Manchester United reported sales of its apparel and other licensed products declined 4.4 percent from October to November as it was soliciting bids from sporting goods companies to manage the business.
The British football club reported sale sof merchandise, apparel and products licensing (MAPL) decline by £9.1 million ($15 mm) in the second fiscal quarter ended Dec. 31, 2013. Fiscal year-to-date revenue from the business was £19.8 million ($31 mm), up £900,000, or 4.8 percent.
Nike has run the business for MANU since 2000 under a licensing agreement that requires Nike pay the club a minimum of £303 million over 13 years, plus half of annual profits from the club's merchandising and licensing operations. As part of the deal, Nike provides the team’s soccer kits and runs its stores in England, Singapore, Macau, Thailand and India.
However, MANU and Nike have been unable to agree to terms for extending the contract and MANU invited Adidas, Warrior and Puma to submit bids on the business this summer, according to reports by British media. Those same reports have speculated that club management, which is controlled by the Florida-based Glazer family, is pushing for a deal that would pay MANU $1 billion over 10 years.
While ranked as the third most valuable pro soccer franchise in the world, MANU has fallen to seventh place in the English Premier League this season. The lack of wins, however, has had relatively little impact on the club’s overall Commercial revenues, which are increasingly being driven by sponsorships such as a $600 million deal the club signed with Chevrolet in 2012. The club reported Sponsorship revenues rose nearly 40 percent during the quarter, more than offsetting declines in merchandise and online advertising. Commercial revenues for the six months ended Dec. 31 are running 30.0 percent ahead of the comparable period a year ago.
