Champions League night at Old Trafford – a venue that could return next season. (Image: Getty)
There was a time when Manchester United took Champions League football for granted. The fame of the European night at Old Trafford was well deserved and the revenue the competition brought in was built into the balance sheet.
United enjoyed an 18-year run at Europe’s top table, until Sir Alex Ferguson’s retirement changed the course of history. United used to be regulars in the knockout stages, but now they are finding it harder to qualify for the finals.
Since 2013, only six Champions League games have been played, and since spring 2020 there has only been one knockout tie. United are yet to play in the competition’s new format, which offers eight league phase matches against eight different opponents.
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Things should change next season. United are within reach of a return to the Champions League for the first time since being eliminated from the group stage in the final months of 2023. After that, they will have to learn the intricacies of surviving the group stage.
But whatever happens, finishing in the top 24 in a 32-team league will have to be a formality. This will guarantee United at least 10 games, five of which will be at home. Old Trafford’s bean counters will be delighted.
Missing the Champions League certainly had a negative impact on the balance sheet. United slipped to eighth place in the latest Deloitte Football Money League, their lowest ever position, and with no European football played this season and only 20 games played at Old Trafford in all competitions, they could fall further next year.
The latest financial results paint a contrasting picture. United’s revenues remain strong and are likely to hit record numbers if they return to the Champions League next season.
However, in February it increased its revolving credit facility to £400m, of which £185m is now available. He has also paid £422.1m in transfer fees to other clubs, of which £238m is due to be paid within a year.
They also recently used a tool called transfer factoring, selling part of the transfer fees they were due to receive to lenders for an upfront payment of £39.4m, helping to repay part of the credit facility. That could help finance some of this summer’s transfer business.
Michael Carrick is leading Manchester United’s European ambitions. (Image: Getty)
As football finance expert Kieran Maguire explains, a return to the Champions League would clearly provide a financial boost and alleviate any potential concerns.
“You’re essentially getting at least £30m just by locking it up,” Mr Maguire said. “The prize money will be 2 million euros per match if we win and 700,000 euros if we draw, plus there will be a gate receipt.
“We’re guaranteed four home games, but it could be seven or eight at home. For a club of United’s size, you’re looking at earning £8m a game in gate receipts. That means at least £30m in gate receipts. He’ll get another £30 million in entry fees, so that’s at least £60 million. He’ll get £10 million in bonuses from Adidas (kit supplier), so that’s about it.” As the tournament progresses, he’ll get another £30 million. The £10,000 numbers start to add up.
“I think last year’s prize money was around 150 million euros. We’re talking about a club that had a pretty good UEFA coefficient, but United haven’t had that coefficient lately because they’re not as good as they used to be, but you’d still see 120 million euros, and of course if they win they qualify for the next FIFA Club World Cup, so Chelsea got 80 million pounds. That’s really going to happen.” Ratchet up. ”
Winning the Champions League may be too big a step for United to budget for at the moment, but the financial implications, especially under the new model, could have a big impact on the bottom line.
Not only would it give a healthy boost to the transfer kitty, it would also be a huge incentive for players to come to Old Trafford, but it could also allow United to stretch their wage budget at a time when some big-money earners are likely to have already left the scene.
“I think it helps us not only to be more competitive, but also to be able to offer wages,” Maguire said. “I’ve put out a few things on Twitter recently. United have always had the highest wages in the Premier League, but now they’re behind City and Liverpool, which you wouldn’t expect from a club as prestigious as United.”
“It allows them to get into the market and the players want to play at the highest level, so not only can they afford to pay them, but they can also offer them something from a non-financial perspective.”
Less likely to have a big impact are plans for a new stadium. United are in talks with potential investors to help fund the project, which could exceed £2bn, and Maguire cited the example of Tottenham.
“I think the stadium issue is pretty well fenced,” he explained. “If they were going to go to the debt market, Spurs would have borrowed a lot of money for the stadium and qualification to the Champions League was never guaranteed, but they still have the ability to A) borrow a lot of money and B) borrow a lot of money very cheaply.
“If Manchester United can show that they have addressed some of the on-pitch shortcomings that we have seen over the last 10 years, that can only help in terms of investor confidence.”
