Leeds United disclosed an overall deficit of £33.7 million for the 2022-23 financial year, despite earning £73 million from player transfers, as revealed in the club’s latest financial report.
During the season, marked by their relegation from the Premier League, Leeds United saw a record turnover of £189.6 million.
However, they also experienced a significant surge in operating losses, reaching £105 million, which was partially mitigated by income generated from the transfers of Kalvin Phillips to Manchester City and Raphinha to Barcelona.
Kalvin Phillips. Credit: Imago Images
Administrative costs soared from £203 million in the previous financial year to £275 million. The club’s annual wage bill rose from £121 million to £145 million, contributing to a £71 million increase in operating losses compared to the prior year.
Additionally, £9.5 million was expended on contract severance, reflecting the dismissal of two head coaches, Jesse March, and Javi Gracia, during the campaign, with Sam Allardyce assuming control towards the season’s end.
Leeds United’s financial deficit of £33.7 million was slightly lower than the £36 million loss reported in the preceding year.
The club affirmed to The Atheltic their compliance with profitability and sustainability regulations set by both the Premier League and EFL.
Gate receipts for the year climbed to £29 million, while TV and broadcasting income slightly decreased to £17.4 million. Merchandise income and central distributions also experienced minor declines.
This financial period marks the conclusion of Andrea Radrizzani’s tenure as Leeds United’s majority shareholder.
Radrizzani, who acquired the club in 2017, finalised the sale to 49ers Enterprises in September, following an agreement reached in June of the same year.
What is PSR?
Simply put, Profit and Sustainability rules (PSR) allow clubs to lose £105 million over the course of three seasons, or £35 million per season, on a rolling basis. Youth development or infrastructure improvements are not included.
Premier League clubs Everton and Nottingham Forest have both been handed hefty points deductions for breaking these rules.
What next for Leeds United?
Earning promotion back to the Premier League, whether it’s automatic or through the play-offs, the first time of asking will go a long way to help any potential financial pitfalls, but at the moment, it would appear everything is fine.
Focus remains on the final three games against Middlesbrough, QPR, and Southampton after a disappointing run of results.
