Despite relegation, Burnley actually managed to deliver a £36m pre-tax profit in 2021/22, compared to a £3m loss the previous year. Revenue rose £8m (7%) from £115m to £123m, but the bottom line improvement was very largely driven by profit from player sales shooting up from £5m to £55m.
Burnley’s £36m profit was actually the second best financial
performances in the 2021/22 Premier League, only surpassed by Manchester City’s
£42m. In contrast, many clubs reported huge losses last season.
Burnley’s profit from player sales rose £50m from £5m to a
club record £55m. Many players were released for nothing, but the club got
decent money for four departures: Chris Wood and Nick Pope to Newcastle United,
Nathan Collins to Wolves and Dwight McNeil to Everton.
This was a deliberate strategy to raise funds “in
anticipation of lower turnover next season due to relegation”. The club then
used a portion of these proceeds to pay down £20m of debt with the remainder
available to invest in the squad and fund operations in the Championship.
This was the sixth highest player trading profit in the
Premier League last season, only below Chelsea £123m, Aston Villa £97m,
Manchester City £68m, Everton £68m and Brighton £62m.
Unlike most other football clubs, Burnley have a good track
record in terms of profitability. In the last six years in the Premier League,
they only once posted a loss – and that was only £3m in 2020/21, a season
ravaged by COVID. In that period the club has generated an impressive £110m
profit.
The club noted that “the reduction in total wages and the
influx of cash from transfer fees more than offset the loss of broadcasting
revenue due to relegation”, but it is still likely that Burnley will make a
loss in the 2022/23 Championship, given the much lower player sales. However, it will be a different story next
season, as the club will once again benefit from the lucrative Premier League
TV deal, so they are a good bet to return to profitability.
Despite the growth last season, Burnley’s £123m revenue was
still down £16m (11%) from the club’s peak in 2017/18, when they finished in a
highly creditable 7th place in the Premier League. The worsening performance on the pitch has
driven a sizeable reduction in broadcasting income, though this still accounted
for 85% of total revenue.
Burnley’s financial challenge is very clearly seen by their
£123m revenue being the lowest in the Premier League, a full £5m behind Watford
£128m and £11m behind Norwich City £134m.
This was miles below the elite, e.g. the top four clubs all earned more
than four times as much as Burnley, led by Manchester City £613m, while the gap
to sixth placed Arsenal was nearly quarter of a billion pounds.
Burnley’s wages rose £6m (7%) from £86m to £92m, despite not
having to pay any bonuses for Premier League survival, as the number of
players, managerial and training staff increased from 133 to 152. Presumably this
was also inflated by a once-off payment for manager Sean Dyche’s dismissal. This is the club’s second highest wage bill
ever, only surpassed by £100m in 2019/20, though that was exacerbated by the
accounting period covering 13 months. Wages have therefore grown by £31m (50%)
from £61m since the first season after promotion in 2016/17.
In many ways, it is not that surprising that Burnley were relegated,
as their £92m wages were in the bottom three of the Premier League, given the
strong correlation between wages and performance.
Burnley more than doubled the amount they spent on player
purchases from £19m to £41m in 2021/22, though this was still one of the lowest
in the Premier League, only ahead of Brentford, Wolves and Watford. This was miles below the likes of Aston Villa
£204m, Arsenal £188m and Tottenham £160m.
This season was a different story, as Burnley were the biggest spenders
in the Championship with £23m, based on Transfermarkt figures.
In the last five years, only Manchester United have provided
more money to their owners. In that period, some other clubs received
substantial amounts from their owners, including Everton £574m, Chelsea £416m
and Aston Villa £351m.
Given the understandable worries of many Burnley fans after
relegation, these financial results are a lot better than expected.
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