Leicester City has published the accounts for the year ending 30 June 2025 and they show a loss of £71.1m before tax.
The size of this loss, coupled with the fact that it occurred in the season the club were relegated from the Premier League will concern many supporters.
With a loss £71.1m on top of the losses incurred in 2022/23 and 2023/24, everything points to another Profit and Sustainability Regulations (PSR) breach. This is despite the club parading improvements made in managing staff costs against income, the owners demonstrating their ability to finance debt, and the club’s confidence that they have complied with PSR.
The Trust and the Fans Advisory Board met with the club’s Chief Executive Officer, Kevin Davies shortly prior to the accounts being published. He was frank and open with us, responding to our concerns and questions.
The high level information is as follows –
- Being in the Premier League in 2024/25 saw income rise by around £80m to £186.5m (largely due to increased broadcasting income) compared to the previous season in the Championship.
- Asked whether the loss of just over £71m would mean the club would again breach PSR and face further points deductions, Davies assured us that the club would be compliant with PSR and that would become clearer when their financial statement for the current year is made available in December 2026.
- Despite the size of the loss in 2024/25, previous operating losses have been reduced. For example wages, which were 101% of overall income in 2023/24, and 116% of overall income in 2022/23, were down to 82% of turnover in 2024/25.
- The Trust has a duty to seek assurances that the club is not in danger of going into administration. These accounts show that another £124m of the club’s debt was converted into equity by King Power during the year, an action which can help the club to avoid this fate.
- A key concern for supporters, with this level of loss in the Premier League, and income being lower in the Championship, is how will the club survive if its relegated to League 1. And whether the club are in the Championship or League 1, will the ratio of wages to income continue to be managed to avoid losses.
- The Financial Statements indicate that the club has budgeted for the parachute payment only having a year to run, and the possibility of broadcasting income dwindling. Davies also indicated that player salaries would be adjusted in accordance with their contracts.
Despite these explanations and assurances, the severe decline of the club in the last few seasons, and the perilous situation it faces at the bottom of the Championship, raises serious doubts about the management structure being able to make best use of the club revenues and past investment by King Power. Especially when it is stated that the club’s costs in the year increased due to ‘trying to compete at that level’ which they failed to do in spectacular fashion.
We know changes have been made. We now need to see whether these are sufficient and lead to improvement.
What is certain is that whether relegated or remaining in the Championship the crunch season financially could be 2027/28, when the parachute money runs out and broadcasting revenues dwindle.