Spurs finances report 22/23 (swissramble writeup)

[tom4s]

Couldnt find a proper thread for it, but the ever excellent football finance writer "Swiss Ramble" has published his writeup of our finance report for 22/23

https://swissramble.substack.com/p/tottenham-hotspur-finances-202223

Tottenham Hotspur Finances 2022/23​

That's Entertainment​

Tottenham Hotspur’s 2022/23 accounts cover a season when they finished 8th in the Premier League, thus failing to qualify for Europe for the first time since 2010. However, they did reach the last 16 of the Champions League last year, before being eliminated by Milan.

The challenges on the pitch were underlined by the dismissal of head coach Antonio Conte in March 2023. The Italian was initially replaced by his assistant Cristian Stellini, but he lasted less than four weeks before Ryan Mason took over on an interim basis until the end of the season.

Ange Postecoglou was then lured from Celtic in June, after the popular Australian manager had won the domestic treble in Scotland.

Profit/(Loss) 2022/23​

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Tottenham’s pre-tax loss increased by more than 50% from £61m to £95m, which chairman Daniel Levy said was a reflection of “significant and continued investment in the playing squad.”

Revenue rose £107m (24%) from £443m to £550m, which was a new club record, breaking through the half a billion pounds barrier for the first time. This was predominately due to participation in the Champions League and hosting major events at the Tottenham Hotspur Stadium.

However, the revenue growth was wiped out by a substantial increase in operating expenses, which were up £132m (27%) from £483m to £615m, while profit from player sales dropped from £19m to £16m.

In addition, net interest payable increased by £4m (10%) from £41m to £45m. It’s worth noting that this substantial charge contributed almost half of the club’s £95m pre-tax loss.

The loss after tax was a bit smaller at £87m, thanks to an £8m tax credit, though this was also a lot higher than the prior year’s £50m.


There were two main reasons for Tottenham’s revenue growth.

• The return to the Champions League led to significant increases in both broadcasting, up £50m (33%) from £154m to £204m, and match day, which rose £12m (11%) to a club record £118m.
• Numerous third party events helped drive commercial up £44m (24%) from £184m to £228m, which was yet another club high.

However, there were also chunky increases in staff costs, so the wage bill rose £42m (20%) from £209m to £251m, while player amortisation increased by £30m (37%) from £79m to £109m and player impairment was up from £2m to £11m.

Other expenses shot up £47m (39%) from £120m to £167m, while exceptional charges increased from £1m to £5m for onerous employment contracts.

Tottenham’s £95m pre-tax loss is the second worst in the 2022/23 Premier League, only surpassed by Aston Villa’s £120m. That said, they are not alone in posting a large deficit, as half of the top flight lost more than £50m last season, including Chelsea £90m, Leicester City £90m and Everton £89m.

On the other hand, a few clubs did manage to generate a profit, most notably Brighton £133m and Manchester City £80m. Bournemouth also reported a £44m profit, though this would have been a £27m loss without a £71m owner loan write-off.

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[tom4s]

Player Sales 2022/23​

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Tottenham’s net loss was not helped by relatively low profit from player sales, which fell £3m from £19m to £16m, mainly from the transfers of Steven Bergwijn to Ajax, Jack Clarke to Sunderland and Cameron Carter-Vickers to Celtic.

However, many players also left on loan, including Ndombélé, Lo Celso, Udogie, Winks, Reguilon, Rodon, Gil and Spence, while Matt Doherty joined Atletico Madrid on a free transfer.

Some clubs did much better with their player trading, especially Chelsea £142m, Manchester City £122m and Brighton £121m, who all generated more than £100m, with the obvious benefits to the bottom line.

Profit/(Loss) Trend​

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Tottenham have now suffered large losses four years in a row, adding up to a deficit of more than £300m over this period, though to be fair two of these seasons were severely affected by the pandemic.

Before that, Spurs had reported profits for seven consecutive seasons, which had generated an impressive £412m surplus. In 2018 and 2019 alone Spurs delivered a hefty £226m profit.

COVID Impact​

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While all clubs were adversely impacted by the pandemic, it hit Spurs particularly hard, as they had invested in a very expensive stadium, counting on a large increase in match day (and commercial) revenue.

Chairman Daniel Levy noted, “The new stadium was some two years later than envisaged, due to the COVID-19 pandemic, which resulted in the loss of circa £200m in revenue.”

I estimate that the revenue loss was split between £51m in 2019/20 and £149m in 2020/21, largely due to a £144m reduction in match day, followed by commercial £41m and broadcasting £15m.

 

[tom4s]

A Game of Two Halves​

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The change in Tottenham’s profitability can be seen by comparing their financial performance over the last four years with the preceding 4-year period.

In the last four years, Tottenham’s £304m loss was one of the largest in the Premier League, only “beaten” by Everton £395m and Chelsea £332m.


This was in stark contrast to the preceding 4-year period when Tottenham’s £316m profit was comfortably the best result in the top flight, nearly twice as much as the next highest, Liverpool £187m.

This is worth emphasising, as the prevailing image of Spurs is as a very profitable club, but that has not really been the case for a while, despite the impressive revenue growth.

Player Sales Trend​

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One reason why Tottenham have struggled to make money in recent years is their low profits from player trading (for a big club), generating less than £20m in each of the last five years.

The last time that this activity had a major impact was 2017/18, when the £73m profit was boosted by Kyle Walker’s move to Manchester City, though the club record £104m came back in 2013/14, largely from the lucrative sale of Gareth Bale to Real Madrid.


As a result, Tottenham’s £80m profit from player sales in the last five years is towards the lower end of the Premier League and the smallest of the Big Six. This was miles below the likes of Chelsea £496m, Manchester City £337m and even Leicester City £249m.


However, that will change this season following the big money sale of Harry Kane to Bayern Munich for a reported £82m (€95m). Although he might no longer be “one of their own”, his sale will make a difference financially, especially as the proceeds represent pure profit, given that he was an Academy product.

In addition, Harry Winks and Davinson Sanchez were sold to Leicester City and Galatasaray after these accounts closed, though a couple of experienced players left on frees, namely Hugo Lloris and Lucas Moura.

Exceptional Items​

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Tottenham booked £5m of exceptional charges for onerous contracts, up from £1m the previous year. It is not clear whether this refers to Conte’s severance pay, which was a lot lower than some had thought, as it only covered the remainder of his salary until the end of the season, when his contract was due to expire.

 

[tom4s]

Operating Profit/(Loss)​

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Tottenham’s operating loss (i.e. excluding player sales, exceptional items and interest payable) widened from £39m to £60m, the club’s highest ever, just ahead of the COVID-impacted 2020/21 season.

Spurs used to be one of the very few clubs that managed to achieve operating profits, but this changed in 2019/20, partly due to the impact of the pandemic, but also because depreciation significantly increased after the new stadium was built.


Of course, the vast majority of football clubs report losses for their day-to-day business, so this is far from unusual. In fact, only one club in the Premier League managed to make money at the operating level last season, namely Brentford – and that was only £5m.

Tottenham’s £60m operating loss was in the bottom half of the table, but a lot smaller than some of the massive deficits elsewhere, e.g. Leicester City £151m, Aston Villa £139m and Everton £120m – with Chelsea still to come.

EBITDA​

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However, Tottenham’s EBITDA (Earnings Before Interest, Tax, Depreciation & Amortisation), which is often considered a proxy for cash operating profit, as it strips out player trading and exceptional items, improved from £114m to £131m, albeit a fair bit lower than their £168m peak pre-pandemic.


Nevertheless, Spurs’ £131m EBITDA is still the second best in the Premier League, only behind Manchester United’s £155m, which highlights the impact of the (non-cash) £72m depreciation charge on their figures, as this is excluded from this metric.

Revenue​

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Tottenham’s £550m revenue was comfortably the club’s highest ever, around £89m (19%) more than the £461m peak in 2019, when the club reached the Champions League final.

As Levy observed, “Our turnover has exceeded half a billion pounds for the first time. Whilst UEFA monies contributed, this has also been driven by increased stadium revenues from both football and non-football events and additional revenue streams.”

The chairman’s not wrong, as the drivers for the growth in the last four years are match day and especially commercial, up by £36m and £93m respectively, while broadcasting was actually £40m lower.

In fact, commercial is now Tottenham’s most important revenue stream, accounting for 41% of total revenue, ahead of broadcasting 37% and match day 21%.


Tottenham have enjoyed the second highest revenue growth of the Big Six since 2019, only behind the behemoth that is Manchester City.

Furthermore, Spurs have turned a £141m deficit against their North London rivals Arsenal into an £85m surplus, a huge swing of nearly a quarter of a billion pounds in the last seven years.


In fact, Tottenham’s £550m revenue is now the fourth highest in England, having overtaken Chelsea last season, though they are still a fair way behind the top three, e.g. Manchester City’s £713m is £163m higher, while Manchester United are nearly £100m more.


Tottenham improved one place from 9th to 8th in the Deloitte Money League, which ranks clubs globally by revenue. This is their best position since 2018/19, while they have climbed six places in the last decade, as they were down in 14th in 2012/13.


Tottenham actually had the highest year-on-year growth of any English club with £106m, per the Money League, though they were outpaced by four continental clubs, namely Barcelona £155m, Paris Saint-Germain £143m, Real Madrid £118m and Milan £111m.


Tottenham fans will be delighted that their club reman ahead of their great rivals Arsenal, at least in terms of revenue. In fact, in 2022/23 Spurs outpaced Arsenal in all three revenue streams: match day, broadcasting and especially commercial.

 

[tom4s]

Broadcasting Revenue​

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Tottenham’s broadcasting revenue rose £50m (33%) from £154m to £204m, mainly because the Champions League is far more lucrative than the Europa Conference, though there was also some improvement from the new Premier League broadcast deal.

This was still well short of the 2019 peak of £244m, when Spurs were defeated by Liverpool in the Champions League final.


Broadcasting income in England is largely a reflection of success on the pitch, so Manchester City’s £299m was £95m more than Spurs, because of their treble, including wins in the Premier League, Champions League and FA Cup.


According to the Premier League, Tottenham’s central distribution was worth £152m, which was £6m higher than the previous season. This was made up of £89m equal share, £40m merit payment and £23m facility fee.

The net improvement was because this was the first year of the new 3-year cycle, which offset a reduction in the merit payment, as Spurs finished four places lower (8th vs. 4th), and the facility fee, as they were shown live one time less.

Nevertheless, they still received more than Brighton and Aston Villa, who both finished ahead of Spurs in the league, as they were televised live much more often.

Europe TV​

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Tottenham earned €66m for reaching the last 16 in the 2022/23 Champions League, which compromised €15.6m participation fee, €20.6m prize money, €19.3m UEFA coefficient, €9.5m TV pool and €0.6m final balance.

Eagle-eyed observers might have seen that Liverpool earned €84m for reaching the same stage, with the €18m difference due to three factors: a better record in the group stage, higher UEFA coefficient and more money from the first half of the TV pool (after a better finish in the previous season’s Premier League).


This was significantly better than the €10m Spurs earned in the prior year after a COVID-enforced group stage exit from the Europa Conference.


UEFA prize money is a major differentiator for the leading clubs, so qualification is a key part of Tottenham’s strategy.

For example, Manchester City earned a massive €135m for winning the Champions League, which was more than twice as much as Spurs’ €66m.


The importance of European money to Tottenham’s revenue is evident, especially in the years when they qualify for the Champions League (whatever Postecoglou might say).

Income is much higher in these seasons, compared to when they play in lesser competitions – or don’t qualify at all, which is the case this season.


Tottenham have earned more north of €300m from Europe in the last six years, which is pretty good, though it should be noted that this is the second lowest of the Big Six, only ahead of Arsenal’s €150m.

It’s around half of Manchester City’s €615m, while around €200m less than Liverpool €564m and Chelsea €498m.

Match Day Revenue​

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Tottenham’s match day income rose £12m (11%) from £106m to a club record £118m, partly due to the return to the Champions League. This is a significant increase on the £45m earned in 2016/17, which was the last season at the old White Hart Lane stadium.

In 2020/21 all games were played behind closed doors (except a couple with severely restricted capacity).


In fact, in the last seven years Tottenham have seen the highest growth in match day revenue of any club in the Big Six with their £72m being considerably more than the others, e.g. the next best increase was only £25m at Manchester United.

As Levy has pointed out, “The completion of the stadium will deliver significantly increased revenues due to the larger capacity and ability to stage third party events.”

The splendid new stadium has a 62,850 capacity, though there were lengthy delays before completion, with the total cost rising to £1.2 bln. Nevertheless, it has already driven significant revenue growth with more to come, e.g. planning permission has been granted for a 180-room hotel at the southern end of the stadium campus.

Levy added, “All of the activities at the stadium are designed to create diversified sources of revenue which can then be invested in our principal core activity, football.”


As a result of the steep growth, Tottenham’s £118m match day revenue is now the second highest in the Premier League, only surpassed by Manchester United’s £136m.

In fact, it has climbed to be the fourth best in Europe with only Barcelona, PSG and United earning more last season.


As Levy stated, match day has become a “critical revenue stream” for Tottenham, earning the club a staggering £4.9m per game, which is by far the highest in the Premier League, ahead of Arsenal £4.3m and Manchester United £4.1m.


To further illustrate its importance, match day revenue accounts for 21% of Tottenham’s revenue, the fourth highest in the Money League, only surpassed by Marseille 25%, Inter 24% and Arsenal 22%.


Tottenham’s average attendance of 61,585 in 2022/23 was the third highest in the Premier League, only below Manchester United 73,671 and West Ham 62,459, but ahead of North London rivals Arsenal 60,082.


According to UEFA, Spurs had the 10th highest crowds in Europe last season, which is pretty impressive, albeit a long way below Barcelona and Borussia Dortmund, who were both comfortably above 80,000.


All these stats provide a lot of good news for the bean counters, which makes the club’s decision to raise season ticket prices by 6% and implement a phased reduction in senior concessions even more puzzling.

Although there has only been one 1.5% price increase since the new stadium opened in April 2019 and it’s also true that there has been a significant increase in costs such as utilities, rates and consumables, this move still leaves a nasty taste in the mouth, especially as Spurs have the most expensive adult tickets in the Premier League.

 

[tom4s]

Commercial Revenue​

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Tottenham’s commercial revenue rose £45m (24%) from £183m to a club record £228m. Sponsorships grew £15m (12%) from £126m to £141m, while merchandising increased £6m (21%) from £25m to £31m, but the star of the show was other income, which shot up £23m (74%) from £32m to £55m.

The substantial rise in other income was due to numerous third party events at the new stadium, such as the NFL, rugby union, the heavyweight fight between Tyson Fury and Derek Chisora plus a few major gigs (Beyonce, Guns N Roses and Lady Gaga).

The NFL deal, which has been extended to 2030, gives Spurs a stadium hire fee and a slice of catering income and merchandising, though not gate receipts.

In addition, the easing of travel restrictions meant that an overseas pre-season tour was able to take place.


In fact, Tottenham’s commercial income has tripled since 2017, rising £152m from £76m to £228m. This is the highest growth in the Big Six, even ahead of Manchester City’s £143m and Liverpool’s £136m.


Following this steep growth, Tottenham’s £228m commercial revenue is now the fourth highest in the Premier league, having overtaken both Chelsea £210m and Arsenal £169m. However, they are still a fair way below the top three: Manchester City £341m, Manchester United £303m and Liverpool £273m.


Tottenham’s two major commercial deals have both been extended: (a) AIA shirt sponsorship to 2027 for £40m; (b) Nike to 2033 for £30m. While it is good to secure these commercial partnerships, these long-term deals do run the risk of being overtaken by others.

The sleeve sponsorship is with Cinch, reportedly worth £10m a year, while the deal with training wear partner Getir pays £7.5m per annum.


Spurs have still not secured a naming rights deal for the new stadium, though Levy seems unconcerned, “If we get the right naming rights partner – and when I say that, I mean somebody who pays the right money in the right sector – then we are willing to consider doing it. But we’re not as tied to doing it now as perhaps we would’ve been when we first looked at building the stadium.”

Wages​

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Following investment in the squad, Tottenham’s wage bill rose £42m (20%) from £209m to £251m, which is easily a club record. Wages have increased by more than £100m in just five years.


Staff numbers grew by 74 (10%) from 719 to 793, including a 28 increase in players and football administration from 292 to 320. Stadium and operations support headcount has nearly doubled since 2019 from 217 to 413.


In fact, Spurs’ wages have almost doubled since 2017, rising by £124m. That’s a fair amount of growth in six years, but even this has been outpaced by Liverpool, Manchester City and Chelsea.

In contrast, there was hardly any growth at Manchester United and especially Arsenal with just £68m and £35m respectively.


As a result, Tottenham’s £251m wage bill is the fifth highest in the Premier League, having overtaken Arsenal (£235m) for the first time since 1996.

However, there is still a substantial gap to the top four of at least £80m. For some perspective, Manchester City’s £423m is nearly 70% higher than Spurs.


Tottenham’s wages to turnover ratio decreased (improved) from 47% to 46%, though this is still higher than the amazing 39% pre-pandemic. Tottenham have consistently had one of the lowest ratios in the top flight, which is great news financially, though their fans would doubtless want to see more of the club’s cash represented on the pitch.


Indeed, Tottenham’s 46% wages to turnover ratio is by some distance the lowest in the Premier League, even better than Arsenal and Manchester United, both 51%. For even more perspective, this is significantly lower than the other three members of the Big Six: Manchester City 59%, Liverpool 63% and Chelsea 79%.

Directors’ Remuneration​

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Daniel Levy’s remuneration rose 10% from £3.3m to £3.6m, but he was also paid an accrued bonus of £3.0m, taking the total up to a cool £6.6m. This means that the chairman has trousered over £46m in the last 14 years - nice work if you can get it.

Since 2010 the position in the league has actually deteriorated, though the ranking in the Money League has improved, which might indicate the priorities at the club.


Levy £6.6m director’s remuneration is once again the highest in the Premier League, over twice as much as the next best, namely Denise Barrett-Baxendale at Everton £3.3m, Paul Barber at Brighton £2.9m and Richard Arnold £2.6m at Manchester United.

Given that this was a season when Spurs failed to qualify for Europe, while posting a pre-tax loss just shy of £100m, it does raise the question of how much Levy would be paid in a successful season.

It’s also a pretty poor look when the club has just announced a season ticket price rise.

 

[tom4s]

Depreciation​

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Tottenham’s depreciation was unchanged at £72m, having significantly increased three years ago after the massive investment in the new stadium.


Consequently, this is by far the highest charge in the Premier League, over £55m more than Arsenal £17m and Manchester United £14m, though it is worth noting that it is a non cash flow accounting expense.

Player Amortisation​

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Tottenham’s player amortisation, the annual charge to expense transfer fees over the length of a player’s contract, increased by £30m (37%) from £79m to £109m, while player impairment was up from £2m to £11m.


Although this is a record for Spurs, breaking through the £100m barrier for the first time, it is still a lot less than big-spending Manchester United £170m and Chelsea £160m. That said, it is slightly higher than Liverpool, who haven’t done too badly on the pitch.


Tottenham’s £11m player impairment is the second highest to date in last season’s Premier League, albeit miles below Chelsea’s unprecedented £77m in 2021/22.

Other Expenses​

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Tottenham’s other expenses shot up £47m (39%) from £120m to £167m, which means that these have grown by more than £100m since the club moved from the old White Hart Lane Stadium.


Following this significant growth, this is the second highest for this cost category in the Premier League, only below Manchester City £173m.

This shows the other side of the coin of the new stadium, as the associated costs, including those incurred for staging events, have surged in line with the revenue growth.

Transfers​

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Tottenham spent £152m on player purchases in 2022/23, around the same as the previous year, including Cristian Romero from Atalanta, Yves Bissouma from Brighton, Destiny Udogie from Udinese and Djed Spense from Middlesbrough. The club said that the signings of James Maddison from Leicester City and Guglielmo Vicario from Empoli in the summer of 2023 just sneaked into the financial year.

That’s a lot of money, but eight clubs spent more than them, including five with gross spend above £200m, namely Arsenal £251m, Manchester United £247m, Manchester City £221m, Wolves £212m and Chelsea (yet to publish detailed accounts, but surely the highest of the lot).


Nevertheless, Tottenham have clearly ramped up transfer spend with an outlay of £558m in the last four years, which is more than twice as much as the £265m in the preceding 4-year period.

The growth in net spend over the same period is even more dramatic, rising from £57m to £459m.


Spurs have continued to spend since these accounts closed, bringing in Brennan Johnson from Nottingham Forest, Pedro Porro from Sporting, Micky van de Ven from Wolfsburg, Dejan Kulusevski from Juventus, Radu Dragusin from Genoa and Alejo Veliz from Rosario.

Levy is obviously very sensitive on this subject, as he defended the club’s record, “Since opening the stadium in April 2019, we have invested over £600m in our men’s and women’s first team squad.”

Of course, everything is relative, so Tottenham’s £558m in the last four years was still comfortably outspent by four other clubs: Manchester City £744m, Arsenal £736m, Manchester United £698m and especially Chelsea with around a billion.

However, Spurs still had the fifth highest gross spend in the Premier League over this period, over £200m more than Liverpool.

Squad Cost​

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Tottenham’s squad cost, based on amounts paid per the club’s balance sheet (as opposed to market value), increased from £512m to £579m, which means that this has more than doubled since 2017.


Despite this increase, Spurs’ squad remains the sixth highest in the Premier League, a fair way below the top five. Manchester City have broken through the billion pound barrier and Chelsea will almost certainly join them (and probably overtake them) when they publish their 2022/23 accounts.

 

[tom4s]

Debt​

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Tottenham’s gross financial debt was basically unchanged at £851m, mainly the loans used to finance the new stadium. Over 90% is at fixed rates at a very attractive average interest rate of 2.79%. The average maturity of the borrowings is 19.4 years, some of which stretch until 2051.

As the cash balance decreased from £227m to £174m (after a cash pooling adjustment), net debt rose by £51m from £626m to £677m.


Spurs’ £851m gross debt is the highest in the Premier League, ahead of Everton £792m (stadium and transfer spend) and Manchester United £613m (mainly the lingering impact of the Glazers’ leveraged buy-out).

In March 2023 the Investec Bank loan was repaid, but the facility with Bank of America Merrill Lynch was extended by £19m.


Tottenham’s interest payments (as opposed to the accountants’ interest payable in the P&L) increased from £22m to £25m. So, even though Spurs refinanced their stadium debt at the right time, there is still a price to pay in the form of hefty interest charges each year.


As a result, they now pay the second highest interest in the Premier League with their £25m only surpassed by Manchester United’s £31m, though Spurs do at least have a shiny new stadium to show for this, in contrast to merely paying for the privilege of having the Glazers as owners.

Transfer Debt​

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Much of Tottenham’s player spend has been on credit, as transfer debt has more than tripled from £88m in 2019 to a staggering £307m. This covers outstanding stage payments on transfer fees. They are owed £39m by other clubs, so the net payables are £268m.


Of course, many clubs increasingly use this form of financing, so there were also huge amounts owed by Manchester United £277m, Arsenal £240m and Manchester City £204m, but Tottenham’s debt is comfortably the largest.

Total Debt​

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Following the significant investment in both the stadium and the squad, Tottenham’s total debt has shot up to nearly £1.2 bln, comprising £851m financial debt and £307m transfer debt. This was as small as £58m just eight years ago.


From this perspective, Spurs are in a class of their own, more than quarter of a billion higher than Manchester United £890m. For some more context, this is over twice as much as Arsenal’s £516m.

Cash Flow​

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Tottenham’s £65m operating loss swung to £130m operating cash flow after adding back £191m non-cash items (player amortisation, impairment and depreciation), and £4m working capital movements.

This was boosted by £28m player sales, but the club then spent £135m on player purchases, £50m on infrastructure, £25m interest and £2m loan repayments, partly offset by £1m tax credit.


As a result, Tottenham’s cash balance decreased by £53m, reducing the cash balance by £29m from £227m to £198m, further adjusted by £24m for cash pooling.

Even after the fall, this was still by far the highest in the Premier League, ahead of the two Manchester clubs: City £79m and United £76m.



In the last decade Spurs have invested a hefty £1.4 bln in the new stadium and training centre, spending £307m on players (net), while shelling out £139m on interest payments and £41m tax.

Funding​

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ENIC have agreed a capital increase of up to £150m, providing £100m in 2021/22 (£97m after share issue expenses), which was the first time that the owners have provided share capital since 2004. It is true that £40m of preference shares were issued in 2014, but these were bought back over the subsequent three years.


However, this is still a lot less than the sums provided by many other owners, e.g. in the five years up to 2022, there was significant funding at Everton £573m, Chelsea £416m and Aston Villa £351m.

On the other hand, ENIC might point that not all of these clubs have set the world alight, i.e. money does not always guarantee success.

 

[tom4s]

Premier League Profitability and Sustainability Rules​

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Tottenham said that “the club remains fully compliant with the Premier League Profit and Sustainability Rules and is supportive of PSR to ensure the PL remains competitive and sustainable.”

Their stance is understandable, given that they have considerable headroom, once the annual £72m depreciation on infrastructure investment is deducted. In addition, they could deduct sizeable COVID losses in the 2022/23 assessment.

Given the Premier League charges made against Everton, Nottingham Forest and Leicester City, Levy would be entitled to feel that his approach has been vindicated to a certain extent.

UEFA Financial Sustainability Rules​

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As Tottenham often qualify for Europe, they must also comply with UEFA’s regulations, but the good news is that these are less strict than the former regime, as the maximum allowable loss has doubled from €30m to €60m (potentially as much as €90m if a club is deemed to be in good financial health).


UEFA have also introduced squad cost control via a new ratio of player wages, transfers and agent fees that will be limited to 70% of revenue & profit on player sales, though there is a gradual implementation over 3 seasons (90% in 2023, 80% in 2024 and 70% from 2025), giving clubs time to get their house in order.


Based on my calculations, Tottenham’s ratio was 60% in 2022/23, which is worse than their 46% wages to turnover ratio, due to the inclusion of player amortisation/impairment and onerous contracts, allied with relatively low player sales.

However, this is still well within the ultimate 70% target, so this will not be a major challenge for the club.

Ownership​

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Levy said, “To capitalise on our long-term potential, to continue to invest in the teams and undertake future capital projects, the club requires a significant increase in its equity base. The Board and its advisors, Rothschild & Co, are in discussions with prospective investors.”

Tottenham have described the charges against former owner, Joe Lewis, as “a legal matter unconnected with the club.” He pleaded guilty to insider trading and conspiracy charges in January, admitting to sharing secrets about publicly traded companies with several individuals.

Lewis was removed as a “person of significant control” in 2022 after Tottenham’s ownership was handed over to a family trust.

Conclusion​

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Levy highlighted the impact of the new stadium on the club’s revenue, but noted that the “absolute priority” was to deliver on-pitch success.

Obviously, he also emphasised the importance of “investing in our football in a financially sustainable matter”, though potential investors might have noted that Tottenham have now reported large losses four years in a row.

This season’s revenue is likely to see a further increase from monetising the stadium with even more third party events, but Levy admitted that “this will not compensate for the lack of European football”.

However, Spurs finances will benefit from Harry Kane’s big money sale, while Big Ange’s team is on course to return to Europe with a decent chance of securing Champions League qualification.

 

[tom4s]

Done!

Boy, that was longer than I thought when i started pasting this in. Will do something about the image sizes later

EDIT: have now resized all images one-by-one, which was pretty painful. Hadnt undergone this massive ordeal if the full article wasnt behind paywall. hope someone enjoys it!

 

[vegassd]

Thanks for posting @tom4s

 

[blitzfyr]

Thanks for this. Is there a similar PSR analysis somewhere for Chelsea for the period to June 2022 (June 2023 accounts still awaited)?

By my rough calcs they had a 3 yr PSR adjusted loss of more than £250m (before adjusting for COVID expense which isn’t clear) so I can’t understand why they weren’t investigated unless they could offset nearly £150m of COVID losses and women’s/youth football expenditure.

2023’s loss is reportedly a further £90m with minimal depreciation to offset so presumably they are in line for a further breach but again this doesn't seem to be in question until at least next season whereas Everton are getting their 2023 points deduction this season.

Apologies if the wrong thread for this but any insights welcome!

 

[tom4s]

Thanks for this. Is there a similar PSR analysis somewhere for Chelsea for the period to June 2022 (June 2023 accounts still awaited)?

By my rough calcs they had a 3 yr PSR adjusted loss of more than £250m (before adjusting for COVID expense which isn’t clear) so I can’t understand why they weren’t investigated unless they could offset nearly £150m of COVID losses and women’s/youth football expenditure.

2023’s loss is reportedly a further £90m with minimal depreciation to offset so presumably they are in line for a further breach but again this doesn't seem to be in question until at least next season whereas Everton are getting their 2023 points deduction this season.

Apologies if the wrong thread for this but any insights welcome!

You could check Swissrambles Xitter feed. Might be some stuff in there https://twitter.com/SwissRamble

 

[Westmorlandspur]

Thanks for this. Is there a similar PSR analysis somewhere for Chelsea for the period to June 2022 (June 2023 accounts still awaited)?

By my rough calcs they had a 3 yr PSR adjusted loss of more than £250m (before adjusting for COVID expense which isn’t clear) so I can’t understand why they weren’t investigated unless they could offset nearly £150m of COVID losses and women’s/youth football expenditure.

2023’s loss is reportedly a further £90m with minimal depreciation to offset so presumably they are in line for a further breach but again this doesn't seem to be in question until at least next season whereas Everton are getting their 2023 points deduction this season.

Apologies if the wrong thread for this but any insights welcome!

Although we haven’t seen Chelsea’s results , they will have been seen by the prem lge by end of last year. If there is a breach we would know about it as they should have been charged. Still be interesting to see though. Will have to sell some players to avoid getting done next time.

 

[Westmorlandspur]

Wages are 250m and revenue well over 500m. Surely that is less than 50% wages to revenue. Ramble says 60%??
Are we aware that he is an Arsenal fan!!!!

 

[BehindEnemyLines]

Premier League Profitability and Sustainability Rules​

​

Tottenham said that “the club remains fully compliant with the Premier League Profit and Sustainability Rules and is supportive of PSR to ensure the PL remains competitive and sustainable.”

Their stance is understandable, given that they have considerable headroom, once the annual £72m depreciation on infrastructure investment is deducted. In addition, they could deduct sizeable COVID losses in the 2022/23 assessment.

Given the Premier League charges made against Everton, Nottingham Forest and Leicester City, Levy would be entitled to feel that his approach has been vindicated to a certain extent.

UEFA Financial Sustainability Rules​

​

As Tottenham often qualify for Europe, they must also comply with UEFA’s regulations, but the good news is that these are less strict than the former regime, as the maximum allowable loss has doubled from €30m to €60m (potentially as much as €90m if a club is deemed to be in good financial health).


UEFA have also introduced squad cost control via a new ratio of player wages, transfers and agent fees that will be limited to 70% of revenue & profit on player sales, though there is a gradual implementation over 3 seasons (90% in 2023, 80% in 2024 and 70% from 2025), giving clubs time to get their house in order.


Based on my calculations, Tottenham’s ratio was 60% in 2022/23, which is worse than their 46% wages to turnover ratio, due to the inclusion of player amortisation/impairment and onerous contracts, allied with relatively low player sales.

However, this is still well within the ultimate 70% target, so this will not be a major challenge for the club.

Ownership​

​

Levy said, “To capitalise on our long-term potential, to continue to invest in the teams and undertake future capital projects, the club requires a significant increase in its equity base. The Board and its advisors, Rothschild & Co, are in discussions with prospective investors.”

Tottenham have described the charges against former owner, Joe Lewis, as “a legal matter unconnected with the club.” He pleaded guilty to insider trading and conspiracy charges in January, admitting to sharing secrets about publicly traded companies with several individuals.

Lewis was removed as a “person of significant control” in 2022 after Tottenham’s ownership was handed over to a family trust.

Conclusion​

​

Levy highlighted the impact of the new stadium on the club’s revenue, but noted that the “absolute priority” was to deliver on-pitch success.

Obviously, he also emphasised the importance of “investing in our football in a financially sustainable matter”, though potential investors might have noted that Tottenham have now reported large losses four years in a row.

This season’s revenue is likely to see a further increase from monetising the stadium with even more third party events, but Levy admitted that “this will not compensate for the lack of European football”.

However, Spurs finances will benefit from Harry Kane’s big money sale, while Big Ange’s team is on course to return to Europe with a decent chance of securing Champions League qualification.

Worth noting that Profit & Sustainability is a rolling 3 year period, so the P&S headroom of £208m will reduce substantially as we'll lose the £86m from the Covid period (which averaged out 2020 and 2021 and introduced some leeway). However, we still have a lot of headroom moving forwards......and it's nice seeing it set out in this format, as normally it's quite hard to read.

I always find it amusing when the papers and other fans cling to headline figures (which for us is a substantial loss year on year), but ignore the fact that a large part of that is balance sheet adjustments.

 

[BehindEnemyLines]

Wages are 250m and revenue well over 500m. Surely that is less than 50% wages to revenue. Ramble says 60%??
Are we aware that he is an Arsenal fan!!!!

Swiss Ramble correctly identifies it at 46%?

Are you referring to the squad cost ratio of 60% for UEFA rules? If so, then that includes player amortisation and impairment costs as well as wages.

 

[McArchibald]

Wages are 250m and revenue well over 500m. Surely that is less than 50% wages to revenue. Ramble says 60%??
Are we aware that he is an Arsenal fan!!!!

That was according to the UEFA calculation methods.

As for him being a Gooner... nobody's perfect, but I have never seen him skew an analysis of any club's finances in order to put the Woolwich outfit in a better light...

 

[HNIM]

"As a result, they now pay the second highest interest in the Premier League with their £25m only surpassed by Manchester United’s £31m, though Spurs do at least have a shiny new stadium to show for this, in contrast to merely paying for the privilege of having the Glazers as owners."

 

[Zaphod]

It shows how bad we've been at selling players.
Chelsea seemed to have a conveyor belt of youngsters they sold every season.