Spurs closing in on Manchester Uniteds record debt levels

5 April 2019

Spurs debt tottenham hotspur
Photo: Getty Images Tottenham players celebrating a goal against Crystal Palace when playing Wednesday evening at their new stadium for the first time. The club has just posted the annual report - which was a world record profit. Debt is also increasing.

Tottenham announce world record profits – but debt is also on the rise. Daniel Levy takes big pay cut.

While the debt-level is growing it's worth mentioning that revenue from the new stadium generates extra cash-flow to pay of the debt.

Tottenham Hotspur today broke a world record by posting an annual report with the biggest profit ever made by a football club.

Overall finances look healthy, but it is noticeable that debt is also at a level where only Manchester United outperform the North London club.

In the annual report Spurs announced borrowings for the stadium which stood at £445.3 million, as of June last year, with that payable by 2022 including interest, although refinancing would be an option. The club has a total loan facility of £537 million.

Record debt levels

Spurs also owe £21 million on a loan to rebuild its training ground, which was completed on August 2015. That is also repayable by the end of December 2022.

Last month www.offthepitch.com reported that amount had been reduced - the figure previously stood at £23million.

The club’s executive chairman Daniel Levy was paid £3 million - a 50 per cent pay reduction from the £6 million he received in 2017.

The £466.3 million stadium and training ground debt is close to Manchester United’s current record debt levels of £487 million.

However Tottenham’s total liabilities (current and non-current liabilities) stand at £964 million as of June 2018 - a £345 million rise from £619 million in 2017. Total assets increased from £840 million to £1.3 billion.

The total assets and total liabilities figures reflect stadium borrowing and the value of the new stadium project.

Important mentioning is the fact that despite Tottenham’s £637 million stadium debt will cost the club an estimated £50 million a year in interest and loan repayments, Spurs officials have said they expect £100 million in match day revenues at the new stadium, which represents a £55 million a year revenue increase - more than enough to cover the stadium repayments.

Furthermore repayments and interest payments would fall every year, as the outstanding debt amount decreases.

Levy take pay-cut

Looking at the total wages including non-playing staff they went up from £126.9 million in 2017 to £147.6 million for this latest financial year, 39 per cent of revenues.

The club’s executive chairman Daniel Levy was paid £3 million - a 50 per cent pay reduction from the £6 million he received in 2017.

The playing squad in terms of its value to the club, according to length of contract of individual players, was valued at £151.3 million.

However, since then Harry Kane, Dele Alli and Hugo Lloris have signed new long-term contracts at the club. The accounts refer to the value of three unnamed players as “material to the financial statements - more valuable than others” - and put their value at £74.3 million.

Matchday revenues doubled

Looking at the bigger picture, which was reported earlier today, Spurs are growing their business with a remarkable pace.

Tottenham Hotspur have announced net profits of £113 million, breaking the record set by Liverpool in February of £106 million.

The club raised a total of £73.1 million from the sales of Walker, Nabil Bentaleb, Kevin Wimmer, Clinton N’Jie and Federico Fazio over that period compared to £40 million in 2017.

The club’s latest accounts for the 12 months to June 2018, showed the benefits of the temporary move to Wembley, with the record net profit figure leaping up from £36.2 million in 2017.

A major contributor to the increase of £69.8 million in net profits was matchday revenues, which doubled from £45.3m (last season at old White Hart Lane) to £91m (first season at Wembley).

The matchday revenues at Wembley indicate the likely revenues the club will achieve in their new 62,062 stadium.

All time high

Spurs played in front of crowds that averaged 68,500 at Wembley, compared less than 40,000 at the old White Hart Lane, resulting in an increase in ticket receipts from £19 million for the previous financial year to £42.6 million.

Record results were also driven by their player trading, mainly the sale of Kyle Walker to Manchester City in the summer of 2017 for £50 million.

The club raised a total of £73.1 million from the sales of Walker, Nabil Bentaleb, Kevin Wimmer, Clinton N’Jie and Federico Fazio over that period compared to £40 million in 2017.

Since the financial year in question two transfer windows have passed without Spurs making a single new acquisition.

The club’s revenue hit an all-time high of £380.7 million, up from £309.7 million the previous year - a rise of £71 million.

Improved terms

In addition to matchday receipts, revenues and player sales, Spurs saw their UEFA prize money rise from £38.4 million in 2017 - when the club dropped into the Europa League after failing to qualify for the knock-out stages of the Champions League - to £53.1 million in 2018.

The club reached the knock-out stages of the Champions League in 2018, before being eliminated by Juventus in the round of 16.

Commercial income went up £109.1 million from £76.2 million, partially as a result of the club changing its kit supplier from Under Armour with Nike on improved terms. The deal with Nike was reportedly worth £25 million a year. Terms have since been improved again to £30 million a year.