Kieran Maguire taken aback by Leicester City's 'brutal' accounts as he identifies 'unsustainable' factor

Football finance expert Kieran Maguire admits the sheer scale of Leicester City's spending came as a shock. The Foxes, Leeds United’s rivals in the Championship promotion race, released their accounts on Thursday evening which showed pre-tax losses of £89.7m during their last season in the Premier League, which takes their total losses over the last three seasons to around £215m.

That far exceeds the £105m limit top flight clubs are permitted to lose over the same period. The club were charged last month by the Premier League over alleged breaches of the competitions Profit and Sustainability rules and if found guilty they could be deducted points next season.

The case is far from cut and dried with Leicester set to benefit from add backs such as the money spent on the club's academy and women's team, but the accounts represent a huge oversight off the field, with revenue falling by 17 per cent to £177m, while the wage bill increased to £206m and it’s the latter figure that Maguire finds most staggering.

"Like many people, I was taken aback," he said on the 'When You're Smiling' podcast. "I knew it wasn’t going to be a great year but the fact that the club had to extend its financial year to 13 months to squeeze in sales and reduce the losses to just £90m was indicative of what a challenge it was. We knew the revenue would be down but I was amazed that the wage bill went up so high.

"For the first time in my knowledge in the Premier League, they were paying more out in wages than was coming in through the door - in a non-Covid year. The only time that’s happened in Premier League history. A brutal set of numbers.

"What Leicester City have done is, following the success of winning the Premier League in 2016, they went through a period of spending £100m or more in recruiting talent. That stepped down in 2020/21, partially due to Covid, but the investment in new talent in 22/23 was just £53m. That’s the lowest since the first season back in the Premier League.

"It doesn’t look great. There’s a catch-up of all the spending, some of which has worked and some haven’t. The club had budgeted to finish in the top half of the Premier League and it didn’t. The money from TV was down by about £35m. The club wasn’t competing in Europe, that had an impact as well. All these individual things, collectively, led to a poor season on the pitch and financial results."

He added: "It’s all to do with wages. The wage bill has more than doubled from when the club won the Premier League in 2016. That’s simply not sustainable."