Manchester United have confirmed their revenue has fallen 12.2% to £194.4 million for the six months to the end of December.
As the Premier League outfit lost payments from Nike after failing to qualify for the UEFA Champions League under David Moyes, sharp falls in broadcast and match-day revenues ensured profits for the six-month period fell to £8.9 million, down a staggering 52%.
The Old Trafford based club also confirmed the decline was offset by a 23% increase in sponsorship revenues, increased to £35.8 million. Announcing two new sponsorships in the last three months, Nigerian drinks company Chi and Chinese neutraceutical group IVC (Aland) became the club’s latest partners.
Chief Executive Ed Woodward spoke out about the changes in revenue at the club, saying: "Notwithstanding no European football this season, our revenues... remain strong. On the pitch, the team is well positioned to challenge for a top-four finish in the Premier League and we look forward to the rest of the season."
The Red Devils could only secure a seventh place finish in England’s top tier, following the departure of Sir Alex Ferguson after 26 years. Also leaving was David Gill, who was replaced by Woodward during the summer break.
As a result, the club failed to qualify for either the Champions League or the Europa League, and have only featured in domestic competitions this season.
However, the 20-time Premier League winners have been on the rise since the introduction of Dutchman Louis van Gaal as manager, as the Reds look on track for top-four finish and a return to European football.
Richard Hunter, the Head of Equities at Hargreaves Lansdown Stockbrokers, feels the lack of Champions League football has led to a 39% decline in broadcast revenues, as well as a 6% increase in operating expenses.
He added: "Things may be improving on the field, but this is not a quarter to be remembered. Even so, the Manchester United marketing machine remains in full drive, with a near 10% increase in commercial revenues for the [three-month] period and an overall profit for the half-year, albeit lower than the prior year."
The club will soon benefit from its share of the £5.14 billion deal reached with Sky and BT for the broadcasting rights of the Premier League from 2017 to 2019. With shares up 13% on the year, they remain 12% below the high reached in the middle of last year.
They will now expect to hit their target revenues for the whole year – estimated between £385 million to £395 million – once again down £40 million from the previous year.
Manchester United currently sit third in the Premier League, trailing league leaders Chelsea by 11 points, while looking firm favourites to clinch the FA Cup at Wembley later this season.