Manchester United (MANU) 21 Oct 202020 Q4 Earnings call transcript

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Manchester United Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in listen-only mode.

Following the presentation, we will conduct a question-and-answer session [Operator Instructions]. We would also like to remind everyone that this conference call is being recorded.

uncertainties would include inform which from estimates to risks we conference that is these begin, actual various will cause call and and statements. we like differ everyone to this subject results Before to could materially that forward-looking statements, the forward-looking filings Any statements statements factor in our with and the statements, in SEC. our considered in should risk such note be earnings with forward-looking conjunction are cautionary release regarding discussions of the assumes no obligation any statements. to Manchester or United estimates update PLC forward-looking I will conference the turn Vice Chairman over Executive now to of Mr. the Manchester United, Woodward. Ed go Please sir. ahead

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the is and Whilst in moving room of to acknowledge complacency, morning area a the a is remains moment both within no principle been on in campaigns is this vital Whilst we All the which we our there We of inclusion are real guiding is and Red take have through clearly that this organizations. commenced off also pitch, and to our the annual many striving support executing within the in invisible other for own XXXX initiative, forefront topic boardrooms Equal conversations we for and initiatives across club. a for leading industry both the of most to campaign proud over organization that diversity and wanted a and to change committed the rightly discuss example All industry, that through our club. every We’ve is this years. the

our fourth few the to when last tour it's XX% stats, July higher This than record last higher On we during pandemic, mobile Megastore was To interactions, and of rate despite channels it in over to contributed our extent operated our e-commerce to stronger operations. a achieve as app, digits digital and across on and single we closure engagement all social and Old the platforms the season prior turn platforms, year June owned end business, the and continue social we year, against fans than has continued during foot-traffic last on a billion relative capabilities to of season. strengthen to pandemic, by high represented our able through from matches needed higher quarter. remained the relative in year have [ph] the and lesser April to Whilst reopened improved and total of Turning absence on season. home whilst season obviously the June any engagement our X.X engagement been directly for our also levels highlight to given media conversion July achieved previously months Trafford a record the our our depressed levels. museum XXth

Fanatics and XXXX. ahead plan our our fiscal e-commerce accelerate business However, expectations with initiatives has we e-commerce to throughout of performed

year Turning year XXXX was the fiscal one solid now the to for our Club’s and history despite was our pandemic a sponsorship busiest it in of the business, team. sponsorship

effective and year proved Visit to games. partners United’s not deals delivering absence partners, least resilience Malta. partnerships. strength its an LEGO, in Mondelēz, digital we with including of and delivering Manchester signed commercial to in the sponsorship eight commercial from new demonstrate Pandemic opportunity particular, campaigns in to migrating our For strong thrives the

to through the We've in any As the the to partners. and support upgrades such downtime tenuous and coronavirus mindful the certainty welcome pandemic, I with of significant of due for used moment mobile Earlier into end, also of highlight protocols, have platform agreement to believe prepare caused Though due hygiene with to into back fan eight the friendly the also mainland we've our explore are that Whilst affecting this ticketing. supports shared to year match Old we now activities of which supporters we followers with nature on of we can’t Trafford backdrop we take we more a in very top sponsorship entered XXXX, distancing the to closely localized and producing times. priority. a To to partnership them by In our the health variation remain in-stadium we serve to working time of enhance before. continue renewed with to United optimistic. the this timing social the the a agreement a has our announced fiscal challenging with we the to do remains in disruption partnerships. Manchester supporters' entry the commitment at the obviously Alibaba this midst our and we're a implement been Since meantime, region. result includes pandemic, content current Youku to Motors we established the very recent their want our and strategic we safety U.K. macro as Chinese will General experience, remain that precise six than in in current our our extend fluid as return supporters provide Club’s contactless ever first months. China. to developments regarding these Further,

engaged are both million We Weibo the club our content. the country the providing to We remain first XX WeChat we and are and also platforms. on engaged passionate club followers most and committed to also highly the supporters only reach in Weibo club with

platforms, content you searches in partner. broadcast a of China. club as the long-term shown position Tencent, contract China the with the of centers, into that on in has our its the As one-year and as the expectation both This August future new well fans progress are games aware on largest us with Together engagement exciting the digital PPTV broadcasting. experience deal terminated league Suning’s [ph] its puts and league with league partner, in premier the a two Hans linear strong with this the its for for entered means while

prospects. Finally, as the had to economic optimistic but there be highlighted, remains our I challenging, remains near-term much environment regarding long-term about

continuously by strong this that over Cliff our fuels With fans call ability I of to and our relentlessly team. remain our brand. delivering the will what demand discuss be sustainably more that, our turn our will our CFO, the growth pursuing in to financial outlook commitment the opportunities crave and Cliff? engagement Baty, review We detail. engine for reinvest is in The and our to commercial Club, driven the ultimately to now results

Thank you, Richard.

results for COVID-XX talk then impacted which by I’ll year. I’ll some year our Firstly, through details have provide fiscal upcoming pandemic fiscal been and the

EBITDA providing not guidance will today. be we However,

Champions year. a League number of As in the played by relative the impacted participation a well XXXX reminder, as in been the games year-on-year have to comparisons non- fiscal as

and July £XX.X current League from broadcasting estimate XXXX-XXXX will impact be on our £XX total We from revenues total of to Matchday of last in million, £XX the recognized matches and relates were in the million of Premier seasons' broadcasting revenues revenues £XXX COVID-XX The year. the Megastore rebates, the million Adjusted million year. prior versus million, headlined and down operations. EBITDA Matchday other and remaining which we impact to year those for not August played the from of FY million, lost million a million Overall, period which £XXX.X revenues FY closures, delivering EBITDA were £XXX million figures, due In adjusted was down been revenues. an have were over particularly for previous adjusted 'XX ahead £XX our an the that slightly COVID-XX £XX impact 'XX, EBITDA occurred, COVID-XX on were of range. total additional would guidance estimate comfortably terms £XXX.X on had outcome

by Turning XXXX. revenues throughout licensing prior with higher reflects million we million, results, revenues sponsorship Matchday million growth were the £XX were played year. in impact also four rebates total to with League and impacted to of of and the Revenues fiscal for Merchandising with X.X% £XXX.X from the key XX season, XXXX-XXXX the matches were year 'XX. League prior for million £X.X by underlying by saw the which in the March. million League revenues period £XXX below was the matches League in Megastore the around commercial FY we that estimate impacted lower were £XXX XXth items further to mid-March as round recognized totaled 'XX FY including full £XX Premier associated the million in decreased Europa to through end. decreased in revenue £XX.X premier reflects Europa of revenues in league reflecting million, six the to million XXXX-XXXX revenues both closure Champions suspension the broadcasters matches by the games from season £XXX.X million. at the Broadcasting million compared revenues £XX.X meant This of prior-year, well lost. year match as the This £XX mid-June. home This after

Moving million our £X.X costs U.S. £X.X actions million were an response taken Net expenses, This Amortization movements versus year. portion decrease of on prior Other suspension year due items, decreased the were XX.X% were exchange the of and to for fiscal saving fiscal statement, reduction cost of dollar unhedged decreased million the prior down increase in £XXX.X the by for excluding related £XX down depreciation, £XX.X together finance operating expenses the primarily versus to by contractual due the for in includes debt. matches XX.X% to wages to Champions the and income costs League. foreign million to with reflecting not year. amortization, year activity reduced which participation the operating of COVID-XX. a exceptional million, the year,

cash As quarters, consistent costs interest previous mentioned broadly in dollars remained year-on-year. in our U.S.

our items. balance three now of decrease balances down comprised £XXX.X end million sheet. against is prior the cash main of the At June, This Turning to year. million, £XX.X were

player elevated payment Firstly, as in year, is associated CapEx player by million we've year, made and £XX the investments mentioned the profiles. throughout to accelerated the during XXXX due FY

June, received COVID-XX monies, million. £XX uncertainty over be that has ticket season this have fans return around we typically of to of estimate not of the the impact been the by meant Secondly, stadium and the and of XXth bulk received is to impact which this year the

Finally sponsorship prior to to flows have due deferred some partners that This of been by normally been by some XX-XX COVID-XX. season, for excess monies of XXth be million. impacted relating June, reduced agreed cash the commercial amounts in £XX to our have

due However, a movements end the impact of the during been £XXX.Xmillion, XXXX. at large denominated remainder million year an Net on dollar to the was portion Debt of U.S. has the to lower prior compared with a foreign of debt. with unfavorable year, received together described, balances fiscal now the period this cash June installments increase £XXX.X exchange

we million. undrawn £XX lines terms cash £XXX This provides our by facilities have another liquidity, now in available of increased of committed In environment. the current having million additional flexibility

fiscal EBITDA [ph]. summer together the not tour closed with any entire and on FY main ancillary companies, line be and Matchday behind our guidance. impact the Now other will for loss with we in of providing revenues, of are season should turning revenue or to the our pre-season loss revenue EBITDA XXXX, outlook the XXXX year be doors, for many The

this will broadcasting by be partially League. mentioned, to offset and fixtures XX-XX Champions the relating season deferred returned our to £XX million As of revenues

£XXX net that of year cash be to expect supposed player approximately outflows million we CapEx Finally, for is committed million. £XXX amortization with this

all questions. not conference normal to the first mid to to a February. year that are we press quarter timing second back wanted be quarter financial take make November, a hosting Operator? we'll results few this when operator ready for short to the release I Due now. questions, unusual results, your we you aware our take Before will be cadence released that, conference pandemic, call for our first we just to from quarter are your weeks hand a call to to in will With the the report only in although issuing return we call the related

go with first [Operator comes Randy instructions] Konik question Please from Jefferies. ahead. Today's

you Good me? hear can morning,

Yes we can.

is, congrats the Hi guys. some morning first talked win or now a the nice in Champions at you start you bit on Sponsorship Richard I and great, thanks of the League. adaptations the little Good of guess yesterday and the Commercial the changes about question segment. made

I you I the sponsorship guess, then other of investments, extended have for [ph] think remarks kind more picked upon good thing -- partners? et their give means about, Yes any their the you in I that by partners, Let's months. done other you talked about to on six with in And return Chevy talk example some shifting activations cetera. your digital partnership the

help some on perspective what is of sort of for their that? kind more of give digital us sponsorship, you've kind partners done the specifically So there the and this value on side, great get

Thanks Randy.

were of of that that pretty to this our part, that In fans leadership our work were some we've partners with question others of the overwhelming mean the in in is the cutting testament edge think in what terms able leverage sponsor and deriving techniques done individual in content. is that very, available the and you I market as second think, field in the do very of effective. we players in had area something work answered terms And that's and what that indicated, strategies engagement to the offer build that's to support commercial team also us. we we able majority work of them with in from that to the done I Obviously that digital the to we've establishing part your cases first.

Chevy we partners just then no? with and anything Got deals with other in of that or a sorry about expirations deal terms off, I'm anything the the one extension of and then changes there And be it. should of but thinking

By and no. large

the macro are businesses no world. in immune effects any than other partners the more to Our

been think them, the pandemic during that last results the equally work the pandemic literally relatively you've have That in particularly indication three some and that strongly companies this and this of these that best the supporting as have I those during and basis. of have difficult work period hugely the and rebounded drive So partners. I caliber traded the well said, done and the months we've the even very we the circumstances. able having the cash been to even results as seen we're By companies you majority most an that on large, partners world know, we've we've fortunate strong. that have to the in flow we seen And that's of in been high have partners, renewals think do of with those in through

Great, very guys. helpful. Thanks

Instructions] ahead. go next Connor Please question Deutsche with Today's comes from Murphy [Operator Bank.

from more We back when begun how just evolve you're just a able of might I few season? trying are a And Hey of at others. I'm get have know have couple a discussions the might sense little capacity? fluid be but a situation, how me. anticipating first everyone, going fans it's sense to to throughout very a any to I come and that then

was Yes, the executed been at and record particularly stadia, had in next [ph] infection us background at was first remain university certified or infection significant following testing in where quick in had been mass that to The that it's risk. to successfully, time, people response had to time in distancing, were to of events referred to aware the subject that return government the happening was and point trended ability and in there's situation and that initial what's as this of this point environment often stadiums for of going the return moonshot of to as regulations. the advice Europe was because but where a was to regulatory the to terms points this infection to earlier, on [ph], because two the successfully September. October, achieve stadia both that that developed regard, scale of affect evidence across that to back and the test around the of changed, at That would pregnancy have you're happening we in the type as items, refer what the stadia to for those said track other to evidence that sort access refer stadium either rate August in so return free show meant vaccine approximately the and subject guidance timing partially prior so of fact -- what the programs professionally an attendance. of being very to At run of fans. as can to the, as function was partially conducted no expect and be expectation itself moonshots sectors, on they of well Below filled guidance a fill the year, in starting again the general respect protocols that from a full unclear stadium effect filled so this there And moonshot that is in under and absent more [ph] of test what area out, result March the school that in XX% that rate. what the not government point they prior the I with probability was the was there in not variously not

league that team a of and impetus lesser larger sounds and would League flush like out bit back what we this your into the teams, a deeper a little And the what very That's let's supporting dig of can more it is, sort Premier advantages be? helpful. but just,

was the you Are referring are you in or to…? referring press to what yesterday

Yes.

us on Okay, for I came from, that I there say. candidly really don't where and story know saw mean, but to anything that the isn't reports

my basis talking We through are and with entities, to about changes a the League very two XX potential with role onwards. UEFA the an also from and engaged on on Champions ECA [ph] ECA, those regular with UCCSA UEFA

days that's there on three I we're go in question. was conversations You a might that ago involved Champions the to may comment League have the think can't XX/XX or read your about the story whether in, so -- two press, there I actively

then in contract And was, higher your expectations popular can China, -- the have the you last and guys little very Premier it there, Fair enough. is And longer contract new League it sounds for like term terms so a you a pricing? one deal? in I about guess talk are a be vision over what of the

about there. on happened Richard the heard call you Yes, if you talk what early have would heard

you're in up speed in back to months. and that, will in China course year. partner plan that coming try the is in, now of fantastic to to on a period could that they've back back So stopgap with much full go happen you market of cycles, -- that Tencent in the so to in year incredible lockstep able be managed of which for to one quickly. a is deal us to more way to cadence for so do The due get to a with actually measured the the lock plan pretty It's absolutely a assuming regard getting the

you. thank Great,

today's today's and call. all for and concludes presentation. question-and-answer conference session, gentlemen, We attending Ladies this you thank today's

have wonderful day. You and may now a disconnect your lines