Kieran Maguire makes ‘genuinely concerned’ admission after analysing West Ham United accounts
Kieran Maguire has given his views on the “significant” spending done by West Ham in their most recent accounts and says he is “genuinely concerned” about a financial crisis in football.
West Ham announced in last week’s accounts for the year up to 31 May, 2023 that they made a pre-tax loss of £18.3million, compared to a £12m profit the previous year.
However, the club pointed out that an outlay on players of £184m over the period in question was part of the reason for the profit turning into a loss.
Speaking on The Price of Football podcast [3 December, 1hr, 4m 44s], finance expert Maguire said that, while the way West Ham have financed deals is normal these days, it is a concern in terms of the wider footballing landscape.
“You’d think that because they won a cup they’d have earned money, but they actually lost £18m, despite the benefit of only paying £3.5m a year in rent for the 60,000 stadium,” Maguire said.
“West Ham bought players for around about £180m in 2022-23, which is significant. You’d think it’s not like David Sullivan to open the wallet wildly, but he’s not. They’ve used the club’s credit card, and as a result of that they owe £171m in outstanding transfer fees to other clubs.
“That’s fine as that’s how football operates these days. But I’m genuinely concerned that we’re going to have a similar position to the one we had in the world of traditional finance in 2007-08 that there was an awful lot of debt being transferred from bank to bank to bank.
“It only then takes one person to fall down and you’ve got a domino effect. West Ham generated money, they’ve made money through Declan Rice, so they’re not the problem. It’s a much broader football issue. Credit is not the best way to do things.”
Risk/reward balance
The headline from the club’s accounts was that fairly sizeable loss on the back of making a profit the year before.
The club were right to point out, though, that putting money into the squad – and paying players higher wages – contributed to that.
Ultimately, the period in question ended with United lifting a trophy for the first time since 1980, so the risk/reward balance paid off.
It is also worth pointing out that the money brought in through winning the Europa Conference League was not included in those most recent accounts.
When you factor that in, plus the £100m+ sale of Declan Rice, West Ham are certainly not in the worst financial position – even if they did reinvest all that money back into the squad.
It goes a long way to showing why incoming activity is unlikely this month unless a good deal can be found, which is easier said than done.
As Maguire says, this approach may not be the wisest way to go about things, but it certainly does not stop other clubs from doing so.
In other West Ham news, a Sky Sports reporter has shared details on a deal that is close to completion at London Stadium.