Newcastle United’s financial accounts confirmed they were just days away from facing a points deduction.
The Premier League handed out points deductions to Everton and Nottingham Forest last season after they were found to have breached the Profit and Sustainability Rules.
PSR has slowed Newcastle’s growth under PIF, limiting the club’s spending power in recent seasons. Eddie Howe again had to cope without any major signings in the January window.
Before that, Newcastle were forced to sell in the summer with Elliot Anderson and Yankuba Minteh sold to Nottingham Forest and Brighton to raise funds.
Selling Anderson was Howe’s hardest decision as Newcastle boss, but it was deemed necessary. Newcastle risked a 10-point deduction if they didn’t balance their books by the PSR cut-off date.
Photo by Serena Taylor/Newcastle United via Getty Images
Photo by Serena Taylor/Newcastle United via Getty Images
Newcastle United were days away from £69m disaster
Newcastle announced revenue of £320m in their latest 2023/24 accounts, yet the club still made an overall loss of £11m.
It reflects the increasing costs at St James’ Park, including rising wages and operating costs as PIF plot to bring the Magpies back to the top of English football.
But it could – and was almost – so much worse before Newcastle completed the sales of Anderson and Minteh.
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As reported by The Athletic, Newcastle were facing a £69m loss and a PSR breach of well above £50m before they raised cash through Anderson and Minteh.
The two last-gasp transfer deals brought in £65m to the club, while the compensation paid by Manchester United for sporting director Dan Ashworth also contributed.
The PSR window rolled over on June 30th, so Newcastle knew they needed to raise cash before that date.
Newcastle United’s PSR situation in the summer transfer window
Heavy losses suffered by the club after the PIF takeover is what put Newcastle at risk of a points deduction.
PSR states that top-flight clubs cannot lose in excess of £105million over a rolling three-year period.
Therefore, Newcastle are set for a £73m PSR boost on July 1st when the losses from the 2021/22 accounts drop out of that three-year window.
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It should provide Paul Mitchell with a healthier transfer budget for the summer, meaning the wait for major signings will finally be over.
Newcastle’s January sales added £100m to the transfer budget, and reports suggest Mitchell is targeting three new signings.