Newcastle Relegation Caused USD27.5m Sink into the Red

Figures have shown that English Premier League soccer club Newcastle United sank £17.1m (US$27.5m) into the red as a result of relegation from the top flight in 2009 for the end of the 08-09 season, compared with a £15.2m ($24.4m) deficit in the season before that.

According to accounts filed with Companies House, turnover reduced 39 per cent to £52.4m ($84.2m), with owner Mike Ashley putting a further £42m ($67.5m) into the club despite an increase in gate receipts.

The latest figures do not reflect Newcastle’s return to the Premier League, with promotion worth anything up to £60m ($96.4m) to successful clubs, nor do the accounts include Andy Carroll’s £35m ($56.2m) sale to Liverpool in January.

Newcastle managing director Derek Llambias said: “Our overriding aim in 2009-10 was to secure promotion back to the Premier League at the first attempt. Relegation presented a considerable challenge for us financially.

“With such a marked reduction in turnover, largely due to reduced TV and media revenue, we needed to cut our operating costs accordingly without jeopardising our ability to return to top flight football straight away.

“It has been a significant achievement to keep our overall loss at a level similar to the year before despite the impact of relegation, and our ability to do this has been helped immeasurably by the continued financial support of Mike Ashley, who injected a further £42m ($67.5m) into the club last year interest-free.”

Revenue from television and other media fell 57 per cent to £16m ($25.7m), although new sponsorship deals were struck with Puma and Northern Rock.

Despite a 33 per cent drop, Newcastle’s determination to retain the services of enough Premier League-class players to launch a credible bid for promotion meant the wage bill still amounted £47.5m ($76.3m).