Manchester United reported second-quarter financial results Wednesday, revealing a 12% overall revenue decline driven by the club’s absence from the UEFA Champions League, which dented broadcast revenue 42%. Overall, revenue for the three months ending Dec. 31 fell to £199 million ($250 million based on current exchange rates) from £226 million ($285 million).
The quarterly report arrives as the 20-time English champion endures its worst season in a half century. Man United currently sits 15th in the 20-team Premier League two-thirds of the way through the season, 31 points behind leading Liverpool. Last season, United finished in eighth place, its worst showing since the EPL launched in 1992.
The poor start to the season triggered the club to fire manager Erik ten Hag in October just four months after he signed a new contract. United’s financial report highlighted the cost of firing ten Hag and his staff as an exceptional item of £14.5 million ($18.3 million). Ten Hag was replaced by Ruben Amorim.
Adjusted EBITDA for the quarter was $89 million, down 23%. United’s net loss was $35 million after finance costs, depreciation and amortization.
It has been a rough first year at Manchester United for Jim Ratcliffe, who spent $1.3 billion for 25% of the club and heads its sporting operations. Last year, United laid off roughly 250 employees; recently published reports say the team is considering more firings.
In November, United announced a mid-season ticket price increase, with tickets for all remaining home games at £66 ($83). Amid a backlash, the club penned a letter to a fan group highlighting its losses of more £300 million ($378 million) over the past three years.
“This is not sustainable, and if we do not act now we are in danger of failing to comply with PSR/FFP (financial) requirements in future years and significantly impacting our ability to compete on the pitch,” the club wrote.
In its financial results, the 20-time English champion reiterated its prior full-year revenue guidance between $820 million and $845 million, and it said adjusted EBITDA would be on the high end of its previous forecast of $183 million to $202 million. CEO Omar Berrada said the club continues to work on a decision on the future of its Old Trafford stadium.
Commercial revenue for the quarter was $107 million, up 18.5% from the prior year. The Qualcomm jersey deal helped push sponsorship revenue up 9.7%, while retail and merchandise rose 29% due to the launch of United’s new e-commerce model with Scayle.
Broadcasting revenue was $78 million, down from $134 million, due to lower payouts from participating in the Europa League, versus its inclusion in the Champions League last year. Matchday revenue rose 9.2% to $66 million from strong demand for hospitality packages.
Last year, United ranked atop Sportico’s annual look at the world’s most valuable soccer teams at $6.2 billion.