Manchester United plc 2013 Third Quarter Results

  Manchester United plc 2013 Third Quarter Results

  *Sponsorship Revenue Increased 52.2%
  *Record Third Quarter Revenue of £91.7 Million
  *Adjusted EBITDA Increased 22.5% to a Third Quarter Record of £25.0 Million

Business Wire

MANCHESTER, England -- May 02, 2013

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 three and nine month periods ended 31 March 2013.

                                  Highlights

  *Increased third quarter commercial revenue 31.9% year on year.
  *Innovative Training Centre sponsorship as part of our eight year
    partnership with Aon.
  *Announced three new Sponsorship deals – gloops (regional; Japan) our first
    social gaming agreement; Ekspres Bank (financial services, Denmark); and
    BIDV (financial services, Vietnam).
  *2013 Summer Tour – in addition to Australia, Japan, and Hong Kong the Tour
    will also include Thailand.
  *Won the 2012/13 Premier League title for a record 20 English League titles
    with four games to spare.

                                  Commentary

Ed Woodward, Executive Vice Chairman commented, ‘Each of our three primary
sectors – Commercial, Broadcasting and Matchday – delivered strong top-line
gains and helped us achieve a record third quarter for both revenue and
adjusted EBITDA. In addition, we are delighted to be continuing and deepening
our relationship with Aon, as our new Training Kit, Training Centre and Tour
Partner, for an additional eight years’.

                                   Outlook

For fiscal 2013, Manchester United continues to expect:

  *Revenue to be £350m to £360m.
  *Adjusted EBITDA to be £107m to £110m.

                                                                  
Key Financials (unaudited)

£ million (except      Three months                 Nine months
earnings              ended                     ended             
per share)             31 March                     31 March
                     2013     2012    Change   2013     2012    Change
Commercial revenue    36.0     27.3    31.9%    114.5    89.5    27.9%
Broadcasting revenue  21.7     16.9    28.4%    75.0     76.4    (1.8%)
Matchday revenue      34.0     26.6    27.8%    88.6     79.9    10.9%
Total revenue         91.7     70.8    29.5%    278.1    245.8   13.1%
Adjusted EBITDA*      25.0     20.4    22.5%    91.5     84.6    8.2%

(Loss)/profit before  (3.1)    2.8     -        19.2     15.7    22.3%
tax
Tax credit/(expense)  6.7      (1.7)   -        21.1     22.5    (6.2%)

Profit for the
period (i.e. Net      3.6      1.1     227.3%   40.3     38.2    5.5%
Income)
Basic and diluted
earnings
per share
attributable to       0.02     0.01    100.0%   0.25     0.24    4.2%
owners of the
Company
(Pounds Sterling)
Gross debt**          367.6    423.3   (13.2%)  367.6    423.3   (13.2%)
Cash and cash         36.2     25.6    41.4%    36.2     25.6    41.4%
equivalents

* Adjusted EBITDA is a non-IFRS measure. See the accompanying Supplemental
Notes and Exhibit for the reconciliation and definition of this non-IFRS
measure and the reasons we believe this measure provides useful information to
investors regarding the Group’s financial condition and results of operations.

** Gross debt has decreased by 15.9% since 30 June 2012 (£436.9 million).

                               Revenue Analysis

Commercial

Commercial revenue for the third quarter increased 31.9% year on year to £36.0
million driven by the addition of several new sponsorship deals. For the third
quarter:

  *Sponsorship revenue increased 52.2% to £21.0 million;
  *Retail, Merchandising, Apparel & Product Licensing increased 9.5% to £9.2
    million; and
  *New Media & Mobile increased 13.7% to £5.8 million.

Broadcasting

Broadcasting revenues for the third quarter increased 28.4% year on year to
£21.7 million. The main reason for this increase relates to progress to the
Champions League Round of 16 (compared to exiting at the group stages in the
prior year).

Matchday

Matchday revenues for the third quarter increased 27.8% year on year to £34.0
million, due primarily to an additional three home cup games in the quarter
compared to the prior year quarter.

                         Other Financial Information

Operating expenses

Total operating expenses for the third quarter increased 18.6% year on year to
£79.0million.

Staff costs

Staff costs for the third quarter increased 25.1% year on year to
£44.9million, primarily due to new player signings, existing player wage
increases and growth in commercial headcount. The nine months year to date
increase is 15.1% year on year to £129.4million.

Other operating expenses

Other operating expenses for the third quarter increased 50.3% year on year to
£21.8million, primarily due to an increase in domestic cup gateshare costs,
catering direct costs, and police and security costs – associated with the
four FA cup home games played in the quarter compared with none in the prior
year quarter.

Depreciation & amortisation of players’ registrations

Depreciation for the third quarter decreased 9.5% year on year to £1.9
million, from £2.1 million in the prior period; and amortisation of players’
registrations for the quarter increased 7.2% year on year to £10.4 million.
The unamortised balance of existing players’ registrations at 31 March 2013
was £126.5 million.

Exceptional items

Exceptional items for the third quarter were £nil compared with £4.4 million
in the prior year quarter.

Profit on disposal of players’ registrations

Profit on the disposal of players’ registrations for the third quarter was
£2.5 million compared with £2.1 million in the prior year quarter.

Net finance costs

Net finance costs for the third quarter increased £14.8 million year on year
to £18.3million. The main reason for this increase is a net adverse FX swing
of £15.7 million year on year on translation of the Group’s US dollar
denominated senior secured notes and cash balances, partially offset by a
reduction in interest payable of £0.9 million following the re-purchase and
retirement earlier in the fiscal year of US$101.7 million of US dollar
denominated notes.

Unrealised foreign exchange losses/gains on translation of the Group’s US
dollar denominated assets and liabilities are not a cash charge/benefit and
could reverse depending on dollar/sterling exchange rate movements. Any
foreign exchange gain or loss on a cumulative basis on the Group’s US dollar
denominated senior secured notes will not be realised until maturity in 2017
or earlier if the notes are redeemed prior to their maturity date.

Tax

The Group recorded a non-cash tax credit for the third quarter of £6.7
million. The credit reflects management’s revised best estimate of the
effective tax rate for the year of 38%, which is lower than the rate estimated
as of 31 December 2012. The effective tax rate for the year is higher than the
US statutory tax rate of 35%, due to a current mismatch in the recognition of
the UK and US deferred tax assets and liabilities. It should be noted that
these are all non-cash tax charges. In the prior year third quarter the Group
recorded a tax charge of £1.7 million.

Profit for the period

The profit for the period for the third quarter was £3.6 million compared with
a profit of £1.1 million in the prior year quarter. Earnings per share
attributable to owners of the Company for the third quarter were £0.02
compared with £0.01 in the prior year quarter.

Cash flows

Cash used in operating activities for the third quarter was £23.6 million, a
decrease of £0.7 million compared to £24.3 million net cash used in the prior
year quarter.

Capital expenditure on property, plant and equipment and investment property
for the third quarter was £1.3 million, a decrease of £0.3 million compared to
£1.6 million in the prior year quarter.

Net player capital expenditure for the third quarter was £1.4 million, an
increase of £2.3 million compared to £0.9 million net inflow in the prior year
quarter.

Net cash used in financing activities for the third quarter was £7.2 million,
an increase of £7.1 million compared to £0.1 million net cash used in the
prior year quarter. During the third quarter the Group acquired the remaining
33.3% of the issued share capital of MUTV Limited for a purchase consideration
(including transaction costs) of £2.7 million. The Group also repaid the loan
stock issued to the former minority shareholder of MUTV Limited amounting to
£4.4 million. The Group now holds 100% of the issued share capital of MUTV
Limited.

Cash and cash equivalents

Cash and cash equivalents at 31 March 2013 were £36.2 million compared to
£25.6 million at 31 March 2012.

Borrowings

Total borrowings were £367.6 million at 31 March 2013 compared to £423.3
million at 31 March 2012. During the nine months we re-purchased and retired
the sterling equivalent of £62.6 million of senior secured notes comprising
US$101.7 million of US dollar denominated notes. The consideration paid
amounted to £67.9 million.

                         Conference Call Information

The Company’s conference call to review the third quarter and nine months
fiscal 2013 results will be broadcast live over the internet today, 2 May 2013
at 08:00 am 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.

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.

                           About Manchester United

Through our 135 year heritage we have won 61 trophies, enabling us to develop
the world’s leading sports brand and a global community of 659million
followers. Our large, passionate community provides Manchester United with a
worldwide platform to generate significant revenue from multiple sources,
including sponsorship, merchandising, product licensing, new media& mobile,
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).

                                                       
                                                          
Key Performance Indicators
                                     
                                    Three months ended   Nine months ended
                                    31 March            31 March
                                   2013       2012    2013      2012
Commercial % of total revenue       39.2%      38.6%   41.2%     36.4%
Nike and Aon % of Commercial        38.9%      48.5%   37.1%     44.3%
Partners and other % of Commercial  61.1%      51.5%   62.9%     55.7%
Broadcasting % of total revenue     23.7%      23.8%   27.0%     31.1%
Matchday % of total revenue         37.1%      37.6%   31.8%     32.5%
Home Matches Played                                           
FAPL                                5          5       15        15
UEFA competitions                   1          2       4         5
Domestic Cups                       4          -       5         1
Away Matches Played                                           
UEFA competitions                   1          2       4         5
Domestic Cups                       1          2       2         4

Other                                                         
Employees at period end             792        710     792       710
Staff costs % of revenue            48.9%      50.7%   46.5%     45.7%

                        
Phasing of Premier
League                   Quarter 1  Quarter 2  Quarter 3  Quarter 4  Total
home games
2012/13 season           3          7          5          4          19
2011/12 season           3          7          5          4          19

                                               
                                                  
CONSOLIDATED INCOME STATEMENT
(unaudited; in £ thousands, except per share and shares outstanding data)
                                                  
                     Three months ended           Nine months ended
                     31 March                     31 March
                   2013         2012          2013          2012
Revenue               91,721      70,768        278,093      245,828
Operating expenses     (79,069 )     (66,544 )      (227,049 )     (203,001 )
Profit on disposal
of players’          2,520      2,066       8,025       7,896    
registrations
Operating profit     15,172     6,290       59,069      50,723   
Finance costs          (18,607 )     (3,662  )      (40,360  )     (35,724  )
Finance income       285        198         441         676      
Net finance costs    (18,322 )   (3,464  )    (39,919  )   (35,048  )
(Loss)/profit          (3,150  )     2,826          19,150         15,675
before tax
Tax                  6,784      (1,709  )    21,170      22,543   
credit/(expense)
Profit for the       3,634      1,117       40,320      38,218   
period
Attributable to:
                       3,634         1,035          40,151         37,984
Owners of the
Company
Non-controlling      -          82          169         234      
interest
                    3,634      1,117       40,320      38,218   
                                                                 
Earnings per share
attributable to
the owners of the
Company:
Basic and diluted
earnings per share     0.02          0.01((1 ))     0.25           0.24((1  ))
(Pounds Sterling)
Weighted average
shares outstanding   163,826    155,352     162,586     155,352  
(Thousands)

^(1) As adjusted retrospectively to reflect the reorganisation transactions
described in supplemental note 1.1.

                                                      
                                                            
CONSOLIDATED BALANCE SHEET
(unaudited; in £ thousands)
                                                            
                                   31 March  30 June  31 March
                                       2013       2012      2012
ASSETS
Non-current assets
Property, plant and equipment          252,888    247,866   243,863
Investment property                    14,111     14,197    14,210
Goodwill                               421,453    421,453   421,453
Players’ registrations                 126,457    112,399   99,362
Trade and other receivables            2,500      3,000     13,000
Non-current tax receivable             -          -         2,500
Deferred tax asset                  16,402    -        -
                                   833,811   798,915  794,388
Current assets
Derivative financial instruments       546        967       401
Trade and other receivables            74,297     74,163    45,199
Current tax receivable                 2,500      2,500     -
Cash and cash equivalents           36,211    70,603   25,576
                                   113,554   148,233  71,176
Total assets                        947,365   947,148  865,564

                                                             
                                                                   
CONSOLIDATED BALANCE SHEET (continued)
(unaudited; in £ thousands)
                                                                   
                                     31 March   30 June      31 March
                                         2013        2012^(1)      2012^(1)
EQUITY AND LIABILITIES
Equity
Share capital                             52         50           50
Share premium                              68,822      25            25
Merger reserve                             249,030     249,030       249,030
Hedging reserve                            398         666           99
Retained earnings/(deficit)            23,548    (12,671 )   12,272  
Equity attributable to owners of           341,850     237,100       261,476
the Company
Non-controlling interests              -         (2,003  )   (2,096  )
                                      341,850   235,097    259,380 
Non-current liabilities
Derivative financial instruments           1,571       1,685         1,628
Trade and other payables                   21,384      22,305        22,645
Borrowings                                 362,102     421,247       416,676
Deferred revenue                           17,980      9,375         11,619
Provisions                                 1,092       1,378         1,530
Deferred tax liabilities               22,416    26,678     31,995  
                                      426,545   482,668    486,093 
Current liabilities
Derivative financial instruments           154         -             6
Current tax liabilities                    1,128       1,128         1,127
Trade and other payables                   76,804      83,664        47,509
Borrowings                                 5,487       15,628        6,604
Deferred revenue                           94,936      128,535       64,408
Provisions                             461       428        437     
                                      178,970   229,383    120,091 
Total equity and liabilities           947,365   947,148    865,564 

^(1) As adjusted retrospectively to reflect the reorganisation transactions
described in supplemental note 1.1.

                                                                                                
                                                                                                         
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(unaudited; in £ thousands)
                                                                                                         
                                                                Retained    Total          Non-
                   Share    Share       Merger   Hedging  earnings/  attributable  controlling  Total
                     capital   premium      reserve   reserve   (deficit)   to owners of   interests     equity
                                                                            the Company
Balance at 1 July   -        249,105    -        (466  )  (25,886 )  222,753      (2,330   )   220,423 
2011
Profit for the       -         -            -         -         37,984      37,984         234           38,218
period
Cash flow hedges,    -         -            -         565       -           565            -             565
net of tax
Currency
translation         -        -          -        -       174       174          -           174     
differences
Total
comprehensive        -         -            -         565       38,158      38,723         234           38,957
income for the
period
Proceeds from        50        25           -         -         -           75             -             75
shares issued
Capital             -        (249,105 )  249,030  -       -         (75       )   -           (75     )
reorganisation^(1)
Balance at 31       50       25         249,030  99      12,272    261,476      (2,096   )   259,380 
March 2012
(Loss)/profit for    -         -            -         -         (14,998 )   (14,998   )    93            (14,905 )
the period
Cash flow hedges,    -         -            -         567       -           567            -             567
net of tax
Currency
translation         -        -          -        -       55        55           -           55      
differences
Total
comprehensive        -         -            -         567       (14,943 )   (14,376   )    93            (14,283 )
income/(loss) for
the period
Dividends           -        -          -        -       (10,000 )  (10,000   )   -           (10,000 )
Balance at 30 June  50       25         249,030  666     (12,671 )  237,100      (2,003   )   235,097 
2012
Profit for the       -         -            -         -         40,151      40,151         169           40,320
period
Cash flow hedges,    -         -            -         (268  )   -           (268      )    -             (268    )
net of tax
Currency
translation         -        -          -        -       (68     )  (68       )   -           (68     )
differences
Total
comprehensive        -         -            -         (268  )   40,083      39,815         169           39,984
(loss)/ income for
the period
Equity settled
share-based          -         -            -         -         634         634            -             634
payments
Proceeds from        2         68,797       -         -         -           68,799         -             68,799
shares issued^(2)
Acquisition of
non-controlling     -        -          -        -       (4,498  )  (4,498    )   1,834       (2,664  )
interest in MUTV
Limited^(3)
Balance at 31       52       68,822     249,030  398     23,548    341,850      -           341,850 
March 2013

^(1) Adjusted retrospectively to reflect the reorganisation transactions
described in supplemental note 1.1.

^(2) See supplemental note 1.2.

^(3) See supplemental note 5.

                                                     
                                                        
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited; in £ thousands)
                                                        
                                Three months ended      Nine months ended
                                31 March                31 March
                              2013      2012      2013      2012     
Cash flows from operating                                        
activities
Cash (used in)/generated from
operations (see supplemental    (4,938  )   (6,055  )   56,925      13,779
note 3)
Interest paid                   (18,963 )   (18,601 )   (46,897 )   (43,553  )
Interest received               285         444         442         823
Income tax (paid)/received     -         (64     )  600       (3,274   )
Net cash (used in)/generated   (23,616 )  (24,276 )  11,070    (32,225  )
from operating activities
Cash flows from investing
activities
Purchases of property, plant    (1,311  )   (1,597  )   (10,649 )   (9,638   )
and equipment
Purchases of investment         -           -           -           (7,364   )
property
Purchases of players’           (3,009  )   (864    )   (41,267 )   (53,153  )
registrations
Proceeds from sale of          1,606     1,751     7,969     6,124    
players’ registrations
Net cash used in investing     (2,714  )  (710    )  (43,947 )  (64,031  )
activities
Cash flows from financing
activities
Proceeds from issue of shares   -           -           70,258      -
(see supplemental note 1.2)
Expenses directly related to
the issue of shares (see        -           -           (1,459  )   -
supplemental note 1.2)
Acquisition of additional
interest in subsidiary (see     (2,664  )   -           (2,664  )   -
supplemental note 5)
Repayment of other borrowings  (4,534  )  (86     )  (67,330 )  (28,463  )
Net cash used in financing     (7,198  )  (86     )  (1,195  )  (28,463  )
activities
Net decrease in cash and cash   (33,528 )   (25,072 )   (34,072 )   (124,719 )
equivalents
Cash and cash equivalents at    66,631      50,900      70,603      150,645
beginning of period
Exchange gains/(losses) on     3,108     (252    )  (320    )  (350     )
cash and cash equivalents
Cash and cash equivalents at   36,211    25,576    36,211    25,576   
end of period
                                                                             
                                                                             

                              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 is incorporated under the Companies Law (2011
Revision) of the Cayman Islands. The Company became the parent of the Group as
a result of reorganisation transactions which were completed immediately prior
to the completion of the public offering of Manchester United plc shares on
the New York Stock Exchange (“NYSE”) in August 2012 as described more fully
below.

1.1 The reorganisation transactions

The Group had historically conducted business through Red Football Shareholder
Limited, a private limited company incorporated in England and Wales, and its
subsidiaries. Prior to the reorganisation transactions, Red Football
Shareholder Limited was a direct, wholly owned subsidiary of Red Football LLC,
a Delaware limited liability company. On 30 April 2012, Red Football LLC
formed a wholly-owned subsidiary, Manchester United Ltd., an exempted company
with limited liability incorporated under the Companies Law (2011 Revision) of
the Cayman Islands, as amended and restated from time to time. On 8 August
2012, Manchester United Ltd. changed its legal name to Manchester United plc.

On 9 August 2012, Red Football LLC contributed all of the equity interest of
Red Football Shareholder Limited to Manchester United plc. As a result of
these reorganisation transactions, Red Football Shareholder Limited became an
indirect, wholly-owned subsidiary of Manchester United plc.

The new parent, Manchester United plc. had 155,352,366 shares in issue
immediately after the reorganisation transactions and before the issue of new
shares pursuant to the public offering. The reorganisation transactions have
been treated as a capital reorganisation arising at the reorganisation date (9
August 2012). In accordance with International Financial Reporting Standards,
historic earnings per share calculations and the balance sheet as at 30 June
2012 and 31 March 2012 reflect the capital structure of the new parent rather
than that of the former parent, Red Football Shareholder Limited.

1.2 Initial public offering (“IPO”)

On 10 August 2012, the Company issued a further 8,333,334 ordinary shares at
an issue price of $14 per share and listed such shares on the NYSE. Net of
underwriting costs and discounts, proceeds of $110,250,000 (£70,258,000) were
received. Expenses of £1,459,000 directly attributable to this issue of new
shares have been offset against share premium.

2 Earnings per share

Basic and diluted earnings per share is calculated by dividing the profit for
the period attributable to owners of the Company by the weighted average
number of ordinary shares in issue during the period, as adjusted for the
reorganisation transactions described in supplemental note 1.1. The Company
did not have any dilutive shares during the period (2012: none).

                             Unaudited                  Unaudited
                            three months ended        nine months ended
                             31 March                   31 March
                           2013      2012         2013     2012    
Profit for the period
attributable to owners of    3,634     1,035          40,151   37,984
the Company
(£’000)
Weighted average Class A
ordinary shares              39,826      31,352  ^(1)   38,586    31,352  ^(1)
(thousands)
Weighted average Class B
ordinary shares              124,000     124,000 ^(1)   124,000   124,000 ^(1)
(thousands)
Basic and diluted earnings
per share attributable to
owners                      0.02      0.01    ^(1)  0.25     0.24    ^(1)
of the Company (Pounds
Sterling)

^(1) As adjusted retrospectively to reflect the reorganisation transactions
described in supplemental note 1.1.

On 15 August 2012, the Company issued a further 139,895 Class A ordinary
shares pursuant to the Company’s 2012 Equity Incentive Award Plan and listed
such shares on the NYSE. The number of shares in issue as of 31 December 2012
was 163,825,595 shares comprising 39,825,595 Class A ordinary shares and
124,000,000 Class B ordinary shares.

3 Cash (used in)/generated from operations

                                 Unaudited               Unaudited
                               three months ended     nine months ended
                                 31 March                31 March
                              2013      2012      2013      2012    
                                 £’000       £’000       £’000       £’000
Profit for the period            3,634      1,117       40,320     38,218
Tax (credit)/expense           (6,784  )  1,709     (21,170 )  (22,543 )
(Loss)/profit before tax         (3,150  )   2,826       19,150      15,675
Depreciation charges             1,974       2,111       5,743       5,671
Amortisation of players’         10,389      9,747       30,872      29,767
registrations
Profit on disposal of            (2,520  )   (2,066  )   (8,025  )   (7,896  )
players’ registrations
Net finance costs                18,322      3,464       39,919      35,048
Share-based payments             153         -           634         -
Fair value losses/(gains) on
derivative financial             224         (25     )   215         (265    )
instruments
(Increase)/decrease in trade     (12,393 )   3,652       2,334       11,123
and other receivables
Decrease in trade and other
payables and deferred            (17,879 )   (25,637 )   (33,623 )   (74,782 )
revenue
Decrease in provisions         (58     )  (127    )  (294    )  (562    )
Cash (used in)/generated       (4,938  )  (6,055  )  56,925    13,779  
from operations
                                                                             
                                                                             

4 Reconciliation of Adjusted EBITDA to profit for the period

                                  Unaudited              Unaudited
                                three months ended    nine months ended
                                  31 March               31 March
                               2013      2012     2013      2012    
                                  £’000       £’000      £’000       £’000
Adjusted EBITDA                   25,015     20,419     91,538     84,628
Adjustments:
Depreciation                      (1,974  )   (2,111 )   (5,743  )   (5,671  )
Amortisation of players’          (10,389 )   (9,747 )   (30,872 )   (29,767 )
registrations
Exceptional items                 -           (4,337 )   (3,879  )   (6,363  )
Profit on disposal of             2,520       2,066      8,025       7,896
players’ registrations
Net finance costs                 (18,322 )   (3,464 )   (39,919 )   (35,048 )
Tax credit/(expense)            6,784     (1,709 )  21,170    22,543  
Profit for the period           3,634     1,117    40,320    38,218  

5 Transactions with non-controlling interest

On 2 January 2013, the Group acquired the remaining 33.3% of the issued share
capital of MUTV Limited for a purchase consideration (including transaction
costs) of £2,664,000. The Group now holds 100% of the issued share capital of
MUTV Limited. The carrying amount of the non-controlling interests in MUTV
Limited on the date of acquisition was (£1,834,000). The Group derecognised
non-controlling interests of (£1,834,000) and recorded a decrease in equity
attributable to owners of the Company of £4,498,000. The effect of changes in
the ownership interest of MUTV Limited on the equity attributable to owners of
the Company during the period is summarised as follows:

                                      Unaudited              Unaudited
                                    three months ended   nine months ended
                                      31 March               31 March
                                   2013       2012    2013      2012
                                      £’000        £’000     £’000       £’000
Carrying amount of
non-controlling interests             (1,834  )   -         (1,834  )  -
acquired
Consideration paid to               (2,664  )   -       (2,664  )  -
non-controlling interests
Amount recognised in equity
attributable to owners of the       (4,498  )   -       (4,498  )  -
Company
                                                                         
                                                                         

Non-IFRS Measures: Definitions and Use/Importance

The definition of the non-IFRS measure utilised in this Press Release is set
out below together with the reasons why we believe this measure provides
useful information to investors regarding the Group’s financial condition and
results of operations.

1. Adjusted EBITDA

Adjusted EBITDA is defined as profit for the period before net finance costs,
tax credit/(expense), depreciation, amortisation of, and profit on disposal
of, players’ registrations and exceptional items. 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 capital structure (primarily interest
expense), asset base (primarily depreciation and amortisation) and items
outside the control of our management (primarily income taxes and interest
income and expense). 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 Adjusted EBITDA to profit for the period is presented in
supplemental note 4.

Contact:

Investor Relations:
ICR
Brendon Frey / Rachel Schacter, +1 203 682 8200
ir@manutd.co.uk
or
Media:
Manchester United plc
Philip Townsend, +44 161 868 8148
philip.townsend@manutd.co.uk
or
Sard Verbinnen & Co
Jim Barron / Michael Henson, + 1 212 687 8080
 
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