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Manchester United on Thursday posted a strong set of earnings ahead of its initial public offering in Singapore, recording a 9.6% rise in full-year net profit and an 18% reduction in net debt.
The results will boost the English soccer club, which plans to raise $1 billion in an IPO set for October, with proceeds going toward expanding the club's Asia business, as well as paying down club debt.
Manchester United said that earnings before interest, tax, depreciation and amortization for the year to June 30 were £110.9 million ($180.2 million), compared with £101.2 million last year.
The club also posted record revenue of £331.4 million, up £45 million in 2010 on the back of increased activity from sponsorship deals, attendance and broadcasting.
Over the year, Manchester United became English Premier League champions, reached the final of the European Champions League and the semi-finals of the FA Cup, extending its run of matches and boosting match revenue.
Taken private by U.S. tycoon Malcolm Glazer in 2005 in a deal worth £790 million, Manchester United has struggled to service the £700 million debt taken on to finance the leveraged buyout.
However, Thursday it said that net debt had been cut to £308.3 million, from GBP376.9 million last year and that its cash balance was £150.6 million.
Soccer has a huge domestic and international profile with top-class clubs like Manchester United continuing to generate spectacular revenue on the back of attendance, broadcasting and merchandising sales. Asia, in particular, is seen as a high-growth market for the club, which like other international companies wants to tap into increasingly wealthy consumers and bullish investors.
Manchester United has in excess of 100 million fans in Southeast Asia and is boosting commercial ties in the region, most recently signing a sponsorship deal with Honda Motor Co.
Having originally planned to list in Hong Kong, Manchester United switched to Singapore in June to take advantage of the dual-share listing structure that is available, people familiar with the matter have said.
A two-tier share structure, one with voting rights and one without, enables its owners to effectively retain control of the team. It has raised concerns about corporate governance at the club, which is owned by the Glazer family, headed by patriarch Malcolm Glazer. The family is also owner of the National Football League's Tampa Bay Buccaneers.
Credit Suisse Group has been mandated as sole global coordinator and bookrunner on the IPO, which is expected to involve a sale of around 25%, valuing the whole company at $4 billion.
Singapore regulations stipulate that at least 12% of a listed company must be in public hands. Hong Kong requires 25%, although it gives companies waivers in certain cases.
Nonvoting preference shares aren't counted as part of the public float, and investors buying into the IPO will have to buy equal numbers of voting and nonvoting shares, two people familiar with the deal said.
Singapore Exchange Chief Executive Magnus Bocker promised an approval of four weeks for the IPO, which was filed with the exchange Aug. 18, essentially putting the club on the fast-track route. Singapore IPOs usually take up to 12 weeks to get a green light for launch.
Manchester United on Thursday posted a strong set of earnings ahead of its initial public offering in Singapore, recording a 9.6% rise in full-year net profit and an 18% reduction in net debt.
The results will boost the English soccer club, which plans to raise $1 billion in an IPO set for October, with proceeds going toward expanding the club's Asia business, as well as paying down club debt.
Manchester United said that earnings before interest, tax, depreciation and amortization for the year to June 30 were £110.9 million ($180.2 million), compared with £101.2 million last year.
The club also posted record revenue of £331.4 million, up £45 million in 2010 on the back of increased activity from sponsorship deals, attendance and broadcasting.
Over the year, Manchester United became English Premier League champions, reached the final of the European Champions League and the semi-finals of the FA Cup, extending its run of matches and boosting match revenue.
Taken private by U.S. tycoon Malcolm Glazer in 2005 in a deal worth £790 million, Manchester United has struggled to service the £700 million debt taken on to finance the leveraged buyout.
However, Thursday it said that net debt had been cut to £308.3 million, from GBP376.9 million last year and that its cash balance was £150.6 million.
Soccer has a huge domestic and international profile with top-class clubs like Manchester United continuing to generate spectacular revenue on the back of attendance, broadcasting and merchandising sales. Asia, in particular, is seen as a high-growth market for the club, which like other international companies wants to tap into increasingly wealthy consumers and bullish investors.
Manchester United has in excess of 100 million fans in Southeast Asia and is boosting commercial ties in the region, most recently signing a sponsorship deal with Honda Motor Co.
Having originally planned to list in Hong Kong, Manchester United switched to Singapore in June to take advantage of the dual-share listing structure that is available, people familiar with the matter have said.
A two-tier share structure, one with voting rights and one without, enables its owners to effectively retain control of the team. It has raised concerns about corporate governance at the club, which is owned by the Glazer family, headed by patriarch Malcolm Glazer. The family is also owner of the National Football League's Tampa Bay Buccaneers.
Credit Suisse Group has been mandated as sole global coordinator and bookrunner on the IPO, which is expected to involve a sale of around 25%, valuing the whole company at $4 billion.
Singapore regulations stipulate that at least 12% of a listed company must be in public hands. Hong Kong requires 25%, although it gives companies waivers in certain cases.
Nonvoting preference shares aren't counted as part of the public float, and investors buying into the IPO will have to buy equal numbers of voting and nonvoting shares, two people familiar with the deal said.
Singapore Exchange Chief Executive Magnus Bocker promised an approval of four weeks for the IPO, which was filed with the exchange Aug. 18, essentially putting the club on the fast-track route. Singapore IPOs usually take up to 12 weeks to get a green light for launch.