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Manchester United have regained their position as Britain's richest football club, posting record figures for turnover and profit for the last financial year.
Thanks to the club's ownership structure, however, almost all of the profit will be required to meet interest payments on loans incurred by the club's controlling Glazer family.
Figures published for the year to June 2007 show United's gross turnover were up 21per cent to £245 million, comfortably exceeding the £202 million posted by rivals Arsenal last year. Profits before tax rose to £59.6 million, a 93 per cent increase on the previous year.
The impressive increase in revenue was fuelled by capacity at the club's Old Trafford stadium increasing to 76,000, increased media revenue generated by winning the English Premier League, reaching the FA Cup final and the semi-final of the Champions League, and a rise in commercial income thanks largely to the record shirt-sponsorship deal with AIG.
After tax, the club's profits were £42,289,000, just exceeding the £42 million required to service annual interest payments of eight per cent on a £525 million loan secured against the club's assets by the Glazer-owned holding company Red Football. The family is also liable for interest of almost £20 million annually on a further £135 million in borrowing.
Chief executive David Gill said the financial performance demonstrated that the club is capable of servicing the loans as well as financing lavish spending on players but conceded that United had to maximise commercial opportunities.
Players Michael Carrick, Nani, Andersen, Owen Hargreaves and Tomasz Kuszczak were all purchased in the financial year covered by the latest accounts for a total cost in excess of £60 million.
"The amount of debt repayment we are responsible for (£42 million) is comfortably serviced by the business and that will remain the case," Gill said. "The banks would not have loaned the money if they were not comfortable with the situation. What we have to do is maximise the terms for the club and harvest every opportunity."
United's strong financial performance allows them to resist interest in key players, and Gill insisted that Ronaldo was not for sale despite reported interest from Real Madrid.
"You cannot sell players like that and we are not going to sell players like that," he said. "We don't produce financial results like we have done by selling players like Ronaldo. It doesn't make sense."
Gill predicted that profits would rise again this year thanks to the new Premier League television deal and a commercial strategy focused on 139 million "core" fans around the world. These supporters, among million supporters the club claim to have in 21 countries, will be targeted by a new global sponsorship strategy.
"The number of overseas supporters is what set us apart from other clubs and we will look at ways of engaging with those that cannot be among the 76,000 inside the ground," Gill said.
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