Now £100m United break new ground off field
The most recent three-monthly accounts showed revenues rising to £24m over the first quarter of the accounting year, and it is thought the second, up to December 31, will be equally strong.
United’s new ‘territory specific’ approach to commercial opportunities, agreed with the Glazer family and implemented by commercial director Richard Arnold, has allowed the Old Trafford outfit to rapidly expand that area of club revenue.
The last annual figures showed a 16% growth in commercial income to £81m and last week global logistics giant DHL became the latest company to confirm an extended “partnership” with the Old Trafford outfit, their three-year deal allowing them to take charge of the distribution of United’s massive merchandising operation.
Even if United do not get to the £100m mark this year, it is only a matter of time before they make it, emphasising just how popular the club remains as it pushes towards a record 19th league championship.
And with revenue streams continuing to grow in other sectors, chief executive David Gill is confident that the spread across all three areas; media, match day and commercial, means United are insulated against future problems in other areas.
“One of the strengths of this club compared to others is that we get income from all revenue streams,” he said.
“Our match day revenue is around 40% of our overall turnover, we are part of a great competition in the Premier League that continues to grow and the commercial sector has gone up from 20% to 30%. That will stand us in very good stead. They are all high margins and will continue to give us the money Alex Ferguson needs to keep the club at the top. There is a strong desire within our great supporter base for that to happen.”
There are issues looming though, not all of which United have control over. Legal arguments over distribution rights for TV companies could yet revolutionise the way football is sold, which in turn might have a major impact on the cash companies such as BSkyB and ESPN are prepared to hand over to the Premier League.
Meanwhile, Celtic have revealed a “disappointing” set of interim financial results for the final six months of last year.
The Parkhead club, who were knocked out of the Champions League and Europa League at the first hurdle this season, posted a decrease in turnover of 21.4% to £28.4m while bank debt almost trebled to £9.1m.
And although profit before taxation rose to £7.1m from £1.3m, that was largely down to the sale of Aiden McGeady to Spartak Moscow for £9.5m, with the club warning the second part of the season would be “more challenging”.
Celtic chairman John Reid reminded Hoops fans of the importance of European football to the club.
“In previous years, and again last summer, I stressed the importance to our club of financial stability and participation in Europe, and that commercial and football success cannot be separated,” he told the club’s official website.
“At this time last year we knew we were facing a very difficult season, and so it proved. In turn, that left a legacy of setback at the beginning of the current season, in dropping out of European competition entirely at an early stage.
“But while some of the economic and financial issues that we would face as a result could be predicted, we had little inkling of other events which will undoubtedly play a large part in shaping the future of football in Scotland.
“The cold wind of economic recession, combined with the effects of the even colder Scottish winter and our early exit from Europe, are reflected in disappointing underlying trading results for the six months to December 31, 2010.”
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