(WFI) Interest payments and one-off financial charges on Manchester United’s huge debts have caused the club record losses of £83.6million, despite it reporting increased turnover.
The results published earlier today show that turnover has increased to a record £286.4m because increased matchday, broadcasting and commercial income, but that club debt was still in excess of half a billion pounds.
Total debt stood at £521.7m to the end of the year to 30 June. In addition to this, the Glazer family, who own the club, also owe a further £225m in high-interest PIK loans. These are secured against their shareholding in United and now accrue at an annual interest rate of 16.25% per annum.
The club missed out on the EPL title last year to Chelsea after winning the three previous titles and the 2008 Champions League.
But the squad has suffered from lack of investment and little of the £80 million received from the sale of Cristiano Ronaldo to Real Madrid last year has found its way back into Sir Alex Ferguson’s transfer kitty. His team is still heavily reliant on veterans Ryan Giggs and Paul Scholes and has had an indifferent start to the current season.
The Manchester United Supporters Trust (MUST) say that the results increase pressure on the Glazer family after the supporters had suffered another let down from their regime.
“The financial results today continue to demonstrate the tremendous revenue generated by Manchester United – directly or indirectly through the unparalleled loyal support the club receives,” said a MUST spokesman.
“Sadly those supporters are let down by owners who continue to extract millions from our club.
“Imagine how successful we could be without the millstone that is the Glazers’ ownership?
“The pressure continues to build on them – with greater competition domestically it is going to become increasingly expensive just to maintain a place in the Champions League and the huge debt burden makes the club extremely vulnerable to any dip in revenues such as that which might be triggered by a decline in on the pitch performance.
“When Sir Alex retires the chances of maintaining anything like the same level of success look remote without massive investment.
“So the clock is ticking for the Glazers – and for the supporters too.”
From INSIDER‘s James Corbett
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