Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Manchester United Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in listen-only mode. Following the presentation, we will conduct a question-and-answer session [Operator Instructions].

We would also like to remind everyone that this conference call is being recorded. Before we begin, we would like to inform everyone that this conference call will include estimates and forward-looking statements, which is subject to various risks and uncertainties that could cause actual results to differ materially from these statements.

Any such statements are forward-looking statements, should be considered in conjunction with the cautionary note in our earnings release regarding forward-looking statements and risk factor discussions in our filings with the SEC. Manchester United PLC assumes no obligation to update any of the estimates or forward-looking statements.

I will now turn the conference over to the Executive Vice Chairman of Manchester United, Mr. Ed Woodward. Please go ahead sir..

Thank you, and thank you to everybody for joining us today. We're looking back today on what's been one of the most extraordinary and challenging seasons in recent history and I'm proud of the way the club continues to respond.

There are still big challenges and uncertainties ahead as the COVID-19 pandemic continues to disrupt our way of life across the globe. This disruption is clear to see in the financial results that we're announcing today and we expect the impacts remain visible for quite some time to come.

However, the past year has also demonstrated the underlying strength and resilience of the club, the special role that sports plays in our societies and the meaningful impacts the club can make in our communities through this period of uncertainty.

On the field we will never be satisfied as Manchester United makes the winning choices, but our third place finish in the Premier League and strong cup runs last year showed us that while there is more hard work ahead and the path is not always smooth, we are making progress.

We have a clear strategy under our league to build a successful committed team with a pool of homegrown talent blended with high quality recruits that plays fast line attacking football.

To that end we are pleased with our recent additions to the first team squads of Donny van de Beek and Alex Telles, two players we have been tracking as part of our proven process for a long period of time and Edinson Cavani, a top striker who as a proven new option to our forward line.

We also welcome Facundo Pellistri and Amad Diallo, who will join in January, two exciting young prospects who we have also been scouting extensively.

Added to the arrival of Bruno Fernandes earlier this year, these recruits underscore our continued commitment to strengthening the score to take investment in new players in summer 2019 to over €200 million, more than any other major European club over that timeframe.

We are also continuing to invest strongly in our thriving Academy, these grads just make up a third of our current first team squad. The pipeline of new talent is exciting as ever with only giving first team debuts to eight Academy graduates last season, the highest number since the paltry [ph] days of breaking through six to eight years ago.

This space and use remains an integral part of our identity at the club. Even with the addition of some more experienced players this month, our squad remains one of the youngest in the Premier Leagues with an average age of 25. This means the team has potential for significant further improvement as our young players develop and mature.

We are also tremendously excited by the progress being made by our women's team under Casey Stoney following the arrival of several new players this summer including Tobin Heath and Christen Press to - both two-time World Cup winners with the U.S. national team.

While our commitment to investment remains it must be balanced with the recognition of the extraordinarily challenging environment facing us and also more positive time. Let me share a few initial observations on this summer's [indiscernible] data finished recently.

Gross transfer spend across the big five European leagues were down about 40% this summer driven by both the lower volume of transactions and lower average fees.

The contraction was also felt at the top end of the market with no transactions over €100 million for the first time in five years and an almost 30% reduction in the average fee for the top 30 transfers. There was a material increase in the share of free transfers and loans which were up 20% and 30% respectively.

At the club level many of our peers were cautious with Real Madrid, Barcelona, Bayern Munich, Juventus and PSG having combined net spend of €9 million. Of course there were one or two outliers the other way and most likely Chelsea who are making up for not being able to be active during their transfer ban from summer 2019.

But we need to look across multiple windows to gain a clear perspective. And as I mentioned earlier, our aggregate net investment over the last three terms or windows compares very favorably with our peers. The bottom line is we are investing and we will continue to invest to back our manager.

More recently you may have read about the discussions taking place within English football about plans to address the near team for the financial predicament created by the pandemic for clubs in the lower leagues. We've been playing an active role in those discussions because we strongly believe in supporting the English football pyramid.

Both in the short term to address the issues created by COVID-19 and in the long-term to improve financial sustainability at all levels of the game. There will always be intense debate around any changes to the structure of football just as there was before the formation of the Premier League 28 years ago.

Now at this critical juncture for the game, we must ensure that the huge success of the Premier League is reinforced while assuring that the wider football pyramid continues to thrive in a rapidly changing medium environment. Achieving this will require strategic vision and leadership.

We are pleased that the Premier League is committed to work together on the plans and strategic structures and financing of the English football. Now it must deliver on that promise and we are committed to playing a leading role in pushing that process towards a successful outcome.

Another crucial issue for football, reopening of stadiums for spectators as soon as the government allows. While the situation at Greater Manchester in UK as a whole continues to evolve, our plans for the return of fans are well advanced and we are confident of ours and the whole leagues ability to welcome them back in a safe bio secure environment.

Crowds have been permitted to return to varying degrees in over 20 European countries, albeit with significant capacity restrictions to allow for social distancing and we urge the UK Government to follow these positive examples as soon as it is safe to do so.

While we recognize that public health must always be a priority, what is needed is consistency of approach. People are allowed to sit in a narrow plane for hours or in the cinema or even watch football in a cinema and why are they not allowed inside the stadium environment which is professionally managed and controlled.

If indoor concerts are allowed, why should outdoor socially distanced football fans be treated differently? Fans are the bedrock of this game and some of the inconsistencies out there are frustrating for them and indeed for the clubs. Despite severe near-term pressures created by the pandemic, we do remain optimistic about the medium to long-term.

Demand for live football around the world is strong and our sustainable commercial model means we are very well placed to harness that growth while continuing to pursue what will always be our number one priority, delivering success, entertainment, and trophies on the pitch.

I'll now hand over to our Group Managing Director, Richard Arnold, who will update you on our key business activities. Thank you..

Thank you, Ed and thank you to everyone for joining us today. Resilience is a trait closely associated with Manchester United and since we last spoke in May, that trait has been needed and demonstrated once again. Cliff will walk you through the impact that COVID-19 has had on our revenue streams and the continued impact we expect into fiscal 2021.

And I'd like to share a few insights into how we've faced this challenge. First, throughout the fourth quarter, we continued to use our global platform to raise awareness and provide assistance to those in need in our surrounding communities across the UK and internationally.

We stepped up our efforts via our Manchester United Foundation by supporting local food banks, providing meals for the NHS, making cash donations to partner schools, teaming up with supported clubs, and launching a fundraising campaign.

Contributions to date are about already over £1 million pounds and climbing, and as we highlighted in May, we're appreciative of the generosity of our players and our colleagues who have donated their time and energy and it is our intent that these efforts will inspire more sustainable long-term support for our community.

We are also incredibly proud of the individual efforts of Marcus Rashford, who served as an exemplary red both and off the pitch, this year by using his platform to bring incredible awareness to a cause that is very dear to his heart, child hunger.

Marcus was successful with not only championing this very important cause and bringing considerable awareness that applied to many UK schoolchildren who were suffering during this pandemic, but he also campaigned for and successfully achieved, changed the affected children across the whole country.

We also wanted to take a moment this morning to discuss the diversity and inclusion initiatives of the club. Whilst this is a topic that is rightly moving to the forefront of conversations in boardrooms across every industry, we are proud that we have been leading and executing in this area within our organization over many years.

Whilst we acknowledge that there is clearly no room for complacency, our All Red All Equal initiative, which commenced in 2016 is the most invisible example and is both a guiding principle and remains a vital annual campaign for the club.

We’ve committed to striving for real change within the industry on and off the pitch, both through our own campaigns and through the support of other organizations.

Turning to our business, we have needed and been able to continue to strengthen our digital and media capabilities during the pandemic, it's when we achieve higher engagement levels relative to last year across all platforms during the fourth quarter.

To highlight a few stats, despite the pandemic, our total rate [ph] from April through the end of the season in July improved by high single digits against the prior season.

On our owned and operated platforms, June and July represented record months for engagement on our mobile app, whilst it was also a record year on our social channels as we achieved over 1.1 billion social interactions, higher than any season previously and 24% higher than last season.

This engagement in turn contributed directly to stronger e-commerce conversion levels. Whilst our Megastore reopened on June 15th foot-traffic has remained depressed relative to last year, obviously given the absence of fans Old Trafford home matches and to a lesser extent the continued closure of our museum and tour operations.

However, our e-commerce business with Fanatics has performed ahead of expectations and we plan to accelerate our e-commerce initiatives throughout fiscal 2021. Turning now to our sponsorship business, fiscal year 2020 was a solid year and despite the pandemic it was one of the busiest in the Club’s history for our sponsorship team.

For the year we signed eight new sponsorship deals with partners including LEGO, Mondelēz, and Visit Malta. Manchester United’s commercial strength thrives not least from its strong and effective commercial partnerships.

Pandemic proved an opportunity to demonstrate resilience in delivering to our partners, in particular, migrating to delivering digital campaigns in the absence of games. As a result of this we've also renewed eight partnerships. Whilst we remain in the midst of this pandemic, we're mindful of the current tenuous macro backdrop affecting our partners.

We've been working very closely with them to support their activities through these challenging times. To that end, due to the disruption caused by the pandemic, we entered into a variation agreement with General Motors to extend our current shared sponsorship agreement for six months.

Though we can’t provide any certainty at this time regarding the precise timing of the return of our supports to Old Trafford due to the very fluid nature of recent coronavirus developments into U.K. we do remain optimistic.

In the meantime, we continue to prepare to welcome back our supporters with hygiene and social distancing protocols, as health and safety obviously remains the top priority.

Further, we have used the downtime to explore and implement upgrades that we believe will serve to enhance our supporters' in-stadium experience, such as contactless entry with mobile ticketing. I also want to take a moment to highlight the Club’s commitment to our supporters in China.

Since our first friendly match on the mainland in 1975, Manchester United has established a significant fan and followers in the region. Earlier in the fiscal year we announced a strategic partnership with Alibaba which includes the Youku platform and we are now producing more localized Chinese content than ever before.

We are also the first and only club to reach 10 million Weibo followers and we are also the most engaged club on both the Weibo and WeChat platforms. We remain committed to providing our passionate supporters in the country with highly engaged club content.

As you are aware in August the premier league terminated its deal with its China broadcast partner, Suning’s PPTV and the league entered into a one-year contract with Tencent, while the league searches for new long-term partner.

This means that the club has its games and content shown on both of the two largest digital platforms, as well as the expectation of linear broadcasting. Together with the exciting progress on the Hans [ph] experience centers, this puts us in a strong position for future engagement with our fans in China.

Finally, as I had highlighted, the near-term economic environment remains challenging, but there remains much to be optimistic about regarding our long-term prospects. We will be relentlessly pursuing the growth opportunities that remain for our brand.

The strong commercial engine of this Club, driven by our commitment to delivering the engagement our fans crave and demand is what ultimately fuels our ability to continuously and sustainably reinvest in the team. With that, I will now turn the call over to our CFO, Cliff Baty, to review our results and discuss our financial outlook in more detail.

Cliff?.

Thank you, Richard. Firstly, I’ll talk through our fiscal year results which have been impacted by COVID-19 pandemic and then I’ll provide some details for the upcoming fiscal year. However, we will not be providing EBITDA guidance today.

As a reminder, the year-on-year comparisons relative to fiscal 2019 have been impacted by non- participation in the Champions League as well as a number of games played in the year.

In terms of headlined figures, total revenues for the period were £509 million, down £118.1 million versus last year due to the impact of COVID-19 particularly on broadcasting and Matchday revenues. Adjusted EBITDA was £132.1 million, down £53.7 million from prior year.

Overall, we estimate the impact of COVID-19 on total FY '20 revenues were £70 million of which £40 million were lost from Matchday closures, Premier League rebates, an impact on our Megastore and other operations.

The remaining £30 million relates to broadcasting revenues from the 2019-2020 seasons' matches which were played in July and August and those revenues will be recognized in the current year.

We estimate that the adjusted EBITDA outcome for FY '20, had COVID-19 not occurred, would have been an additional £60 million, delivering a total adjusted EBITDA slightly over £190 million comfortably ahead of our previous guidance range.

Turning to key items in the results, total commercial revenues were £279 million with sponsorship revenues of £182.7 million, 5.6% higher from the prior year. This reflects the underlying growth we saw throughout fiscal 2020.

Merchandising and licensing revenues were £5.8 million below prior year at £96.3 million reflecting the closure of the Megastore from mid-March through mid-June. Broadcasting revenues decreased by £101 million to £140.2 million.

This reflects both the lower Europa League revenues in FY '20 compared to Champions League in the prior-year, as well as the impact of 10 matches in the 2019-2020 season, including six premier league matches that were played after the period end.

Revenues were also further impacted by rebates to broadcasters which we estimate totaled £14 million for the full 2019-2020 season with around £11 million recognized in FY '20. Matchday revenues for the year decreased by £21 million to £89.8 million, impacted by the suspension of matches in March.

This meant revenue associated with four home Premier League games and the Europa League round 16th match was lost. Moving down to the income statement, operating expenses, excluding depreciation, amortization, and exceptional items, decreased by 14.6% versus the prior year.

This includes wages which were down 14.5% primarily due to contractual reduction related to not participation in the Champions League. Other operating expenses for the fiscal year decreased by £16.1 million reflecting suspension of matches together with the reduced activity and cost saving actions taken in response to COVID-19.

Amortization costs were £126.7 million for the fiscal year, a decrease of £2.5 million versus the prior year. Net finance costs for the year were £26 million, an increase of £3.5 million due to foreign exchange movements on the unhedged portion of our U.S. dollar debt. As mentioned in previous quarters, our cash interest costs in U.S.

dollars remained broadly consistent year-on-year. Turning now to our balance sheet. At the end of June, cash balances were £51.5 million, down £256.1 million against the prior year. This decrease is comprised of three main items.

Firstly, as we've mentioned throughout the year, player CapEx is elevated in FY 2020 by £56 million due to player investments made during the year, and the associated accelerated payment profiles.

Secondly, the impact of COVID-19 and the uncertainty around return of fans to the stadium has meant that the bulk of season ticket monies, which is typically received by the 30th of June, have not been received this year and we estimate this impact to be over £50 million.

Finally some sponsorship monies normally due prior to 30th of June, relating to the 20-21 season, have been agreed to be deferred for some commercial partners that have been impacted by COVID-19. This reduced our cash flows by amounts in excess of £80 million.

However, a large portion of this has now been received with the remainder June installments during fiscal year 2021. Net Debt at the period end was £474.1million, an increase of £270.5 million compared to the prior year, due to the lower cash balances described, together with the impact of unfavorable foreign exchange movements on a U.S.

dollar denominated debt. In terms of cash liquidity, we now have £200 million of undrawn committed facilities having increased our available lines by another £50 million. This provides additional flexibility in the current environment.

Now turning to our outlook for the fiscal year 2021, in line with many other companies, we are not providing any revenue or EBITDA guidance. The main impact on revenue and EBITDA for FY 2021 will be the loss of Matchday and ancillary revenues, should the entire season be behind closed doors, together with the loss of our pre-season summer tour [ph].

As mentioned, this will be partially offset by £30 million of deferred broadcasting revenues relating to season 19-20 fixtures and our returned to the Champions League. Finally, we expect that committed player CapEx net cash outflows for this year is supposed to be approximately £120 million with amortization of £127 million.

Before we hand the call back to the operator to take your questions, I wanted to make you all aware that we will not be hosting a first quarter conference call when our results are released in mid November, just a few short weeks from now.

Due to the unusual timing this year related to the pandemic, we'll only be issuing a press release for the first quarter financial results, although we will return to normal conference call cadence for our second quarter report in February. With that, we are ready to take your questions.

Operator?.

[Operator instructions] Today's first question comes from Randy Konik with Jefferies. Please go ahead..

Good morning, can you hear me?.

Yes we can..

Hi great, thanks guys. Good morning and congrats on the nice win yesterday at the start of the Champions League. I guess the first question is, now Richard you talked a little bit about some of the changes or adaptations you made in the Commercial and Sponsorship segment.

Let's talk about, I guess, for example Chevy [ph] you extended the sponsorship by I think six months.

Yes have you done that with any other partners? And then the other thing I picked upon in the remarks you talked about shifting some activations to more digital means kind of give your partners, good return on their -- in their partnership investments, et cetera.

So give us some perspective on what you've kind of specifically done more there on the digital side, and help the partners kind of get great value for their sponsorship, is this sort of that?.

Thanks Randy. I think, in some part, the second part of your question answered the first. In the overwhelming majority of individual sponsor cases what we've done is work with partners to build commercial strategies that leverage what is available to us.

Obviously as you indicated, the work that we've done in establishing leadership in our field in terms of our digital engagement techniques with fans mean that we were able to offer them something that's pretty cutting edge in the market and very, very effective.

And I think that's testament to the work of the team in this area that we were able to do that and also the support that we had from players and others in terms of deriving that content..

Got it.

And then and then anything changes with expirations of deals in terms of the extension of the Chevy deal and I'm sorry just a one off, but anything there that we should be thinking about with other partners or no?.

By and large no. Our partners are no more immune to the macro effects than any other businesses in the world. So you know, you've seen in these results the work that we've done supporting them, particularly on the cash flow basis. That having been said, equally we're hugely fortunate that we have some of the best companies in the world as partners.

By and large, the majority of those have rebounded very strongly and have traded relatively well through the period and I think that the renewals we've seen even during this pandemic and literally during this pandemic in the last three months have been strong.

And I think that that's an indication of the high caliber companies we have as partners, and the work that we've been able to do with those partners to drive results in even the most difficult of circumstances..

Great, very helpful. Thanks guys..

[Operator Instructions] Today's next question comes from Connor Murphy with Deutsche Bank. Please go ahead..

Hey everyone, just a few from me. We first have begun to a little more when you're anticipating fans might be able to come back at any sense of capacity? I know it's a very fluid situation, but I'm just trying to get a sense of how discussions are going and how that might evolve throughout the season? And then I have a couple others..

Yes, so as you're aware with subject to government regulatory environment in this regard, the initial expectation had been that there would be a return to partially filled stadiums starting on the first of October, following on from test events that were successfully conducted in August and September.

That advice was changed, not because of the effect of what was happening as a result of the partially filled stadia, and in fact there's significant track record across Europe for that being executed successfully, but because of what was happening in other sectors, particularly around the return to school and university and the background infection rate.

And the government guidance had been at that point in time, that absent what they refer to as the moonshot [ph] was not to affect -- not to expect full stadia prior to March next year, where they refer to moonshots [ph], that is the ability for us to have either variously vaccine programs or show quick response testing at mass scale so the, and what's often referred to as pregnancy type test where people can achieve certified infection free attendance.

At this point in time it's unclear as to the probability and timing of those two moonshot [ph] items, so we remain subject to the more general situation in terms of the return of fans.

The guidance in respect of the fill rate was a function of distancing, both in the access points to the stadium and in the stadium itself and that trended out, approximately 30% under the prior regulations.

Below again going back to what I said earlier, the evidence was that the sort of professionally run stadia that had very well developed protocols in this area meant that there was no evidence at this point that that was an infection risk..

That's very helpful.

And can we dig a little more into this deeper back your team Premier League and what the impetus is, it sounds like supporting lesser teams, but just, let's sort of flush that out a bit and what the advantages of a larger league would be?.

Are you referring to what was in the press yesterday or are you referring to…?.

Yes..

Okay, I mean, I saw the reports on that and candidly don't know where that story came from, but there isn't really anything for us to say.

We are engaged on a very regular basis through my role with an ECA, and also on the UCCSA [ph] with UEFA with those two entities, ECA and UEFA talking about potential changes to the Champions League from 24 onwards.

You might have read I think two or three days ago in the press, there was a story about whether the Champions League may go to 30/16 that's -- there the conversations that we're actively involved in, so I can't comment on your question..

Fair enough.

And then the last one was, can you talk a little about the Premier League contract in China, and what the expectations are in terms of a new deal? And it sounds like you guys have -- it is very popular over there, so I guess your vision be for a longer term contract higher pricing?.

Yes, if you heard on the call early you would have heard Richard talk about what happened there. So assuming you're up to speed with regard to that, absolutely the plan on the back of getting a fantastic partner in, which is Tencent in China for a -- you could be able to stopgap period of one year.

It's pretty incredible actually that they've managed to lock that in so quickly. The plan now is to go back to market in due course in a much more measured way and try to do a full year deal to get us back lockstep with the cadence of the cycles, so for that will happen in the coming months..

Great, thank you..

Ladies and gentlemen, this concludes today's question-and-answer session, and today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day..