Premier League Financial Forecast: Chelsea turmoil continues with club set to post another huge loss

Chelsea’s shocking defeat against Dinamo Zagreb in the opening UCL fixture was followed by equally shocking headlines the following morning when Thomas Tuchel was sacked.

The London club splurged over £200 million in the transfer window under their new owners, and now have to pay Tuchel a reported £13 million severance package, on top of which they must pay about £20 million to Brighton in compensation for Graham Potter, who has signed a five-year deal worth £12 million a year.

This enormous spending will definitely put the club under financial pressure in 2022/23 if the renewed Chelsea do not deliver on the pitch to give their turnover a significant boost. 

This could be critical as Chelsea made a £153 million loss in the 2020/21 financial year and are forecast to post a £86 million loss in 2021/22, according to the Off The Pitch Premier League Financial Forecast 2022. 

Here is our financial forecast for Chelsea’s 2021/22 season.

Chelsea set for another huge loss despite massive player sales

Most CEOs in football will have expected a much calmer 2021/22 season compared to the previous two , but last season may have been even more chaotic for Chelsea FC. Big things were expected, on the back of a season when the club won their second Champions League trophy and splashed out £100 million to get Lukaku back from Inter Milan.

But it is safe to say things did not go as expected last season. Lukaku has been shipped back to Inter Milan on loan, Russia invaded Ukraine and owner Abramovich was forced to sell the club.

After three months of hefty restrictions imposed by the UK government, a consortium of US investors took over. Closing the financial year of 2021/22 with an estimated loss of £86 million underlines just how hard the season was for the club.

Government limits on ticket sales from March till the end of the season prohibited the club from reaching pre-pandemic levels of matchday income.

Similarly, though commercial income is seen rising by approximately £10 million compared to the year before, the suspension of the Three sponsorship and restrictions on retail sales in the final months of the season are expected to have negatively impacted the total.

The hassle involved in bringing Lukaku back to the Bridge saw player amortisations rise from £162 million to £172 million in 2021/22, which is estimated to carry an annual amortisation charge of £20 million, partially eased by the departures of Zappacosta, Zouma, Giroud, and Moses.

Unsurprisingly, the big move for the Belgian striker also caused a significant climb in wages. After incurring other non-cash expenses, the club are expected to record an operating loss of £176 million, which is an improvement of approximately £6 million.

Significant player sales of young talent such as Tomori and Abraham along with the departures mentioned, we estimate Chelsea will score a hefty £91 million in profit from player sales, which - after a minor interest charge - will have settled the net losses before tax at £86 million.

The 2022/23 season is set to be a new start for Chelsea, which is having to rebuild after several key players have left. The club have already strengthened the squad with the likes of Raheem Sterling and Kalidou Koulibaly.