Manchester United extended its presence in financial services yesterday by agreeing with Bank of Scotland and Zurich Financial to launch a new range of affinity products under the MU Finance brand.
The new services will include personal loans as well as a range of investment, mortgage and general insurance policies. The deal will see a financial services shop established at Old Trafford where Zurich's financial advisers will offer fans personal financial advice.
News of the move came as the club reported a 30 per cent increase in pre-tax profit to £21.8m for the year to July. Turnover grew 12 per cent to £129.6m, helped by a first full-year contribution from expanding Old Trafford to 67,700 seats and gains in sponsorship revenue. The dividend was raised 5.3 per cent to 1.39p.
Peter Kenyon, chief executive, said: "We are a different business to other football clubs. We think there is very considerable potential for growth."
For four years, United fans have been able to invest in a savings scheme with Britannia Building Society and carry a branded credit card from MBNA Europe Bank. Each venture earns United more than £500,000 annually.
The club's £50m spending spree on new players, primarily Juan Veron and Ruud van Nistelrooy, resulted in deficit of £1.2m at 31 July compared with a £10.6m surplus a year ago. The figures do not include the proceeds from the September sale of Jaap Stam to Lazio for £15.3m.
As transfer fees have risen, so too have player salaries, though United recorded a relatively modest 12 per cent rise in this expense to £50m. But Mr Kenyon said that wage inflation of 25-30 per cent is likely in the current year. Amortisation of player transfer fees fell to £10.2m in fiscal 2001, down from £13.1m. The signings of Veron and Van Nistelrooy will add a further £17m in amortisation charges in fiscal 2002.
Commenting on the transfer deals, Mr Kenyon said: "We felt it was time to strengthen. We spent heavily, we spent wisely."
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