EX-99.1 2 a19-4558_1ex99d1.htm EX-99.1

Exhibit 99.1

 

 

·                  Q2 RECORD REVENUES OF £208.6 MILLION

·                  Q2 RECORD ADJUSTED EBITDA OF £104.3 MILLION

·                  Q2 OPERATING PROFIT OF £44.0 MILLION

 

MANCHESTER, England. — 14 February 2019 — 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 2019 fiscal second quarter ended 31 December 2018.

 

Highlights

 

·                 Ole Gunnar Solskjaer and Mike Phelan returned to Old Trafford to manage the remainder of the 18/19 season

 

·                 Agreed new contracts with Anthony Martial, Ashley Young, Chris Smalling, Phil Jones and Scott McTominay

 

·                 Record revenue and EBITDA for the quarter of £208.6m and £104.3m

 

·                 Announced partnership with Harves to open a series of Manchester United Entertainment and Experience Centres in China

 

·                 Announced global partnership with Remington

 

Commentary

 

Ed Woodward, Executive Vice Chairman, commented, “The appointment of Ole and Mike as caretaker manager and assistant manager, working with Kieran, Michael and Emilio, has had a positive impact throughout the club. We are delighted with the improvement in the team’s performances since December and we look forward to a strong finish to the 18/19 season.”

 

Outlook

 

For fiscal 2019, Manchester United continues to expect:

 

·                  Revenue to be £615m to £630m.

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

 

1


 

Key Financials (unaudited)

 

 

 

Three months ended
31 December

 

 

 

Six months ended
31 December

 

 

 

£ million (except
earnings/(loss) per share)

 

2018

 

Restated(1)
2017

 

Change

 

2018

 

Restated(1)
2017

 

Change

 

Commercial revenue

 

65.9

 

65.3

 

0.9

%

141.8

 

145.8

 

(2.7

)%

Broadcasting revenue

 

103.7

 

75.2

 

37.9

%

146.5

 

116.0

 

26.3

%

Matchday revenue

 

39.0

 

36.9

 

5.7

%

55.3

 

59.3

 

(6.7

)%

Total revenue

 

208.6

 

177.4

 

17.6

%

343.6

 

321.1

 

7.0

%

Adjusted EBITDA(2)

 

104.3

 

81.2

 

28.4

%

133.7

 

120.5

 

11.0

%

Operating profit

 

44.0

 

42.2

 

4.3

%

57.9

 

60.1

 

(3.7

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit/(loss) for the period (i.e. net income/(loss))(3)

 

26.8

 

(19.7

)

 

33.4

 

(10.1

)

 

Basic earnings/(loss) per share (pence)

 

16.27

 

(12.00

)

 

20.31

 

(6.17

)

 

Adjusted profit for the period (i.e. adjusted net income)(1)/(2)

 

46.3

 

23.9

 

93.7

%

53.3

 

31.8

 

67.6

%

Adjusted basic earnings per share (pence)(2)

 

28.13

 

14.56

 

93.2

%

32.40

 

19.38

 

67.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net debt(2)/(4)

 

317.7

 

328.6

 

(3.3

)%

317.7

 

328.6

 

(3.3

)%

 


(1) Comparative amounts have been restated following the implementation of IFRS 15 — see supplemental note 5 for further details.

(2) Adjusted EBITDA, adjusted profit for the period, adjusted basic earnings per share and net debt are non-IFRS measures. See “Non-IFRS Measures: Definitions and Use” on page 5 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.

(3) The US federal corporate income tax rate reduced from 35% to 21% following the 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 three and six months ended 31 December 2017 included a non-cash tax accounting write off of £49.0 million.

(4) The gross USD debt principal remains unchanged.

 

Revenue Analysis

 

Commercial

 

Commercial revenue for the quarter was £65.9 million, an increase of £0.6 million, or 0.9%, over the prior year quarter.

 

·                  Sponsorship revenue for the quarter was £40.3 million, an increase of £1.0 million, or 2.5%, over the prior year quarter;

·                  Retail, Merchandising, Apparel & Product Licensing revenue for the quarter was £25.6 million, a decrease of £0.4 million, or 1.5% over the prior year quarter.

 

Broadcasting

 

Broadcasting revenue for the quarter was £103.7 million, an increase of £28.5 million, or 37.9%, over the prior year quarter, primarily due to the new UEFA Champions League broadcasting rights agreement and playing one additional UEFA Champions League game.

 

2


 

Matchday

 

Matchday revenue for the quarter was £39.0 million, an increase of £2.1 million, or 5.7%, over the prior year quarter, primarily due to playing one additional UEFA Champions League home game.

 

Other Financial Information

 

Operating expenses

 

Total operating expenses for the quarter were £160.3 million, an increase of £24.1 million, or 17.7%, over the prior year quarter.

 

Employee benefit expenses

 

Employee benefit expenses for the quarter were £77.9 million, an increase of £8.2 million, or 11.8%, over the prior year quarter, primarily due to investment in the first team playing squad.

 

Other operating expenses

 

Other operating expenses for the quarter were £26.4 million, a decrease of £0.1 million, or 0.4%, over the prior year quarter.

 

Depreciation & amortization

 

Depreciation for the quarter was £3.0 million, an increase of £0.3 million, or 11.1%, over the prior year quarter. Amortization for the quarter was £33.4 million, a decrease of £3.9 million, or 10.5%, over the prior year quarter. The unamortized balance of registrations at 31 December 2018 was £309.1 million.

 

Exceptional items

 

Exceptional items for the quarter were £19.6 million, relating to compensation to the former manager and certain members of the coaching staff for loss of office. Exceptional items for the prior year quarter were £nil.

 

(Loss)/profit on disposal of intangible assets

 

Loss on disposal of intangible assets for the quarter was £4.3 million, compared to a profit of £1.0 million in the prior year quarter.

 

Net finance costs

 

Net finance costs for the quarter were £6.3 million, an increase of £1.9 million, or 43.2%, over the prior year quarter, primarily due to unrealized, non-cash foreign exchange losses on unhedged USD borrowings compared to gains in the prior year quarter.

 

Tax

 

Tax expense for the quarter was £10.9 million, compared to £57.5 million in the prior year quarter. The US federal corporate income tax rate reduced from 35% to 21% following the enactment of US tax reform on 22 December 2017. This necessitated a re-measurement of the then existing US deferred tax position in the period to 31 December 2017. As a result the prior year quarter included a non-cash tax accounting write off of £49.0 million.

 

Cash flows

 

Net cash used in operating activities for the quarter was £42.4 million, a decrease of £2.0 million over the prior year quarter.

 

Net capital expenditure on property, plant and equipment for the quarter was £2.4 million, a decrease of £1.7 million over the prior year quarter.

 

Net capital expenditure on intangible assets for the quarter was £16.2 million, an increase of £4.4 million over the prior year quarter.

 

3


 

Overall cash and cash equivalents (including the effects of exchange rate changes) decreased by £57.1 million in the quarter, compared to a decrease of £60.9 million in the prior year quarter.

 

Net debt

 

Net debt as of 31 December 2018 was £317.7 million, a decrease of £10.9 million over the year. The gross USD debt principal remains unchanged.

 

Dividend

 

A semi-annual cash dividend of $0.09 per share was paid on 4 January 2019. A further semi-annual cash dividend of $0.09 per share will be paid on 5 June 2019, to shareholders of record on 26 April 2019. The stock will begin to trade ex-dividend on 25 April 2019.

 

Conference Call Information

 

The Company’s conference call to review second quarter fiscal 2019 results will be broadcast live over the internet today, 14 February 2019 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 141-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).

 

4


 

Non-IFRS Measures: Definitions and Use

 

1.                  Adjusted EBITDA

 

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

 

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), material volatile items (primarily profit on disposal of intangible assets and exceptional items), 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 profit/(loss) for the period to Adjusted EBITDA is presented in supplemental note 2.

 

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

 

Adjusted profit 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 embedded foreign exchange derivatives, adding/subtracting the actual tax expense/credit for the period, and subtracting the adjusted tax expense for the period (based on a normalized tax rate of 21%; 2017: 35%). The normalized tax rate of 21% is the current US federal corporate income tax rate.

 

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) equivalent to the US federal corporate income tax rate of 21% (2017: 35%). A reconciliation of profit/(loss) for the period to adjusted profit for the period is presented in supplemental note 3.

 

3.              Adjusted basic and diluted earnings per share

 

Adjusted basic and diluted earnings per share are calculated by dividing the adjusted profit for the period by the weighted average number of ordinary shares in issue during the period. Adjusted diluted earnings 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. There is 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 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.

 

5


 

Key Performance Indicators

 

 

 

Three months ended

 

Six months ended

 

 

 

31 December

 

31 December

 

 

 

2018

 

Restated(1)
2017

 

2018

 

Restated(1)
2017

 

Commercial % of total revenue

 

31.6

%

36.8

%

41.3

%

45.4

%

Broadcasting % of total revenue

 

49.7

%

42.4

%

42.6

%

36.1

%

Matchday % of total revenue

 

18.7

%

20.8

%

16.1

%

18.5

%

Home Matches Played

 

 

 

 

 

 

 

 

 

PL

 

7

 

7

 

10

 

11

 

UEFA competitions

 

3

 

2

 

3

 

3

 

Domestic Cups

 

 

 

1

 

1

 

Away Matches Played

 

 

 

 

 

 

 

 

 

PL

 

6

 

7

 

10

 

10

 

UEFA competitions

 

2

 

2

 

3

 

4

(2)

Domestic Cups

 

 

2

 

 

2

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

Employees at period end

 

937

 

923

 

937

 

923

 

Employee benefit expenses % of revenue

 

37.3

%

39.3

%

45.1

%

43.5

%

 


(1) Comparative amounts have been restated — see supplemental note 5 for further details.

(2)  Includes UEFA Super Cup final following UEFA Europa League win in 2016/17.

 

Phasing of Premier League games

 

Quarter 1

 

Quarter 2

 

Quarter 3

 

Quarter 4

 

Total

 

2018/19 season*

 

7

 

13

 

12

 

6

 

38

 

2017/18 season

 

7

 

14

 

10

 

7

 

38

 

 


*Subject to changes in broadcasting scheduling

 

Contacts

 

Manchester United plc

Investor Relations:

Cliff Baty

Chief Financial Officer

+44 161 868 8650

ir@manutd.co.uk

 

Manchester United plc

Media:

Charlie Brooks

Director of Communications

+44 161 868 8148

charlie.brooks@manutd.co.uk

 

 

 

 

 

Sard Verbinnen & Co

Jim Barron / Devin Broda

+ 1 212 687 8080

JBarron@SARDVERB.com

dbroda@SARDVERB.com

 

6


 

CONSOLIDATED INCOME STATEMENT

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

 

 

 

Three months ended
31 December

 

Six months ended
31 December

 

 

 

2018

 

Restated(1)
2017

 

2018

 

Restated(1)
2017

 

Revenue

 

208,612

 

177,415

 

343,638

 

321,080

 

Operating expenses

 

(160,269

)

(136,252

)

(303,849

)

(279,288

)

(Loss)/profit on disposal of intangible assets

 

(4,349

)

1,013

 

18,079

 

18,292

 

Operating profit

 

43,994

 

42,176

 

57,868

 

60,084

 

Finance costs

 

(7,131

)

(4,533

)

(12,946

)

(5,534

)

Finance income

 

785

 

170

 

1,474

 

388

 

Net finance costs

 

(6,346

)

(4,363

)

(11,472

)

(5,146

)

Profit before tax

 

37,648

 

37,813

 

46,396

 

54,938

 

Tax expense(2)

 

(10,878

)

(57,510

)

(12,980

)

(65,065

)

Profit/(loss) for the period

 

26,770

 

(19,697

)

33,416

 

(10,127

)

 

 

 

 

 

 

 

 

 

 

Basic earnings/(loss) per share:

 

 

 

 

 

 

 

 

 

Basic earnings/(loss) per share (pence)

 

16.27

 

(12.00

)

20.31

 

(6.17

)

Weighted average number of ordinary shares outstanding (thousands)

 

164,526

 

164,195

 

164,526

 

164,195

 

Diluted earnings/(loss) per share:

 

 

 

 

 

 

 

 

 

Diluted earnings/(loss) per share (pence)(3)

 

16.26

 

(12.00

)

20.29

 

(6.17

)

Weighted average number of ordinary shares outstanding (thousands)

 

164,663

 

164,585

 

164,663

 

164,585

 

 


(1) Comparative amounts have been restated — see supplemental note 5 for further details.

 

(2) The US federal corporate income tax rate reduced from 35% to 21% following the enactment of US tax reform on 22 December 2017. This necessitated a re-measurement of the then existing US deferred tax position in the period to 31 December 2017. As a result the prior year period tax expense included a non-cash tax accounting write off of £49.0 million.

 

(3) For the three and six months ended 31 December 2017 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.

 

7


 

CONSOLIDATED BALANCE SHEET

(unaudited; in £ thousands)

 

 

 

31 December
2018

 

Restated(1)
30 June
2018

 

Restated(1)
31 December
2017

 

ASSETS

 

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

 

Property, plant and equipment

 

246,910

 

245,401

 

246,673

 

Investment property

 

13,772

 

13,836

 

13,901

 

Intangible assets

 

739,472

 

799,640

 

770,076

 

Derivative financial instruments

 

2,559

 

4,807

 

1,192

 

Trade and other receivables

 

10,387

 

4,724

 

10,560

 

Tax receivable

 

547

 

547

 

1,882

 

Deferred tax asset

 

57,636

 

63,332

 

77,500

 

 

 

1,071,283

 

1,132,287

 

1,121,784

 

Current assets

 

 

 

 

 

 

 

Inventories

 

2,610

 

1,416

 

1,918

 

Derivative financial instruments

 

625

 

1,159

 

2,704

 

Trade and other receivables

 

124,232

 

168,060

 

123,027

 

Tax receivable

 

598

 

800

 

 

Cash and cash equivalents

 

190,395

 

242,022

 

155,312

 

 

 

318,460

 

413,457

 

282,961

 

Total assets

 

1,389,743

 

1,545,744

 

1,404,745

 

 


(1) Comparative amounts have been restated — see supplemental note 5 for further details.

 

8


 

CONSOLIDATED BALANCE SHEET (continued)

(unaudited; in £ thousands)

 

 

 

31 December
2018

 

Restated(1)
30 June
2018

 

Restated(1)
31 December
2017

 

EQUITY AND LIABILITIES

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

Share capital

 

53

 

53

 

53

 

Share premium

 

68,822

 

68,822

 

68,822

 

Merger reserve

 

249,030

 

249,030

 

249,030

 

Hedging reserve

 

(35,693

)

(27,558

)

(23,944

)

Retained earnings

 

170,544

 

136,757

 

184,529

 

 

 

452,756

 

427,104

 

478,490

 

Non-current liabilities

 

 

 

 

 

 

 

Trade and other payables

 

46,644

 

104,271

 

70,331

 

Borrowings

 

502,576

 

486,694

 

474,748

 

Deferred revenue

 

32,952

 

37,085

 

32,704

 

Deferred tax liabilities

 

33,302

 

29,134

 

35,801

 

 

 

615,474

 

657,184

 

613,584

 

Current liabilities

 

 

 

 

 

 

 

Tax liabilities

 

5,771

 

3,874

 

3,704

 

Trade and other payables

 

180,588

 

267,996

 

182,965

 

Borrowings

 

5,492

 

9,074

 

9,160

 

Deferred revenue

 

129,662

 

180,512

 

116,842

 

 

 

321,513

 

461,456

 

312,671

 

Total equity and liabilities

 

1,389,743

 

1,545,744

 

1,404,745

 

 


(1) Comparative amounts have been restated — see supplemental note 5 for further details.

 

9


 

CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited; in £ thousands)

 

 

 

Three months ended
31 December

 

Six months ended
31 December

 

 

 

2018

 

2017

 

2018

 

2017

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

Cash (used in)/generated from operations (see supplemental note 4)

 

(41,019

)

(38,440

)

82,337

 

(11,489

)

Interest paid

 

(1,734

)

(1,621

)

(9,507

)

(9,639

)

Interest received

 

722

 

170

 

1,355

 

388

 

Tax paid

 

(376

)

(4,530

)

(1,810

)

(5,768

)

Net cash (used in)/generated from operating activities

 

(42,407

)

(44,421

)

72,375

 

(26,508

)

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

Payments for property, plant and equipment

 

(2,414

)

(4,243

)

(7,318

)

(8,587

)

Proceeds from sale of property, plant and equipment

 

 

75

 

 

75

 

Payments for intangible assets

 

(16,418

)

(12,000

)

(145,056

)

(129,121

)

Proceeds from sale of intangible assets

 

255

 

256

 

25,183

 

32,442

 

Net cash used in investing activities

 

(18,577

)

(15,912

)

(127,191

)

(105,191

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

Repayment of borrowings

 

 

(106

)

(3,750

)

(206

)

Net cash used in financing activities

 

 

(106

)

(3,750

)

(206

)

Net decrease in cash and cash equivalents

 

(60,984

)

(60,439

)

(58,566

)

(131,905

)

Cash and cash equivalents at beginning of period

 

247,505

 

216,236

 

242,022

 

290,267

 

Effects of exchange rate changes on cash and cash equivalents

 

3,874

 

(485

)

6,939

 

(3,050

)

Cash and cash equivalents at end of period

 

190,395

 

155,312

 

190,395

 

155,312

 

 

10


 

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 profit/(loss) for the period to Adjusted EBITDA

 

 

 

Three months ended
31 December

 

Six months ended
31 December

 

 

 

2018
£’000

 

Restated(1)
2017
£’000

 

2018
£’000

 

Restated(1)
2017
£’000

 

Profit/(loss) for the period

 

26,770

 

(19,697

)

33,416

 

(10,127

)

Adjustments:

 

 

 

 

 

 

 

 

 

Tax expense

 

10,878

 

57,510

 

12,980

 

65,065

 

Net finance costs

 

6,346

 

4,363

 

11,472

 

5,146

 

Loss/(profit) on disposal of intangible assets

 

4,349

 

(1,013

)

(18,079

)

(18,292

)

Exceptional items

 

19,599

 

 

19,599

 

 

Amortization

 

33,440

 

37,335

 

68,571

 

73,389

 

Depreciation

 

2,970

 

2,755

 

5,779

 

5,329

 

Adjusted EBITDA

 

104,352

 

81,253

 

133,738

 

120,510

 

 


(1) Comparative amounts have been restated — see supplemental note 5 for further details.

 

11


 

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

 

 

 

Three months ended
31 December

 

Six months ended
31 December

 

 

 

2018
£’000

 

Restated(1)
2017
£’000

 

2018
£’000

 

Restated(1)
2017
£’000

 

Profit/(loss) for the period

 

26,770

 

(19,697

)

33,416

 

(10,127

)

Exceptional items

 

19,599

 

 

19,599

 

 

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

 

1,316

 

(1,328

)

1,535

 

(6,824

)

Fair value movement on embedded foreign exchange derivatives

 

25

 

291

 

(56

)

845

 

Tax expense

 

10,878

 

57,510

 

12,980

 

65,065

 

Adjusted profit before tax

 

58,588

 

36,776

 

67,474

 

48,959

 

Adjusted tax expense (using a normalized US statutory rate of 21% (2017: 35%))

 

(12,303

)

(12,872

)

(14,170

)

(17,136

)

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

 

46,285

 

23,904

 

53,304

 

31,823

 

 

 

 

 

 

 

 

 

 

 

Adjusted basic earnings per share:

 

 

 

 

 

 

 

 

 

Adjusted basic earnings per share (pence)

 

28.13

 

14.56

 

32.40

 

19.38

 

Weighted average number of ordinary shares outstanding (thousands)

 

164,526

 

164,195

 

164,526

 

164,195

 

Adjusted diluted earnings per share:

 

 

 

 

 

 

 

 

 

Adjusted diluted earnings per share (pence)

 

28.11

 

14.52

 

32.37

 

19.34

 

Weighted average number of ordinary shares outstanding (thousands)

 

164,663

 

164,585

 

164,663

 

164,585

 

 


(1) Comparative amounts have been restated — see supplemental note 5 for further details.

 

12


 

4                               Cash (used in)/generated from operations

 

 

 

Three months ended
31 December

 

Six months ended
31 December

 

 

 

2018
£’000

 

Restated(1)
2017
£’000

 

2018
£’000

 

Restated(1)
2017
£’000

 

Profit/(loss) for the period

 

26,770

 

(19,697

)

33,416

 

(10,127

)

Tax expense

 

10,878

 

57,510

 

12,980

 

65,065

 

Profit before tax

 

37,648

 

37,813

 

46,396

 

54,938

 

Depreciation

 

2,970

 

2,755

 

5,779

 

5,329

 

Amortization

 

33,440

 

37,335

 

68,571

 

73,389

 

Loss/(profit) on disposal of intangible assets registrations

 

4,349

 

(1,013

)

(18,079

)

(18,292

)

Net finance costs

 

6,346

 

4,363

 

11,472

 

5,146

 

Profit on disposal of property, plant and equipment

 

 

(75

)

 

(75

)

Equity-settled share-based payments

 

161

 

618

 

371

 

1,203

 

Foreign exchange losses on operating activities

 

(95

)

9

 

182

 

1,000

 

Reclassified from hedging reserve

 

1,536

 

3,587

 

2,844

 

7,468

 

Changes in working capital:

 

 

 

 

 

 

 

 

 

Inventories

 

56

 

156

 

(1,194

)

(281

)

Trade and other receivables

 

(30,303

)

(37,282

)

39,293

 

(25,437

)

Trade and other payables and deferred revenue

 

(97,127

)

(86,706

)

(73,298

)

(115,877

)

Cash (used in)/generated from operations

 

(41,019

)

(38,440

)

82,337

 

(11,489

)

 


(1) Comparative amounts have been restated — see supplemental note 5 for further details.

 

13


 

5                               Restatement of prior periods following implementation of IFRS 15

 

The Group adopted IFRS 15 ‘Revenue from contracts with customers’ with effect from 1 July 2018. The implementation of IFRS 15 had an impact on the Group’s financial statements as at 1 July 2018 and consequently prior year amounts have been restated. The table below shows the retrospective impact on revenue for the four quarters ended 30 June 2018. Note 34 to the interim consolidated financial statements for the three and six months ended 31 December 2018 contains tables and notes which explain how the restatement affected the consolidated income statement, consolidated statement of comprehensive income, consolidated balance sheet, and consolidated statement of cash flows.

 

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 therefore revenue on certain commercial contracts is recognized earlier under IFRS 15. The effect of the retrospective application is an increase in cumulative revenue recognized 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

 

Following adoption of IFRS 15, certain performance obligations are satisfied over time as each Premier League match (home and away) is played — accordingly revenue is recognized evenly as each Premier League match (home and away) is played. Broadcasting merit awards were previously recognized one share in the first quarter with the remainder being recognized when they were known at the end of each football season. Merit awards represent variable consideration and therefore, following adoption of IFRS 15, are estimated using the most likely amount method based on management’s estimate of where the Club’s finishing position will be at the end of each season. Broadcasting equal share payments were previously recognized evenly as each Premier League home match was 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

 

 

14