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Manchester United staring at earnings loss of Sh7.2B, sack Jose Mourinho

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Jose Mourinho has finally walked the plank at the sinking Manchester United ship in a move that seems to imply the English football giants are viewing the potential failure of the club to reach the Champions League next season as a massive misstep.

The move could mean the club has scorned the fact that Mourinho may have cost the club revenue in the region of Ksh7.2 billion in the event he stayed on until the end of the season and failed to secure the club’s spot in the Champions League.

Manchester United has therefore decided to part with a reportedly Ksh3.1 billion in order to relieve Mourinho of his services, rather than suffer the setback of allowing the former Real Madrid manager the chance of leading the Red Devil’s to a potential loss of Ksh7.2 billion in Champions League money for the next season.

Another manager may still fail in leading the club to the European continental club competition, but sacking Mourinho could be a way of cutting losses and looking for a less expensive option in the interim.

The Champions League, run by European football organisation UEFA, is arguably the marquee continental club competition in the world.

Qualification to the Champions League guarantees a club a minimum of Ksh1.7 billion. With TV revenues and performance bonuses kicking in, a club may earn handsomely from anywhere within the region of Ksh4 billion to Ksh 8 billion.

Last season, United earned Ksh4.5 billion, although this was because of qualifying for the competition via the Europa League rather than through its national league.


Tottenham Hotspur and Chelsea, two clubs that also reached the same stage of the competition (Round of 16) as the Red Devils earned Ksh7.2 billion and Ksh7.4 billion respectively.

Conversely, Manchester City which got to the quarter-finals was paid Ksh7.2 billion, while the Champions League runners-up Liverpool received Ksh9 billion for their exploits in the competition.

The threat of loss of this revenue, coupled with poor performances, a string of excuses propagated to the media and strained relationships with players and executives at the club, has secured Mourinho’s departure from the club.

Financial position of Manchester United

Manchester United are 20-times champions of England, and three times winners of Europe’s most coveted trophy but are struggling to rekindle the sort of form set by the pace of former super manager Sir Alex Ferguson.

In a 26 year stint, the Scotsman established an empire which won not only on the field but also became a sporting economic giant, regularly featuring on Forbes list of valuable sports entities.

Financial results of the 2017-2018 season released by the club in September show that the club made a pre-tax profit of Ksh3.3 billion, down from Ksh7.4 billion registered in the 2016-2017 period.

Revenue grew by 2% to settle at Ksh76.7 billion amid a flat commercial income of Ksh35.8 billion.


Over the reporting period, Manchester United had the highest revenue of all Premier League clubs, at Ksh76.7 billion, with its closest challenger being last season’s Premier League champions Manchester City who registered Ksh65 billion.

Its wage bill stood at a Premier League high of Ksh38.4 billion, even though other expenses shot down by Ksh15.2 billion. Matchday revenue dropped 2% to settle at Ksh14.3 billion.

In an analysis from football business blogger The Swiss Ramble, United’s relatively poor performance in Europe, (including not even qualifying in the 2014-2015 season), means the Red Devils earned Ksh19.8 billion in the last 5 years.

In contrast, Manchester City have gained Ksh32.3 billion from European competition over the same period, with Chelsea and Arsenal registering Ksh25.1 billion and Ksh24.9 billion respectively.

At the same time, The Swiss Ramble said the club’s profits could have been higher if it did not have to deal with the consequences of the Glazer buyout from 2005 which totalled around Ksh103.9 billion, most of it financed by loans.

“In the last 10 years they [Man Utd] made operating profits of £651m [Ksh84.6 billion], which have been largely offset by net financing costs of £523m,[Ksh67.9 billion],” the football business blog said.

The Swiss Ramble however noted that the “good news” is that Man Utd’s debt has decline from a “horrific” Ksh15.2 billion in 2009 to “only” Ksh2.3 billion in 2018.

Season’s woes

A poor start to the current campaign sees the club languishing in sixth place in the league on 26 points from 17 games, one point and one position ahead of promoted club Wolverhampton Wanderers.

Current Barclays Premier League leaders Liverpool are 19 points ahead of the Red Devils, with one of Mourinho’s former clubs Chelsea, who occupy the fourth and final Champions League spot, currently 11 points ahead of United.

Romelu Lukaku of Manchester United reacts during the Group H match of the UEFA Champions League between Manchester United and Juventus at Old Trafford on October 23, 2018 in Manchester, United Kingdom.
(Oct. 22, 2018 – Source: Michael Regan/Getty Images Europe)

Champions League football is a valuable premium in terms of club revenue for Man Utd, and was the reason why David Moyes, the first manager who failed to follow the footsteps of the illustrious Ferguson, was sacked.

It was also why Mourinho’s predecessor was shown the door, as Louis Van Gaal ensured that the Portuguese manager endured his first season in the Europa League, the continent’s second tier competition.


In a statement released by the club on December 18, Manchester United said Mourinho has left the club with immediate effect.

“The club would like to thank Jose [Mourinho] for his work during his time at Manchester United and to wish him success in the future,” Manchester United said.

The statement brings an end to Mourinho’s two and a half years in charge of Manchester United. It also, rather ironically, continues a trend of the Portuguese manager failing to last more than three seasons at a club, having only previously managed the feat during his first stint as Chelsea manager.

It also comes days after United suffered a 3-1 loss to Premier League rivals Liverpool. Supporters of the club on social media were however not as surprised by the setback, having seemingly become accustomed to what they term as ‘boring defensive football’ which was not yielding results.

Mourinho has also been at war with club executives, seemingly straining relations with chief executive Ed Woodward over the CEO’s reluctance to release funds for squad improvements before the season began.

The Portuguese manager’s constant jibes over the lack of defensive cover in his squad has been followed with the club looking devoid of strategy when taking to the field.

This has occasioned the club’s five losses in 17 matches. The Red Devil’s have also conceded 29 goals even before the halfway stage of the Premier League, more than they conceded in the league over the course of the whole of last season.


In contrast, its rivals are growing from strength to strength. Even perennial enemies Arsenal, who had to replace legacy manager Arsene Wenger before the season began, have seemingly handled the situation of replacing a powerful man with more deftness than Manchester United ever did when United replaced Sir Alex Ferguson.

Caretaker manager

Manchester United added in their statement, “A new caretaker manager will be appointed until the end of the current season while the club conducts a thorough recruitment process for a new full-time manager.”

Sources within British media, especially Sky Sports, have intimated that the interim appointment may not be from within the club and say an announcement could be forthcoming within the next 48 hours.

The new manager will have to pick up the pieces of the club and try to salvage an already bad season. Beyond the League, Manchester United is in the round of 16 of the Champions League and faces high flying PSG in February. The 20-times Premier League champions are also out of the Carabao Cup.

A new manager’s reprieve could be to eye the FA Cup, which begins next year.


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Mike Njoroge
Mike Njorogehttp://www.businesstoday.co.ke
Mike Njoroge is the founder of Daystar Oracle and FootballTriangle. He is passionate about news, religion and sports. He can be reached at: [email protected]
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