Newcastle United have released their financial accounts for the year ending 30 June 2024.
The last 18 months have been a struggle for the club off the pitch with PSR continuing to prove problematic, effectively halting their progress on the pitch.
Despite that, Eddie Howe still has Newcastle United in the top six of the Premier League, just a few points off a place in the Champions League. Thanks to positive results by the English clubs in the competition, a fifth-place finish in the Premier League will most likely be enough to get them back into Europe’s premier competition.
Newcastle fans will be eager to see the club return to Europe after narrowly missing out at the end of last season. Howe guided an injury-riddled squad to seventh in the table which which was enough for Europa Conference League football at the time but Manchester United’s FA Cup win took it away from them.
The financial accounts posted earlier this week showed that Newcastle recorded a turnover of £320m and their losses were heavily reduced from previous years.
Newcastle can spend in the summer thanks to a £73m PSR boost due to the losses from the heavy spending three years ago dropping off the cycle.
One key figure in the financials was that Newcastle’s wage bill increased to £219m due to new deals for the likes of Bruno Guimaraes and Joelinton, with the former becoming Newcastle’s highest earner on a whopping £160,000-per-week.
Alexander Isak will be handed a new deal in the summer over concerns regarding his figure at the club. However, there are questions over exactly how much the club could offer him.
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With bigger spending potentially on the horizon, we spoke to a financial expert to see what the most recent accounts truly mean for Newcastle.
Photo by Clive Brunskill/Getty Images
Photo by Clive Brunskill/Getty Images
Newcastle United’s wage bill increase explained
In February, it was announced that Martin Dubravka and Emil Krafth signed new deals at Newcastle to keep them at the club until the end of the 2025/26 season. While Newcastle want to hand Isak a new contract, fans may feel as if Newcastle must also weigh up their options in the transfer window and whether they can afford to sign players and give lucrative new contracts out to star players.
Geordie Boot Boys spoke to Adam Williams, Head of Football Finance and Governance Content at GRV Media to understand what the wage increase means for Newcastle.
“As far as Newcastle are concerned, the increase in the wage bill is significant,” Williams said.
At £219m, that would have been higher than both Arsenal and Spurs in 2022-23. In 2023-24, it is higher than Tottenham’s. We don’t have Aston Villa’s accounts yet for 2023-24, but I expect that their wage bill will be higher than Newcastle’s.
“That means that Newcastle will probably have the seventh-highest wage bill in the division. However, as a proportion of revenue, Newcastle’s wage bill will has actually gone down, not up.
“By turnover, they are now the 15th richest club in the world. When we eventually move to the new revenue-based PSR system, that means only 14 clubs in the world can outspend them, in theory.”
Newcastle United fans feel the effects of commercial growth
On Thursday, Newcastle announced a 5% increase in season ticket costs as a way to continue increasing their commercial revenue. The Magpies will lose out on the near-£30m they received in Champions League revenue last season but will make up for it with the lucrative Adidas deal and the success of St James’ STACK which has turned out to be a big money-spinner since opening in 2024.
Newcastle fans weren’t happy with the season ticket prices, taking to social media to voice their displeasure.
On the impact on fans, Williams said: “The increases in commercial and matchday income are seriously impressive. If they are going to climb higher up that list, they need to continue to grow that pie.
“The obvious concern for Newcastle fans here – and one we need to be careful not to lose sight of – is that supporters are going to feel the pinch in terms of ticket prices, merchandise and so on if the club is determined to continue the growth to carve out more headroom to spend under PSR.
“For that reason, the financial significance of the new stadium can’t be overstated. The growth in sponsorship revenue can’t continue at this rate forever, so they have limited options.
“Newcastle have said they will always spend the maximum allowed under PSR. The inescapable truth is that some of the burden will be passed onto fans.”
Whether Newcastle United can afford Alexander Isak contract
Newcastle handed Anthony Gordon a new deal in 2024 which should keep him at the club for the next few years. Now, fans want Mitchell to do the same for Isak.
Isak could leave Newcastle in the summer with clubs across Europe fighting for his signature, recent reports have suggested Liverpool will replace Mohamed Salah with Isak, who could also increase their commercial revenue, as well as their performances on the pitch.
Newcastle will have to give Isak a significant pay rise if they are to keep the Swede past this season, the 25-year-old also wants to play frequent European football – which he believes he can do with Newcastle.
“Stepping back, the figures for 2023-24 are really, really positive,” Williams added.
“The £72m they lost in 2023-24 is now no longer part of the calculation from next summer onwards. Because it has been replaced by a more modest £11m loss, that’s an extra £61m worth of headroom.
“If they want to give Alexander Isak a bumper new deal, they should have more than enough room to do so.
“Wages will have increased again in 2024-25 and, if they get into Europe, will do so again next season. But even then, they have ample room to manoeuvre and I suspect there will be far less budgetary restraint in the summer.”