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#CFC profit before tax increased from £16m to £67m, as revenue rose by £82m (23%) to a record £433m, primarily due to the club’s return to European competition, and profit on player sales was up £44m to £113m. Profit after tax improved from £15m to £62m. 
All #CFC revenue streams increased: broadcasting was £42m (26%) higher at £204m, due to Champions League; match day climbed £8m (13%) to £74m, largely for the same reason; while commercial rose £32m (24%) to £165m, mainly from the new Nike kit deal.
On the other hand, there was significant #CFC cost growth: the wage bill increased by £24m (11%) to £244m; player amortisation surged £35m (40%) to £124m; and other expenses rose £10m (10%) to £105m. There were also £6m exceptional cost to buy back retail & merchandising rights.
#CFC have made a profit 3 times in the last 5 seasons (£19m in 2014, £16m in 2017 & £67m in 2018) with significant improvement since the huge £140m loss in 2005. However, 2018/19 is likely to be more challenging, as the club competes in the less lucrative Europa League.
#CFC figures have frequently suffered from so-called exceptional items, which have increased costs by an amazing £208m since 2005, largely early termination of shirt sponsor deals £93m and compensation for sacked managers £69m. 2017/18 does not include Conte’s severance pay.
However, profit from player sales is having an increasing influence on #CFC. Between 2009 and 2013, Chelsea averaged £18m profit, but this has shot up to £67m in the 5 years since then. Excluding player sales, Chelsea’s average annual loss has increased from £67m to £79m.
That said, #CFC EBITDA (Earnings Before Interest, Tax, Depreciation & Amortisation), considered as a proxy for cash operating profit, as it excludes player sales and exceptional items, has risen 4 years in a row from £16m in 2015 to £94m in 2018, the highest in Chelsea’s history.
#CFC have grown revenue by £129m (41%) in the 3 years since 2015, mainly broadcasting £69m and commercial £57m, with match day relatively flat. As chairman Bruce Buck said, “the club has now posted a series of record-breaking revenues.”
#CFC £142m Premier League TV money was £9m lower than the previous season, primarily due to a lower merit payment of £31m (5th place vs. 1st) and lower facility fees £30m (broadcast live 26 times vs. 28). Club has received £948m from the Premier League in the last 13 years.
#CFC earned €65m from Europe for reaching the Champions League last 16, similar to the €69m they received in 2015/16. They did not qualify for Europe in 2016/17, so this is pure improvement. It’s the 6th highest distribution in Europe (CL winners Real Madrid got €89m).
#CFC have good sponsorship deals: Nike £60m (though this is £900m over 15 years, which might look low later in that period); Yokohama shirt £40m; Carabao training wear £10m; and Hyundai sleeve £6m (though some report £10m).
Even though Stamford Bridge continued to sell out, the 41,500 average attendance is only the 8th highest in the Premier League (4th highest in London). Ticket prices remained frozen at 2011/12 levels.
This is why Chelsea were looking to upgrade their stadium to a 60,000 capacity, but the £1 bln development has been put on hold, officially “due to the current unfavourable investment climate”, but probably also linked to Roman Abramovich’s difficulties in extending his UK visa.
Having fallen slightly in 2016/17, the wage bill surged £24m (11%) from £220m to £244m, though the wages to turnover ratio improved from 61% to 55%, thanks to the large revenue growth. Admin & commercial staff down 66 (10%). Directors’ remuneration increased from £208k to £916k.
#CFC player amortisation shot up 40% (£35m) to £124m, reflecting the club’s significant investment in the playing squad. This expense has grown £53m in the last 2 years and is even higher than the £83m reported in 2005, following the initial wave of purchases under Abramovich.
Other expenses also increased by 10% (£10m) to £105m in 2017/18 without any real explanation. These costs are now up £34m (48%) in just 2 years. Note: new stadium planning costs have been booked in the holding company, Fordstam Limited.
#CFC net spend has substantially ramped up in the last couple of seasons to an annual average of £93m, compared to just £6m for 2014-17. Sales have increased by 12% to £114m, but gross spend has nearly doubled to £208m. 2018/19 includes Kepa, Jorginho and Pulisic.
#CFC have no financial debt in the football club, as this is converted into equity by issuing new shares. That said, the holding company, Fordstam Limited, does have £1.1 bln of debt in the form of an interest-free loan from the owner, theoretically repayable on 18 months notice.
#CFC cash flow from operations was £67m, but the significant £100m (net) player purchases and £7m capex (improvements at Stamford Bridge and the Cobham training ground) required £38m of additional borrowings (net).
Since Abramovich acquired the club, he has put around £1 bln into the club (£69m in 2017/18), split £640m loans and £350m share capital. Most of this funding has been seen on the pitch with a massive £887m (82%) spent on net player recruitment, while £152m went on infrastructure.
#CFC have confirmed that they have complied with UEFA and Premier League financial regulations (i.e. FFP) since 2012. They expect to do so for the foreseeable future, while balancing these imperatives with success on the field.
#CFC chairman Bruce Buck described this as “a successful financial year”, adding “we have a sound business footing to support our on-pitch quest for success.” This is true, but it is worth noting the reliance on profitable player sales and Champions League qualification.
