MANCHESTER United expect their miserable season to cost them around £35m but say they still intend to spend as they look to re-establish themselves as England’s top club.
Chief executive Ed Woodward confirmed yesterday that the team’s failure to qualify for European competition would dent next year’s earnings by a figure “in the mid-30 millions of pounds”.
United’s bottom line could take an even bigger hit if, as Woodward pledged, they make several signings to support a new manager, widely expected to be confirmed as Holland boss Louis van Gaal early next week.
Old Trafford chiefs hope that those costs are mitigated by continued growth of commercial revenues, which contributed to record quarterly income of £115.5m for the three months to March.
“We estimate that the isolated impact on 2015’s EBITDA from not qualifying for European football will be in the mid-30 millions of pounds,” Woodward told an investor call.
He added that the figure was so high because this season United, as reigning English champions, were entitled to a large slice of Champions League central revenue distributions.
Woodward said the seventh-place Premier League finish was “very disappointing” and that “everyone at the club is working hard to ensure that our performances on the pitch next season will be what we and our fans expect”.
“We are now focused on bringing in a new manager who will help Manchester United return to the top of English football and challenge in Europe,” he continued. “We expect to make an announcement in due course. In the meantime we continue to be active in the transfer market.”
United will have to spend carefully as Premier League rules prohibit clubs from increasing their wage bill year on year by more than £4m, unless funded by revenue growth.
A new kit deal promises a boost of around £40m per year but Woodward said months of talks with Nike and other manufacturers had still not resulted in agreement, and that in any case the cash would not hit United’s accounts until 2015-16.
Rivals Manchester City appear set to be punished by European chiefs Uefa for breaking new financial fair play rules, and Woodward reiterated United’s backing for the initiative.
He added: “We continue to support FFP and believe it will help control player capital expenditure and wage inflation.”
£4M maximum increase in wage bill allowed without extra income