Newcastle United’s financial report has stressed great progress on-and-off the pitch, in both a sporting and commercial sense, but the group’s losses are hardly enviable.
Publishing its results for the financial year – ending 30 June 2023 – in its strategic report this week, the Premier League club reported 28% growth in turnover from £180m to £250.3m.
“The group has made great progress over the 18 month period since its acquisition by the PIF-led ownership group,” Newcastle United stressed in its report, detailing confidence in club investments.
However, these investments have come at a cost. The club’s losses as of June 2023 widened year-on-year from £70.7m in 2022 to £73.4m, attributed to investment in the playing squad.
It is hard to deny that the Magpies have been very liberal in their use of the cheque book since the Saudi sovereign wealth fund’s arrival, the Public Investment Fund (PIF) purchased the club for £305m in October 2021, with management spending over £200m on transfer signings. .
Commenting on X, football accounts academic and broadcaster Kieran Maguire noted that the results mean Newcastle is in the ‘top ten of loss making clubs’ in Premier League history.
The report outlined that operating costs across the board had risen 12% from £206.2m to £230.2m, with staff costs in particular rising 10% from £170.2m to £186.7m.
This was attributed by the group to merit bonuses paid to management, players and club staff due to its performance in the 2022/23 campaign.
However, Newcastle United remained adamant in its report that the losses will have been offset by the 39% YoY increase in revenues, including income from commercial and media rights arrangements.
“Newcastle United has had a very successful year both on and off the pitch,” remarked Darren Eales, Newcastle United CEO.
“We grew revenues by 39%, with an increase in TV money, improved sponsorship deals and a sharper focus on everything we are doing across the club.
“We continue to make progress each day as we strengthen the foundations of the long-term project that we are developing here at the club.”
A breakdown of revenues saw match income rise 38% to £37.9m (£27.5m), driven by the team’s appearance in seven cup fixtures and the 2023 EFL Cup Final, losing to Manchester United.
Meanwhile, media income rose 33% from £124.1m to £165.5m, largely due to the club’s merit award increasing with its fourth place finish in the 2022/23 league table. This meant its share of revenue from the Premier League’s various media rights deals – such as with Sky Sports and TNT – increased.
Lastly, commercial income was up 66% from £26.5m to £42.9m. The club noted elsewhere in its report that 2023 saw ‘growth across key sponsorship and commercial income streams’.
Commercial revenue was also buyed by event income, notably the Diriyah Cup in December 2022 and two concerts in June 2023 at St James Park held by Newcastle-born indie musician Sam Fender.
Newcastle currently stand in ninth place in the Premier League and are also competing in the FA Cup, but have been knocked out of the EFL Cup and European competition. The club did make some commercial inroads early on in the 2023/24 campaign, however, signing deals with BetMGM and Adidas.