Chelsea may have disappointed on the pitch last year (except for winning the FA Cup) but the beancounters had a good season.
On Monday the club announced new records for turnover (which is total revenue) and profit for the fiscal year ending June 30. It’s great news for Roman Abramovich, whose goal is to make the club self-sustaining. But it does come with a caveat.
In raw numbers, club revenue (£443.4m) was up by £82.1m (22.7%) over last year, which was itself a record campaign.
Chelsea’s 2016/17 financial results included their highest ever revenue, despite not playing in Europe, as they benefited from winning the Premier League and reaching the FA Cup Final. Some thoughts in the following thread #CFC— Swiss Ramble (@SwissRamble) January 15, 2018
Record revenues led to record profits of £62.0m last season, too, up from £15.3m the previous year. This keeps Chelsea well in compliance with Financial Fair Play (ed.note: even if we’re the only big team who truly seem concerned about meeting this without obviously cooking the books).
This is only the fourth profitable year of Abramovich’s ownership.
So #CFC have now made a profit twice in last 4 seasons (£19m in 2014 & £16m in 2017).Otherwise, Chelsea have consistently reported losses in Abramovich era, as they have invested substantially in their squad, though a clear improvement since the spectacular £140m loss in 2005. pic.twitter.com/6p5JUkCpfN— Swiss Ramble (@SwissRamble) January 15, 2018
New commercial director Chris Townsend had said his goal was to double Chelsea’s commercial revenue in the next ten years and he’s made a good start. They grew by £32m, thanks in part to the addition of Nike and sleeve sponsor Alliance Tyres (a subsidiary of Yokohama) to the fold.
Broadcast revenue was a big player in the revenue growth. It increased by £41.7m to £204.1m thanks to playing in the Champions League. Playing in Europe also increased matchday revenues by £8.4m, despite ticket prices being frozen since 2011-12.
Chelsea have announced record-breaking revenues of £443.4m plus an additional £113m profit on player sales.— Jake Cohen (@JakeFCohen) December 31, 2018
This amounts to an overall profit of £63m and an increase in overall revenues by 22%.
Chelsea continues to spend as much as possible in the pursuit of winning trophies.
However, the healthy financial picture is indebted to revenues that can’t be counted on every season. One is the Champions League, or even the Europa League (doesn’t pay as well as the Champions League, but is still significant), neither of which are guaranteed (ed.note: and won’t be until the inevitable creation of the European Super League).
The other is player sales, which returned a record profit of £113m. The 21 total deals included £53m for sending Diego Costa to Atlético Madrid, £40m for Nemanja Matić to Manchester United, Nathan Aké to Bournemouth for £20m and Juan Cuadrado to Juventus for £17.3m.
Chelsea become 1st team to ever report profits on player sales of £100 million plus (although Liverpool could top that soon). How important are player sales to clubs? The top 10 made over half a billion pounds of profit #CFC #EFC #NCFC #NUFC #Saints #THFC #MCFC #LCFC #LFC #Swans pic.twitter.com/GwV9ojfoya— PriceOfFootball (@KieranMaguire) January 1, 2019
Nevertheless, Chelsea are understandably pleased with the financial picture.
“The club has now posted a series of record-breaking revenue figures and our profit margin has increased in consecutive years. This has occurred against a backdrop of varying participation in European football, and different degrees of achievement in the Premier League, which demonstrates we have built a sound business footing to support our on-pitch quest for success.”
-Bruce Buck, Chairman; source: Chelsea FC
As a side note, Fordstam Limited, Chelsea’s holding company that’s responsible for non-footballing operations and which technically holds Roman’s £1.17b debt, reported a consolidated profit of £24.9m for the year.
Overall, a happy picture. But the financials make it clear that there is plenty of pressure to get back into the Champions League next season, and not just for footballing reasons.