Luton Town release finances for 2022-23 without significant Premier League money included..

Luton Town have released their accounts for the 2022-23 business year which showed that although turnover had gone up by just under £1m at Kenilworth Road, the club still finished with a loss of £8.3m.

That is mainly due to a huge hike in wages, which have increased from £15.6m to £24.3m, extra costs on top of that meaning the Hatters are now paying around £10m more, although the main reason for that is the players’ bonuses paid out for winning promotion to the top flight in the play-off final on May 27. Operating costs have also risen from £25m to £39m, while Town have had to pay back a £2m loan to the EFL taken out during Covid-19, but player trading saw Luton bring in £3.7m more than the previous year, as they sold James Bree and Harry Cornick, with manager Nathan Jones and his entire backroom staff going to Southampton as well.

Town did spend just £7m on transfer fees themselves, bringing in Mads Andersen from Barnsley for what was then a club record fee ahead of the cut-off point, although that would also include Carlton Morris’s addition from Oakwell, plus signing John McAtee, Jack Walton and Joe Taylor. The Hatters still owe just under £12m as well, way up from £1.7m the year before, but there was rightly no cause for concern from owners 2020 Holdings Ltd, as the accounts had to be submitted by June 30

With the vast sums of Premier League money, potentially as much as £100m, not filtering through to July, it means they will be shown in next year’s accounts. Coupled with that, there was also five weeks expenditure getting Kenilworth Road up to scratch for the top flight included as well, then the financial future of the club is clearly extremely positive, as in their strategic report accompanying the accounts, the club’s owners said: “The 2022-23 season saw the club promoted to the Premier League for the first time in its history.

“Promotion related costs including bonuses, contingent loan and transfer fees have been recognised in this year’s accounts, while the upside, including vastly increased broadcasting revenue will be received and recognised in 2023-24. The directors have produced detailed financial forecasts to the end of the 2024-25 season under a number of scenarios and are confident that regardless of the outcome of the club’s first Premier League season, the increased revenue will provide sufficient working capital to meet the club’s needs during the forecast period.

“The sizeable uplift in broadcast revenue as a result of promotion has allowed the club to invest heavily in its long term strategic plan, with stadium and training ground infrastructure, as well as the first team squad all receiving significant levels of funding. With the team qualifying for the play-offs for the second consecutive season matchday and broadcasting revenues (league distribution) remained at similar levels (£15.2m in 2023 compared to £15.3m in 2022). The play-off final did drive a significant uplift in retail and sponsorship revenue however, which largely accounted for the overall increase of £0.8m.

“The increase in playing trading and other related income relates to compensation from Southampton, following the departures of Nathan Jones and his coaching staff in November 2022. The significant increases in cost of sales and administrative expenses were principally due to promoted related costs, including bonuses and contingent fees, so while the operating loss appears significantly worse than the prior year, the related upside will be reported in the 2023-24 accounts when Premier League revenues are realised.

“The club maintained its strategy of building a squad capable of promotion, so both player acquisition and player wage costs increased progressively from the prior year. The acquisition of Mads Andersen prior to the year end also contributed to the increase in the value of intangible assets. The high wages to turnover ratio is an anomaly caused by the recognition of promotion bonuses in the 2022-23 accounts. Creditors falling due within one year increased by £20m as a result of accrued promotion related costs as noted above and intercompany funding from 2020 Developments.”

Since the deadline for the accounts passed, Luton confirmed they spent just over £20m on bringing the likes of Ryan Giles, Thomas Kaminski, Tahith Chong and Jacob Brown in during the summer transfer window, also selling Carlos Mendes Gomes to Bolton Wanderers as well.

The club continued: “Since the year end, Luton Town Football Club has acquired and extended a number of player registrations at an initial cost of £22m. Additionally a number of player registrations were disposed of with an associated net book value of £0.3m. These transactions will be accounted for in the year end 30 June 2004.”