Chelsea Football Club has reported losses of £121m for the 2021/22 financial year, with the club stating that government sanctions imposed on former owner Roman Abramovich were a significant factor. The sanctions were introduced in March 2022 by the UK government, which sought to freeze the assets of individuals with links to Russian President Vladimir Putin following the invasion of Ukraine.
As a result of the sanctions, Chelsea was given a special license that limited the club’s ability to conduct business, accept reservations for events, and even sign player contracts. These restrictions were lifted in May 2022 when a new group headed by American entrepreneur Todd Boehly finished acquiring the club.
Despite the sanctions, Chelsea’s turnover increased from £434.9m in the previous year to £481.3m, with commercial revenue reaching £177.1m. However, the club attributed the losses to increased operating expenses, including matchday and non-matchday costs.
The club invested £118m in the playing squad but made a profit of £123m on player sales, including Tammy Abraham, Marc Guehi, Fikayo Tomori, and Kurt Zouma. The club’s revenue is excluded from the financial performance of summer 2022 or January 2023 acquisitions, where Chelsea spent around £600m on new players.
Nonetheless, the club maintains that it continues to comply with UEFA and Premier League financial regulations despite the government sanctions’ losses and impact. The sanctions were a significant blow to Chelsea, as they affected the club’s ability to generate revenue. Still, it’s essential to note that the losses incurred do not include the significant investments made in the playing squad in the summer and winter transfer windows. Chelsea spent over £600m to acquire some of the best talents in the world, likes of Mykhailo Mudryk and Enzo fernades
The club’s investment in the playing squad was driven by the desire to remain competitive in the Premier League. The competition is intense, with Manchester City, Liverpool, and Manchester United investing heavily in their squads.
Additionally, the club’s owner, Roman Abramovich, has always been keen on investing in the team to achieve success both domestically and in Europe. Chelsea’s financial position remains robust despite the losses, generating significant commercial revenue through sponsorships and partnerships.
The club’s commercial revenue increased to £177.1m, a sign of the strength of the Chelsea brand. Chelsea has also continued to comply with UEFA and Premier League financial regulations, which require clubs to operate within their means and not to incur significant losses. These rules encourage financial stability in football and ensure that clubs do not engage in reckless spending that could lead to financial ruin.
Chelsea’s adherence to these regulations is commendable, especially considering the significant investments made in the playing squad. The club’s management has been careful to ensure that spending is done responsibly and sustainably, which is essential for the club’s long-term success.
The losses reported by Chelsea for the 2021/22 financial year were primarily due to government sanctions imposed on former owner Roman Abramovich. However, the club’s financial position remains robust, with significant investments made in the playing squad to remain competitive in the Premier League and Europe. Additionally, the club continues to comply with UEFA and Premier League financial regulations, a testament to its commitment to financial stability and sustainability.