Stoke City record losses of more than £90million – but may avoid FFP sanctions

Championship side Stoke City posted a mammoth loss of more than £90million, according to their latest accounts.

The Potters’ figures show they made losses of £91.6 million in 2019/20 – despite parachute payments still being paid to them following their relegation from the Premier League in 2018.

In accounts posted to Companies House for the year ending May 31, 2020, the club were hit hard by a combination of the pandemic and the continued ramifications of relegation from the top flight.

Turnover fell to £49.8m compared to £70m the previous financial year while operating expenses grew to £141.4m with a big chunk of that a result of writing down the value of the squad.

Stoke City finished 14th in the Championship last season

Contributing massively to the figure is £30.3m in amortisation – the automatic devaluation of a player over the course of their contract.

For example, an £8m player on a four-year deal is worth £6m on the balance sheet after one year.

There is also impairment which stands at over £42m – this is where a player is marked down as a balance sheet, on top of amortisation, to give a more realistic appraisal of their value.

Luckily for Stoke, amortisation and impairment do count towards Financial Fair Play (FFP). FFP rules state that clubs in the EFL cannot post losses of more than £39m over a three-year period.

Aditionally, losses that can be directly attributed to Covid-19 can be added back – meaning the Potters may well escape any FFP sanctions.

Stoke chief executive Tony Scholes recently spoke about the club’s financial situation, admitting: “It’s going to be a difficult summer.”

City have posted finishes of 16th, 15th and 14th in their three seasons in the second tier since being relegated from the Premier League.

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