Kieran Maguire: Arsenal have been hit with 'financial penalties' after £107m reveal
Arsenal were hit with “financial penalties” in 2020-21 after they were unable to meet the terms of a lending agreement.
So says finance guru Kieran Maguire, speaking exclusively to Football Insider about the Gunners’ accounts for the year ending 31 May 2021.
In the results published on Monday (28 February), Arsenal revealed an eye-watering loss of £107.3million as revenue fell to £327.6m.
Matchday revenue tumbled by £75m to £3.8m for a season played almost entirely behind closed doors as a result of the pandemic.
And Maguire explains that the Gunners took an additional £40m hit as a result of the terms of a “break clause”.
“These figures need to be treated with caution,” he told Football Insider‘s Adam Williams.
“Arsenal would usually be hoping to get close to £100m on matchday revenue but they only got £4m.
“That would have wiped out a significant portion of the loss.
“It is intriguing that Arsenal have moved away from a lot of external borrowing and are now borrowing from companies in Stan Kroenke’s group.
“There was a very signficant one-off break clause too. Let me explain that a little further.
“If you have a three-year mortgage at a fixed rate and you break that then there are financial penalties.
“The financial penalties for Arsenal were quite signficant because the overall interest charge jumped from £13m to £40m.
“So if you strip that out and you take into consideration the impact of Covid, Arsenal might have made a profit.
“They were hit hard by Covid and by not being in the Champions League for a few years.”
Arsenal, who face Watford on Sunday (6 March), finished 8th in 2020-21.
Mikel Arteta’s side are currently 6th and will move into the top four if they take advantage of their games in hand.