PT5
Unspoken above about United’s operating cashflow was the fact the £620.9million cash in through the door between 2019 and 2025 was almost half the £1.112bn they generated in the prior six-year period. The club spent heavily on transfers then too, £660.7m, but still managed to build up a hefty pile of cash. The growth in wages as a proportion of revenue, alongside other cost growth, flatlining income and even greater spending on transfers has driven United’s cash squeeze.
A further recent drain on cash has been increased infrastructure activity. The state of the Old Trafford roof drew much attention a year ago, but United have at least started spending more on improvements: an average of £11.6million a season over the past three years, against £5.8m per season over the previous decade.
More substantial has been investment at Carrington, United’s training ground, which a chunk of the money from Ratcliffe was earmarked for — £42.7m went into works there last season, to go alongside £13m in the previous two years; a further £13.3m in capital works were contracted at the end of June, albeit how much of that related to Carrington isn’t known. Lower capital spending in 2025-26 will aid United’s cash position.
United’s financial revival still has a way to go. Transfer payables are growing rather than reducing, likewise broader debt. Annual interest payments on the latter are sneaking back up to the £40million mark.
Yet there has been a clear impact from the choices taken over the past two years. The wage bill is down and, before interest and exceptional costs relating to restructuring both outside and inside the manager’s dugout, they were in the black for the first time in five years.
More reductions will come: United have incurred substantial costs in reducing the workforce; future years will see savings without the offsetting hit of redundancy packages. If Amorim can build on the weekend’s win against Sunderland, there might be no need to incur further managerial costs.
Significant player departures loom, even if they won’t command fees when they go. In Casemiro, Jadon Sancho, Harry Maguire and Tyrell Malacia, United have a quartet of contracts expiring next June which, after including employer costs on top, would comprise wage savings not far shy of £1million a week. Around 80 per cent of Sancho’s pay this season is at least being covered by Aston Villa during his loan there, while Rasmus Hojlund’s good start having been similarly borrowed by Napoli enhances the likelihood of that move being made permanent for €44m (£38.3m; $51.3m at current rates).
Higher debt is a concern, but conversely shows growing confidence in United’s finances. The club consolidated their existing RCFs into one bigger facility, and in doing so reduced the interest rate on short-term borrowings. The level of those borrowings means interest could nominally be up in 2025-26, but lower than if the consolidation hadn’t taken place.
That interest remains a burden — more now than ever, given costs elsewhere. Cash interest payments of £853million have been made since the Glazers arrived. It is simply accepted as a cost of living for United now. Fixing underlying operations has taken priority over debt reduction.
Doing the former will prove easier if results on the field improve. United’s wage bill now sits well behind those of peers, a situation which naturally makes it harder to compete. Hefty transfer spending is the apparent offset, and looks a bold strategy; the correlation of wages to performance is much stronger, though there’s evidence that patience pays off for big transfer spenders.
How much patience United can afford is unknown, however. Each season out of the Champions League will make it harder to catch up to their rivals. And all of this is without even mentioning a new Old Trafford, which would cost over £1billion to build. Funding that will be easier with the revenues playing in Europe’s top club competition brings, but returning to UEFA’s top table will require much better use of resources.
Overall, the picture for United is a mixed one.
There are obvious improvements, and a clear, if brutal, plan has been implemented to fix a club whose finances had been allowed to reach a parlous state. In the short term, United can breathe a little easier, even with higher debt. But getting it right on the pitch is now of utmost importance.
Ratcliffe and his INEOS empire provided a lot of necessary funds last year, but a recent halting of dividends in the latter’s wider business doesn’t point to a likelihood United will be able to tap more owner funding any time soon.
United’s fortunes off the field will be driven by those on it.
Unspoken above about United’s operating cashflow was the fact the £620.9million cash in through the door between 2019 and 2025 was almost half the £1.112bn they generated in the prior six-year period. The club spent heavily on transfers then too, £660.7m, but still managed to build up a hefty pile of cash. The growth in wages as a proportion of revenue, alongside other cost growth, flatlining income and even greater spending on transfers has driven United’s cash squeeze.
A further recent drain on cash has been increased infrastructure activity. The state of the Old Trafford roof drew much attention a year ago, but United have at least started spending more on improvements: an average of £11.6million a season over the past three years, against £5.8m per season over the previous decade.
More substantial has been investment at Carrington, United’s training ground, which a chunk of the money from Ratcliffe was earmarked for — £42.7m went into works there last season, to go alongside £13m in the previous two years; a further £13.3m in capital works were contracted at the end of June, albeit how much of that related to Carrington isn’t known. Lower capital spending in 2025-26 will aid United’s cash position.
United’s financial revival still has a way to go. Transfer payables are growing rather than reducing, likewise broader debt. Annual interest payments on the latter are sneaking back up to the £40million mark.
Yet there has been a clear impact from the choices taken over the past two years. The wage bill is down and, before interest and exceptional costs relating to restructuring both outside and inside the manager’s dugout, they were in the black for the first time in five years.
More reductions will come: United have incurred substantial costs in reducing the workforce; future years will see savings without the offsetting hit of redundancy packages. If Amorim can build on the weekend’s win against Sunderland, there might be no need to incur further managerial costs.
Significant player departures loom, even if they won’t command fees when they go. In Casemiro, Jadon Sancho, Harry Maguire and Tyrell Malacia, United have a quartet of contracts expiring next June which, after including employer costs on top, would comprise wage savings not far shy of £1million a week. Around 80 per cent of Sancho’s pay this season is at least being covered by Aston Villa during his loan there, while Rasmus Hojlund’s good start having been similarly borrowed by Napoli enhances the likelihood of that move being made permanent for €44m (£38.3m; $51.3m at current rates).
Higher debt is a concern, but conversely shows growing confidence in United’s finances. The club consolidated their existing RCFs into one bigger facility, and in doing so reduced the interest rate on short-term borrowings. The level of those borrowings means interest could nominally be up in 2025-26, but lower than if the consolidation hadn’t taken place.
That interest remains a burden — more now than ever, given costs elsewhere. Cash interest payments of £853million have been made since the Glazers arrived. It is simply accepted as a cost of living for United now. Fixing underlying operations has taken priority over debt reduction.
Doing the former will prove easier if results on the field improve. United’s wage bill now sits well behind those of peers, a situation which naturally makes it harder to compete. Hefty transfer spending is the apparent offset, and looks a bold strategy; the correlation of wages to performance is much stronger, though there’s evidence that patience pays off for big transfer spenders.
How much patience United can afford is unknown, however. Each season out of the Champions League will make it harder to catch up to their rivals. And all of this is without even mentioning a new Old Trafford, which would cost over £1billion to build. Funding that will be easier with the revenues playing in Europe’s top club competition brings, but returning to UEFA’s top table will require much better use of resources.
Overall, the picture for United is a mixed one.
There are obvious improvements, and a clear, if brutal, plan has been implemented to fix a club whose finances had been allowed to reach a parlous state. In the short term, United can breathe a little easier, even with higher debt. But getting it right on the pitch is now of utmost importance.
Ratcliffe and his INEOS empire provided a lot of necessary funds last year, but a recent halting of dividends in the latter’s wider business doesn’t point to a likelihood United will be able to tap more owner funding any time soon.
United’s fortunes off the field will be driven by those on it.
