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United report 34% drop in profits
- Club CEO Peter Kenyon says investors have no intention of making takeover bid

London: Manchester United played down talk of a takeover on Tuesday as the world’s richest club reported a 34 per cent drop in half-year profit due to lower player sales.

Investors who have a substantial stake in United have no intention of making a takeover bid, Chief Executive Peter Kenyon told BBC Radio on Tuesday.

“We have had several meetings with a lot of our shareholders but the story so far is that they see it as an undervalued business with potential for maximising its brand,” Kenyon said.

Kenyon downplayed talk of a takeover bid after a number of high-profile investors including Irish racecourse magnates and friends of manager Alex Ferguson, John Paul McManus and John Magnier, had increased their stake to 10.4 per cent.

The shares have surged 25 per cent since the start of the year, attracting a growing band of high-profile investors.

United remained upbeat about their financial prospects, however, when other clubs were suffering in the volatile soccer market.

Kenyon said, after seven consecutive seasons of reaching at least the quarter finals of the lucrative Champions League, that United were a “predictable player”.

Premier League rivals Leeds United and Chelsea on Monday reported rising debt and half-year losses.

Manchester United, second in the Premier League, bring success on the pitch to their accounts with sales up 13 per cent and a debt-free balance sheet.

“Strong financial results set us apart and we see further growth from our ground-breaking Nike deal while seeing further cost control measures,” Kenyon said.

The world’s richest football club reported pre-tax profits for the six months to January 31 of £20.3 million ($32.08 million), with the fall due largely to one-off profits on the sale of Jaap Stam to Lazio and Andy Cole to Blackburn in the previous reporting period.

Operating profits, before player trading, rose to £31.3 million from £20.4 million, however, driven by United’s £300-million, 13-year partnership with American sportswear manufacturer Nike, which kicked in last year.

United, second in the Premier League and through to the quarter finals of the Champions League, said they were less exposed to the “financial uncertainties” facing other clubs.

On Monday both Leeds United and Chelsea reported increased losses and debts. “The strength of the balance sheet and our diversified and highly visible revenue streams reduce the exposure of Manchester United to the financial uncertainties being suffered by some other clubs in the premiership and around Europe,” chairman Roy Gardner said in a statement on Monday.

United, whose players include England captain David Beckham, club captain Roy Keane and Dutch striker Ruud van Nistelrooy, said the wage bill rose to £39.7 million in the half-year, or around 43 per cent of turnover.

Wages were expected to rise to around the self-imposed ceiling of 50 per cent for the full year, however.

The club, which has a global fan base of about 54 million, said their strategy for the future was built on continued success on the pitch, developing the value of media rights, promoting the brand and turning more fans into customers.

Group turnover continued to rise to finance the increased wage bill, up 13 percent to 92.6 million pounds, as the club benefited from more cup games played at Old Trafford and higher media revenue. All three revenue streams — from matchdays, media and commercial — were up, but Kenyon cautioned he did not see growth for the new Premier League TV deal to start in summer 2004 although football was a good partner for broadcasters. (Reuters)

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