EX-99.1 2 a18-34007_1ex99d1.htm EX-99.1

Exhibit 99.1

 

 

·      RECORD TOTAL REVENUE OF £590.0 MILLION

·      ADJUSTED EBITDA OF £177.1 MILLION

·      OPERATING PROFIT OF £44.1 MILLION

 

MANCHESTER, England. — 25 September 2018 — Manchester United (NYSE: MANU; the “Company” and the “Group”) — one of the most popular and successful sports teams in the world - today announced financial results for the 2018 fiscal fourth quarter and twelve months ended 30 June 2018.

 

Highlights

 

·                  7 sponsorship deals announced including first shirt sleeve partnership with Kohler

 

·                  5 global partnerships

·                  1 regional partnership; and

·                  1 financial services partnership.

 

·                  Successfully launched Manchester United new club website and app

 

·                  Commencement of a new UEFA club competitions cycle with gross commercial revenue up 33% to €3.2 billion

 

·                  Favourable change to EPL international distribution effective 19/20

 

·                  Established Manchester United Women’s Football Club competing in the 18/19 FA Women’s Championship

 

Commentary

 

Ed Woodward, Executive Vice Chairman, commented, “Everyone at the club is working tirelessly to add to Manchester United’s 66 and Jose’s 25 trophies. That is what our passionate fans and our history demands. We are committed to our philosophy of blending top academy graduates with world class players and are proud that, once again, last season we had more academy graduate minutes on the pitch than any other Premier League club. Our increased revenue expectation for the year demonstrates our continued strong long-term financial performance which underpins everything we do and allows us to compete for top talent in an increasingly competitive transfer market.”

 

Outlook

 

For fiscal 2019, Manchester United expect:

 

·                  Revenue to be £615m to £630m

·                  Adjusted EBITDA to be £175m to £190m

 

1



 

Key Financials (unaudited)

 

£ million (except

 

Twelve months ended
30 June

 

 

 

Three months ended
30 June

 

 

 

(loss)/earnings per share)

 

2018

 

2017

 

Change

 

2018

 

2017

 

Change

 

Commercial revenue

 

276.1

 

275.5

 

0.2

%

63.5

 

67.9

 

(6.5

)%

Broadcasting revenue

 

204.1

 

194.1

 

5.2

%

64.7

 

81.1

 

(20.2

)%

Matchday revenue

 

109.8

 

111.6

 

(1.6

)%

19.4

 

26.9

 

(27.9

)%

Total revenue

 

590.0

 

581.2

 

1.5

%

147.6

 

175.9

 

(16.1

)%

Adjusted EBITDA(1)

 

177.1

 

199.8

 

(11.4

)%

36.6

 

69.6

 

(47.4

)%

Operating profit

 

44.1

 

80.8

 

(45.4

)%

2.5

 

41.1

 

(93.9

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss)/profit for the period (i.e. net (loss)/income) (2)

 

(37.3

)

39.2

 

 

(16.3

)

24.3

 

 

Basic (loss)/earnings per share

 

(22.70

)

23.88

 

 

(9.89

)

14.79

 

 

Adjusted profit/(loss) for the period (i.e. adjusted net income/(loss))(1)

 

17.4

 

34.8

 

(50.0

)%

(0.8

)

22.9

 

 

Adjusted basic earnings/ (loss) per share (pence)(1)

 

10.59

 

21.20

 

(50.0

)%

(0.51

)

13.98

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net debt(1)/(3)

 

253.7

 

213.1

 

19.1

%

253.7

 

213.1

 

19.1

%

 


(1) Adjusted EBITDA, adjusted profit/(loss) for the period, adjusted basic earnings/(loss) per share and net debt are non-IFRS measures. See “Non-IFRS Measures: Definitions and Use” below and the accompanying Supplemental Notes for the definitions and reconciliations for these non-IFRS measures and the reasons we believe these measures provide useful information to investors regarding the Group’s financial condition and results of operations.

 

(2) The US federal corporate income tax rate reduced from 35% to 21% following the substantive enactment of US tax reform on 22 December 2017. This necessitated a re-measurement of the existing US deferred tax position in the period to 31 December 2017. As a result the loss for the twelve months ended 30 June 2018 includes a non-cash tax accounting write off of £48.8 million.

 

(3) The gross USD debt principal remains unchanged.

 

Revenue Analysis

 

Commercial

 

Commercial revenue for the year was £276.1 million, an increase of £0.6 million, or 0.2%, over the prior year.

 

·                  Sponsorship revenue was £173.2 million, an increase of £1.7 million, or 1.0%, over the prior year.

·                  Retail, Merchandising, Apparel & Product Licensing revenue was £102.9 million, a decrease of £1.1 million, or 1.1%, over the prior year.

 

For the quarter, commercial revenue was £63.5 million, a decrease of £4.4 million, or 6.5%, over the prior year quarter.

 

·                  Sponsorship revenue was £38.9 million, a decrease of £3.2 million, or 7.6%, over the prior year quarter.

·                  Retail, Merchandising, Apparel & Product Licensing revenue was £24.6 million, a decrease of £1.2 million, or 4.7%, over the prior year quarter.

 

Broadcasting

 

Broadcasting revenue for the year was £204.1 million, an increase of £10.0 million, or 5.2%, over the prior year, primarily due to finishing runners up in the Premier League compared to sixth in the prior year.

 

2



 

Broadcasting revenue for the quarter was £64.7 million, a decrease of £16.4 million, or 20.2%, over the prior year quarter, primarily due to winning the UEFA Europa League in the prior year.

 

Matchday

 

Matchday revenue for the year was £109.8 million, a decrease of £1.8 million, or 1.6%, over the prior year.

 

Matchday revenue for the quarter was £19.4 million, a decrease of £7.5 million, or 27.9%, over the prior year quarter, primarily due to quarterly phasing of Premier League home games and impact of UEFA Europa League quarter-final and semi-final home games in the prior year quarter.

 

Other Financial Information

 

Operating expenses

 

Total operating expenses for the year were £564.0 million, an increase of £52.7 million, or 10.3%, over the prior year.

 

Employee benefit expenses

 

Employee benefit expenses for the year were £295.9 million, an increase of £32.4 million, or 12.3%, over the prior year, primarily due to player salary uplifts related to participation in the UEFA Champions League.

 

Other operating expenses

 

Other operating expenses for the year were £117.0 million, a decrease of £0.9 million, or 0.8%, over the prior year.

 

Depreciation and amortization

 

Depreciation for the year was £10.8 million, an increase of £0.5 million, or 4.9%, over the prior year. Amortization for the year was £138.4 million, an increase of £14.0 million, or 11.3%, over the prior year. The unamortized balance of registrations at 30 June 2018 was £369.5 million.

 

Exceptional items

 

Exceptional costs for the year were £1.9 million, relating to the present value of the additional contributions the Group is expected to pay to make good the increased deficit of the Football League pension scheme pursuant to the latest triennial actuarial valuation at 31 August 2017. Exceptional credit for the prior year was £4.8 million, relating to a reversal of a player registration impairment charge for a player considered to be re-established as a member of the first team playing squad.

 

Profit on disposal of intangible assets

 

Profit on disposal of intangible assets for the year was £18.1 million, compared to £10.9 million for the prior year. The profit on disposal of intangible assets for the year primarily relates to the disposal of Januzaj (Real Sociedad) and sell on fees relating to former players.

 

Net finance costs

 

Net finance costs for the year were £18.0 million, a decrease of £6.3 million, or 25.9%, over the prior year. The decrease was primarily due to unrealized foreign exchange gains on unhedged USD borrowings.

 

3



 

Tax

 

The tax expense for the year was £63.4 million, compared to £17.3 million in the prior year. The current year charge includes a non-cash, tax accounting write-off of £48.8 million following the substantive enactment of US tax reform on 22 December 2017. The non-cash write-off was primarily due to the reduction in the US federal corporate income tax rate from 35% to 21%, which necessitated re-measurement of the existing US deferred tax position in the period to 31 December 2017.

 

Cash flows

 

Overall cash and cash equivalents (including the effects of exchange rate movements) decreased by £48.2 million in the year.

 

Net cash generated from operating activities for the year was £95.2 million, a decrease of £132.5 million over the prior year, primarily due to timing of cash receipts on commercial contractual arrangements.

 

Net capital expenditure on property, plant and equipment for the year was £13.2 million, an increase of £4.9 million over the prior year.

 

Net capital expenditure on intangible assets for the year was £108.1 million, a decrease of £33.9 million over the prior year.

 

Net debt

 

Net Debt as of 30 June 2018 was £253.7 million, an increase of £40.6 million over the year, primarily due to an overall decrease in cash and cash equivalents as described above. The gross USD debt principal remains unchanged.

 

Dividend

 

Two semi-annual dividends of $0.09 per share were paid during the year.

 

4



 

Conference Call Information

 

The Company’s conference call to review fiscal 2018 and fourth quarter results will be broadcast live over the internet today, 25 September 2018 at 8:00 a.m. Eastern Time and will be available on Manchester United’s investor relations website at http://ir.manutd.com. Thereafter, a replay of the webcast will be available for thirty days.

 

About Manchester United

 

Manchester United is one of the most popular and successful sports teams in the world, playing one of the most popular spectator sports on Earth.

 

Through our 140-year heritage we have won 66 trophies, enabling us to develop what we believe is one of the world’s leading sports brands and a global community of 659 million followers. Our large, passionate community provides Manchester United with a worldwide platform to generate significant revenue from multiple sources, including sponsorship, merchandising, product licensing, broadcasting and matchday.

 

Cautionary Statement

 

This press release contains forward-looking statements. You should not place undue reliance on such statements because they are subject to numerous risks and uncertainties relating to the Company’s operations and business environment, all of which are difficult to predict and many are beyond the Company’s control. Forward-looking statements include information concerning the Company’s possible or assumed future results of operations, including descriptions of its business strategy. These statements often include words such as “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible” or similar expressions. The forward-looking statements contained in this press release are based on our current expectations and estimates of future events and trends, which affect or may affect our businesses and operations. You should understand that these statements are not guarantees of performance or results. They involve known and unknown risks, uncertainties and assumptions. Although the Company believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect its actual financial results or results of operations and could cause actual results to differ materially from those in these forward-looking statements. These factors are more fully discussed in the “Risk Factors” section and elsewhere in the Company’s Registration Statement on Form F-1, as amended (File No. 333-182535) and the Company’s Annual Report on Form 20-F (File No. 001-35627).

 

Statement Regarding Unaudited Financial Information

 

The unaudited financial information set forth is preliminary and subject to adjustments. The audit of the financial statements and related notes to be included in our annual report on Form 20-F for the year ended 30 June 2018 is still in progress. Adjustments to the financial statements may be identified when audit work is completed, which could result in significant differences from this preliminary unaudited financial information.

 

5



 

Non-IFRS Measures: Definitions and Use

 

1.                   Adjusted EBITDA

 

Adjusted EBITDA is defined as (loss)/profit for the period before depreciation, amortization, profit on disposal of intangible assets, exceptional items, net finance costs, and tax.

 

We believe Adjusted EBITDA is useful as a measure of comparative operating performance from period to period and among companies as it is reflective of changes in pricing decisions, cost controls and other factors that affect operating performance, and it removes the effect of our asset base (primarily depreciation and amortization), capital structure (primarily finance costs), and items outside the control of our management (primarily taxes).  Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for an analysis of our results as reported under IFRS as issued by the IASB. A reconciliation of (loss)/profit for the period to Adjusted EBITDA is presented in supplemental note 2.

 

2.                  Adjusted profit/(loss) for the period (i.e. adjusted net income/(loss))

 

Adjusted profit/(loss) for the period is calculated, where appropriate, by adjusting for charges/credits related to exceptional items, foreign exchange gains/losses on unhedged US dollar denominated borrowings, and fair value movements on derivative financial instruments, adding/subtracting the actual tax expense/credit for the period, and subtracting/adding the adjusted tax expense/credit for the period (based on an normalized tax rate of 28%; 2017: 35%). The normalized tax rate of 28% was the weighted average US federal corporate income tax rate applicable during the financial year.

 

We believe that in assessing the comparative performance of the business, in order to get a clearer view of the underlying financial performance of the business, it is useful to strip out the distorting effects of the items referred to above and then to apply a ‘normalized’ tax rate (for both the current and prior periods) of the weighted average US federal corporate income tax rate of 28% (2017: 35%) applicable during the financial year. A reconciliation of (loss)/profit for the period to adjusted profit/(loss) for the period is presented in supplemental note 3.

 

3.                   Adjusted basic and diluted earnings/(loss) per share

 

Adjusted basic and diluted earnings/(loss) per share are calculated by dividing the adjusted profit/(loss) for the period by the weighted average number of ordinary shares in issue during the period. Adjusted diluted earnings/(loss) per share is calculated by adjusting the weighted average number of ordinary shares in issue during the period to assume conversion of all dilutive potential ordinary shares. We have one category of dilutive potential ordinary shares: share awards pursuant to the 2012 Equity Incentive Plan (the “Equity Plan”). Share awards pursuant to the Equity Plan are assumed to have been converted into ordinary shares at the beginning of the financial year. Adjusted basic and diluted earnings/(loss) per share are presented in supplemental note 3.

 

4.                   Net debt

 

Net debt is calculated as non-current and current borrowings minus cash and cash equivalents.

 

6



 

Key Performance Indicators

 

 

 

Twelve months ended

 

Three months ended

 

 

 

30 June

 

30 June

 

 

 

2018

 

2017

 

2018

 

2017

 

Commercial % of total revenue

 

46.8

%

47.4

%

43.0

%

38.6

%

Broadcasting % of total revenue

 

34.6

%

33.4

%

43.8

%

46.1

%

Matchday % of total revenue

 

18.6

%

19.2

%

13.2

%

15.3

%

Home Matches Played

 

 

 

 

 

 

 

 

 

PL

 

19

 

19

 

3

 

5

 

UEFA competitions

 

4

 

7

 

 

2

 

Domestic Cups

 

3

 

5

 

 

 

Away Matches Played

 

 

 

 

 

 

 

 

 

UEFA competitions

 

5

 

8

 

 

3

 

Domestic Cups

 

6

 

5

 

2

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

Employees at period end

 

922

 

895

 

922

 

895

 

Employee benefit expenses % of revenue

 

50.2

%

45.3

%

55.1

%

40.4

%

 

Phasing of Premier League home
games

 

Quarter 1

 

Quarter 2

 

Quarter 3

 

Quarter 4

 

Total

2018/19 season*

 

3

 

7

 

6

 

3

 

19

2017/18 season

 

4

 

7

 

5

 

3

 

19

2016/17 season

 

3

 

7

 

4

 

5

 

19

 


*Subject to changes in broadcasting scheduling

 

Contacts

 

Manchester United plc

 

Sard Verbinnen & Co

Investor Relations:

 

Jim Barron / Devin Broda

Cliff Baty

 

+ 1 212 687 8080

Chief Financial Officer

 

JBarron@SARDVERB.com

+44 161 868 8650

 

dbroda@SARDVERB.com

ir@manutd.co.uk

 

 

 

7



 

CONSOLIDATED INCOME STATEMENT

 

(unaudited; in £ thousands, except per share and shares outstanding data)

 

 

 

Twelve months ended
30 June

 

Three months ended
30 June

 

 

 

2018

 

2017

 

2018

 

2017

 

Revenue

 

590,022

 

581,204

 

147,611

 

175,936

 

Operating expenses

 

(564,006

)

(511,315

)

(148,307

)

(138,118

)

Profit on disposal of intangible assets

 

18,119

 

10,926

 

3,273

 

3,327

 

Operating profit

 

44,135

 

80,815

 

2,577

 

41,145

 

Finance costs

 

(24,233

)

(26,829

)

(14,868

)

(9,375

)

Finance income

 

6,195

 

2,552

 

884

 

6,279

 

Net finance costs

 

(18,038

)

(24,277

)

(13,984

)

(3,096

)

Profit/(loss) before tax

 

26,097

 

56,538

 

(11,407

)

38,049

 

Tax expense(1)

 

(63,367

)

(17,361

)

(4,832

)

(13,797

)

(Loss)/profit for the period(1)

 

(37,270

)

39,177

 

(16,239

)

24,252

 

 

 

 

 

 

 

 

 

 

 

Basic (loss)/earnings per share:

 

 

 

 

 

 

 

 

 

Basic (loss)/earnings per share (pence)(1)

 

(22.70

)

23.88

 

(9.89

)

14.79

 

Weighted average number of ordinary shares outstanding (thousands)

 

164,195

 

164,025

 

164,195

 

164,025

 

Diluted (loss)/earnings per share:

 

 

 

 

 

 

 

 

 

Diluted (loss)/earnings per share (pence)(1)/(2)

 

(22.70

)

23.82

 

(9.89

)

14.74

 

Weighted average number of ordinary shares outstanding (thousands)

 

164,610

 

164,493

 

164,610

 

164,493

 

 


(1) The US federal corporate income tax rate reduced from 35% to 21% following the substantive enactment of US tax reform on 22 December 2017. This necessitated a re-measurement of the existing US deferred tax position in the period to 31 December 2017. As a result the tax expense for the year ended 30 June 2018 includes a non-cash tax accounting write off of £48.8 million. Accordingly, this has resulted in a loss for the twelve months ended 30 June 2018 and also a basic and diluted loss per share.

 

(2) For the twelve and three months ended 30 June 2018, potential ordinary shares are anti-dilutive, as their inclusion in the diluted loss per share calculation would reduce the loss per share, and hence have been excluded.

 

8



 

CONSOLIDATED BALANCE SHEET

(unaudited; in £ thousands)

 

 

 

As of
30 June
2018

 

As of
30 June
2017

 

ASSETS

 

 

 

 

 

Non-current assets

 

 

 

 

 

Property, plant and equipment

 

245,401

 

244,738

 

Investment property

 

13,836

 

13,966

 

Intangible assets

 

799,640

 

717,544

 

Derivative financial instruments

 

4,807

 

1,666

 

Trade and other receivables

 

4,724

 

15,399

 

Tax receivable

 

547

 

 

Deferred tax asset

 

63,974

 

142,107

 

 

 

1,132,929

 

1,135,420

 

Current assets

 

 

 

 

 

Inventories

 

1,416

 

1,637

 

Derivative financial instruments

 

1,159

 

3,218

 

Trade and other receivables

 

168,060

 

103,732

 

Tax receivable

 

800

 

 

Cash and cash equivalents

 

242,022

 

290,267

 

 

 

413,457

 

398,854

 

Total assets

 

1,546,386

 

1,534,274

 

 

9



 

CONSOLIDATED BALANCE SHEET (continued)

(unaudited; in £ thousands)

 

 

 

As of
30 June
2018

 

As of
30 June
2017

 

EQUITY AND LIABILITIES

 

 

 

 

 

Equity

 

 

 

 

 

Share capital

 

53

 

53

 

Share premium

 

68,822

 

68,822

 

Merger reserve

 

249,030

 

249,030

 

Hedging reserve

 

(27,738

)

(31,724

)

Retained earnings

 

135,099

 

191,436

 

 

 

425,266

 

477,617

 

Non-current liabilities

 

 

 

 

 

Derivative financial instruments

 

 

655

 

Trade and other payables

 

104,271

 

83,587

 

Borrowings

 

486,694

 

497,630

 

Deferred revenue

 

37,085

 

39,648

 

Deferred tax liabilities

 

28,559

 

20,828

 

 

 

656,609

 

642,348

 

Current liabilities

 

 

 

 

 

Derivative financial instruments

 

 

1,253

 

Tax liabilities

 

3,874

 

9,772

 

Trade and other payables

 

267,996

 

190,315

 

Borrowings

 

9,074

 

5,724

 

Deferred revenue

 

183,567

 

207,245

 

 

 

464,511

 

414,309

 

Total equity and liabilities

 

1,546,386

 

1,534,274

 

 

10



 

CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited; in £ thousands)

 

 

 

Twelve months ended
30 June

 

Three months ended
30 June

 

 

 

2018

 

2017

 

2018

 

2017

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

Cash generated from operations (see supplemental note 4)

 

119,604

 

251,759

 

102,350

 

180,539

 

Interest paid

 

(18,904

)

(19,523

)

(2,055

)

(1,760

)

Interest received

 

1,187

 

736

 

533

 

312

 

Tax paid

 

(6,637

)

(5,312

)

(249

)

(1,359

)

Net cash generated from operating activities

 

95,250

 

227,660

 

100,579

 

177,732

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

Payments for property, plant and equipment

 

(13,260

)

(8,373

)

(3,675

)

(2,021

)

Proceeds from sale of property, plant and equipment

 

81

 

 

6

 

 

(Payments)/refund for investment property

 

 

(641

)

 

18

 

Payments for intangible assets

 

(154,955

)

(193,825

)

(19,022

)

(23,543

)

Proceeds from sale of intangible assets

 

46,865

 

51,871

 

6,220

 

1,266

 

Net cash used in investing activities

 

(121,269

)

(150,968

)

(16,471

)

(24,280

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

Repayment of borrowings

 

(419

)

(395

)

(107

)

(100

)

Dividends paid

 

(21,982

)

(23,295

)

(11,053

)

(11,471

)

Net cash used in financing activities

 

(22,401

)

(23,690

)

(11,160

)

(11,571

)

Net (decrease)/increase in cash and cash equivalents

 

(48,420

)

53,002

 

72,948

 

141,881

 

Cash and cash equivalents at beginning of period

 

290,267

 

229,194

 

161,717

 

152,653

 

Effects of exchange rate changes on cash and cash equivalents

 

175

 

8,071

 

7,357

 

(4,267

)

Cash and cash equivalents at end of period

 

242,022

 

290,267

 

242,022

 

290,267

 

 

11



 

SUPPLEMENTAL NOTES

 

1                                         General information

 

Manchester United plc (the “Company”) and its subsidiaries (together the “Group”) is a professional football club together with related and ancillary activities. The Company incorporated under the Companies Law (2011 Revision) of the Cayman Islands, as amended and restated from time to time.

 

2                               Reconciliation of (loss)/profit for the period to Adjusted EBITDA

 

 

 

Twelve months ended
30 June

 

Three months ended
30 June

 

 

 

2018
£’000

 

2017
£’000

 

2018
£’000

 

2017
£’000

 

(Loss)/profit for the period

 

(37,270

)

39,177

 

(16,239

)

24,252

 

Adjustments:

 

 

 

 

 

 

 

 

 

Tax expense

 

63,367

 

17,361

 

4,832

 

13,797

 

Net finance costs

 

18,038

 

24,277

 

13,984

 

3,096

 

Profit on disposal of intangible assets

 

(18,119

)

(10,926

)

(3,273

)

(3,327

)

Exceptional items

 

1,917

 

(4,753

)

1,917

 

 

Amortization

 

138,380

 

124,434

 

32,591

 

29,275

 

Depreciation

 

10,755

 

10,228

 

2,804

 

2,507

 

Adjusted EBITDA

 

177,068

 

199,798

 

36,616

 

69,600

 

 

12



 

3                               Reconciliation of (loss)/profit for the period to adjusted profit/(loss) for the period and adjusted basic and diluted earnings/(loss) per share

 

 

 

Twelve months ended
30 June

 

Three months ended
30 June

 

 

 

2018
£’000

 

2017
£’000

 

2018
£’000

 

2017
£’000

 

(Loss)/profit for the period

 

(37,270

)

39,177

 

(16,239

)

24,252

 

Exceptional items

 

1,917

 

(4,753

)

1,917

 

 

Foreign exchange (gains)/losses on unhedged US dollar denominated borrowings

 

(4,952

)

(1,816

)

8,633

 

(5,967

)

Fair value movement on derivative financial instruments

 

1,089

 

3,534

 

(295

)

3,190

 

Tax expense

 

63,367

 

17,361

 

4,832

 

13,797

 

Adjusted profit/(loss) before tax

 

24,151

 

53,503

 

(1,152

)

35,272

 

Adjusted tax (expense)/credit (using a normalized tax rate of 28% (2017: 35%))

 

(6,762

)

(18,726

)

323

 

(12,345

)

Adjusted profit/(loss) for the period (i.e. adjusted net income/(loss))

 

17,389

 

34,777

 

(829

)

22,927

 

 

 

 

 

 

 

 

 

 

 

Adjusted basic earnings/(loss) per share:

 

 

 

 

 

 

 

 

 

Adjusted basic earnings/(loss) per share (pence)

 

10.59

 

21.20

 

(0.51

)

13.98

 

Weighted average number of ordinary shares outstanding (thousands)

 

164,195

 

164,025

 

164,195

 

164,025

 

Adjusted diluted earnings/(loss) per share:

 

 

 

 

 

 

 

 

 

Adjusted diluted earnings/(loss) per share (pence)(1)

 

10.56

 

21.14

 

(0.51

)

13.94

 

Weighted average number of ordinary shares outstanding (thousands)

 

164,610

 

164,493

 

164,610

 

164,493

 

 


(1) For the three months ended 30 June 2018 potential ordinary shares are anti-dilutive, as their inclusion in the diluted loss per share calculation would reduce the loss per share, and hence have been excluded.

 

13



 

4                               Cash generated from operations

 

 

 

Twelve months ended
30 June

 

Three months ended
30 June

 

 

 

2018
£’000

 

2017
£’000

 

2018
£’000

 

2017
£’000

 

(Loss)/profit for the period

 

(37,270

)

39,177

 

(16,239

)

24,252

 

Tax expense

 

63,367

 

17,361

 

4,832

 

13,797

 

Profit/(loss) before tax

 

26,097

 

56,538

 

(11,407

)

38,049

 

Adjustments for:

 

 

 

 

 

 

 

 

 

Depreciation

 

10,755

 

10,228

 

2,804

 

2,507

 

Reversal of impairment

 

 

(4,753

)

 

 

Amortization

 

138,380

 

124,434

 

32,591

 

29,275

 

Profit on disposal of intangible assets

 

(18,119

)

(10,926

)

(3,273

)

(3,327

)

Net finance costs

 

18,038

 

24,277

 

13,984

 

3,096

 

(Profit)/loss on disposal of property, plant and equipment

 

(81

)

43

 

(6

)

43

 

Equity-settled share-based payments

 

2,915

 

2,187

 

1,095

 

751

 

Foreign exchange losses/(gains) on operating activities

 

994

 

2,646

 

(206

)

242

 

Reclassified from hedging reserve

 

14,395

 

4,765

 

2,915

 

2,358

 

Changes in working capital:

 

 

 

 

 

 

 

 

 

Inventories

 

221

 

(711

)

(18

)

(289

)

Trade and other receivables

 

(72,027

)

17,525

 

(79,295

)

(15,745

)

Trade and other payables and deferred revenue

 

(1,964

)

25,506

 

143,166

 

123,579

 

Cash generated from operations

 

119,604

 

251,759

 

102,350

 

180,539

 

 

14



 

5                               Retrospective impact of adoption of IFRS 15

 

The Group will adopt IFRS 15, “Revenue from contracts with customers”, from 1 July 2018 and will apply the standard retrospectively to each prior reporting period presented. The standard replaces IAS 18, “Revenue” and IAS 11, “Construction Contracts” and related interpretations. The table below shows the retrospective impact on revenue for the four quarters ended 30 June 2018.

 

Commercial revenue

 

IFRS 15 focuses on the identification and satisfaction of performance obligations and includes specific guidance on the methods for measuring progress towards complete satisfaction of a performance obligation. Such guidance was not present in IAS 18 and therefore treatment was open to interpretation. As a result of the specific guidance in IFRS 15, revenue on certain commercial contracts will be recognized earlier under the new standard. The effect of the retrospective application will be an increase in cumulative revenue recognised over the financial years up to and including the year ended 30 June 2018 including a reduction to the amount of revenue recognized during the financial year ended 30 June 2018 only.

 

Broadcasting revenue

 

Broadcasting merit awards are currently recognized one share in the first quarter with the remainder being recognized when they are known at the end of each football season. Merit awards represent variable consideration and therefore, following adoption of IFRS 15, will be recognized evenly as each Premier League match (home and away) is played, based on management’s estimate of where the Club’s finishing position will be at the end of each season. Broadcasting equal share payments are currently recognized evenly as each Premier League home match is played. Following adoption of IFRS 15, equal share payments will be recognized as each Premier League match (home and away) is played. Note, these changes only affect the amount of broadcasting revenue recognized in each quarter, they do not affect the amount of broadcasting revenue recognized for the financial year as a whole.

 

Matchday revenue

 

Adoption of IFRS 15 has no impact on the recognition of matchday revenue.

 

£’000

 

Three months
ended
30 September
2017

 

Three months
ended
31 December
2017

 

Three months
ended
31 March
2018

 

Three months
ended
30 June
2018

 

Twelve months
ended
30 June
2018

 

Commercial revenue

 

 

 

 

 

 

 

 

 

 

 

Reported

 

80,544

 

65,366

 

66,673

 

63,516

 

276,099

 

Adjustment

 

(66

)

(66

)

(66

)

(66

)

(264

)

Restated

 

80,478

 

65,300

 

66,607

 

63,450

 

275,835

 

 

 

 

 

 

 

 

 

 

 

 

 

Broadcasting revenue

 

 

 

 

 

 

 

 

 

 

 

Reported

 

38,082

 

61,628

 

39,674

 

64,753

 

204,137

 

Adjustment

 

2,751

 

13,519

 

9,656

 

(25,926

)

 

Restated

 

40,833

 

75,147

 

49,330

 

38,827

 

204,137

 

 

 

 

 

 

 

 

 

 

 

 

 

Matchday revenue

 

 

 

 

 

 

 

 

 

 

 

Reported

 

22,354

 

36,968

 

31,122

 

19,342

 

109,786

 

Adjustment

 

 

 

 

 

 

Restated

 

22,354

 

36,968

 

31,122

 

19,342

 

109,786

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

 

 

 

 

 

 

 

 

 

 

Reported

 

140,980

 

163,962

 

137,469

 

147,611

 

590,022

 

Adjustment

 

2,685

 

13,453

 

9,590

 

(25,992

)

(264

)

Restated

 

143,665

 

177,415

 

147,059

 

121,619

 

589,758

 

 

15