MANCHESTER United reported a £11.5m drop in profits yesterday, which it said had been caused in part by poor performances on the pitch.

The football club said annual profits were down to £27.9m and warned future results would be affected by a fall in media revenues.

The club said media income would fall by about £14m - partly because of its third-place finish in the Premiership last season - causing a significant impact on short-term profitability.

The fall in profits reflected the cost of buying players, including England strikers Wayne Rooney and Alan Smith.

United said it had planned to bid for Rooney next summer, but Newcastle United's interest in the player forced it to accelerate those plans.

The club said: "As a result, we have now spent next summer's transfer budget unless players are disposed of to realise cash for reinvestment."

United also used yesterday's results to provide full and transparent disclosure of all player transfer activity and agent fees.

The figures showed more than £5m was paid to agents in the year to July 31.

Despite the fall in bottom-line profits from £39.3m last year, Manchester United said its performance at an operating level showed a six per cent improvement to £58.3m.

However, the club warned that short-term results would be affected by a sharp drop in media revenues, including £8m from the latest Premier League television deal.

The third-place finish in the Premiership will also have a £6m knock-on effect on media revenues from the Champions League.

Staff costs as a percentage of revenues were held at 45 per cent - well below its target of 50 per cent.

Turnover for the year was down by £4m at £169m.

Chief executive David Gill said: "Despite the expected fall in media revenues in this current year, our long-term strategic planning will ensure that we continue to grow as both a business and football club."