The Premier League "has never been richer," with the most recent combined annual income for the current 20 clubs "soaring past" £3B ($4.5B) for the first time, according to Nick Harris of the London DAILY MAIL. But a review of the books also shows "club debts" standing at more than £2.5B ($3.7B).
Much of that "poses no imminent danger to the clubs encumbered with it." Chelsea’s parent company owes Roman Abramovich £958M ($1.4B), for example, and he "is showing no sign of demanding it back any time soon." But a group of clubs including Aston Villa, Hull, Leicester, Newcastle, Queens Park Rangers and West Ham "have each racked up debt" of around £100M ($149M), much of which is owed to their owners. And in an era when the Premier League "has never had so much cash it is bewildering so many clubs remain financially unstable." West Bromwich Albion CEO Mark Jenkins said that the "'boom-and-bust culture' of unsustainable spending in an attempt to buy success underpins the phenomenon." Jenkins, whose club has just posted its latest set of profitable accounts and is close to being debt-free, said, "The easiest thing to do when you reach the Premier League is over-reach. ... You can get sucked into a boom-and-bust culture. That’s drained the pockets of many a star-struck or misguided owner."
Examples of clubs that "aimed for the stars but have ended up in administration or other self-inflicted fiscal turmoil are numerous." Leeds, QPR, Birmingham and Coventry "spring readily to mind" (DAILY MAIL, 3/28).
