Manchester United were forced to pay a compensation bill of £14.5 million ($18.2m) to Erik ten Hag, his coaching team and former sporting director Dan Ashworth following his dismissal as manager in October, as revealed in stark quarterly accounts which also highlight a £44.8m drop in broadcasting revenue in 12 months.
Ten Hag was fired by United just four months after signing a new contract at Old Trafford following an FA Cup Final win against Manchester City in May which secured Europa League qualification in the wake of the team’s worst-ever Premier League finish — eighth place.
Dan Ashworth left his position as sporting director in December after just five months in the role. He arrived at United after the club reached a settlement with his former team Newcastle United that ran into millions of pounds.
The decision to extend the former Ajax coach’s contract until Jun 2026, rather than terminate his deal with 12 months remaining on his existing one, came at a heavy cost according the financial figures released on Wednesday as part of the second quarter fiscal period accounts submitted to the New York Stock Exchange (NYSE).
Ten Hag and Ashworth’s severance packages were listed in the accounts under ‘Exceptional Items,” with the club saying, “Exceptional items for the quarter were a cost of £14.5m. This relates to costs associated with the departure of former men’s first team manager Erik ten Hag and various members of football staff.”
United have embarked on a series of cost-cutting measures including over 200 redundancies since Sir Jim Ratcliffe’s INEOS group completed a minority share purchase of 27.7% on Feb. 20 last year.
More cuts are expected and the financial figures highlight the importance of Champions League football to United — a competition they are unlikely to compete in next season unless Ruben Amorim’s team win the Europa League.
While commercial revenue climbed by £3.8m to £43m year-on-year due to a new shirt sponsorship deal with Qualcomm, broadcasting revenue plunged by 42.1% to £61.6m due to playing in the Europa League rather than the Champions League this season.
Net finance costs also rose from £300,000 to £37.6m — a jump the club attribute to “an unfavourable swing in foreign exchange rates resulting in unrealised foreign exchange losses on unhedged USD borrowings in the current year quarter, compared to a favorable swing in the prior year quarter.”
Despite the worrying financial numbers, United chief executive Omar Berrada said that the club’s focus remains on improving the men’s team’s league position.
The team travels to Everton on Saturday in fifteenth position, just three places above the Premier League relegation zone.
“We recognise the challenges in improving our men’s team’s league position and we are all working hard, collectively, to achieve that. At the same time, we are pleased to have progressed to the knock-out phase of the UEFA Europa League and the fifth Round of the FA Cup,” Berrada said. “Meanwhile, our women’s team is currently placed second in the Women’s Super League, and has reached the quarterfinals of the FA Cup.
“Our redevelopment of the Carrington Training Complex remains on track. We continue to work towards a decision on the future of Old Trafford as part of a wider regeneration programme, which has now attracted UK Government support. This follows the work of the Old Trafford Regeneration Task Force in demonstrating the significant economic potential of a revitalised area around a future stadium project.”
Commenting on the financial results in a statement, the Manchester United Supporters Trust (MUST) claimed that an increase in ticket prices would be “futile and counter productive” as the recent decision to make all tickets £66 would raise just £2m in revenue.
“Fans should not pay the price for a problem that starts with our crippling debt interest payments and is exacerbated by a decade or more of mismanagement,” the statement added. “It’s time to freeze ticket prices and allow everyone — players, management, owners and fans — to get behind United and restore this club to where it belongs.”
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