Date: 30th October 2010 at 12:00pm
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Following up on his previous article for us, Andreas Nicolaides, a finance writer for takes another look at United’s finances in light of the financial figures released earlier this month.

With the release of Manchester United’s financial accounts for the year 2010 earlier this month, inevitably there have been more questions raised about the current financial structure of the club. During recent weeks there have been murmurs that United may be following in Liverpool’s footsteps, and that the club may be slowly on the decline. But do the accounts released actually have a different meaning? Here’s my take on it…

The fact of the matter is that the key figure everyone will talk about is the record loss of nearly £84million. But what people may have neglected is the fact that the club also reported a record operating profit of £100.8million, so where did it all go wrong, and is the situation as bad as some people have made out?

The main reason for the incredible tumble that caused the eventual £84million loss is the debt that has been put upon the club. The debts created by the Glazer family meant a total of £40million was paid in interest payments alone, and an added bill of £65million was issued for re-arranging loans. Forgetting all those setbacks the club actually raked in £286.4million of revenue, and the revenue stream would have been even healthier had we progressed further in Europe and the FA Cup.

To be fair to the Glazers, my opinion is that the way they have run the club has improved over the past year. The bond issue that they decided to take instead of the long term financing seems to have paid off, as the repayments would have been a lot higher. During their tenure they have also exploited the amount of commercial income the club has made, this is up £12million for 2010, and it’s mainly due attracting various regional sponsorship deals.

I think what the account figures have proved is that, thanks to amount of revenue the club makes, Manchester United are the only club who could cope with such a financial burden. If it wasn’t for a couple of poor financial decisions made by the Glazers when they first came to the club, the finances might be in a better position, but we cant look back, we have to look forward.

Chris Brady, dean of BPP Business School, said: “Without the debt costs the club would have something like £50million more for transfers. But after mistakes early on, the Glazers are actually managing the business quite well.”

Since the figures were released there have been many, ‘what if?’ questions, and none more important than, ‘what if Manchester United fail to stay in the top four?’ Missing out on the top four would be unthinkable for the club, and that’s when the panic button would be hit. The loss of revenue would damage our financial stability an enormous amount. To be honest, my opinion on this is that I can’t really see it happening, I think the current squad is too good to be pushed out of the top four, but this is football and anything can happen.

The Rooney situation of last week certainly hasn’t helped matters either. When a player of Rooney’s quality and stature is questioning the clubs buying policy, as well as questioning the clubs ability to attract the best players, it certainly brings the clubs finances into the limelight yet again.

The fact of the mater is that Manchester United fans will never forgive the Glazers for the amount of debt that they have placed upon the club. I think knowing that if it wasn’t for the loans and re-financing issues we faced in early 2010, we would have actually made a healthy profit makes the situation that little bit harder to deal with.

I think to sum up all the issues that have concerned Manchester United in recent weeks I’ll leave you with recent quote from Sir Alex Ferguson; “we are the biggest club in the world, and we should never forget that”.


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