Manchester United reported a 30 per cent rise in annual profit today, with sponsorship deals and higher gate receipts at their enlarged stadium boosting revenue to record levels.
But United said controlling player wage costs remained the most important challenge.
The group reported pre-tax profits of £21.8 million sterling in the year to July 31st, compared to £16.8 million last time, on turnover up 12 per cent at £129.6 million pounds. It raised its final dividend to 1.39p, making a total for the year of two pence, compared to 1.9p previously.
The club said it expected a significant increase in wage costs after renegotating player contracts for several first-team members.
Player wages account for 39 per cent of revenue - the lowest ratio in the Premier League - but the club said this figure was expected to rise.
"Controlling player costs remains the most important single challenge in our business," said chairman Mr Roland Smith in a statement.
"We have renegotiated the playing contracts of several members of the first-team squad. Whilst this will result in a significant increase in wage costs for the current financial year, these contracts . . . can be viewed as a significant investment for the future," he said.
Partnerships with global sports giant Nike, which will manufacture the clubs kits from August next year, and with mobile phone group Vodafone, which sponsors United's strip, were examples of the most effective methods of increasing revenue growth to combat the spiralling costs, United said.