Accounts should reveal impact of relegation

THE profound impact of relegation and a January spending spree on Newcastle United’s finances will be revealed when the club’s accounts are filed in the next couple of weeks.

The accounts will be released by the club in the next few weeks and that release will emphasise the importance of returning to the top flight for a club that has missed out on nearly £80million in revenue due to relegation last season.

The accounts cover the period between July 2015 and June 2016 – a period that saw the club invest heavily in the January transfer window and suffer relegation to the Championship, which saw the club’s revenue cut.

United have posted successive profits in the last two financial years and last year they posted the second largest profit in the Premier League. But that will not be the case this season, with Mike Ashley having loaned the club £33million to cope with the impact of going down.

It’s understood that this year’s accounts illustrate the stark impact of relegation and may also partly explain why the club did not invest in January this year, despite Rafa Benitez hoping to bring in reinforcements to prop up the promotion push.

Although they sold some of their biggest earners and prize assets, Newcastle opted not to make major cuts on the back of relegation. This was partly down to previous costsaving measures but also a recognition of the mistakes of the past, when the club did not perhaps have an infrastructure best placed for success.

Indeed United invested in the transfer window to back Benitez’s judgement, signing 12 players and giving the boss free rein to improve. That was on the back of Ashley’s loan, which may be the reason for his interest in the club’s business in January.