Despite posting record first-quarter revenues of £157.1 million, Manchester United failed to avoid a £25.8m net loss at the start of the 2023/24 financial year.
As per The Athletic, United have adjusted their projected revenues for the 2023/24 financial year, lowering the assessment to a range of £635m to £665m.
This revision comes after initially foreseeing income of up to £680m, with the primary factor being their premature exit from the Champions League.
Record matchday and commercial takings for the quarter, combined with the prize money from the Champions League, have increased Man Utd’s revenue from £143.7m the previous year.
However, another free-spending recruitment campaign during the summer transfer window inevitably led to a significant rise in the club’s wage bill.
Seven summer signings, including Andre Onana, Mason Mount and Rasmus Hojlund, joining the Red Devils for an aggregate fee of £178m, have taken United’s ballooning wage bill to £90.3m.
A profit from player sales remained humble, with the departures of Fred, Anthony Elanga and Dean Henderson pouring around £29.5m into the club’s coffers.
This disproportion between insane fees paid for newcomers and relatively insignificant figures obtained from player sales has been the elephant in the room since Sir Alex Ferguson’s retirement.
Sir Jim Ratcliffe’s arrival is no longer fans’ caprice amid prayers for the Glazers’ exit or at least some form of co-control – it’s a textbook definition of necessity.
Man United dodged as bullet in 2022/23 as, unlike Everton and Nottingham Forest, they were not found guilty of breaching the Premier League’s profitability and sustainability rules (PSR).
In the first quarter of the 2023/24 fiscal year, United recorded a pre-tax deficit of £32.8m, which, adding to the cumulative pre-tax losses of £182.2m over the past two seasons, brings the total figure to £215m.
Despite substantial deductions expected for that amount, United might encounter difficulty reducing their losses to a level below the maximum limit of £105m permitted over three years.
That’s where Ratcliffe comes into play.
Ratcliffe has pledged an extra £237m investment in the club as part of his £1.3 billion minority acquisition, which could yield an increase in his stake to 29 percent.
While that could lead to a misperception of Ratcliffe as Man Utd’s saviour, controversies surrounding his effort to relocate the club’s training ground for his company’s purposes demand scrutiny.
