The club say that ‘Pre-tax losses of £35 million were directly attributable to COVID-19.’ The breakdown of which is estimated as follows:
- Lost match day revenues of £14m
- Deferral of £34m of broadcasting revenues into financial year 2020/21
- £6m of other commercial and broadcasting revenue losses, offset by cost savings of £19m, including the wage reduction
Since the restart in June, games have been played behind closed doors, bar a couple which had extremely limited capacity.
Other key points:
– The exceptional costs incurred of £10.4 million (2019 – £3.9 million) were attributable to a number of changes in the First Team coaching and support personnel. This relates to the firing of Unai Emery and his staff.
– Overall wage costs finished at £234.5 million (2019 – £234.9 million) with underlying growth in player wages offset by cost saving measures in response to COVID-19, including a wage reduction scheme agreed by the First Team players and a waiver of remuneration by the Executive management team.
– Commercial gains were partially offset by lower broadcasting revenues as a consequence of exiting the UEFA Europa League at the Round of 32 (2019 finalists).
– Since the year end, the Group has refinanced its stadium finance bonds and undertaken a range of cost-cutting measures. These steps will ensure the club is well placed to respond once the situation starts to improve.
– The club continues to have the unwavering support and commitment of its parent company, Kroenke Sports & Entertainment, and its ultimate owner Stan Kroenke.
— With the impact of a full season without fans because of the Covid-19 pandemic, finances next year are likely to be negatively impacted in a very significant way.
Earlier in the year, the club took a short term Bank of England loan which is to be repaid by May. Some of this money was used to negotiate contract terminations with Mesut Ozil, Shkodran Mustafi and Sokratis, all of whom departed during the January transfer window.