(Reuters) - English soccer club Manchester United promised to use its financial muscle to help recover from a “turbulent season”, as it stuck with its full-year earnings forecast despite a quarterly hit from higher wages.
Following a brief upturn in form after replacing manager Jose Mourinho with former striker Ole Gunnar Solskjaer, the team stuttered in the last few weeks and finished only in sixth place in the Premier League last weekend.
This further fuelled calls to rebuild the squad as the 20-time English champions missed out on a berth in next season’s lucrative UEFA Champions League competition.
“Preparations for the new season are underway and the underlying strength of our business will allow us to support the manager and his team as we look to the future,” Executive Vice Chairman Ed Woodward said.
Solskjaer said last week United would need a “miraculous season” to challenge for the Premier League title next year because of how much their rivals have improved, and called for wise investment in the squad and developing young players.
The club has also reportedly been looking to appoint a technical director to oversee player recruitment and contract negotiations and allow Woodward to focus primarily on further boosting financial performance off the pitch.
Woodward, a former investment banker who advised the American Glazer family on its takeover of the club in 2005, has seen several big-money signings and a trio of managers underperform after the retirement of Alex Ferguson in 2013.
Since Woodward’s appointment as Executive Vice Chairman in 2012, the club’s commercial revenue has more than doubled. Commercial revenue in the latest quarter was unchanged from a year ago at 66.6 million pounds.
“After a turbulent season, everyone at Manchester United is focussed on building towards the success that this great club expects and our fans deserve,” he said in a statement.
The club stuck to its forecast for the year to June 30 of 615-630 million pounds in revenue and adjusted EBITDA of 175-190 million pounds, even as it posted a drop of almost 10 percent in third-quarter core earnings.
Earnings before interest, tax, depreciation and amortisation (EBITDA) for the three months to the end of March fell to 41.2 million pounds ($52.8 million), down from 45.7 million a year earlier.
That in part reflected the impact of wage costs of 84.8 million pounds, up 9.7 million pounds from a year ago, mainly due to investment in a squad which includes French World Cup winner Paul Pogba and Chilean Alexis Sanchez.
Reporting by Shashwat Awasthi and Chris Peters in Bengaluru; editing by Jason Neely/Keith Weir