Premiership football giants Manchester United have posted a 20 per cent drop in full-year profits.

Manchester United said they earned £46m in the year ending June 2005, a drop of £12.3m from the previous 12 months.

The club's chief executive David Gill attributed the fall in profits to a decrease in media revenue.

He said: "The drop in profits and cash generation from the previous year reflects mainly the impact of the media deals, with a reduction in the domestic FAPL revenue of £6.5m following the new three year deal and a reduction of £7.6m in Champions League media revenue mainly from finishing third in the FAPL in 2003/4 compared to first in 2002/3."

Last June, shares in Manchester United were delisted from the London Stock Exchange after US sports tycoon Malcolm Glazer bought the club for £790m.

United spent £6.6m in legal and banking fees during the protracted Glazer takeover.

United chief executive David Gill: "Manchester United remains the most profitable football club in the world and the largest in terms of global brand revenues."

The club also spent over £25m on Everton forward Wayne Rooney and Fulham goalkeeper Edwin Van der Sar, including £2.2m in agents fees.

However, Gill defended the money paid to agents and told BBC Radio Five Live's Sportsweek programme: "Agents provide a service - the issue is who pays for it, the player or the acquiring club?

"We operate in a market for world class players and one of the costs in acquiring them is the service of an agent."

Despite an early exit in this season's lucrative Champions League, Gill said the forecast for 2006 was promising.

"Manchester United remains the most profitable football club in the world and the largest in terms of global brand revenues," he said.

"The value of the Manchester United name with its huge and loyal fan base remains strong.

"We believe that Old Trafford, the biggest Club stadium in the UK, will continue to develop as a year round venue, and new developments like the new £43m quadrant facilities will enhance our ability to achieve that."

United have made two new signings during the January transfer window as they look to rebuild their squad for next season.

French international Patrice Evra joined from Monaco for £5m and Serbia and Montenegro defender Nemanja Vidic joined from Spartak Moscow for £7m.