Two football clubs United in name but with finances worlds apart

The Blades’ 2011 annual accounts reveal a 20 per cent fall in turnover to £16.2m from £20.5m.

Turnover has halved since 2009, when the club nearly reached the promised land of the Premier League and associated TV broadcast riches.

It was also the year that the club saw its parachute payments fall by £10m.

Sheffield United reported a pre-tax loss of £13.6m in the year ending June 2011, narrower than the £18.8m loss of the previous year.

Relegation from the Championship cost the club £700,000 reduction in gate receipts, which fell to £4.2m as average attendances slipped to 20,632 from 25,120. Commercial, retail and catering revenues were similarly lower.

The Blades said owner Kevin McCabe has pumped in working capital “to ensure funding for the current season is assured”.

The club slashed operating costs, including players’ wages, to £18.2m from £22.3m, and cut back administration costs to £12.5m from £15.8m. It also managed to reduce net debt to £32m from £57m.

The club sold its stake in the neighbouring Copthorne Hotel and disposed of the Blades Enterprise Centre, although it retains an option to buy them back.

The scale of the McCabe family’s support was illustrated by the decision to convert more than £17m in loan notes into equity.

Mr McCabe described the financial year and football season as “wretched” for everyone connected with Sheffield United.

“But rather than wallow in self pity we have used these difficult experiences to reassess the whole way the Blades are run,” he said.

“It has meant taking some painful decisions from which we hope to emerge stronger and, as a result, more successful in years ahead.”

He reiterated his ambition for the club to win promotion this season and said his medium-term objective remains to establish the club as a financially self-sufficient Premier League club with a core of young players built around the 2011 FA Youth Cup final squad.

Julian Winter, chief executive, said the club would continue to consider external investment.

Meanwhile, Premier League champions Manchester United reported an increase in first quarter earnings and said it had reduced its debt, benefiting from a sharp rise in commercial revenue. The club, which has put on hold a planned $1bn flotation in Singapore because of market volatility, said that earnings before interest, tax, depreciation and amortisation rose by 30 per cent to £19.3m in its first quarter to end September.

Man Utd said total revenue rose by 17 per cent to £73.8m. Its gross debt has fallen to £433.2m from £516.7m.