Manchester United PLCResults for Year to 31 July 2002

30 September 2002

Not Just a Football Club……

Not Just a Football Club…….

Agenda

• Introduction Peter Kenyon

• Group results for the yearNick Humby

• From fans to customers David Gill

• Strategies to build on Peter Kenyon

on the global brand

Not Just Winning…….Creating Value

• Turnover up 13% to £146.1m (2001 £129.6m)

• Profit before tax up 48% to £32.3m (2001

£21.8m)

• Dividend increased by 55% to 3.1p (2.0p) with a

final normal dividend of 1.46p per share and a

special dividend of 1.00p per share.

Not Just Winning…..Strong Revenue Growth

31/7/02 %31/7/01

£000 change £000Match day 56,253 9% 51,763Media 51,948 66% 31,237Commercial 26,493 -3% 27,411Merchandising 11,368 -41% 19,158Total turnover £146,062 £129,569

Growth over last year 13%

Not Just Winning……Increasing Dividends

2002 2001 (restated)

£000 £000

Turnover 146,062 129,569

Profit before tax 32,347 21,778

Tax (7,308) (7,399)

Profit after tax 25,039 14,379

Effective tax rate 22.6% 34.0%

Earnings per share 9.6 5.5

Dividend per share 3.1 2.0

Dividend cover 3.1 2.8

Not Just Winning…..Increasing Profits

2002 2001£000 £000 £000 £000

Operating profit 33,929 31,680Player amortisation (17,647) (10,173)Profits on player disposals 17,406 ( 241) 2,219 (7,954)

33,688 23,726Exceptional costs (864) (2,073)

32,824 21,653Associates/JV’s (504) (602)Interest 27 727Profit before tax 32,347 21,778

Not Just Winning…….Managing Costs

2002 % 2001£000 increase £000

Turnover 146,062 13% 129,569Gross profit 130,377 21% 107,449Wages & salaries (69,999) 40% (50,002)Other operating expenses (26,449) 2% (25,767)Operating profits 33,929 31,680Gross margin 89% 83%Wages a % of turnover 48% 39%Operating margin 23% 24%

Not Just Winning….. GoodContribution from Each Stage of ECL

Profits

Phase II£6.0m

Semi Final£3.7m

Phase I£13.1m

Quarter Finals£2.9m

Revenue

Phase I£15.3m

Semi Finals£4.2m

Quarter Finals£3.8mPhase II

£8.6m

Profits increase by 34% over last year

Not Just Winning……Managing the Cash

2002 2001 £000 £000

Cash from operations 42,806 50,882Net transfer fee (12,083) (43,310)Fixed asset investment (13,923) (7,802)

16,800 (230)Dividend & interest (5,197) (4,467)Tax (9,433) (7,377)Other - 274Net cash flow 2,170 (11,800)Net cash/debt on 31 July 933 (1,237)

Not Just Our Fans…...Our Customers

Executive Box Seats

Season Tickets

MU Finance Customers

MU TV Subscribers

Members

Museum/Tour Visitors

ManUtd.com Unique Users

Purchase of Replica Shirts

UK Fans

Overseas fans

Increasing

Number

of

Fans

Increasing

Value

as

Customers

Match day Commercial Media

Not Just Our Fans……Valued Customers of Our Partners

PRINCIPAL SPONSOR OF

MANCHESTER UNITED

THE OFFICIAL BEER OF

MANCHESTER UNITED

OFFICIAL BETTING PARTNER OF

MANCHESTER UNITED

THE OFICIAL RADIO STATION OF

MANCHESTER UNITED

OFFICIAL BUSINESS SOLUTIONS PARTNER TO

MANCHESTER UNITED

OFFICIAL INTERNET PARTNER OF

MANCHESTER UNITED

OFFICIAL SOFT DRINK SUPPLIER TO

MANCHESTER UNITED

OFFICIAL GROOMING PARTNER OF

MANCHESTER UNITED

OFFICIAL IMAGING PARTNER OF

MANCHESTER UNITED

Not Just Fans……MU Finance Customers

Not Just UK Fans……Developing New International Products

Nike• Merchandising business transferred to Nike on 1st August

2002• Minimum guarantee for each of the 1st 4 periods to 31 May

of £20.7m • First 12 months to 31July 2003 worth £24.2m and year to

July 2004 £20.7m• Failure to qualify for Europe would reduce guarantee by £2m

p.a.• Break point for Nike after 6 years• Confident start with launch of new home shirt• New deals - JSV, Central Trading and Sport Etail assigned to

Nike

Not Just UK Fans……Developing New International Activity

Reds Café• Licence trademarks for launch of chain of family

restaurants in Asia– First 3 sites identified

US Tour• Promote Manchester United in US ahead of next

season– Four games (Seattle, Los Angeles, Boston and New

York)

Not Just Football Tactics……Football Strategy

• Contracted Beckham, Keane, Stewart, O’Shea in addition to 8 last year

• 19 players under contract for 3 seasons or more, average age 26

• Secured renewal of Manager for 3 years

• Acquired Rio Ferdinand for £29.3m

• Developing Academy to produce new 1st team stars

• International alliances to identify and develop new young players

Not Just Football Tactics……Media Strategy

• Manchester United live games averaged 3 million UK viewers

• Manchester United PPV games attract 68% more than FAPL average buys

• Media rights acquired for Club use

– Delayed FAPL rights

– ECL archive & web rights (03/04)

• Overseas rights sold in 161 territories last year

• Key media contract renewals ahead

Not Just Football Tactics…….Business Strategy

In summary:-• Achieving good results• Maintain strong operating cash flows• Secure a stable and successful playing set up• Invest in academy to bring on next generation• Managing player costs around 50% of turnover level• Develop quality partnerships to drive new revenue streams• Deliver ambitious CRM targets• Exploit appealing media product• Dividend policy focused on rewarding shareholders when

the company is successful• Not just a football club …… a global brand

Appendices

Match Day Turnover up 9 %

Matchday Catering

£3.8m

European Games£8.9m

League Matches

£7.1m

Other£10.3m

Executive & Season Tickets£26.2m

Media Turnover up 66%

Other Media£2.0mOverseas TV

£1.5m

ECL TV£19.9m

Other UK TV

£19.7m

Equal Share UK TV£8.8m

Commercial Turnover Down 3%

Other£2.3m

Non-match day Catering

£2.7m

MU Finance£1.2m

Other Sponsors

£5.2m

Kit Sponsor£7.9m

Club Sponsor£7.2m

Average Revenue Per Match

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2,200

96/97 97/98 98/99 99/00 00/01 01/02

£,000

Catering

Merchandising

Programme

Hospitality

Gate Receipts

Season Tickets

Capital Expenditure Since Flotation

£,000Rebuilding of west stand 10,300Refurbishment of south and east stands 5,790Acquisition of United trading estate 9,125Rebuilding of north stand 18,650North stand fit-out (including museum) 17,106Land/property/car parks 10,381Carrington training ground (phase I & II) 20,942South stand executive suites 5,304Stadium expansion - east & west stands (incl. Megastore) 33,279Ticketing/membership building 1,992Other (mainly plant, machinery, fixtures & fittings) 33,320Total to 31 July 2002 166,189Expenditure on future major projects (estimate) 3,000

169,189 Net cash received from shareholders (flotation/placing) 23,425Funded via cash generated 145,764

169,189

Profit on Disposal of Players

Gross transfer fee receivable £m £mStam 16.0Cole 6.3Yorke 1.8Greening 2.0Wilson 1.5Macken 1.0Other 0.6 29.2

Less associated costs of disposals (2.9)Net proceeds of disposals 26.3Less amortised player registration costs

Stam 6.2Cole 2.6Other 0.1 (8.9)

Profit on disposal of players £17.4

New Dividend Policy

Per share Total Dividend £m

coverNormal dividend 2.10p £5.455 4.60

Special dividend 1.00p £2.598m

Total dividend 3.10p £8.053 3.10

Less interim dividend 0.64

Dividends payable on22 November 2002 2.46