Manchester United lift earnings forecast after top three Premier League finish
Manchester United’s Financial Performance and Outlook
May 27 (Reuters) - Manchester United raised annual revenue and core profit forecast for the year to June, helped by a third-place finish in the English Premier League and as fans snapped up merchandise as the team's fortunes improved on the pitch.
The club's New York-listed shares rose 5% to $20.71 in premarket trade.
Club Management and Business Transformation
"We feel very positive about the club's progress this season and the continuing positive impact of our business transformation initiatives," CEO Omar Berrada said in a statement.
Impact of Premier League Finish
United's third-place finish under Michael Carrick, who was appointed permanent manager last week, secured a berth in the Champions League for the first time in two seasons.
The club's return to Europe's top club competition is also expected to boost revenue next fiscal year as they benefit from lucrative broadcast rights and new sponsorship deals.
Broadcasting and Revenue Growth
Broadcasting revenue jumped 57% to 64.9 million pounds in the third quarter, driven by the higher Premier League finish compared to last year and increased international broadcast rights payments.
Updated Financial Forecasts
As a result, United expect revenue between 655 million and 665 million pounds and adjusted core profit between 200 million and 210 million pounds for the year ending June.
The Old Trafford club had previously guided to revenue in the 640 million to 660 million pounds range and adjusted core profit in the 180 million to 200 million pounds range.
Challenges and Strategic Changes
Recent Financial Losses
Still, United reported a net loss of 11.8 million pounds for the three months to March, wider than a year earlier, as falling sponsorship revenue, weaker ticket sales and costs related to the sacking of Ruben Amorim weighed on income.
The group had seen net losses for six straight years and looked set for another year in the red.
Club Revitalization Efforts
Jim Ratcliffe, the minority shareholder who runs football operations at the club, has taken steps to revive United's fortunes, including cutting jobs and raising ticket prices.
Historical Context
The 20-times English champions have struggled to replicate the success they enjoyed on- and off-the-pitch under Alex Ferguson, who left in 2013 after helping United win 13 Premier League titles.
(Reporting by Yadarisa Shabong in Bengaluru; Editing by Ronojoy Mazumdar and Christian Radnedge)
