Manchester United's cash reserves fall

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LONDON -- Manchester United's cash reserves fell by $158 million in six months partially to finance an investment in a roster failing to maintain the English champions' dominance.

As a result of spending that also took in stadium improvements and a bond repurchase program, the Old Trafford bank balance dropped from $238 million to $80 million through Dec. 31, the club's quarterly accounts revealed on Tuesday.

Despite net spending of $76 million on new players, including goalkeeper David de Gea, defender Phil Jones and winger Ashley Young, United failed to advance past the first round of the Champions League and has been eliminated from both domestic cups. Meanwhile, neighbor Manchester City holds two-point lead in the Premier League.

United spent $8.4 million in the three months ending Dec. 31 buying back bonds that were issued two years ago to raise $762 million to replace long-term financing and reduce debts to hedge funds.

United has spent $147 million repurchasing that debt -- more than the $130 million received from Real Madrid in 2009 for the sale of Cristiano Ronaldo.

The club's debt, resulting from the 2005 takeover by the American Glazer family, stood at $694 million at the end of 2011 and incurred almost $39 million in interest payments in six months.

Although the debt was down from the $801 million at the end of 2010, it rose again in the final three months of 2011 by $9.5 million.

However, United's moneymaking abilities appear to be undiminished, with $277 million in revenue in the six months ending Dec. 31 -- up more than 10 percent on the same period a year earlier due largely to a rise in TV income and a new training jersey sponsorship deal with express delivery and freight firm DHL.

"Revenues continue to grow strongly although costs are increasing just as quickly so pretty much negating that growth," the Manchester United Supporters' Trust said in a statement. "However the key figures of interest to supporters show the Glazers have now spent every penny of the money received from the sale of Ronaldo, and more.

"That's now 92.8 million pounds ($146 million) spent on buying back their own bond debt that they loaded onto our club."

MUST said that since Ronaldo's departure, net transfers totaled $142 million while $356 million had been taken out of the club to cover debt payments and interest.

"What could the club have done with that extra 225 million pounds ($355 million) ? Cheaper tickets for loyal fans, investing massively in the squad and stadium, developing and retaining the best youth players, competing on an equal basis with the very best teams in Europe," MUST said. "This is the true cost to Manchester United of the Glazers' ownership."

Copyright 2012 by The Associated Press

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