Manchester City have announced the biggest loss in English football history, £197m for the most recent financial year. The loss on that huge scale, bankrolled by the club's oil-rich owner, Sheikh Mansour bin Zayed al-Nahyan during the third year since he bought City in 2008, eclipses the previous biggest loss ever made, £141m by Chelsea in 2005, the second year of their ownership by the oil oligarch Roman Abramovich.
Headline grabbing of course but no huge surprise given that this report contains the transfers covering the financial year when City added Jérôme Boateng for £10.5m, Edin Dzeko for £27m, David Silva for £26m, Yaya Touré for £24m, Aleksandar Kolarov for £19m, Mario Balotelli for £24m and James Milner for £26m: a total of £156.5m (transfer fees from The Guardian).
The intention was of course that the particular summer in question would be the last one where City spent anywhere near such a sum again, and as a result the figures were very much anticipated with Chief Operating Officer Graham Wallace stating:
"Our losses, which we predicted as part of our accelerated investment strategy, will not be repeated on this scale in the future. Consistent with the Club's transformation strategy, and the stated ambition of commercial sustainability, these financial results represent the bottoming out of financial losses at Manchester City before the Club is able to move towards a more sustainable position in all aspects of its operations in the years ahead."
The official site has the announcement here and a link to the full report itself here, which in summary tell us the following:
- Match day ticketing revenue - driven by increased average attendances, UEFA Europa League matches and FA Cup matches - increased by eight per cent (from £18.2m to £19.7m).
- Television rights income increased by 27.4 per cent on the previous year (from £54m to £68.8m), largely driven by the Club's highest-ever finishing position in the Premier League, participation in the UEFA Europa League and the Club's successful FA Cup campaign.
- Commercial partnership revenue increased by 49.7 per cent on the previous year (from £32.4m to £48.5m), driven by the full year impact of continued long-term partnership deals.
- Profitability from retail activities increased to £2.6m following the entering into of a long-term partnership with leading online retailer Kitbag to handle all club retail operations, including the opening of new retail stores.
The report reveals that for the 2010-11 financial year, the Club reported a net loss on a recurrent operations basis of £160.5m. This result is consistent with the guidance provided in the first MCFC annual report that losses would peak in the 2010-11 financial year, as a result of the accelerated investment programme that the Club undertook between 2008 and 2011.
UEFA Champions League participation and the comprehensive partnership with Etihad Airways signed in July 2011 are not reflected in the 2010-11 figures.
Elsewhere around the web, David Conn has also blogged about the investment by Sheikh Mansour here and there is also a good post up on David Silva's Left Foot here. I'll also post anything else relevant to this that appears this coming weekend.