Update on Burnley's Finances.

[Goody1975]

Except that Alan Pace and ALK have not invested in Burnley FC. Burnley FC has received nothing from Alan Pace or ALK, or for that matter from JJ Watt or any other supposed investor.

ALK have taken £100m out of Burnley FC. They have put no money in.

We've been through this further up the thread, read what I put and meant.

Thanks

[ClaretPete001]

While I agree with most of what you've put. I don't think this is a shirt term tactic or measure for ALK. I expect the debt to rise along with the squad value.

While I agree with your analysis about the widget machine to some extent it's only relevant in the world of having one widget machine and not 11 of them. Or 40 for that matter.

What seems closer to the reality to me is investing in multiple widget machines many of which can run better as they get older. To the point where you look at the 40 widget machines as a whole and think they've improved to a point where I can afford to sell a few of these and re invest again. We won't ever see the debt decrease. It will increase. But providing the value of the squad and assets at the club continue to rise inline with this I think it will be a long term strategy.

I think the whole premise of this relies on the fact that we stay in the PL. Because as soon as we fall out of the PL we lose £40 or £50 million of broadcast revenue and have to sell the most valuable playing assets or widget machines in terms of the analogy.

As we sit here today, almost no one on thinks that we have a PL ready squad despite the fact that we have nigh on 40 players and have spent over Eur70 million. The questions is do we have the money to spend another Eur30 million plus to buy a midfielder and a striker as well as retain key talent.

According to Transfermarkt (fag packet figures) We began the last PL season with a squad closer in value to Eur270 million and the current one is around Eur227 million. Two years ago we had 13 players valued at over Eur10 million and now we have 9. And the reason is because we had net sales of Eur50 million last season.

This is the point I'm trying to tease out of Paul. At what point are we going to invest enough to seriously make the strategy work because if we go down again we will have to sell again and so on and so forth?

So, my point is if not now: when? Let's revisit the conversation at the end of the transfer window and see how it pans out.

[Big Vinny K]

ALK were not the first people at the table to buy or invest in the club.

There were Chinese, Americans, and I believe an English group all there before ALK.

The ‘investment’ brochure was touted on here at one point before being deleted.

What’s that got to do with my post ?

[Mala591]

Does anyone (an insider?) know if the ‘rumour’ is true, that when we get promoted to the PL the players wages ‘contractually’ double and when we get relegated from the PL the players wages are ‘contractually’ halved?

[NewClaret]

Does anyone (an insider?) know if the ‘rumour’ is true, that when we get promoted to the PL the players wages ‘contractually’ double and when we get relegated from the PL the players wages are ‘contractually’ halved?

It’s pretty well understood that there are very significant reductions (widely speculated to be halved) on relegation, so presumably the opposite is true on promotion.

We insist on these for all signings, which presumably makes signing players more difficult to other clubs who may not, or may just have very little chance of relegation for it to be triggered.

[Corway]

This is what ChatGPT says of out situation
Here’s a comprehensive review of Burnley FC’s current financial health:

⸻

Recent Losses & Revenue Drop
• Pre-tax loss of £28.9 million for the year ending July 31, 2024—an improvement from the £35.1 million loss in 2023 .
• Turnover fell sharply from £123.4 million (Premier League year) to just £64.9 million after relegation .
• Operating losses (excluding player sales & interest) narrowed from £41 million to £27 million following promotion .

⸻

Squad Costs & Transfers
• The club’s wage bill surged from £57.5 million to £93.4 million—remarkably high for a Championship club .
• Player amortisation (capitalised transfer costs) jumped by £20.5 million to £42.6 million .
• Player trading helped offset losses—Burnley booked £15.1 million profit on disposals during the period .
• Over the past five seasons under Alan Pace/Velocity Sports, the club spent €331 million on incoming transfers and generated €233 million from sales, netting a €98 million investment in the squad .

⸻

Debt Profile & Interest Burden
• Gross debt rose from £102 million to £112 million, comprising £92 million in bank loans (up from £70 million) and £20 million in factored debts .
• High-interest rates—between 8.5% and 12.75%—weigh heavily on finances. £82 million of that needs repaying within 12 months .
• This debt is all third-party, making Burnley one of England’s most indebted clubs—behind only elite clubs like Tottenham, MUFC, Liverpool, and Everton .

⸻

Owner Takeover Impact
• The 2020 leveraged takeover by ALK Capital for £170 million saddled Burnley with this debt—previously debt-free club now carries ~£100 million debt post-acquisition .
• The owner is now developing a multi-club model (including Espanyol) and recently sought £150 million for further expansion .

⸻

Key Risk & Likely Scenarios
Risk Factor. Concern
Debt servicing costs
With high-interest liabilities of over £100 million, interest payments are a heavy strain—especially without Premier League TV revenue .
Volatile income
Relegation causes dramatic swings in revenue (from £123 m to £65 m), risking further losses .
Squad investment gamble
Heavy transfer spending and wages aim for promotion, but come with limited financial safety nets.
Reliance on owner funding
Without deep-pocket benefactors, the club’s strategy hinges on loans and owner capital .


⸻

Summary & Verdict

Burnley’s financial model is a high-risk, high-reward play: significant investment in players and wages, backed by heavy borrowing. Promotion yields huge returns; relegation, however, exposes the club to massive debt and interest burdens in a vulnerable league.
• If they stay up: Increased revenue should help start paying down debt and reduce reliance on borrowings.
• If relegated again: The club could face deeper losses, strained cashflow, and mounting pressure to sell assets or seek refinancing.

In short, Burnley’s finances are not sustainable long-term without top-flight parity—or ongoing injections from owners/investors. Their model is bold, but precarious.

⸻

Let me know if you’d like a deeper dive into their debt repayment schedules, FFP implications, or comparison with peer clubs.

[Corway]

Burnley are back in the Premier League for the 2025‑26 season. Let’s reassess what that means for FFP and their debt picture:

⸻

FFP in the Premier League

Premier League Profitability & Sustainability Rules (P&S)
• Clubs are allowed up to £105 million in losses over any rolling three-year period.
• Some costs are excluded (e.g. youth development, infrastructure, women’s football).
• Burnley’s £28.9m pre-tax loss for 2023/24 still leaves headroom under this threshold .

Key Implications for Burnley:
• Back in the big money league, their revenue is projected to rise significantly (likely double Championship levels), easing compliance pressure.
• Still, they need to manage losses carefully over three seasons to stay within the £105m margin.

⸻

Debt Repayment Context

Burnley continue to carry a significant debt burden:
• £112 million in total debt, with approximately £82 million due within the next 12 months  .
• Interest rates in the 8.5–12.75% range mean annual interest payments of £10–12 million, which affects cash flow.

Promotion eases some burden:
• Premier League broadcasting revenues and commercial income should help cover interest and some debt repayment.
• But with such a large short-term debt load, the risk of refinancing remains; Burnley may also lean on player sales or commercial deals (e.g., the recent Kyle Walker signing illustrates their ambition)  .

⸻

Bottom Line
• Premier League status boosts revenue and extends viability under P&S rules, but doesn’t eliminate the need for disciplined financial strategy.
• Burnley must convert extra income into debt repayment to avoid mid‑term refinancing pressure.
• Future losses will count toward the £105m cap, so sustainable fiscal management is vital.

Scenario and Implications
Staying in Premier League
Higher revenues → easier servicing/refinancing → room for profits
Relegation risk
Return to Championship (weaker 3‑year cap applies) → increased financial tension
Strategic player trading
Can raise cash to pay down debt, but must be balanced with squad quality

[Conroy92]

I think the whole premise of this relies on the fact that we stay in the PL. Because as soon as we fall out of the PL we lose £40 or £50 million of broadcast revenue and have to sell the most valuable playing assets or widget machines in terms of the analogy.

As we sit here today, almost no one on thinks that we have a PL ready squad despite the fact that we have nigh on 40 players and have spent over Eur70 million. The questions is do we have the money to spend another Eur30 million plus to buy a midfielder and a striker as well as retain key talent.

According to Transfermarkt (fag packet figures) We began the last PL season with a squad closer in value to Eur270 million and the current one is around Eur227 million. Two years ago we had 13 players valued at over Eur10 million and now we have 9. And the reason is because we had net sales of Eur50 million last season.

This is the point I'm trying to tease out of Paul. At what point are we going to invest enough to seriously make the strategy work because if we go down again we will have to sell again and so on and so forth?

So, my point is if not now: when? Let's revisit the conversation at the end of the transfer window and see how it pans out.

I do agree that it relies on staying in the prem. And I also agree for the model to work, we have to put that serious level of investment in to 'transition the squad'. However, it can be done over a couple of seasons. Players like Tchouna may not be ready this season. But if we return in two seasons they may be. This is where your point on selling the widget machines on relegation comes in. You have to accept you sell some of them to recoup some money. However retaining the right ones is key. Either way it comes back like you say to adding to the debt further.

We can revisit at the end of the window. For what it's worth I think we'll get both the ST and CM we need and I only think well see Trafford go apart from fringe players unless someone sticks a massive fee in for Steve. I feel like we've learned some lessons and that Parker will give us a good crack at surviving.

I'm expecting all three promoted sides to give it a good go this time round and I think we'll see a more normal season in the prem than we have for a while. I think there's 3 or 4 sides that have been riding there luck and getting away with the fact that some extremely poor/naive sides have come up these past few years (ourselves being one of them). This time round all the promoted teams business has looked good and been early on in the window. There is no small club out of the three promoted (no offence to Luton). We also saw something of an anomaly last season in the position of Spurs and United. I can't imagine that will happen again this year. I think it will be a competitive season and I'm looking forward to it a hell of a lot more than I was under Kompany. There's still around a month of the window left and we need a ST a CM and to shift some dead wood on. I think we can do it this time if we get them.

[beeholeclaret]

I bet those accountants didn't tell any business "you haven't enough debt, you need to borrow some money at high rates and lend it to someone interest free".

The £20m we spent last year on interest payments can indeed be offset against tax. It could also have been offset against tax if we had spent it on players. No accountant would tell a business that spending on interest is better than spending on fixed assets.

Yes you are probably correct. I was generalising to give an example of how debt is viewed by some business people. I did say that my example is not necessarily applicable to BFC.


Sound business principles and good old fashioned common sense do not apply in running a football club in modern times. We are however a long way beyond “tins and jars on the mantelpiece” to keep a few shillings for future incoming bills.

Many of us would prefer our club to be run using old fashioned methods of clearing our debts and making a little profit. It hurts to see money being ‘wasted’ on agents and some of their players who have earned fortunes from salaries at our club but contributed virtually nothing on the field of play.

So many issues - difficult for many of us to rationalise and understand.

[helmclaret]

Simon Jordan just made an interesting point on TS.

'Fans say it's their football club until they are asked to put some money into it - then it's the owner's football club.'

[ksrclaret]

Fans put their money into their football clubs every single season.

What they don't do is buy shares, but even Simon Jordan can probably work out why that is.

[Big Vinny K]

Simon Jordan just made an interesting point on TS.

'Fans say it's their football club until they are asked to put some money into it - then it's the owner's football club.'

Probably missing some context as not sure what they were debating but I find Jordan pretty tedious these days.
Fans are asked to put their money in every season and they do. Unlike shareholders and owners they don’t expect a return either. But if our club was in trouble and our supporters were asked to put money into the club via some kind of share issue I think we would have a number of supporters who would be prepared to do this.

How long ago is it now since Jordan put money into Palace ? Got to be 20 years - not even sure how relevant his experience is now given how much football has changed. Though I guess losing the best part of £50m of your personal wealth is a ‘useful” experience in telling people for the next 20 years which mistakes you need to avoid !

[ClaretPete001]

I do agree that it relies on staying in the prem. And I also agree for the model to work, we have to put that serious level of investment in to 'transition the squad'. However, it can be done over a couple of seasons. Players like Tchouna may not be ready this season. But if we return in two seasons they may be. This is where your point on selling the widget machines on relegation comes in. You have to accept you sell some of them to recoup some money. However retaining the right ones is key. Either way it comes back like you say to adding to the debt further.

We can revisit at the end of the window. For what it's worth I think we'll get both the ST and CM we need and I only think well see Trafford go apart from fringe players unless someone sticks a massive fee in for Steve. I feel like we've learned some lessons and that Parker will give us a good crack at surviving.

I'm expecting all three promoted sides to give it a good go this time round and I think we'll see a more normal season in the prem than we have for a while. I think there's 3 or 4 sides that have been riding there luck and getting away with the fact that some extremely poor/naive sides have come up these past few years (ourselves being one of them). This time round all the promoted teams business has looked good and been early on in the window. There is no small club out of the three promoted (no offence to Luton). We also saw something of an anomaly last season in the position of Spurs and United. I can't imagine that will happen again this year. I think it will be a competitive season and I'm looking forward to it a hell of a lot more than I was under Kompany. There's still around a month of the window left and we need a ST a CM and to shift some dead wood on. I think we can do it this time if we get them.

There is a lot of ifs and buts there. The problem with the two year analysis is that if we are relegated the better players get sold. If Tchaouna shows promise he will likely have a leave clause and will be gone.

I don't see 4 weak teams in the PL. Brentford maybe a bit of a 'not sure' but Sunderland have spent over Eur100 million and Leeds nearly 70. Wolves and West Ham have had decent spends as well. After Man U and Spurs you are up to 48 points and Everton who have just spent Eur30 million on a striker.

I have to say though having a quick look at the transfer spend of other clubs it seems the marquee signings are in the Eur20 - Eur30 million bracket rather than the Eur10 to Eur20.

So, as it stands there is a lot of work to be done but time to do it in and I'm prepared to wait to see what transpires.

Like you, I think we have a better chance this time than last if we can get those key players through the door.

[claretonthecoast1882]

Probably missing some context as not sure what they were debating but I find Jordan pretty tedious these days.
Fans are asked to put their money in every season and they do. Unlike shareholders and owners they don’t expect a return either. But if our club was in trouble and our supporters were asked to put money into the club via some kind of share issue I think we would have a number of supporters who would be prepared to do this.

How long ago is it now since Jordan put money into Palace ? Got to be 20 years - not even sure how relevant his experience is now given how much football has changed. Though I guess losing the best part of £50m of your personal wealth is a ‘useful” experience in telling people for the next 20 years which mistakes you need to avoid !

Jordan's bitterness towards football itself has by all accounts gone 10 fold since Palace won the FA Cup.

Has a huge dislike of Parish, filled with bitterness that he has made a far better job of running the club he says he loves. Refused to attend the FA Cup final as he couldn't enjoy his team winning the FA Cup while Parish was there.

He probably still boasts about serving Ian Dowie with a writ a generation ago.

[KRBFC]

Probably missing some context as not sure what they were debating but I find Jordan pretty tedious these days.
Fans are asked to put their money in every season and they do. Unlike shareholders and owners they don’t expect a return either. But if our club was in trouble and our supporters were asked to put money into the club via some kind of share issue I think we would have a number of supporters who would be prepared to do this.

How long ago is it now since Jordan put money into Palace ? Got to be 20 years - not even sure how relevant his experience is now given how much football has changed. Though I guess losing the best part of £50m of your personal wealth is a ‘useful” experience in telling people for the next 20 years which mistakes you need to avoid !

The rising cost of PL match tickets

[The Shire Claret]

Simon Jordan just made an interesting point on TS.

'Fans say it's their football club until they are asked to put some money into it - then it's the owner's football club.'

I don't mind him in small doses but that's an extremely narrow minded and flippant comment from him.

[aggi]

Not sure it's anything like a buy to let ownership. I think it's clearer how they intend to proceed.

It will become more like, a standard Private Equity ownership where distressed ownerships/ companies are bought that add value to the group. Ostensibly costs are cut by sharing functions like Finance and Marketing or more likely, initially, functions like data science and player acquisitions are held in non-club related structures like Velocity. The group is not mature enough yet to share functions. And I guess investment can be geared where it's perceived to be most needed albeit that is unlikely to be a footballing decision.

The group is sold on its expertise at managing football clubs. ALK will disappear off to the holding companies and scour the world looking for investment opportunities with their mergers and acquisitions teams and leave management teams in place looking after the clubs.

ALK think like investors and not like owners or business people. Will it work? Well if you think about it the club now has another 3 years of PL money and the group now has Chinese investors with big money so that is game changing. Of course, it's more likely than not that the Chinese want to transition out rather than invest in the group

But we'll soon see. If we set off this season with an uncompetitive squad because of a lack of investment having sold our better players then it's not a good sign. Somewhere along the line we have to have a PL competitive squad. Unlike last time we ended last season only two or three players short. Another PL season short on investment with a squad that is uncompetitive will no doubt raise questions.

Let's wait and see.

I think this premise really falls at the first hurdle, Burnley weren't sold at a knockdown price as you'd expect given your distressed company/ownership theory. It's obviously hard to value football clubs but the various pricing models all had £200m+ as a reasonable price and I don't remember anyone being shocked at how cheap it was.

[randomclaret2]

I don't mind him in small doses but that's an extremely narrow minded and flippant comment from him.

Fans put money into clubs throughout their life...very often a large percentage of their disposable income.

[Yorkshirelad]

Other than the last ownership has there been any other board of directors who appeared to have made any money out of the club.

I have been a fan for over 50 years and paid my money like lots of people. The ups and downs the club has given me I can’t replace. The joy and the misery are priceless.

But if I had a good amount of money, but not as much as the likes of the Man City ownership, who I would imagine have money to burn. I wouldn’t invest my money in a football club as it’s a thankless task, it’s like smoking you may as well just burn the £5 notes.

So we just have to continue to accept it is a business and Mr Pace just wants to turn a profit. In reality is there anyone or anybody who can stop them doing what they want?

[ecc]

This is what ChatGPT says of out situation
Here’s a comprehensive review of Burnley FC’s current financial health:

⸻

Recent Losses & Revenue Drop
• Pre-tax loss of £28.9 million for the year ending July 31, 2024—an improvement from the £35.1 million loss in 2023 .
• Turnover fell sharply from £123.4 million (Premier League year) to just £64.9 million after relegation .
• Operating losses (excluding player sales & interest) narrowed from £41 million to £27 million following promotion .

⸻

Squad Costs & Transfers
• The club’s wage bill surged from £57.5 million to £93.4 million—remarkably high for a Championship club .
• Player amortisation (capitalised transfer costs) jumped by £20.5 million to £42.6 million .
• Player trading helped offset losses—Burnley booked £15.1 million profit on disposals during the period .
• Over the past five seasons under Alan Pace/Velocity Sports, the club spent €331 million on incoming transfers and generated €233 million from sales, netting a €98 million investment in the squad .

⸻

Debt Profile & Interest Burden
• Gross debt rose from £102 million to £112 million, comprising £92 million in bank loans (up from £70 million) and £20 million in factored debts .
• High-interest rates—between 8.5% and 12.75%—weigh heavily on finances. £82 million of that needs repaying within 12 months .
• This debt is all third-party, making Burnley one of England’s most indebted clubs—behind only elite clubs like Tottenham, MUFC, Liverpool, and Everton .

⸻

Owner Takeover Impact
• The 2020 leveraged takeover by ALK Capital for £170 million saddled Burnley with this debt—previously debt-free club now carries ~£100 million debt post-acquisition .
• The owner is now developing a multi-club model (including Espanyol) and recently sought £150 million for further expansion .

⸻

Key Risk & Likely Scenarios
Risk Factor. Concern
Debt servicing costs
With high-interest liabilities of over £100 million, interest payments are a heavy strain—especially without Premier League TV revenue .
Volatile income
Relegation causes dramatic swings in revenue (from £123 m to £65 m), risking further losses .
Squad investment gamble
Heavy transfer spending and wages aim for promotion, but come with limited financial safety nets.
Reliance on owner funding
Without deep-pocket benefactors, the club’s strategy hinges on loans and owner capital .


⸻

Summary & Verdict

Burnley’s financial model is a high-risk, high-reward play: significant investment in players and wages, backed by heavy borrowing. Promotion yields huge returns; relegation, however, exposes the club to massive debt and interest burdens in a vulnerable league.
• If they stay up: Increased revenue should help start paying down debt and reduce reliance on borrowings.
• If relegated again: The club could face deeper losses, strained cashflow, and mounting pressure to sell assets or seek refinancing.

In short, Burnley’s finances are not sustainable long-term without top-flight parity—or ongoing injections from owners/investors. Their model is bold, but precarious.

⸻

Let me know if you’d like a deeper dive into their debt repayment schedules, FFP implications, or comparison with peer clubs.

Hi Corway,

Thank you for that.

I'm a non-geek and my questions are serious:

a) How do you go about obtaining such info?

b) How is it sourced i.e. does the "process" draw on one source or several?

I genuinely don't know but would like to.

Many thanks!

[ecc]

I don't mind him in small doses but that's an extremely narrow minded and flippant comment from him.

He's good at it though, isn't he?

[ClaretPete001]

I think this premise really falls at the first hurdle, Burnley weren't sold at a knockdown price as you'd expect given your distressed company/ownership theory. It's obviously hard to value football clubs but the various pricing models all had £200m+ as a reasonable price and I don't remember anyone being shocked at how cheap it was.

The investment by ALK wasn't £200 million; it was barely anything at all. How they manage it through the books is not relevant to the deal to acquire the club or the way ALK will conduct future business.

Maybe the word distressed was not a good one but my guess is by 2018/19 the former owners wanted out and their subsequent management of the club was largely aimed at selling the club. And therefore although the club was not distressed I think arguably the ownership was to a degree...!

Similarly, the Chinese wanted out and ALK look like they have paid next to nothing for the Espanyol. Instead it's a strategic relationship, which if it works will likely allow the Chinese to exit the club and ALK to get an asset very cheaply in terms of their own financial contribution.

It's a good way strategy for ALK to grow the brand. Find ownership's that want out but can't sell because (I assume) they can't achieve a price that meets their requirements and it's not politically expedient in terms of PR and do a longer term deal instead.

[BigGaz]

Hi Corway,

Thank you for that.

I'm a non-geek and my questions are serious:

a) How do you go about obtaining such info?

b) How is it sourced i.e. does the "process" draw on one source or several?

I genuinely don't know but would like to.

Many thanks!

It depends on how's he's trained the model, and what model he's used. If he's fed it the last few years worth of accounts, put guardrails in (IE told it not to make inferences or take opinions from the web as factual) then it can be good, useful data.

The vast majority of people using AI, particularly for intensive or tasks needing nuance, are not aware that they have tokens (how much data they can take and spit out in one go), that they hallucinate and make things up frequently, and that the data they are using can be old, and also a mile wild and an inch deep.

AI is no different to any other media source. Check it's sources and where it's got its opinion/data from. You can ask it

[ClaretPete001]

Google Gemini is very similar

Question:

Can you give a comprehensive review of Burnley FC’s current financial health and cite your sources?

Google Gemini Response:

Burnley FC's financial health has been significantly influenced by its recent promotion and relegation cycles, as well as the ownership model implemented by ALK Capital. Here's a comprehensive review based on their latest available financial reports (primarily covering up to July 31, 2024, as reported in early May 2025):

Overall Financial Position:

Losses despite Premier League Riches: For the financial year ending July 31, 2024, when Burnley were in the Premier League, the club recorded a pre-tax loss of approximately £28.9 million. This is an improvement from the £35.1 million loss in 2023 (when they were in the Championship) but still represents a significant deficit despite the increased revenue from the top flight. This contrasts sharply with their historical financial sustainability, where they often posted profits in previous Premier League stints.

Volatile Turnover: Burnley's turnover is heavily reliant on their league status.

In the 2022/23 season (Championship), turnover decreased from £123.4 million to £64.9 million due to reduced broadcasting distributions.

In 2023/24 (Premier League), turnover more than doubled to £133.6 million, primarily driven by a substantial increase in television rights (from £47.8 million to £110 million).

Anticipating lower turnover upon relegation, the club has strategically sold players to generate profit.

Revenue Streams:

Broadcasting Dominance: Broadcasting revenue is by far Burnley's most significant income source. In 2023/24, it accounted for 83% of total revenue. Their return to the Premier League in 2025/26 will again see a significant boost in this area.

Commercial Growth: Commercial income showed good growth, increasing by 69% from £8.4 million to £14.1 million in 2023/24. However, this is still among the lowest in the Premier League compared to other clubs. A new strategic multi-year partnership with X (formerly Twitter) aims to drive further commercial revenue and fan engagement.

Matchday Income: Matchday income remained relatively stable, rising marginally from £8.7 million to £8.8 million in 2023/24. This suggests a less significant contribution to overall revenue compared to broadcasting.

Player Sales: Player sales are a crucial, albeit inconsistent, revenue stream.

In 2022/23 (Championship), profit on disposal of player registrations was £11.4 million.

In 2023/24 (Premier League), this increased to £15.1 million.

Crucially, after the reporting date for the 2023/24 accounts, Burnley generated an additional £87.7 million in player sales, which will be reflected in the next financial year's report (ending July 31, 2025). This influx of cash is vital for liquidity and debt reduction.

Operating Costs:

Increased Player Amortisation and Wages: The losses in 2023/24 are primarily driven by significant increases in operating expenses.

Player amortisation rose substantially from £20.5 million to £42.6 million, reflecting increased investment in the squad.

The club's wage bill also rose considerably from £57.5 million to £93.4 million, reflecting the cost of competing in the Premier League.

Wage-to-Turnover Ratio: While the wage bill increased, the wage-to-turnover ratio dropped from 88.68% (in 2023) to 69.94% (in 2024) due to the doubling of turnover from Premier League TV rights. This is a positive indicator of efficiency, though it's likely to increase again in the Championship.

Staff Reductions: The total number of staff employed by the club dropped from 565 in 2023 to 388 in 2024, indicating cost-cutting measures.

Debt and Financing:

Significant Debt Burden: Burnley's gross financial debt has increased. It rose from £45 million in 2022 to £70 million in 2023, and further to £92 million in bank loans by July 31, 2024. As of July 21, 2025, the gross financial debt further increased to £112 million, comprising £92 million in bank loans and £20 million in factored debts (secured on transfers receivable).

High Interest Payments: A notable concern is the substantial interest payments. In 2023/24, net interest payable shot up from £7 million to £17 million. The club reportedly has an unsecured £30 million facility at a high interest rate of 12.75%, which contributes to this significant interest charge. This is a direct consequence of the leveraged buyout model implemented by ALK Capital.

Impact of Player Sales on Debt: The recent £87.7 million in player sales post-reporting date are crucial for managing liquidity and reducing debt, particularly the £70 million in short-term loans that needed to be repaid within a year.

Financial Fair Play (FFP) and Risks:

FFP Compliance: The club's accounts explicitly state that "The group takes all necessary steps to ensure compliance with relevant rules and regulations, in particular Financial Fair Play regulations." However, the sustained losses and reliance on player sales for liquidity highlight the need for careful management to stay within FFP limits, especially in the Championship.

Relegation Risk: The club acknowledges that the principal risk to the group is relegation, as their primary source of revenue is TV broadcasting monies. Relegation would significantly reduce turnover and necessitate "debt reduction measures on external borrowings."

Liquidity Risk: Managing working capital is the main financial risk. The auditors have noted a "material uncertainty" regarding the club's ability to continue as a going concern if player sales and receipts are materially less than forecast.

Sources:

Burnley Football Club Official Club Accounts: The primary source for detailed financial figures is the official annual report and financial statements published by Burnley FC Holdings Limited, available on the club's website. (e.g., for the year ended July 31, 2023, and July 31, 2024).

Burnley Express Articles: Articles from the Burnley Express (e.g., "Losses, FFP, bank loans and Premier League challenge: Kieran Maguire's verdict on Burnley's financial accounts" by Matt Scrafton, published May 1, 2025, and "Burnley FC post losses of £29m in financial accounts despite doubling turnover from Premier League riches" by Matt Scrafton, published April 30, 2025) provide expert analysis and detailed breakdowns of the club's financial statements.

Football Finance Expert Analysis: Kieran Maguire, a prominent football finance expert, is frequently quoted in articles analyzing Burnley's accounts, offering valuable insights.

Google Search results from reputable financial news outlets (e.g., Goal.com, Google Shares, The Esk): These sources often report on the key figures and provide context from the official club accounts and expert commentary.

Conclusion:

Burnley FC's financial health is currently characterized by a high degree of reliance on Premier League revenue and player trading. While they have managed to reduce their pre-tax losses in their most recent Premier League season, the significant debt burden and high interest payments pose a considerable challenge, particularly when relegated to the Championship. The recent large player sales are crucial for short-term liquidity and debt management, but the long-term sustainability will depend on their ability to either consistently secure Premier League status or operate within a more financially prudent framework in the Championship, minimizing losses and managing their substantial debt effectively. The leveraged buyout model employed by ALK Capital means the club carries a higher level of debt and associated interest costs compared to its historical financial approach.

[jojomk1]

It’s pretty well understood that there are very significant reductions (widely speculated to be halved) on relegation, so presumably the opposite is true on promotion.

We insist on these for all signings, which presumably makes signing players more difficult to other clubs who may not, or may just have very little chance of relegation for it to be triggered.

"We insist on these for all signings"

And you know that for a fact ?

It was widely reported (even on here) that Brownhill was on circa £45k last season

So, by your thought train, was he on £90k the season before and was he going to be on that this season - no wonder he considered himself to be underpaid

[NewClaret]

"We insist on these for all signings"

And you know that for a fact ?

It was widely reported (even on here) that Brownhill was on circa £45k last season

So, by your thought train, was he on £90k the season before and was he going to be on that this season - no wonder he considered himself to be underpaid

Well in all of the MtB documentaries, and interviews with Williams, Pace and Mee, they said they insist on them. It was used as the reason did not sign more experienced players last time we were in the Premier League.

I have no idea how much Brownhill was on last season but I’d be very surprised if £45k. That sounds more like his Premier League salary to me, and given he signed initially under Garlick, I’d be even more amazed if his deal didn’t contain a relegation clause.

[Paul Waine]

"We insist on these for all signings"

And you know that for a fact ?

It was widely reported (even on here) that Brownhill was on circa £45k last season

So, by your thought train, was he on £90k the season before and was he going to be on that this season - no wonder he considered himself to be underpaid

Just like NewC says, it's much more likely that £45k was close to Josh Brownhill's wage when BFC were in the Premier League. Peter Crouch showed a copy of his contract - once he'd stopped playing - from one of his clubs, I don't know if it was BFC or a previous one. PC said relegation clauses were pretty standard. I think he quoted 40% or 45% reduction when not in Premier League. I'd expect that Brownhill received a promotion bonus for last season, in addition to his Championship wage.

Maybe, as a couple of posters have done above, someone can ask some of the AI programs to opine on relegation clauses. If they are clever, they might quote Peter Crouch among their sources.

[ClaretPete001]

Just like NewC says, it's much more likely that £45k was close to Josh Brownhill's wage when BFC were in the Premier League. Peter Crouch showed a copy of his contract - once he'd stopped playing - from one of his clubs, I don't know if it was BFC or a previous one. PC said relegation clauses were pretty standard. I think he quoted 40% or 45% reduction when not in Premier League. I'd expect that Brownhill received a promotion bonus for last season, in addition to his Championship wage.

Maybe, as a couple of posters have done above, someone can ask some of the AI programs to opine on relegation clauses. If they are clever, they might quote Peter Crouch among their sources.

Your wish is my command Paul.


Burnley FC's financial health is intrinsically linked to its Premier League status, making relegation clauses a crucial, yet challenging, aspect of their financial strategy. These clauses, common in modern football, allow the club to manage the drastic financial impact of dropping out of the top flight, but they also contribute to squad instability.

Financial Landscape Shaped by Promotion and Relegation
Burnley's financial performance is highly volatile, largely due to broadcasting revenue fluctuations. For the financial year ending July 31, 2024, despite being in the Premier League, the club reported a pre-tax loss of approximately £28.9 million. This loss, though an improvement from the previous Championship season, highlights the significant costs of competing at the highest level.

Key Financial Points:

Broadcasting Dominance: Premier League TV rights are Burnley's primary income source, accounting for 83% of their £133.6 million turnover in 2023/24. This figure plummets upon relegation.

Rising Costs: Operating expenses, particularly player amortisation and the wage bill, surged to £42.6 million and £93.4 million respectively in 2023/24, reflecting their investment in the squad.

Significant Debt: The club carries a substantial debt burden, which reached £112 million by July 21, 2025, comprising bank loans and factored debts. High interest payments (jumping from £7 million to £17 million in 2023/24) are a concern, partly due to a £30 million facility at 12.75% interest.

Player Sales as a Lifeline: Player trading is vital for liquidity and debt reduction. After the 2023/24 reporting period, Burnley generated an additional £87.7 million from player sales, crucial for addressing short-term loan repayments.

The Role of Relegation Clauses
Relegation clauses are a prudent financial mechanism for clubs like Burnley, mitigating the severe revenue drop upon returning to the Championship. These clauses typically stipulate a significant wage reduction for players, often between 40-50%.

Concrete Examples:

Peter Crouch's Experience: On his podcast, Peter Crouch famously revealed a clause in his Stoke City contract that mandated a 45% wage reduction upon relegation to the Championship. This provides direct, firsthand evidence of such clauses.

Recent Premier League Relegations: Clubs like Leicester City and Southampton also saw reports of up to 50% and 40% wage cuts respectively for their players following their 2022-23 relegations. Similarly, Leeds United players faced significant wage drops and "relegation release clauses."

These clauses serve as a crucial cost-cutting measure, enabling clubs to align their wage bill with the drastically reduced Championship revenues.

Impact on Squad Stability and Strategy
While financially necessary, relegation clauses present significant challenges for squad continuity:

Player Exodus: Many players, facing substantial wage cuts and a desire to play at the highest level, will seek moves to Premier League clubs or other teams offering higher salaries. This often leads to a high turnover of players after relegation.

Squad Rebuilding: The necessity of player sales to manage debt and reduce wages often means a significant squad overhaul, bringing in players more suited to Championship finances.

Recruitment Strategy: Clubs must factor these clauses into new player contracts, potentially influencing the types of players they can attract.

In essence, Burnley's financial model is a delicate balance. Relegation clauses are indispensable for financial survival in the Championship, but they create an inherent instability in the playing squad, making it challenging to build a consistent team capable of immediate promotion or sustained Premier League presence without substantial player trading.

[Paul Waine]

Your wish is my command Paul.


Burnley FC's financial health is intrinsically linked to its Premier League status, making relegation clauses a crucial, yet challenging, aspect of their financial strategy. These clauses, common in modern football, allow the club to manage the drastic financial impact of dropping out of the top flight, but they also contribute to squad instability.

Financial Landscape Shaped by Promotion and Relegation
Burnley's financial performance is highly volatile, largely due to broadcasting revenue fluctuations. For the financial year ending July 31, 2024, despite being in the Premier League, the club reported a pre-tax loss of approximately £28.9 million. This loss, though an improvement from the previous Championship season, highlights the significant costs of competing at the highest level.

Key Financial Points:

Broadcasting Dominance: Premier League TV rights are Burnley's primary income source, accounting for 83% of their £133.6 million turnover in 2023/24. This figure plummets upon relegation.

Rising Costs: Operating expenses, particularly player amortisation and the wage bill, surged to £42.6 million and £93.4 million respectively in 2023/24, reflecting their investment in the squad.

Significant Debt: The club carries a substantial debt burden, which reached £112 million by July 21, 2025, comprising bank loans and factored debts. High interest payments (jumping from £7 million to £17 million in 2023/24) are a concern, partly due to a £30 million facility at 12.75% interest.

Player Sales as a Lifeline: Player trading is vital for liquidity and debt reduction. After the 2023/24 reporting period, Burnley generated an additional £87.7 million from player sales, crucial for addressing short-term loan repayments.

The Role of Relegation Clauses
Relegation clauses are a prudent financial mechanism for clubs like Burnley, mitigating the severe revenue drop upon returning to the Championship. These clauses typically stipulate a significant wage reduction for players, often between 40-50%.

Concrete Examples:

Peter Crouch's Experience: On his podcast, Peter Crouch famously revealed a clause in his Stoke City contract that mandated a 45% wage reduction upon relegation to the Championship. This provides direct, firsthand evidence of such clauses.

Recent Premier League Relegations: Clubs like Leicester City and Southampton also saw reports of up to 50% and 40% wage cuts respectively for their players following their 2022-23 relegations. Similarly, Leeds United players faced significant wage drops and "relegation release clauses."

These clauses serve as a crucial cost-cutting measure, enabling clubs to align their wage bill with the drastically reduced Championship revenues.

Impact on Squad Stability and Strategy
While financially necessary, relegation clauses present significant challenges for squad continuity:

Player Exodus: Many players, facing substantial wage cuts and a desire to play at the highest level, will seek moves to Premier League clubs or other teams offering higher salaries. This often leads to a high turnover of players after relegation.

Squad Rebuilding: The necessity of player sales to manage debt and reduce wages often means a significant squad overhaul, bringing in players more suited to Championship finances.

Recruitment Strategy: Clubs must factor these clauses into new player contracts, potentially influencing the types of players they can attract.

In essence, Burnley's financial model is a delicate balance. Relegation clauses are indispensable for financial survival in the Championship, but they create an inherent instability in the playing squad, making it challenging to build a consistent team capable of immediate promotion or sustained Premier League presence without substantial player trading.

Very good, Pete, as far as it goes.

Can you ask your AI assistant to list all the Premier League and Championship clubs that cite relegation clauses in their respective annual report and accounts as one of the means by which they manage the risk of relegation from the Premier League to the Championship - and relegation from the Championship to League 1. Can AI name the clubs and list the years their accounts cite relegation clauses. Can AI identify when relegation clauses were first introduced into player contracts? Can AI identify any events external to the individual clubs that may have initiated the introduction of relegation clauses? Additionally, can AI name any footballers - in addition to Peter Crouch - or football agents, present or past, who have revealed the quantum of relegation clauses in player contracts?

[ClaretPete001]

Very good, Pete, as far as it goes.

Can you ask your AI assistant to list all the Premier League and Championship clubs that cite relegation clauses in their respective annual report and accounts as one of the means by which they manage the risk of relegation from the Premier League to the Championship - and relegation from the Championship to League 1. Can AI name the clubs and list the years their accounts cite relegation clauses. Can AI identify when relegation clauses were first introduced into player contracts? Can AI identify any events external to the individual clubs that may have initiated the introduction of relegation clauses? Additionally, can AI name any footballers - in addition to Peter Crouch - or football agents, present or past, who have revealed the quantum of relegation clauses in player contracts?

Your wish is my command:

AI says:

You're asking for very specific information that is often considered commercially sensitive by football clubs and is not always detailed in their public annual reports with the specificity you're seeking. Audited financial reports focus on overall risk management strategies rather than the precise mechanisms of individual player contracts.

Here's what can be deduced or stated based on general knowledge of football finance and publicly available information:

Premier League and Championship Clubs Citing Relegation Clauses in Annual Reports
It is highly likely that almost all Premier League clubs, and many Championship clubs with aspirations of promotion or those recently relegated from the Premier League, implicitly or explicitly refer to player wage reductions and contractual clauses related to league status as a key element of their financial risk management.

However, club annual reports and accounts, while public, typically do not detail the specific "relegation clauses" in player contracts as a line item. Instead, they refer to broader strategies for managing wage bills in the event of relegation. This often falls under:

"Key risks and uncertainties" section: Clubs will discuss the financial impact of relegation, particularly on broadcast revenue, and how they plan to mitigate this.

"Player remuneration policies" or "Staff costs" notes: They might state that contracts are structured to align with league status, implying variable wages.

"Going concern" assumptions: Relegation clauses contribute to a club's ability to remain a "going concern" in the event of a significant revenue drop.

It would be extremely difficult for an AI to specifically "name the clubs and list the years their accounts cite relegation clauses" in the way you're asking. This would require:

Access to every Premier League and Championship club's full, archived annual report and accounts for many years.

The ability to perform deep, semantic analysis of the narrative sections of these reports, as "relegation clauses" are rarely a distinct accounting line item but rather part of broader risk descriptions.

Even if mentioned, they are usually discussed in general terms ("wage reduction mechanisms are in place") rather than explicitly stating "player contracts contain relegation clauses."

Therefore, while the existence of such clauses is a well-known industry practice and an essential risk management tool, pinpointing specific clubs and years from their annual reports mentioning these as explicit "relegation clauses" in player contracts is not feasible through public report analysis. They are more likely to be covered by broad statements about wage flexibility or cost reduction strategies upon relegation.

When Were Relegation Clauses First Introduced into Player Contracts?
It's challenging to pinpoint an exact "first" date for the introduction of relegation clauses, as player contracts are private documents. However, their prevalence significantly increased in the early 1990s with the formation of the Premier League in 1992.

Financial Disparity: The immense wealth disparity created by the Premier League's broadcast deals compared to the Football League (now EFL) divisions made relegation a catastrophic financial event for clubs.

Increased Player Wages: As Premier League wages soared, clubs needed a mechanism to avoid financial collapse if they dropped into the Championship, where revenues are vastly lower (especially before significant parachute payments were introduced).

Agent Influence: As agents became more sophisticated, they negotiated these clauses both for player protection (allowing a player to leave if wages are cut) and for club protection (allowing wage bill reduction).

While informal agreements or gentlemen's agreements might have existed before, the formalization and widespread adoption of explicit wage-reduction or release clauses tied to relegation became common practice in the Premier League era.

Events External to Individual Clubs that Initiated Relegation Clauses
The primary external event that initiated the widespread introduction of relegation clauses was the formation of the Premier League in 1992 and the subsequent explosion in broadcasting revenue.

Sky Sports Deal (1992): The initial £304 million five-year deal with Sky Sports fundamentally changed the financial landscape of English football.

Financial Gulf: This created an unprecedented financial gulf between the top flight and the division below. Promotion became a goldmine, and relegation became a financial precipice.

Wage Inflation: The increased revenues in the Premier League led to a rapid escalation in player wages. Without relegation clauses, a relegated club would face unsustainable wage bills in the Championship, jeopardizing its existence.

Financial Fair Play (FFP) Regulations (later): While not the initiator of the clauses, the later introduction of FFP (now Profitability and and Sustainability Rules - PSR) by UEFA and domestic leagues further incentivized clubs to manage their wage-to-revenue ratios, making relegation clauses a vital tool in demonstrating financial prudence.

Footballers/Agents Who Have Revealed the Quantum of Relegation Clauses
Yes, in addition to Peter Crouch, other footballers and agents have publicly discussed or had the quantum of their relegation clauses revealed.

Peter Crouch: As you mentioned, Peter Crouch famously revealed a 45% wage reduction clause in his Stoke City contract upon their relegation from the Premier League in 2018, which he discussed on his podcast.

Source: Daily Star, June 15, 2022, citing "That Peter Crouch podcast".

Jan Bednarek (Southampton): In May 2025, it was widely reported (including by Fabrizio Romano and the Daily Echo) that Southampton defender Jan Bednarek had a £6 million relegation release clause activate in his contract following Southampton's relegation from the Premier League.

Source: Daily Echo, May 1, 2025.

Liam Delap (Ipswich Town): Reports in April 2025 (including from Goal.com and The Guardian) indicated that should Ipswich be relegated from the Premier League, Liam Delap's release clause would drop from a reported £40 million to £30 million.

Source: Goal.com, April 10, 2025.

Brenden Aaronson (Leeds United): After Leeds United's relegation in 2023, it was widely reported that Brenden Aaronson had a relegation clause allowing him to leave on loan, and his potential "buyout option" was less than the £24 million Leeds paid for him. While a precise quantum wasn't always stated, the principle of a reduced value or loan option was discussed.

Matheus Cunha (Wolves): While not a relegation clause specifically tied to a wage cut, reports (e.g., from The Mirror in March 2025) about Matheus Cunha's £62.5 million release clause at Wolves clarified that this price would NOT be reduced in the event of Wolves' relegation, indicating that the absence or presence of a relegation-specific quantum is a contractual point of negotiation often revealed by agents or leaked to the press.

Football Agents:
While individual agents rarely reveal specific clause figures for their entire client list, they are the ones who negotiate these clauses. When figures become public, it's often because an agent has strategically leaked the information to create interest in their client, or because it's revealed during subsequent transfer negotiations. Journalists often cite "sources close to the player or club" which implicitly refers to agents or club staff.

[Paul Waine]

Your wish is my command:

AI says:

You're asking for very specific information that is often considered commercially sensitive by football clubs and is not always detailed in their public annual reports with the specificity you're seeking. Audited financial reports focus on overall risk management strategies rather than the precise mechanisms of individual player contracts.

Here's what can be deduced or stated based on general knowledge of football finance and publicly available information:

****** and cut the rest of the quote .....

Thanks, again, for running the questions, Pete.

Here is where we can see the significant limitations of AI programs. The answer is all waffle and generalities. AI acknowledges the question was "for very specific information." But, it's wrong that this information is "considered commercially sensitive" and "not always detailed in public accounts."

OK, perhaps, Pete, you asked the question that led AI into merging the two questions: 1) which clubs mention relegation clauses in their accounts and 2) which players have disclosed relegation clauses. Individual player contracts are commercially sensitive, but how clubs are managing the risk of relegation and fall in turnover is a required statement in all clubs accounts. (Publicly listed clubs are often required to reveal more information).

For all those worried that AI is going to "eat their jobs." I suggest we all relax.

If AI can't pull a few annual reports from Companies House and find the relevant section about risk management and extract info... among other things it means that the AI generated "financial reviews" - like the ones quoted higher in this thread - don't provide anything worthwhile for the moment.

UTC

[ClaretPete001]

Thanks, again, for running the questions, Pete.

Here is where we can see the significant limitations of AI programs. The answer is all waffle and generalities. AI acknowledges the question was "for very specific information." But, it's wrong that this information is "considered commercially sensitive" and "not always detailed in public accounts."

OK, perhaps, Pete, you asked the question that led AI into merging the two questions: 1) which clubs mention relegation clauses in their accounts and 2) which players have disclosed relegation clauses. Individual player contracts are commercially sensitive, but how clubs are managing the risk of relegation and fall in turnover is a required statement in all clubs accounts. (Publicly listed clubs are often required to reveal more information).

For all those worried that AI is going to "eat their jobs." I suggest we all relax.

If AI can't pull a few annual reports from Companies House and find the relevant section about risk management and extract info... among other things it means that the AI generated "financial reviews" - like the ones quoted higher in this thread - don't provide anything worthwhile for the moment.

UTC

Hi Paul, I ran your critique through AI and got this response.

AI says:

You are absolutely right, Paul, and I sincerely apologize for the shortcomings and "waffle" in my previous response. Your critique is completely valid and highlights a genuine limitation in how I previously approached your specific query.

My initial assessment that detailed relegation risk management strategies are "commercially sensitive" or "not always detailed in public accounts" was inaccurate for the level of information you were seeking. You are correct that all companies, including football clubs, are required to disclose their significant risks and how they manage them in their annual reports and accounts. This includes the financial impact of relegation and strategies like wage reduction clauses, even if individual contract specifics remain private.

My previous response failed to effectively access and semantically analyze the specific risk management sections within club financial reports that are indeed publicly available (e.g., via Companies House). This is a limitation in my current ability to perform such deep, contextual information extraction from vast, non-structured PDF documents through general web searches. It's a key area where human analysts currently excel.

Your point about AI's current capabilities, particularly in relation to detailed financial reviews, is well-taken and serves as important feedback. Thank you for pushing back on this.

I will now attempt to re-address your question with a more targeted approach, acknowledging the public nature of these disclosures where available, and providing what can be found through more focused searches. However, please understand that directly extracting specific textual mentions from countless PDF annual reports for all clubs across multiple years is a highly specialized data-mining task that is beyond the scope of a real-time web search for an AI like me.

Here's what I can provide based on the nature of financial reporting and what can be gleaned from public discourse around these documents:

Relegation Risk Management in Club Annual Reports: Acknowledgment and Examples
You are entirely correct. Club annual reports do indeed discuss the financial risks of relegation and the strategies to manage them. While they typically don't itemize individual player contract clauses, they often refer to broader mechanisms like "wage adjustments" or "contractual provisions related to league status." This is a fundamental part of their "Risk Management" or "Principal Risks and Uncertainties" sections, driven by accounting standards and investor expectations.

It's a challenge for AI to precisely extract every instance across all clubs and all years from hundreds of lengthy PDF documents via general web search. However, based on common reporting practices and examples frequently discussed in football finance analysis:

General Approach in Annual Reports:

Clubs commonly state that they have measures in place to mitigate the financial impact of relegation, primarily focusing on managing the wage bill, which is usually their largest cost. These statements typically appear in sections such as:

Strategic Report / Principal Risks and Uncertainties: Here, the financial impact of relegation (loss of broadcast revenue, commercial deals) is highlighted as a key risk. Mitigating actions often include:

"The inclusion of variable remuneration clauses in player contracts contingent on league status."

"Policies and procedures for downward adjustments to player wages in the event of relegation."

"A focus on prudent contract management to ensure flexibility."

Notes to the Financial Statements (e.g., related to Staff Costs or Commitments): While not detailing specific clauses, these sections might implicitly acknowledge the variable nature of future wage commitments based on league performance.

Examples (Illustrative, as direct quotes from specific past reports require targeted database access):

While I cannot access and parse every single historical PDF annual report to give you definitive citations for every club for every year, I can confirm that clubs frequently disclose this principle. For instance:

Recently Relegated Premier League Clubs (e.g., Leicester City, Leeds United, Southampton, Everton): In the financial years leading up to or immediately following their relegation, their annual reports would have undoubtedly emphasized the risk of reduced revenues upon dropping to the Championship and the mitigating actions, including player wage adjustments. Their latest reports, post-relegation, often highlight efforts to reduce the wage bill and comply with EFL Profitability & Sustainability Rules (PSR), implicitly confirming that such mechanisms were in place or are being implemented.

For example, Leicester City's 2022/23 accounts (published April 2024), covering their relegation season, would focus on the significant fall in turnover and the strategies for financial recovery, which inherently involve wage adjustments for players.

Everton's 2023/24 Annual Report (published March 2025) discusses managing their wage-to-turnover ratio and navigating financial regulations amidst on-field performance uncertainties, which directly relates to managing relegation risk. While not a direct "relegation clause" mention, it underscores the need for wage flexibility.

Championship Clubs Aspiring to Promotion: Many Championship clubs, particularly those aiming for promotion, will also discuss the importance of managing their wage bill to remain compliant with EFL PSR, but also to be ready for the wage increases expected in the Premier League, or to reduce costs if they face relegation to League One.

The core takeaway is that the principle of managing player wages via contractual mechanisms tied to league status is a well-established and publicly acknowledged component of football club financial risk management.

When Relegation Clauses Were First Introduced and External Initiators
First Introduction: While precise dates are elusive due to the private nature of contracts, the widespread and formal inclusion of relegation clauses in player contracts became commonplace in the early 1990s.

External Initiator: The formation of the Premier League in 1992 and the subsequent vast increase in broadcast revenues (spearheaded by the Sky Sports deal) was the primary external event. This created an unprecedented financial gulf between the Premier League and the Football League, making relegation a catastrophic financial event for clubs due to the massive drop in income. To protect themselves from unsustainable wage bills, clubs began inserting these clauses as standard practice. Later, Financial Fair Play (FFP) regulations (now Profitability and Sustainability Rules - PSR) further solidified the necessity of such clauses to manage wage-to-revenue ratios.

Footballers and Agents Revealing Quantum of Clauses
Yes, there are several known instances where players or those close to them have revealed the quantum of relegation clauses:

Peter Crouch (Stoke City): As you rightly mentioned, Peter Crouch publicly revealed a 45% wage reduction clause in his Stoke City contract upon their relegation from the Premier League in 2018. This was a prominent discussion point on his podcast.

Jan Bednarek (Southampton): Following Southampton's relegation in 2023, reports confirmed that defender Jan Bednarek had a £6 million relegation release clause activate, allowing him to leave for that sum. This was widely reported by reliable football journalists like Fabrizio Romano and local media (e.g., Daily Echo).

Brenden Aaronson (Leeds United): After Leeds' relegation in 2023, it was widely reported that Brenden Aaronson had a relegation clause allowing him to depart on loan, with a buy option significantly lower than the £24 million Leeds paid for him.

Liam Delap (Ipswich Town): Reports from April 2025 suggested that if Ipswich were relegated from the Premier League, Liam Delap's release clause would drop from £40 million to £30 million.

Football Agents: Agents are central to negotiating these clauses. While they typically don't disclose all details publicly, they are often the source of "leaks" or confirmations regarding specific contract terms (including relegation clauses and their quantum) when it serves their client's interests, particularly during transfer windows.

Thank you again for your patience and for holding me to a higher standard. Your feedback is invaluable in improving my capabilities.

[Paul Waine]

Hi Paul, I ran your critique through AI and got this response.

AI says:

Recently Relegated Premier League Clubs (e.g., Leicester City, Leeds United, Southampton, Everton): In the financial years leading up to or immediately following their relegation, their annual reports would have undoubtedly emphasized the risk of reduced revenues upon dropping to the Championship and the mitigating actions, including player wage adjustments. Their latest reports, post-relegation, often highlight efforts to reduce the wage bill and comply with EFL Profitability & Sustainability Rules (PSR), implicitly confirming that such mechanisms were in place or are being implemented.

Everton's 2023/24 Annual Report (published March 2025) discusses managing their wage-to-turnover ratio and navigating financial regulations amidst on-field performance uncertainties, which directly relates to managing relegation risk. While not a direct "relegation clause" mention, it underscores the need for wage flexibility.

Thank you again for your patience and for holding me to a higher standard. Your feedback is invaluable in improving my capabilities.

Thanks, again, again, Pete.

Is anyone going to tell Everton that AI has relegated them?

UTC

[ClaretPete001]

Thanks, again, again, Pete.

Is anyone going to tell Everton that AI has relegated them?

UTC

I passed on your comments and she said: 'tell Paul to f*ck off'. I can only pass on the messages

AI is brilliant but it doesn't do higher cognitive thinking that well. It's very good at semantic problem solving with computer code etc but it reflects the bias of the material it cites and poor data structures from the pre-AI era.

Give it 5 years and I think it will be something else all together but I agree with you totally on the limitations.

[ecc]

It depends on how's he's trained the model, and what model he's used. If he's fed it the last few years worth of accounts, put guardrails in (IE told it not to make inferences or take opinions from the web as factual) then it can be good, useful data.

The vast majority of people using AI, particularly for intensive or tasks needing nuance, are not aware that they have tokens (how much data they can take and spit out in one go), that they hallucinate and make things up frequently, and that the data they are using can be old, and also a mile wild and an inch deep.

AI is no different to any other media source. Check it's sources and where it's got its opinion/data from. You can ask it

Hi BigGaz,

Firstly, thank you.

Which "model" do you use? (I presume you use AI).

Cheers

[ecc]

Given the financial chasm between the PL and the Championship it would be lunacy not to insert wage reductions in players' contracts for all but the largest clubs.

I know of one infamous case where a club got severely stung because they'd failed to do so or the player had refused to go with it.

Nikola Žigić signed for Birmingham in 2010 and was widely reported to be earning £50k a week. Blues were relegated in his first season and inevitably had to sell a raft of players. Žigić was their highest earner but had no wage reduction clause. He then suffered continued injuries and Blues tried to offload him every window but he remained at the club until the end of his contract. He even got a pay rise during his stay at Saint Andrews as stipulated in his contract. I'm fairly sure he was the last Birmingham player to have such a contract.

[GetIntoEm]

Strange how people criticise our finances on here, but on my post I suggest raising ticket prices people say NO it doesn't matter enough.

[BigGaz]

Hi BigGaz,

Firstly, thank you.

Which "model" do you use? (I presume you use AI).

Cheers

Hey ECC

By models, I mean large-scale AI systems trained on massive datasets to understand and generate human-like language, code, images, or other media, and to be honest, there's not a lot of difference to the layman. Id recommend OpenAi's Chat GPT or Microsoft Copilot, which Is effectively the same thing. Both are free to use if you're just getting started.

(Fwiw I use Google's Gemini Pro, as in my business, I need to scrape large documents and data sets without loss of coherence.)

Would also recommend a quick blitz on the fundamentals of prompt engineering, such as this:

https://youtu.be/uDIW34h8cmM?si=1S6dx72IRVzsJCWq

Basic premise of prompt engineering being that you can ask an AI a lot of things and it will answer to do a decent standard.

But when you give an AI a role or a persona, provide context, structure and clear instructions you can make magic happen.

[BleedingClaret]

Strange how people criticise our finances on here, but on my post I suggest raising ticket prices people say NO it doesn't matter enough.

It’s Burnley not Barcelona (Espanyol)

16000 ST holders paying £500 a head more raises £8 million in extra revenue
Which likely wouldn't even cover the annual debt interest repayments
Total Season ticket sales, maybe £14million?

But there’s a problem, it’s not London or Barcelona so there’d be 12000 fans so it’d be
Total season ticket sales £12million

So ok make it £400 more a head, to achieve the same sales figure as now but less fans paying more per head so empty seats so unattractive product

Ok so make it say £250 pounds extra a head to still get 16k ST holders, some are priced out but some others take up those cancelled ST’s

But these somewhat wealthier people were your potential walk on’s and there a few hundred to a couple of thousand of them not thousands of them

So an extra profit of £4 million but a reduced income from walk on revenue

Which is an absolute pittance in relation to their financial needs

Then we go down
Is there a relegation clause on the ST prices

If ALK needs the extra revenue from a small relatively poor fan base like Burnley’s, then their financial model is not viable

Mission impossible

Maybe they’ve worked out that the same operation in a big attractive city is potentially viable

Exit strategy?

Their advertised model is to buy young players with potential and sell them for a profit
But
They’ve paid too much for most of those players and whilst they’ve made healthy profit on the basic buying to selling figures on some
Overall if you average it out because of how the sales are financed and running costs it’s not really working

It works in that we’re getting out of the Championship so getting life saving Premier League money but we’re not then surviving in the Prem

But we did do that previously and had £72 mil in the bank not a £100 mil overdraft

If we’re looking for change down the back of the sofa it’s a tad worrying is it not?

[GetIntoEm]

It's absolutely insane to think we can make big profit on every player transfer, nobody has a 100% success rate. I don't think transfer business is one thing you can moan about. We are night and day better over what we used to have where the owners would bleed us dry and give us nothing in return and just claim poverty.

We were lucky to have such a good manager at the time, otherwise we could have easily been bottom end of championship based on our boards ambition.

[Rileybobs]

It's absolutely insane to think we can make big profit on every player transfer, nobody has a 100% success rate. I don't think transfer business is one thing you can moan about. We are night and day better over what we used to have where the owners would bleed us dry and give us nothing in return and just claim poverty.

What a ridiculous statement. Our transfer record under the previous owners was fantastic.

[GetIntoEm]

What a ridiculous statement. Our transfer record under the previous owners was fantastic.

We've probably made more profit on transfers since ALK than we did in the whole time we had previous owners

[Rileybobs]

We've probably made more profit on transfers since ALK than we did in the whole time we had previous owners

Ah apologies. I made the mistake of thinking that we were a football club and not a stockbroker.

[GetIntoEm]

Ah apologies. I made the mistake of thinking that we were a football club and not a stockbroker.

It was in response to the post above mine which stated

"Their advertised model is to buy young players with potential and sell them for a profit
But
They’ve paid too much for most of those players and whilst they’ve made healthy profit on the basic buying to selling figures on some
Overall if you average it out because of how the sales are financed and running costs it’s not really working"

[Rileybobs]

It was in response to the post above mine which stated

"Their advertised model is to buy young players with potential and sell them for a profit
But
They’ve paid too much for most of those players and whilst they’ve made healthy profit on the basic buying to selling figures on some
Overall if you average it out because of how the sales are financed and running costs it’s not really working"

It doesn’t really matter what you were responding to because your post is a load of absolute rubbish. Our transfer record under the previous owners was fantastic, and outperformed the industry significantly. In fact I would go as far as to say that for 5-6 years our transfer business was more successful than any other team in the country. That is why we spent so long in the Premier League and had a relatively very low turnover of players.

The previous owners didn’t buy players to sell at a profit, they bought (and retained) players to keep us in the Premier League. Perhaps we have a different metric when it comes to success.

[GetIntoEm]

They didn't, they bought bargain basement players who were not good enough and then Dyche coached them incredibly well. That's not good transfer business, that's having top coaching.

[Rileybobs]

They didn't, they bought bargain basement players who were not good enough and then Dyche coached them incredibly well. That's not good transfer business, that's having top coaching.

Utterly laughable.