Man United profits down 53% as TV revenue falls and wages rise

David Gill, Manchester United chief executive, yesterday hit out at Malcolm Glazer, saying the US sports tycoon's interest in the world's richest football club had been a "distraction".

Announcing a sharp fall in interim pretax profits, Mr Gill said Mr Glazer's interest in acquiring the club had made for a "challenging six months, on and off the pitch". Mr Glazer has suggested a bid pitched at about 300p a share and would finance his offer by leveraging his 28 per cent stake in the club.

NM Rothschild, the bank advising Mr Glazer, is believed to have finished due diligence on United's books but has yet to lodge a formal bid.

Mr Glazer's camp is hoping to win a board recommendation for an offer but the United board has, to date, indicated that it would not support a bid. "If you look at the Glazer situation, all we can do is reiterate that the price is reasonable," said Mr Gill. "But we don't think it is in the best interests of the company because of the level of debt."

With Mr Glazer and his team considering their options, the focus yesterday was on the decline in United's operating performance.

In a season on the pitch that has been poor by its own high standards, United announced a 53 per cent fall in pretax profits from £26.8 million (€38.6 million) to £12.4 million, driven by a reduced share of media rights revenues. Turnover was flat at £91.6 million, compared with £92.4 million last time.

Mr Gill said the Premier League's latest broadcasting contract had a negative impact on media rights revenues, while an early exit from the Uefa Champions League, the lucrative European competition, also hit United's profits.

The wages paid to United's squad of star players rose during the period, from £37.7 million to £42.7 million and now comprises 46.6 per cent of turnover.

The club said it expected wages to exceed 50 per cent of turnover by the end of the year.

It recently agreed a deal with Audi, the carmaker, as it joined Nike and Vodafone as a United sponsor.

Earnings per share were 3.4p against 7.2p last time. The interim dividend was lifted from 1.25p to 1.325p. - (Financial Times Service)