Chelsea year end 2009 Financials - Almost debt free

Chelsea FC plc have today released the year end 2009 financials. The figures reveal that Roman Abramovich, after converting half of his interest-free loans into equity last year, has now also converted the other half into shares leaving the club virtually debt free.

This latest generous move comes as little surprise and underlines the Russian´s intense commitment to Chelsea.  The contrast of his financial behaviour with the club to that of say Glazer or Hicks Gilet is stark to say the least.

The Chelsea official web site have published the following summary of the main figures: 

- Group turnover was down from £213.1m to £206.4m 

- Turnover was generally flat. The small year-on-year reduction reflects the front-loaded nature of certain sponsorship revenues 

- Loss for the financial year reduced from £65.7m to £44.4m 

- Remainder of shareholder debt of £340m was capitalised 

- Net capital expenditure reduced from £85.1m to £4.2m following the completion of major capital projects such as the training centre at Cobham 

- Cash outflow reduced from £107.4m to £16.9m 

The meat of the above is that losses have decreased by £21.3 million (reduced for the fourth consecutive year) and that cash spending has gone down by £107.4m to £16.9m. 

 

How would we interpret the latter of these two points?  That the financial reins have been pulled in due to recent world economic conditions affecting Abramovich´s personal portfolio?  That his interest in the club is waning?  A determination to achieve the financial targets set shortly after he bought the club?  Or… despite claims by the club that money would be made available for the odd big fish if required, Abramovich is fed up with getting ripped-off in the transfer market?  I would say it´s a little bit of the first point, none of the second and a big helping of the 3rd and 4th points.  Let us not forget that Abramovich was prepared to bid on Daniel Alves, Pato and Robinho in recent seasons and it´s more than likely that the club sounded out Milan over Kaka – and don´t be surprised if someone like Aguero arrives in the summer.

There is a further issue of course – that of Platini and his plans to enforce strict financial regulations on those that compete in Europe´s premier competitions (unless the likes of Real Madrid are unable to comply of course!): 

Chelsea chairman Bruce Buck said:  “The club's debt load has been reduced almost to nil in order to provide more long-term stability for the club. 

“The reduction will also enable the club to comply with any regulations on debt levels which are being discussed by the football community.” 

Can´t really complain can we?!