Monday, April 22, 2024

Arsenal announce post-tax loss of £52.1 million

Arsenal have announced a post-tax loss of £52.1 million for the year ended 31 May 2023.

The loss marks a £6.6m increase compared to 2022 and is attributed by the club to “impairment write-downs on certain player registrations amounting to £18.1m”.

Overall, football revenue for the year was £464.6 million (up from £369.1 million in 2022) and attributable to noteworthy increases in matchday, broadcast and commercial revenue aided by a return to European football and improved results on the pitch.

Following additions to player registrations at a cost of £251.1 million and amortisation charges, the book value of intangible fixed assets (player registrations) was increased to £417.0 million (up from £333.5 million in 2022).

Importantly, the club continues to comply with the FFP regulations put in place by UEFA and the Premier League.

You can read the club’s full statement here.

TOPLINE FIGURES

2018 2019 2020 2021 2022 2023
Matchday revenue 98.90 96.20 78.80 3.80 79.40 102.60
Broadcast revenue 180.00 183.00 118.90 184.40 146.00 191.20
Commercial revenue 106.90 110.80 142.30 136.40 141.70 169.30
Player sales 120.00 12.12 60.10 11.80 22.20 10.70
Player loans 2.30 4.60 3.50 3.10 2.00 1.50
Wages 209.10 205.20 234.50 244.40 212.30 234.80


Matchday revenue

The return of European football meant there were 24 men’s first team fixtures at Emirates Stadium (vs 23 in 21/22), as well as a couple of home friendlies and big crowds for high-profile Arsenal Women fixtures. It’s worth noting that ticket prices increased, as did the average attendance (60,082 vs 59,568 in 2021/22). This was the first time matchday revenue surpassed the £100 million mark since 2014/15.

Broadcast revenue

Broadcasting revenues rose by £45.2 million thanks to involvement in the Europa League and a strong performance in the Premier League where we finished second. This translated into higher merit awards and live coverage facility fees.

Commercial revenue

Adidas and Emirates deals were renewed on new terms and other commercial partners were brought on. The club also states it is benefitting from an uplift in retail performance as a result of its new commercial strategy. Worth noting that Arsenal dropped out of Europe’s top 10 for commercial revenue in the most recent Deloitte Football Money League report.

Wages

Having brought the wage bill down significantly from 2021 to 2022, wages have crept back up again to the pre-pandemic level. That’s predominantly down to a raft of contract renewals which have financially rewarded a young squad for improved performance. Some of the rise is attributed to new contracts to Arsenal Women’s key players and increased headcount across the business as a whole.

Player sales

For the third successive year, our (in)ability to sell players has had “a significant impact on overall profitability” with the club claiming that “market conditions” post-pandemic again took a toll. Given the latest figures incorporate the summer of 2022 and January 2023, we’re looking at very small fees secured for the likes of Dinos Mavropanos, Lucas Torreira, Matteo Guendouzi and Bernd Leno. It’s worth remembering that total fees are usually recouped over a number of years.

Player loans

Just under 40 outgoing loan deals were completed in the summer of 2022 and January 2023 but we accrued only a token amount in return. Granted, the majority were academy stars but it also includes the likes of Nicolas Pepe (Nice), Pablo Mari (Monza), Nuno Tavares (Marseille) and Ainsley Maitland-Niles (Southampton).

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Kris

‘Certain player registrations’, i.e. Nicolas Pepe.

Johnny 4 Hats

But things are looking up.

We could easily shift ESR, Nketiah, Nelson, Tierney and Ramsdale this summer.

None of them add much to the first XI and they will bring in some money.

And yes, I’m saying “some money”. So sick of getting burnt by assuming we sell our players for good money.

Johnny 4 Hats

Plus T5 and Cedric off the wage bill.

Fenko

And Mo Elneny too.
Even we could get some money from TP sales. We are getting less in return for our investment on TP, even though he is an outstanding player on his own. The constant injuries has made his acquisition a bad one for Arsenal.

Heavenly Chapecoense

Mo “the ultimate legend” El Neny.

Emi Rates

Paraphrasing one of my favourite posts here. Was he ever elneny good?

NorthernGooner

So if Raya gets injured, who are you going to stick on goal? ESR still has a future at the club, i would like to think but either way, all of the players you mention will need replacement

Daveo

ESR in goal? 2 birds one stone…

Johnny 4 Hats

Probably not a guy worth £50m on 120k a week.

Maybe ESR has a future. But at present he doesn’t have a clear position that suits him and seems to be injured for large parts of the season.

If we received a decent bid for him, we’d be mad not to seriously consider it.

Rich

Will obviously need to bring in an understudy to Raya, but Ramsdale is a 1st class keeper on 1st class wages. We will bring in an up and comer on lower wages.

Gunner 1975

Not ESR and Rammers. Others? Yes!!

truj

Selling ESR means selling our identity. Literally… I want him to be our next big thing

Gunner 1975

Absolutely! This kid has huge untapped talent that we cannot and must not gift rival clubs. A lot of us have forgotten how brilliant he is because of the numerous injury setbacks. A pundit once said that ESR is different level talent because while his peers run with the ball, he glides with the ball. So let’s keep this kid to “rock round the world” with Bukayo.🔥💪👋👌❤️⚽🏆🏆

Heavenly Chapecoense

So you don’t need a bench. Plus, you’re selling ESR one of my favorites. For Nelson, he needs a loan somewhere he can be a starting XI. He has plenty in the locker.

Me2

Yes, you can shift these players but either you work with a much smaller squad ad become vulnerable to injuries or you replace them and end up registering a loss in profit. I would keep ESR and Rambo though as they add depth in quality. I agree with Arsenal’s poor track record in making significant profit from sales but this is down to the club handing out huge salaries for players that fail to deliver – Ozil being a prime example of that. I was concerned that Kai Havertz would turn out to be a huge financial blunder given his… Read more »

Pete Plum

Your rewriting history. Literally Ozil couldn’t deliver because he wasn’t registered in the squad. Thats not failing to deliver. He wasn’t the man for Arteta but when he played he played well. He wasn’t dropped on form.

Cannon and ball and arsen’all

I don’t think we’d have too much trouble selling Sambi Lokonga for near enough what we paid should we choose to. I watched him against United and he was outstanding. What an engine on him and very good defensively – very tidy in possession too. I’ve just read Stephen Warnocks comments about him on the BBC live feed: “Not having Lokonga tonight could affect them [Luton]. That’s where they are at their strongest and they are blessed to have them [Lokonga and Barkley] because they are such good footballers. They have so much pace in the team too but losing… Read more »

Pete Plum

ESR is looking like his old self, not like last time he came back from injury. I think you’re forgetting how good he is. And he’s one of our own. Not saying I agree on the others either

Jeremy

It’s quite amazing how much that corrupt Barcelona prick set us back financially (and as a consequence what we were able to do on the pitch). Telling he hasn’t had a decent job since.

John C

How have you come to that conclusion from reading this article?

Jeremy

Well he spunked, according to some quick maths (wages + transfer fees – sell on) north of £200 million on the likes of Soares, Luiz, Cellabos, Suarez, Mari, Pepe and Willian to mostly line the pockets of the greedy slug Kia. Players who were nowhere near the level we needed to compete. Yes he lucked out on Saliba and Martinelli (which was mostly thanks to Cagigao) and we got some value out of Tierney…but overall the man was a corrupt disaster. Think of what we could have done with an extra £200 million in the last few seasons.

Jeremy

For context, spread over the 3 full seasons since he left, that’s nearly £70 million a season towards our FFP position (we couldn’t sign anyone this jan due to FFP), or 2-3 world class players which might have made the difference to us qualifying for the CL in 21 (we finished 5th) or winning the league in 22, when we just fell short due largely to injuries. I know it’s all if, buts and maybes, but I am convinced he damaged us and set us back significantly.

John C

You could apply the same logic to the person who gave Ozil a new contract or swapped Sanchez for Mykhitaryan 4 months after rejecting a £60m bid for him or the guy who spent £56m on a 29 year old Aubameyang in a desperate attempt to get the short term results to save their job only a few months after signing Lacazette for a similar amount only a few month earlier. This is the reason by the way we were signing players on free transfers! And to suggest that the free transfer signings of Luis, Willian or even Soares is… Read more »

Jeremy

I’m not making comparisons. I’m simply stating that he wasted a shit ton of the clubs money which we could really have used in the last few seasons. Are you Kia?

John C

But I am making a comparison and providing context.

The previous Arsenal employee in charged of spending the club’s money wasted much more in a far shorter period of time and hamstrung those who proceeded him, including a bloated wage bill and reduced income due to no European football.

Did he do a good job? No, but he didn’t have the best circumstances and again I don’t think he knew the complete scale of the job he was facing. Luckily the club realised that and brought in someone who did in Arteta.

thw14

That whole investigation into Sanllehi was a farce. If the owners were unhappy with his performance, they were well within their rights to just fire him. But they were terrified at the time of coming off as clueless chop-and-changers (which they were), so they did their good process (carry on). Also – Luiz, Mari and Willian were Edu signings as much as Sanllehi ones. In fact Willian was signed the day before Sanllehi was fired/quit, so I don’t get how you’re pinning that on Sanllehi, Jeremy. Edu is also not at all averse to Rolodexery (e.g. the pursuit of Raphinha… Read more »

John C

I’m not sure I agree we became accepting of paying market value recently, i think that happened the moment we bought Ozil in 2013. We subsequently went on to buy Mustafi for £35m, Xhaka £35m, Alexis £35m, Lacazette £50m, Auba £56m, we didn’t exactly have a squad bought on a shoe string. If i’m going to be fair to both Wenger and possibly Sanllehi i think football had moved on from their approaches to squad building. Long gone were/are the days of being successful purely by putting the most amount of talent on the pitch. More than ever do serious… Read more »

thw14

That’s what I meant by Sanllehi contributing – that the club’s willingness to pay value has happened over time, over multiple suit combinations – not, as people seem to suggest, as a result of some big shift in thinking. But I also think that willingness to pay is the most important shift in our transfer strategy. Character has always been a component – that’s why Arteta was bought as a player in the first place, along with Mertesacker, Giroud and others who were not necessarily all-world talents. Positional flexibility is also a long-standing preference – Wenger used to love pointing… Read more »

John C

Our transfer spending changed because we were in danger of falling away from the champions league spots, which we eventually did, if we could still get away with spending the bare minimum we would be. Arteta and Mertesacker were signed during the 2011 trolley dash, which came post 8-2 trashing and had nothing to do with their character. It was desperation pure and simple. Ozil was signed after we were knocked back by Real Madrid for Benzema and offered him instead, could you imagine Arteta and Edu signing a player under similar circumstances? There couldn’t possibly have been any due… Read more »

Oberon

Rubbish he was there for a year and would have had plenty of time to understand the financial situation.

John C

When i say I don’t think he knew the complete scale of the job he was facing, i don’t mean financial, i mean i don’t think he knew we needed to get rid of every single player and replace them.

Which is exactly what Arteta has done

Oberon

You’re conflating a lot of things and not addressing the points he’s making. The corruption was pointed at the fact that in the Sanellhi era agents fees went through the roof. Also Aubameyang was a success as for two years and half years in a rather average team he was still scoring at elite levels. If we had that player in the squad now we would probably be several points clear at the top of the league. Plus comparing Mbappe to Pepe is stupid, one is a generational talent the other had one break out season. Even if you were… Read more »

John C

I’m not conflating anything, he said wasted money. There’s no evidence there’s any correlation between agents fees and corruption. Whilst Aubameyang was a decent player for a couple of years he was bought to save Wenger’s job in the wake of the Alexis and Ozil contract renewal fuck up. A saga that if you were to calculate the costs would be up near £200m in and of itself, when factoring in the lost transfer fee for Alexis, fee for Auba and massive wages given to both Ozil and Mhkytaryan. We’re talking here about wasting money. Luiz and Silvestre were very… Read more »

Johnny 4 Hats

He did sign Saliba.

Saliba is easily £100m so we did kinda break even on Pepe and Saliba.

And yes, that’s some dangerously blue sky thinking.

Tommo

Interesting to see how much this picture changes with CL back and Balogun/Xhaka sales last summer, (both fees being mostly paper profit) partly offset by year 1 of Rice’s amortisation in 23/24

ChickPEA

I’m confident winning the CL will vastly improve our financial condition.

Rich

Win CL and PL giving enough funds to sign Mbappe just before he gets on the plane to Madrid.

Walleye

I suspect the player sales revenue will explode in 24. Am, ek,esr, etc. of course the player expenses will increase as well
also highlights the importance of continuing to advance in the CL

Al M

ESR should stay. Out-
Partey Cedric Pepe Patino Elneny Vieira Tierney Nketiah. Lokonga Tavares. Jorghino. Walters and number of u23’s . Only Jorg has had any real impact this season so no need to replace all. Nearly all out on loan bar Bierith. Possibly AR as I don’t know back ups well enough.
Promote Kwaneri Cozier

HummusHero

Vieira? The kid needs an actual chance. He clearly has potential. As for Jorginho? You must be joking. Fully deserves another year – what an absolute brilliant cover he provides.
Not sure who ‘Kwaneri’ is.

Al M

Commercial activity still second rate. As is making more of stadium close season.
Our wages are too high compared to peers and this prevents sales.
Not impressed

Jeremy

Spurs made 20 million more than us in commercial revenue in 23. Spurs!

Gunner 1975

Yeah, well, shit happens!😜👍.

Man Manny

Is that enough to buy a trophy?

John

True but they’ve got a mammoth mortgage debt to pay down compared to us.

the mickster

the council restricts us from having ‘non football’ events.
therefore it becomes unviable to have music events, as the set up costs for 1 or 2 nights is too high…

Ebo

We’ve hosted arctic monkeys and also plenty of other types 🐒

Ebo

and they wondered why it was hard to get a good atmosphere going in the stadium after they had Coldplay there. Probably still traces of karmic stench from that mucking up the place…

Emi Rates

You forget Muse.

Chris

I was there for Green Day, ‘welcome to paradise’ indeed!

John

All the new player contracts should have a bumper bonus payment tied to silverware. That’s a good way to keep the players motivated and put a ceiling on the total wage bill.

Redbaron

So 52.1 and 45.5 means 97.6 in 2 years. Isn’t FFP regulation about 105 loss in 3 year period? Is the club confident they will not make a loss of more than 7m next year?

BQ1234

This is what I was wondering, althought on the main site it says losses before tax excluding exceptional costs were 34m and 45.5m which is 79.5m ans gives a headroom of 25m loss this season, which makes sense considering the increased champion’s league revenue?

Spanish Gooner

The next figures will include decent transfer revenue for the first time in years (£35m Balogun, £20m Xhaka), compared to about £10m total the year before. We also shouldn’t have any player value impairments (£18m – Pepe), meaning if everything else stays the same next year we’d make a profit of £17.5m, I know that’s not exactly how it works, but I don’t think we need to be worried, especially with Champions League revenue returning.

Redbaron

You are forgetting Rice amortization and also incoming money is also likely to be amortized over atleast 2-3 years. Champions league revenue will help. More incentive for us to go farther in the competition (if any was needed)

Ealing

That’s the correct figure, then there are deductions. For comparison Everton (during the 3 years period ending 2021) had losses of 370 millions, and minus deductions had losses of 124 millions. Arsenal had losses for 181 millions before deductions.

Ealing

For the last 3 year’s period ending 2023 we are at around 190 millions loss before deduction, still compliant but getting closer to as there are less deductions now given that Covid exceptional deductions are over.

The worrying bit is that KSE has had to pay in more money to remain FFP compliant
“ an element of the loans received from KSE UK Inc. during the year was classified as a capital contribution.”

Modha

We really need to get better at selling our players.

Vonnie

We will, once we have better players to sell.

TeeCee

The only way to make decent money selling players is to sell players that other clubs want.
As we’re not a “selling club” we rarely sell players that we want to keep.
Thus we’re looking for somebody we have, who somebody else wants and who isn’t so obviously surplus to our requirements that any potential purchaser is going to play silly buggers with the price.

That’s a very, very short list of somewhere around no players at all.

Gervinho is Driving

Feels like we hold on to players like Nelson, Nketiah, and ESR for so long that we’ve shown where their ceilings are. Mid-table or lower starters, some with injury issues. There’s no sense of “hey maybe this guy will kick on.”
Partey, with his age, issues and wages, we’ll be lucky to get anything. Feels like a terminated contract.
Ramsdale has real value. Amazing, after the Almunia/Manonne/Ospina years, that we’ve sold Szczesny, Leno, Fabianski, and Martinez and yet we still (at present) have two great keepers.

I miss santi cazorla

We did wonderful business by selling Holding for 2 millions. He doesn’t even make at the palace bench.

Lakhtakh

Do think it’s interesting that the going concern comment describes support by KSE if needed – not sure if we can read into this as further support for the next summer window or just refers to the significant outlay for Decs this summer.

John

Chelsea with a wage bill over £100 million higher than ours for absolute dross on long contracts. And no European football income to balance the books. Ha ha! #PochOut!

GoonerTex

does anyone know how annual amortisation of player registration (non-exceptional – (139.1) – and remaining book value of player registrations compares to other Big 6 clubs?

Curious specifically about Chelsea, given the (now banned) contract-length chicanery they recently engaged in.

BillyKrystal

Like an idiot I clicked on a Talksport thing with Simon Jordan and Danny Murphy saying emphatically that neutrals would not and should not root for Arsenal. That we’ve spent more money than City and Liverpool and we’re no underdogs. I just had to see the blinding stupidity on display, the depths bitter old pieces of shit will go to. They didn’t disappoint and left me in a bad mood. But it’s so funny knowing how wrong they are after seeing the wage differences.

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