Published 16:39 IST, October 22nd 2020
Man United debt rises by 133% to £474m following coronavirus-hit campaign: Report
Man United debt: The Red Devils have seen their net debt rise by a whopping 133%, skyrocketing from £203.6m to £474.1m over the past 12 months.
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Manchester United's executive vice-chairman Ed Woodward has claimed that the Red Devils need to adapt to “significant economic ramifications" following the pandemic. On Wednesday, the 20-time English champions released a financial statement showing that their net debt has increased by 133%. Man United paid out £20 million in dividends to their owners, the Glazer family, despite the club's debt skyrocketing from £203.6m to £474.1m over the course of the last 12 months.
Man United finances: Club posts drop in profits owing to economic ramifications of the pandemic
Just a day after Man United recorded an impressive 2-1 win over PSG in their opening Champions League Group H clash, it was revealed that the English giants suffered a severe setback in their finances. Along with the significant increase in debt, the club's fourth quarter and full financial year results showed Man United's revenue dropped by 19% from £627.1m to £509m and a loss of £23.2m compared to the £18.9m profit made last year, largely because of the COVID-19 situation.
The Red Devils claim that the pandemic has cost them around £70m in revenue, with the lack of Old Trafford matchdays and the closure of the club shop all contributing to a large chunk of that sum.
Man United 2019-20 financial results released showing the impact of the pandemic and being out of Champions League
— Rob Harris (@RobHarris) October 21, 2020
Debt soars 133% to £474.1m
Revenue drops 19% to £509m
Losses of £23.2m after £18.9m profit last year
Man United debt: Red Devils confirm dividend payments to Glazer family despite rise in net debt
According to reports from MEN, Man United's principal debt remained the same but the club’s net debt rose by 133% to £474m. Apart from the pandemic, Man United have claimed that the decline in cash income was due to the money spent on player transfers with Donny van de Beek (£40m) and Alex Telles (£13m) arriving at the club. The pandemic has seen games being played behind closed doors, hurting United more than the rest.
Man United despite announcing a loss today paid £11.9m in dividends in the last quarter. That’s £23m for the financial year, with most going to Glazers, even though debt linked to their 2005 buyout has spiralled to more than £470m. Club continues to be a cash machine for them
— tariq panja (@tariqpanja) October 21, 2020
However, United paid a further £11.9 million in dividends to shareholders over three months from April 1 to June 30, with the majority of the sum being paid to six members of the Glazer family who own shares at the club. Dividends are paid twice a year, in January and June, and a decision will reportedly be been made soon on whether payments in January will be made as usual or not.
Reports also claim that Ed Woodward is now 'exploring options' following United's key role in the controversial "Project Big Picture" plans.
Image Credits - manunited.com
15:45 IST, October 22nd 2020