Why Arsenal’s huge £47.8m financial losses will only get a lot worse

Arsenal released their financial results for the for the year ended May 31 2020, revealing their losses after taxation totaled £47.8m. It’s a worrying figure for the club that will only get worse.

The coronavirus pandemic has hit football clubs across the globe immeasurably. Closing down stadiums and bringing football to a standstill for just short three months before May last year brought about an unprecedented situation for the sport.

It comes as little surprise that a club, even of Arsenal’s stature, has recorded such losses, not least as Arsenal have been described as ‘having a Champions League wage bill on a Europa League budget’. Being out of Europe’s top club competition is devastating enough.

This is now Arsenal’s fourth consecutive season in the Europa League and the way the season has progressed there is every chance there may be no European football at all next campaign. The financial losses are massive, but will continue to worsen.

Why Arsenal’s £47.8m financial losses will only get a lot worse as the coronavirus pandemic continues to devastate Premier League finances

"A report from the club stated: “The loss for the year after taxation was £47.8 million (2019 – loss of £27.1 million). Pre-tax losses of £35 million were directly attributable to COVID-19. The impacts of the pandemic have extended into season 2020/21 and are ongoing.”"

These figures are only accounting for the year ending May 2020. Such huge losses recorded over that period were actually rescued somewhat by the £35m sale of Alex Iwobi and others – as laid out by the excellent Swiss Ramble – with Arsenal’s only major sale in the most recent summer transfer window being the £20m accrued for Emiliano Martinez.

Furthermore, these accounts only include roughly three months’ worth of the pandemic’s impact, as behind closed doors football has taken place ever since. That’s further losses in matchday revenue (among various other revenue sources), fewer player sales, more wages spent on players whose contracts the club can’t afford and, crucially, more time not spent in the Champions League. Arsenal still haven’t paid of Nicolas Pepe’s fee, either.

Next time around, expect another £100m+ added to the total losses. It is, of course, not only Arsenal feeling the strain as Premier League rivals Everton, Tottenham and even Brighton recorded greater losses. All have been impacted.

And still, the true scale of the pandemic on football financials won’t be fully revealed until 2021’s accounts.