Barcelona’s $1.5 billion debt was clearly unsustainable, and the club had to make difficult decisions to offset it.
Steps towards recovery
Lionel Messi is, not was, the club’s mascot. He wanted to stay at the club and sign a new four-year contract, which would have resulted in a hefty pay cut. Mes que un club, as you’d expect from a captain, he adopted it as his own. Under LaLiga’s efforts to tighten financial restrictions, Messi’s contract and Laporta’s ambitions were not allowed.
Even Messi’s 50% reduction in salary was not enough to reach LaLiga’s wage cap of 200 million euros. The pay cap was able to accommodate Pique’s contract because it was so minimal.
For those asking why Messi couldn’t take more money out of his contract, Barcelona had the same concept in mind, too. Contracts can be no smaller than 50% of the prior contract to prevent fraud. Messi’s deal was still too much even after taking the biggest possible decrease.
Laporta points the finger at the former administration in this area. Josep Maria Bartomeu, the former president of Barcelona, signed players to contracts of this magnitude. Debt was piled on top of debt due to exorbitantly inflated contracts.
It’s no surprise that the three players brought in by the previous board, Griezmann, Coutinho, and Miralem Pjanic all earned over £200,000 a week in 2020/21. One thing these guys have in common is that they drastically underperform based on their salary. They aren’t wanted by any other club because they know the on-field product won’t live up to expectations. After all is said and done, these players are left to rake in money sitting on the sidelines.
They include Francisco Trinco and Junior Firpo, both of whom opted to leave for less money in the summer of 2021.
This administration was in power from 2014 till 2017. Three UEFA Champions League titles in six years were won by the team led by Messi, Iniesta, Xavi, Sergio Busquets, and other La Masia graduates. Fourth member was added to this core in 2015. As a result, though, the club’s direction swiftly shifted.
Pep Guardiola’s trademark tiki-taka style was lost in the team’s performances on the field. Rather than cultivating their own talent, several players were brought in through the transfer market.
In light of this, we can see how it worked out. A few domestic successes, but none to equal the quality of FC Barcelona’s Champions League wins.
In order to pay off Barcelona’s $1.5 billion in debt, the strategy must return to cultivating local talent at La Masia. Young players like Riqui Puig, Ilaix Moriba, and Oscar Mingueza show the facility still has potential.
Prioritizing La Masia over outside transfers was a central theme of Laporta’s presidential campaign. Although this will be difficult for many Barcelona fans, it will take some time for this to happen. But the 10-year period from 2006 to 2015 shows that the findings don’t lie, as seen by the numbers.
