Championship rivals announce £87m pre-tax loss as £15m Leeds United cost-saving revealed

The south coast club are in the hunt for automatic promotion alongside Leeds, Leicester City and Ipswich Town, knowing an immediate return to the Premier League and the broadcast revenue in excess of £100 million that comes with top flight membership, could offset the significant losses made by the club between June 2022 and June 2023.

While many of the club’s departures last summer are not taken into consideration during this reporting period - including the £30 million departure of James Ward-Prowse to West Ham United - the Saints’ losses serve to highlight the importance of returning to the Premier League without delay.

The overwhelming majority of relegated Premier League clubs tend to report losses totalling tens of millions in their first year after coming down from the top flight, while teams with promotion ambitions tend to swallow short-term losses for the deliverance of Premier League riches, if they are successful. Leeds were no different prior to their 2020 promotion, posting an operating loss of £62 million, before recouping several hundred millions in broadcasting revenue alone over the course of three seasons in the Premier League.

What Southampton’s loss does mean is they skirt close to the Financial Fair Play threshold which allows clubs to lose £105 million over a three-year period. While Leeds are also likely to post a loss for the season 2022/23, their two most recent sets of accounts in 2020/21 and 2021/22 amount to a total pre-tax loss of £48.6 million, allowing a £56.4 million loss facility in 2022/23’s accounts, which are yet to be announced.

Compared to Southampton, Leeds will have also made a cost-saving of £14.6 million which the Saints accrued in payments to former clubs of new coaches, which includes the hiring of Nathan Jones and Russell Martin from Luton Town and Swansea City, respectively.

Leeds’ four most recent appointments - Jesse Marsch, Javi Gracia, Sam Allardyce and Daniel Farke - were all out of work at the time each took charge at Elland Road, therefore the costs incurred by Leeds in changing managers over the past 20 months are expected to be much smaller than their promotion rivals. Leeds’ largest expense in this department is likely to have been paying up Marsch’s contract, which had until the summer of 2025 to run. Gracia had only signed terms until the end of 2022/23 while Allardyce’s short term contract was not renewed following his short-term stint in the dugout.