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Man United predicts big rise in income after profits increase

Man United predicts big rise in income after profits increase

Manchester United predicted a big rise in income over the next two years after announcing that its profits had almost trebled.
United announced an operating profit Friday of 30.8 million pounds (US$60.4 million; euro46.8 million) for the year ending June 30, 2006.
The club's first annual report since it was taken over by American businessman Malcolm Glazer in May 2005 showed profits had risen by 20 million pounds (US$39.2 million; euro30.4 million) from 10.8 million pounds.
The rise came despite United's failure last season to qualify from the group stage of the Champions League for the first time in 10 years.
United will benefit this year from a new Premier League television deal, a 14 million-pound (US$27.4 million; euro21.3 million) annual shirt sponsorship deal with insurance group AIG, and the expansion of Old Trafford by 8,000 seats to 76,000.
Chief Executive David Gill said those factors would contribute to "dramatic growth" over the next two years.
"The future is promising for the club," Gill said in the report. "We continue to operate by budgeting sensibly and managing our affairs through stable business practices."
United should also pick up extra revenue because it has reached the knockout stage of the lucrative Champions League this season. It also leads the Premier League by six points from champion Chelsea and has a chance of winning its first title since 2003.
However, United is still more than 600 million pounds (US$1.2 billion; euro912 million) in debt because Glazer borrowed heavily against future earnings to buy United and take it off the London Stock Exchange.
The club refinanced its debt to cut the amount paid on interest last year.
"This is a very well-structured debut profile and all obligations can be met," Gill told Friday's edition of British daily The Financial Times.
The report said United paid 1.8 million pounds (US$3.5 million; euro2.7 million) to soccer agents, compared to 2.6 million (US$5.1 million; euro3.9 million) the previous year. United is not compelled to reveal those amounts.
Meanwhile, Gill said he was keen for players to be on performance related salaries, but admitted it was unlikely to happen. About 50 percent of United's revenue goes on salaries.
"Personally, I would like to see players' salaries more variable, where they win rewards if we are winning," Gill told The FT. "That is a difficult thing to do in this business."
United is set to appoint a commercial director and chief operating officer _ from a nonsporting background _ to deal with the day-to-day running of the club.


Updated : 2021-06-13 19:09 GMT+08:00