In finance, there is an old idiom that Manchester United fans scrutinising their club’s summer transfer budget should apply: revenue is vanity, profit is sanity, and cash is reality.
As far as Profit and Sustainability Rules (PSR) are concerned, it’s the profit-and-loss account that matters. And on face value, the numbers don’t look particularly good.
Manchester United PLC, the company registered on the New York Stock Exchange, lost £131m in 2023-24.
Based on the quarterly accounts we have seen to date, the deficit will narrow significantly in 2024-25. The Q3 results released yesterday showed a loss of just less than £29m for the nine months up to 31 March.
Graph showing Manchester United's pre-tax profit and loss account from 2013-14 to 2023-24
Manchester United profit and loss account over the last 10 years Credit: Adam Williams/United in Focus/GRV Media
The Premier League allows losses of up to £105m over a rolling three-year period with deductions for things like academy, women’s team and infrastructure investment. In United’s case, the calculation also includes an allowance for costs linked to Sir Jim Ratcliffe’s part-takeover, which reached around £40m.
Even with those add-backs, however, it didn’t look like Ruben Amorim and his recruitment team would have much room in this summer’s transfer market – far from ideal after a campaign that impressed the need for a major revamp of the squad currently filled with multi-millionaire waifs and strays.
But earlier this week, The Athletic dropped what qualifies as a bombshell in the world of football finance: the club’s Premier League and UEFA PSR compliance is assessed based not on Cayman Island-domiciled Manchester United PLC but rather by UK-based subsidiary company Red Football Limited.
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Ostensibly, it’s a small, grey detail but it significantly alters the PSR picture.
In 2023-24, the loss of £131m at the PLC reduces to £36m at Red Football Limited. Why? There are several variables, but many costs are associated with operations in New York.
For the three-year PSR cycle, that means United are well within the limit with allowable deductions factored in, both in the 2024-25 cycle and heading into its 2025-26 equivalent.
However, returning to the vanity-sanity-reality maxim, PSR isn’t the only factor that will dictate the Red Devils’ ability to compete this summer.
Photo by Ash Donelon/Manchester United via Getty Images
Photo by Ash Donelon/Manchester United via Getty Images
You see, the profit-and-loss account isn’t an accurate reflection of the flow of cold, hard cash in and out of the business. It includes non-cash expenses like amortisation and depreciation too.
Looking at cash flow, the margins are tighter. Ultimately, how United follow up the £62.5m acquisition of Matheus Cunha from Wolves will depend on their access to cash, not abstract profit-and-loss figures.
£73m cash in the bank, but reduced 2025-26 revenues to take toll
United’s financial results for the three months up to 31 March 2025 paint both a favourable picture of the club’s financial performance in a torrid season and a chilling reminder of the challenge ahead.
The £3m for the quarter is the headline figure. Revenue for the season is now projected to be £660-670m, which is likely be a club record. Not bad for a season without Champions League football.
Chart showing recorded revenue and projections for Manchester United, with United in Focus logo
Man United revenue projections Credit: Adam Williams/United in Focus/GRV Media
In terms of cash reserves, however, there was a decrease of £22.5m on the same quarter last year. At the reporting date, United had £73m in the bank, as well as £88m undrawn from their £300m revolving credit facility.
With costs, employment expenses fell by £20m due to players sold or loaned, reduced bonuses and the mass job cuts enacted by Ineos. There was also a £7.3m boost from currency movements, though that is stripped out of the club’s PSR calculation.
Adjusted EBITDA (a metric used as something close to a cash proxy to measure core financial performance) was £145m, up from £128m in the same period last season.
By the time the Q4 accounts, United will have around £100m in cash in the bank, plus the £88m from the undrawn credit facility. Given that transfers are typically paid in instalments, that might sound like a lot to play with in the market, but costs over the next 12 months will far outstrip incomings. Matchday income will be down significantly with no European football, as will media income for the same reason.
Since he acquired his stake in the club, Ratcliffe has made capital injections of £328m, but if there is to be significant investment in the transfer market this summer, it will likely need to be funded either by further cash input from the owners or significant player sales.
Sir Jim Ratcliffe will feel ‘vindicated’ by Q3 accounts
“Manchester United’s senior management and Ratcliffe will feel vindicated that the losses for Q3 are down to just £3m,“ Price of Football author and University of Liverpool football finance lecturer Kieran Maguire said of United’s Q3 accounts in exclusive conversation with UIF.
“They probably would have made a profit if they were in the Champions League as opposed to the Europa League, but that is reflected both in revenue and costs.
Photo by Nicolò Campo/LightRocket via Getty Images
Photo by Nicolò Campo/LightRocket via Getty Images
“The job losses are starting to flow through – we’re seeing considerably lower wages, though there has also been an impact in terms of not paying bonuses because of non-participation in the Champions League. In 2024, there were also the costs of the sale to Jim Ratcliffe, which was about £30m. Clearly, those costs haven’t been replicated in 2025 too.
“Overall, these results are solid. There are no major issues from what we can see.
“Marcus Rashford, Antony and Sancho being on loan elsewhere has reduced the wage bill, realistically somewhere in the region of £750,000 per week. If you put that into a quarter, that’s £10m saved on wages, as well as the loan fees coming in for at least two of those players, which has been a contributory factor as well.”