Manchester United Plc Q1 FY2020 earnings call

• Ed Woodward: Ultimate goal is to win trophies with fast, fluid-attacking football using academy graduates and world-class acquisitions. Investments in recruitment infrastructure, academy (graduates playing more minutes, 31 of 32 goals this season by graduates, approaching 4000 consecutive competitive games with academy players). European progress (Europa League knockout, League Cup quarterfinals), women's team in WSL. Broadcast developments (PL live audiences up, CBS deal for UEFA, Amazon Premier League broadcast).
• Richard Arnold: Media/digital milestones (highest daily active users on app, monthly active users up, women's team doc, social engagement). Sponsorship revenues up, megastore turnover ahead, eCommerce growth, venue products selling well, capital projects on track.

Total revenues for the first quarter were £135.4 million, up £0.4 million versus the prior year, with adjusted EBITDA of £34.8 million, up £5.4 million over the prior year. Commercial revenues were £80.4 million, an increase of £4.5 million versus the prior year, with sponsorship revenues at £53.6 million, an increase of £4 million. Broadcasting revenues decreased by £9.9 million to £32.9 million due to participation in the UEFA Europa League compared to the Champions League in the prior year. Matchday revenues increased by £5.8 million to £22.1 million. Operating expenses excluding depreciation and amortization were down £5 million versus prior year, with wages down £6.8 million. Amortization costs were £32.2 million for the fiscal quarter, a decrease of £2.9 million versus the prior fiscal year. Net finance costs for the quarter were £8.5 million, an increase of £3.3 million due to foreign exchange movements. Cash balances at the end of September were £140.3 million, down £107.2 million versus the prior year, and net debt was £384.5 million, an increase of £137.3 million compared to the prior year.

Full year fiscal 2020 revenues are expected between £560 million to £580 million and adjusted EBITDA between £155 million to £165 million.

Q: Randy Konik asked about opportunities for increased commercialization on the app and rethinking the addressable market for sponsorships.

A: Richard Arnold said the app's focus has been on fan engagement and user experience first, with the next phase being to grow the app's scale for integrated commercialization. Regarding sponsorship, underlying demand for rights is strong, pipeline is good, new categories are emerging, and there's strong price point growth in existing categories, so they remain confident in sponsorship growth.