Appeal of Man U brand grows with sponsors despite on-pitch woes

Manchester United’s performance on the pitch might have dipped in the last year but that has not deterred sponsors with the club’s global income from brands eager to associate with the Premier League club rising 49 per cent in its latest fiscal year.

Manchester United
Chevrolet’s £50m a season sponsorship deal underlines the strength of the Manchester United brand

The club is currently facing its first season without European football in more than two decades after finishing a lowly seventh in the Premier League last campaign but still managed to sign 20 brand partnerships in the year to 30 June.

Regional deals with brands including STC in Saudi Arabia and PepsiCo in parts of the Middle East and Asia coupled with global deals with Nike, Aon and DHL helped push sponsorship income up to £135.8m in the period, up from £90.9m a year earlier.

The total is set to increase further in the coming years when its £50m a season shirt sponsorship deal with Chevrolet, which started this season, and record £75m a season kit deal with Adidas, which starts in 2015, kick in.

Sponsorship as a percentage of total revenue grew to almost a third (31 per cent) of the £433.2m for the period, up from 21 per cent a year earlier.

United’s share of the three-year £3bn deal between The Premier League and BSkyB and BT, which started at the beginning of the 2013/14 campaign, helped boost the club’s revenue from broadcasting up 27.8 per cent to £189.3m in the year.

However, its lack of Champions League football this season is expected to dint its revenue for the year to June 2015 when income is expected to drop to between £385m and £395m.

Its results statement was not entirely good reading for investors who saw profit slump. Net profit dropped by 83.7 per cent to £23.8m. The club blamed tough comparisons with the year prior when it benefited from a tax credit.

Profit was also dented by a £5.2m pay out to David Moyes, who was sacked earlier this year after a string of disappointing results. His replacement Louis van Gaal has signed a number of players including record signing Ángel Di María in the hope of improving the club’s on-field fortunes.

Ed Woodward, executive vice chairman, says: “We are very proud of the results achieved in fiscal year 2014 as we once again generated record revenues and EBITDA driven by our commercial and broadcasting businesses which delivered impressive year over year growth. We also recently announced a record-breaking deal with Adidas and very much look forward to launching this partnership next summer.

“With Louis van Gaal at the helm as manager, and the recent signing of some of the world’s leading players to further strengthen our squad, we are very excited about the future and believe it’s the start of a new chapter in the Club’s history. Louis’ footballing philosophy fits very well with Manchester United and he has an impressive track record of success throughout his career, winning league titles with every club he has managed.”

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