Manchester United’s New York-listed shares jumped 11 per
cent in early trading on Friday, in a rare sign of support for the English
football club’s owners after it reported a sharp fall in costs and raised its
earnings guidance.
The club, co-owned by the American Glazer family and British
billionaire Sir Jim Ratcliffe, reported a net loss of £2.7mn in the three
months to March 31, after a loss of £71.5mn a year earlier. It said it expected
to make adjusted earnings before interest, tax, depreciation and amortisation
in its full financial year to the end of June of between £180mn and £190mn, up
from previous guidance of £145mn to £160mn.
Investors have been wary of Manchester United under
Ratcliffe, who took a minority stake in the club in February 2024 and assumed
control of sporting operations. Despite Friday’s bounce, the shares are down
almost a third from their peak in the month of his arrival.
Fans have criticised
Ratcliffe for raising ticket prices, while staff morale has suffered due to job
losses and other cuts. The club recently slumped to its worst English
top-flight finish since the 1970s and lost the Europa League final to Tottenham
Hotspur, adding to its woes.
Ratcliffe has stressed the need to save money at the club,
which has not made a profit since before the coronavirus pandemic. Friday’s
results showed a more than 17 per cent increase in revenues to about £160mn in
the three months to March 31, bolstered by a 50 per cent surge in match-day
earnings and smaller increases from broadcasting and commercial partners.
Operating expenses fell 20 per cent to £162mn, with wages
and other employee benefits falling 22 per cent from a year earlier to £71mn.
Attacking players Marcus Rashford, Jadon Sancho and Antony left the club on
loan in January, easing its wage costs. Wages were further contained when the
club failed to qualify for the European elite Champions League, competing
instead in the lower-tier Europa League. Under Ratcliffe,
United has slashed non-playing staff and stopped giving free
lunches to those who remain. Although fans have praised the Ineos founder for
strengthening the club’s balance sheet with a $300mn cash injection last year,
Ratcliffe is battling to improve United’s finances. After failing to qualify
for European competition next season, the men’s team jetted out to Kuala Lumpur
and Hong Kong for a lucrative tour to boost revenues. Despite Ratcliffe’s
contribution, United’s cash balance was £73mn at the end of March.
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