Chelsea face a battle to comply with the Premier League’s Profit and Sustainability Rules (PSR) and could be forced to sell players before June 30 after their financial situation was laid bare in a set of accounts which give food for thought.
The club’s accounts for the financial year ending June 30, 2023 saw it post a pre-tax loss of £90.1 million ($112 million), while wages rose from £340.2 million. pounds sterling (2022) to £404 million in 2023.
Only Manchester City’s annual wage bill (£423m) is higher than Chelsea’s. Last season, City won the Premier League, Champions League and FA Cup. The Chelsea men’s team finished 12th in the league, although the women’s team won the Women’s Super League and the Women’s FA Cup.
Chelsea’s accounts also show that between July 1, 2022 and June 30, 2023, they spent a total of £745.2 million on new players. Their accounts show that a further £454.1m has been spent on players since June 30, 2023. They raised £203m from player sales and made a net profit of £62.9m sterling on all player exchanges, thanks to the sales of Timo Werner to RB. Leipzig, Kalidou Koulibaly at Al Hilal and Jorginho and Kai Havertz at Arsenal.
Chelsea’s worrying figures
Operating profit/loss in millions of pounds sterling | |
---|---|
Chelsea |
-249 |
Leicester |
-152 |
Towards the Villa |
-139 |
Everton |
-115 |
Leeds |
-78 |
Newcastle |
-66 |
N Forest |
-61 |
Tottenham |
-55 |
wolves |
-54 |
Arsenal |
-39 |
Southampton |
-37 |
Man City |
-36 |
Fulham |
-35 |
Men Utd |
-31 |
Liverpool |
-23 |
Bournemouth |
-21 |
Palace C |
-20 |
Brighton |
-16 |
Western Ham |
-12 |
Brentford |
4 |
Since a consortium led by Todd Boehly and Clearlake Capital bought the club in May 2022, Chelsea have spent a total of £1.2 billion on new signings.
This resulted in their amortization – the way transfers are accounted for in the club’s financial reports, with the cost of acquiring players, including fees and salaries, spread over the length of their contracts – amounting to to £205m, up from £162.5m in 2022.
Due to the £454.1 million spent on players after June 30, 2023 – such as Moises Caicedo, Cole Palmer and Axel Disasi – Chelsea’s amortization figure for the 2023-24 period will likely have increased further. The club’s figure of £205m is already a Premier League high, with Manchester United second on £152m. Manchester City’s is £145.4 million.
GO FURTHER
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What does all this mean for Chelsea’s PSR calculations?
Analysis from football finance expert Kieran Maguire
“Chelsea need to start selling again, but if you have a wage bill of £400 million it means you have players on very high salaries and there are a limited number of clubs willing to offload these players. players, or a limited number. of clubs to which a player would be ready to transfer.
“They’re always good at selling players, and that’s the one thing they’ve always had in their favor. Mason Mount will get £60m back, but Chelsea are now under more pressure when it comes to June 30, especially as we’ve seen the PSR committees say, when it comes to Nottingham Forest, that if you sell more late in the year, hard, you know what the rules are.
“What worries me more is the three-year period that ends this season, because they have not enjoyed the benefits of European football. We were all told payroll would go down under Clearlake Capital, but the fact that it went up made me go back.
“It will go down this season because they won’t pay European bonuses, for example. The depreciation charge is completely out of control and this is due to their eight year contracts being applied. That’s £50m more than Manchester City. They are going to have to work extremely hard to meet the PSR by June 30. »
Chelsea salaries are high
Salaries in millions of pounds sterling | |
---|---|
Man City |
423 |
Chelsea |
404 |
Liverpool |
373 |
Men Utd |
331 |
Tottenham |
251 |
Arsenal |
235 |
Leicester |
206 |
Towards the Villa |
194 |
Newcastle |
187 |
Everton |
159 |
Leeds |
146 |
N Forest |
145 |
Fulham |
139 |
Western Ham |
137 |
Brighton |
128 |
Palace C |
124 |
wolves |
121 |
Southampton |
113 |
Bournemouth |
100 |
Brentford |
99 |
Asked by Athleticism Regarding their accounts, Chelsea have maintained their confidence that they will remain compliant with the Premier League PSR for the period ending with the 2023-24 season. Chelsea added that they expect their wage bill to be different in the 2023-2024 accounts after players left last summer.
How does this look for the future?
Analysis from football finance expert Kieran Maguire
“The main problem is that these accounts are worse than everyone expected. I don’t see any positive points. They cannot increase their income this season because Stamford Bridge is full. TV revenues will fall by around £70 million due to them not playing in Europe and, unless they win every game until the end of the season, finishing eighth or ninth is 3 million pounds per place, so they could get a little more.
“Qualification for the Europa League and the Conference League does not bring money, only the Champions League brings benefits. If you get to the Europa League final or the semi-final, it doesn’t matter, but you don’t make much money before that.
“There must be a lot of pressure on the club. The fact that there was a loss of £90 million was due to the sale of the hotel to themselves. Under EFL rules you are not allowed to include this (hotel sale) in your PSR calculations.
“If they can’t do that for the Premier League it will only make the situation worse.”
GO FURTHER
Confused, drifting, disorder: what’s next for the Chelsea “project”?
What else do the accounts tell us?
The accounts show Chelsea borrowed £428.5million interest-free, although no information is given on who lent the money.
Chelsea also sold a hotel to BlueCo 22 Limited – a company which classifies Boehly and other members of the Chelsea board as directors – for £76.3 million, which would have gone towards reducing the loss by 90 .1 million pounds sterling.
It is unclear whether the Premier League will allow money generated from the sale of the hotel to another company associated with the club to be used for PSR numbers. Chelsea claim this was done in accordance with Premier League rules and topped the league. The Premier League has been contacted for comment.
The accounts also reveal that the club regards Blues Investment Holdings as its ultimate parent company. Blues Investment Holdings is incorporated in the Cayman Islands, a British territory best known for its tax haven status. The parent company of Manchester United is also registered there.
Chelsea’s overall revenue increased from £481.3 million in 2022 to £512.5 million in 2023, with the majority of this increase coming from their commercial department.
Their trading revenues reached £210.1 million for the financial year ending June 30, 2023, having totaled £177.1 million the previous year.
These figures follow the revelation on Friday that Chelsea spent £75.1 million on agent fees between February 1, 2023 and February 2, 2024. This was more than any other Premier League team, with Manchester City having spent £60 million over the course of the season. same period.
(Clive Brunskill/Getty Images)