Blues announced massive loss of £66m for 2008
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Chelsea lost £66m last year but there is more to come after Scolari's sacking
Huge investment: Chelsea owner Roman Abramovich has bankrolled the club
Chelsea paid out an incredible £23million in compensation last season after parting company with managers Jose Mourinho and Avram Grant.
The news comes as the Blues announced a massive £66m loss for the year to the end of June 2008. But there is more bad news to follow as this does not cover the costs of axing boss Luiz Felipe Scolari, who was replaced by Guus Hiddink this week.
Chelsea's billionaire owner Roman Abramovich will again have to foot the bill but eyebrows will be raised at the past claims of Peter Kenyon.
The chief executive, who has worked closely with Abramovich during the Russian's investment of £710m at Stamford Bridge, has previously said that the club's aim is to break even by next year.
Most of the £23m paid to former managers and coaches in the latest figures went to Mourinho after his departure in September 2007. Mourinho, now at Inter Milan, was replaced by Avram Grant but he was sacked at the end of last season.
However, the Blues will now have to fork out again to cover Scolari's exit just seven months into his lucrative two-year contract in west London. It is thought they will have to pay £7.5m to the Brazilian boss.
The club's loss is a slight improvement on the £74m lost last year and £80.2m in 2005/6. Chelsea lost a record £140m in 2004/5.
Chelsea's wage bill remains comfortably the biggest in the Premier League at £148.5million 70.6% of their turnover. Manchester United' by contrast was £106million in 2006/7, 43.6% of turnover.
The club came fifth on the list of the world's richest clubs in 2007/8 but Deloitte's Football Money League is based on revenue and does not take debt into account.
Gone: Jose Mourinho... Out: Avram Grant...
After the latest results, Chelsea attempted to soften the blow by insisting that half of the interest-free loans from Chelsea Ltd, controlled by Abramovich, have been turned into equity.
Blues chairman Bruce Buck said: 'Following the conversion of half of the interest-free loans into equity there should now be no doubt as to the owner's commitment to the club and the stability of the company's funding structure.
'We have always believed that this 'debt', now reduced by 50 per cent, has been misrepresented. Chelsea has no external debt and makes no punitive interest payments to external funders.'
Kenyon added: 'There is no doubt that the positive upward trends of turnover and the continued reduction in losses shows that Chelsea is building a strong business base to build on in what will be challenging times.
'This is even more evident given that the results were adversely affected by the exceptional items.
'We have set ourselves ambitious targets to be EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) neutral on June 30, 2010 and to require zero cash funding from the owner at the beginning of the financial year 2009/2010.
'We have consistently advocated the aim of self-sufficiency which has always been supported by the owner. We are hopeful of being close to these targets in the timeframes we have set given the underlying strengths of the business.
'Success on the field is a key part of this. But in line with our long stated business aims, any squad restructuring in the summer will be funded predominantly by sales as we have consistently reduced our net transfer spend over the last five years and will attempt to continue this trend.
'This is the fifth set of financial accounts since the takeover and Chelsea has made huge progress during that period as a football club and a business.
'In that time we have had significant on-field success, our turnover has increased by 96 per cent, which ranks us fifth in the world, and our fan base has increased hugely. That gives us great confidence for the next five years.'
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Lolx? 66M....
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see lah.. dont sack them can liao what.. sack liao get new manager also never win anything, then sack and compensate again. haiyo...
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the problem is the payroll of the player lah....they are overpaying those clowns lah..
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They actually waste more money sacking their managers than strengthening their squad with younger / new players... This Roman oso a bit dumb... Dunno how to play fantasy football properly...
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Everyone smiling but Roman.
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Originally posted by sand king:
Everyone smiling but Roman.
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if I am not wrong, Chelsea has been losing money since Roman came and it is only his money that is keeping Chelsea afloat..