Leeds cash crisis Revealed: Instant promotion & 22-team PL not as perfect as it sounds
Leeds United will still face an immediate cash crisis even if the Premier League is extended to a 22-team division next season, Football Insider understands.
The prospect of an extended top flight and instant promotion for Championship top-two Leeds and West Brom is back on the agenda again ahead of the Premier League meeting tomorrow.
It would seemingly answer all the woes of Leeds, who recorded a pre-tax loss of £21.4million for last season in their annual accounts published last week.
Promotion to the Premier League is worth a minimum £170m for Championship clubs in TV payments and parachute payments even if they go straight back down.
That would certainly be a gamechanger in the medium term for Leeds, who have suffered major financial problems during their decade-and-a-half in the Football League.
But were the Premier League to vote to end the season by a 30 June deadline and instantly promote Leeds, it would deprive them of matchday revenue from their remaining five home matches.
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Each Elland Road clash is worth £500,000 to Leeds, and those sums are supplemented by spin-off commercial and merchandising revenue.
United would lose out on those millions as well as other key revenues despite the panacea of promotion.
Significantly, the first Premier League TV payment is not usually made until August, meaning Leeds could face transfer market restrictions without loans from owner Andrea Radrizzani or other financial sources.
Analysis of United’s accounts from Football Insider has learned that the club have total creditors of £81m, £53m of which is due to be paid back by 30 June of this year.
That sum includes £7.7m of transfer fee instalments that must be paid by that deadline.
United’s players, coaching staff and senior management have earned widespread praise by volunteering to take a wage deferral because of the impact of the coronavirus pandemic, with salaries capped at £6,000-a-week.
The club claimed in a statement they expect the effects of the virus will cost them “several million pounds” each month.
In other Leeds United news, a £14m transfer reveal comes to light after new paperwork finalised.