Financial Results 2021/22

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Jeff

Administrator
Staff member
Leicester City Football Club today announces its financial results for the year-ending 31 May 2022 – a year of continued investment in which the Club sought to build on the successes of preceding seasons.

Heading into a second straight European campaign for the first time in our history, following consecutive fifth- place finishes in the Premier League (2019/20 and 2020/21) and the lifting of our first FA Cup (2021), the Club retained its primary playing assets while making further significant investments in player acquisitions and salaries.

This approach was the primary factor behind the Club’s pre-tax loss of £92.5M for the year (2021: £31.2M loss) with the retention of the Club’s key playing assets offsetting the profit derived from the sale of players in the year.

The welcome return of supporters to stadiums, an eighth-placed Premier League finish and a run to our first European semi-final in the UEFA Europa Conference League together generated a revenue figure of £214.6M for the year. This drop in revenue compared to 2021’s £226.2M is principally due to the reversal of accounting timing differences in the recognition of revenue relating to the COVID-delayed 2019/20 season, whereby 20 per cent (£32.9M) of revenue from the 2019/20 season was recognised in the 2020/21 financial year. Underlying revenue rose, with an upturn in UEFA revenue (£21.5M from £13.7M) and gate receipts increasing to £21M from £0.5M as supporters returned to stadiums. The increase in revenue was partially offset, however, by a reduction of £6M in Premier League revenue for 2021/22 compared with the previous year due to a lower finishing position.

Season 21/22 was the Club’s second season operating at professional level in the women’s game. Additional investments were made into both our playing squad and the facilities at Belvoir Drive to further professionalise our women’s and girls’ football operation. The Club’s first FA Women’s Super League season ended with top-flight status secure.

Following the successful development of the Club’s world-class training facility in Seagrave, north Leicestershire, the Club is currently finalising agreements with Leicester City Council in order to obtain a formal grant of planning permission for the expansion of King Power Stadium and the development of its wider site (following the Council planning committee’s unanimous approval of the Club’s planning application in September 2022) – a long-term project that will further enhance and diversify the Club’s revenue generation capability.

Under the leadership of the Club’s Chairman, Aiyawatt Srivaddhanaprabha, the Club’s parent company, King Power International, continues to provide a deeply secure footing from which the Club can continue pursuit of its long-term ambitions. On 31 December 2022, Khun Aiyawatt relieved the Club of its outstanding debt to KPI through the conversion of £194M in loans and related interest into equity, thereby strengthening the Club’s balance sheet, reducing its interest costs and providing further evidence of King Power International’s commitment to supporting Club’s long-term sustainability.

Leicester City Chief Executive Susan Whelan said: “Under 12 years of King Power ownership, we have consistently sought to invest in the Club’s future and to build from established positions of strength.

“King Power’s unwavering support of the Club provides a secure position from which to capitalise on our opportunities. However, in order to remain compliant with the game’s regulations both domestically and in Europe – where we aim to compete regularly – our ongoing investment strategy must continue to reflect our underlying revenue progression. Our long-term ambition is to achieve this through on-pitch success, the commercial growth that comes with it and through the expansion of our stadium and the development of the associated masterplan. In the shorter term, as we look to continue to compete with more established opponents, profits from player trading and continued successful recruitment will continue to feature prominently in our strategy. This approach has served us well in the past, bolstering our capability to keep investing in the growth of the Club and forming a cornerstone of the most successful era in Leicester City’s history.

“Everyone at the Club remains committed to the ongoing and responsible establishment of Leicester City as a consistently competitive force in the game’s leading competitions and a powerful force for good in our communities.”
 
Christ on a bike
 
I mean I know such numbers look worse than they are, and football is a different game, but £92.5m in losses doesn’t exactly sound healthy does it?
 
Our club is in a very depressing place. I don’t even think this is the worst of it.
 

Leicester City record huge £92.5m losses but insist summer rebuild is on track​

A significant squad revamp is expected at Leicester in the summer despite major losses
ByJohn Percy7 March 2023 • 8:00pm

Leicester City have announced record losses of £92.5million for the financial year ending May 2022, but insist their summer rebuilding plans remain on course.
Despite the eye-watering figures, Leicester are compliant with Financial Fair Play regulations and still preparing for a major revamp of the squad ahead of next season.
There will be some pressure to sell players in the short to medium term, but with high earners Youri Tielemans, Caglar Soyuncu and Ayoze Perez among a number of squad members out of contract in June, Leicester’s wage bill will be significantly lowered in the summer.
James Maddison, the England international, is also likely to be a target for a number of Premier League clubs, including Tottenham Hotspur, and could cost a minimum £60 million.
Leicester are owned by Thailand duty-free retail company King Power, and the huge losses for 2021/22 have been forecast for some time.

In a statement, the club said the vast majority of those losses was down to continued player investment and the decision not to sell any first-team stars in the summer of 2021. That year they spent around £50m by bringing in Boubakary Soumare, Patson Daka and Jannik Vestergaard as they prepared for a second successive year competing in European football.
Crucially, Leicester also refused to sell any of their stars in that summer, for the first time since winning the league title in 2016. N’Golo Kante, Danny Drinkwater, Riyad Mahrez, Harry Maguire and Ben Chilwell have all departed in recent years, but in the summer of 2021, Leicester made the decision to keep their squad together after winning the FA Cup.
Leicester did not sign an outfield player in the last summer transfer window until deadline day, recruiting Wout Faes by using some of the funds from Wesley Fofana’s £70m sale to Chelsea. Manager Brendan Rodgers signed three new players in January and those transfers were also possible with the Fofana money.
Leicester insist that commercial and sporting revenue figures are both on the up and there are no fears over breaching FFP rules. However, the club is fighting to avoid relegation from the Premier League and dropping into the Championship would clearly represent another massive financial blow.
Leicester's chief executive, Susan Whelan, said: “King Power’s unwavering support of the club provides a secure position from which to capitalise on our opportunities. However, in order to remain compliant with the game’s regulations both domestically and in Europe – where we aim to compete regularly – our ongoing investment strategy must continue to reflect our underlying revenue progression.
"Our long-term ambition is to achieve this through on-pitch success, the commercial growth that comes with it and through the expansion of our stadium and the development of the associated masterplan. In the shorter term, as we look to continue to compete with more established opponents, profits from player trading and continued successful recruitment will continue to feature prominently in our strategy.
"This approach has served us well in the past, bolstering our capability to keep investing in the growth of the Club and forming a cornerstone of the most successful era in Leicester City’s history."
Leicester, who are currently 15th in the table and two points above the relegation zone, host Chelsea at the King Power on Saturday.
 
Letting BR take us down will be a good move
 
****ing hell, what a complete shower

You could tell something was going horribly wrong somewhere, but those losses are genuinely eye-watering
 
"Our long-term ambition is to achieve this through on-pitch success”

How’s that going, then, Susan ?
 
To be fair, there is nothing unexpected in these figures. The club have been advertising the fact that they're going to be awful for a long time.

Summer 2021 is going to go down as our most inept transfer period ever. Even surpassing the mess in 2016.

If we go down, it's really difficult to see how we're not completely ****ed as a club though. I can't even begin to fathom how we survive it. It's convenient that the club are being 'held back' from stadium development due to the section 106 that's still outstanding with LCC. No way we do anything until our position in the PL is secured.
 
If we go down, it's really difficult to see how we're not completely ****ed as a club though. I can't even begin to fathom how we survive it.
Top only has himself to blame should we be relegated, should have sacked Rodgers after the initial 7 games (his Dad would have).
 


Average player wage is £84k a week.

Loss over last five years now £368m

We're paying £363k a week to service loans.
 
Someone at LCFC said:
... Our long-term ambition is to achieve this through on-pitch success, the commercial growth that comes with it and through the expansion of our stadium and the development of the associated masterplan. In the shorter term, as we look to continue to compete with more established opponents, profits from player trading and continued successful recruitment will continue to feature prominently in our strategy.

Two things.

1. You harp on about this "continued successful recruitment" thing but as far as I can see, it's hardly been successful. Bit presumptive of you to say that, don't you think?

2. Development of the associated masterplan. What masterplan exactly? It all sounds very grandiose and exciting but as far as I can see, the masterplan is rather conceptual, in that it doesn't actually exist. If it does though, please share it. Would be fascinating to see how far removed from it we currently are.

That is all.... fur bird.
 
7th highest wage bill in the league....
And we have consistently been that high in the Premiere League as a result. The paragraph below explains why we are where we are, did the board make the right decision probably not, it may explain why BR has not been sacked by the Chairman.

Crucially, Leicester also refused to sell any of their stars in that summer, for the first time since winning the league title in 2016. N’Golo Kante, Danny Drinkwater, Riyad Mahrez, Harry Maguire and Ben Chilwell have all departed in recent years, but in the summer of 2021, Leicester made the decision to keep their squad together after winning the FA Cup.

Leicester did not sign an outfield player in the last summer transfer window until deadline day, recruiting Wout Faes by using some of the funds from Wesley Fofana’s £70m sale to Chelsea. Manager Brendan Rodgers signed three new players in January and those transfers were also possible with the Fofana money
 
In my view, our model fell to pieces for three reasons.

1. We got complacent in our ability to sign players with potential. We employed Congerton and he wasn't up to the job.

2. We qualified for Europe which meant that we needed a bigger squad so we chose to add numbers which inflated the wage bill and reduced standards.

3. COVID. It fecked the transfer market outside of the PL. Therefore there is no market for selling the sort of players we have wanted to sell.

When we went bust twenty years ago, it was due to various factors - relegation, new stadium, ITV digital going bust - that did it.

Same now. It's never one person or one decision. It's a combination of complacency, bad choices and circumstances outside of our control.
 
I think it’s basically rooted in the decision to not sell Tielemans, which would have largely balanced the books.
 
Our model has been buy decently and then sell one on for a big number each year

We’ve recently bought a complete pile of utter shite, whilst at the same time allowing contracts to run down on those who might be worth a few quid

Which means, apart from Madison, we have nothing to sell anymore - and then the model just disintegrates into nothing


Rank mismanagement on and off the pitch
 
And we have consistently been that high in the Premiere League as a result. The paragraph below explains why we are where we are, did the board make the right decision probably not, it may explain why BR has not been sacked by the Chairman.

Crucially, Leicester also refused to sell any of their stars in that summer, for the first time since winning the league title in 2016. N’Golo Kante, Danny Drinkwater, Riyad Mahrez, Harry Maguire and Ben Chilwell have all departed in recent years, but in the summer of 2021, Leicester made the decision to keep their squad together after winning the FA Cup.

Leicester did not sign an outfield player in the last summer transfer window until deadline day, recruiting Wout Faes by using some of the funds from Wesley Fofana’s £70m sale to Chelsea. Manager Brendan Rodgers signed three new players in January and those transfers were also possible with the Fofana money
The fundamental point here is that we couldn't get anyone to overpay for one of our assets.

It's bullshit to claim we 'made a decision to keep the squad together'. Despite the FA Cup win, we were performing worse by most metrics compared to any of the previous few seasons. It was clearly because a crazy offer didn't come in.

If you look at the sales we made previously:
  1. Kante and Mahrez - both took large steps up at the time (and won the league that season after).
  2. Maguire, Chilwell, Drinkwater - all were signed by desperate clubs clearly overpaying.
I think our Board have got lucky with the latter three sales at a premium, and claimed that's their sustainable model.

The only thing that's been sustained over the last four seasons is poor management (ever since Vichai passed away) and poor signings.
 
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