West Ham paid Manuel Pellegrini £3.5million when he was sacked – and that has had a significant impact on the club’s wages-to-turnover ratio.
That is according to finance guru and Football Insider columnist Kieran Maguire, speaking exclusively after West Ham released their annual financial report on Tuesday.
The figures take into account the year up to May 2020 and show a £65.3million loss compared to a £27.2m deficit the previous year.
The numbers also show that West Ham paid approximately £131m in wages, 94 per cent of their total turnover of £139.5m.
But this figure accounts for Pellegrini’s dismissal in December 2019 as well as cash-sapping assets like Sebastien Haller, who left for Ajax in January 2021.
It is likely to come down in West Ham’s next set of results, predicts Maguire.
He told Football Insider correspondent Adam Williams: “I think it’s indicative of a club that has invested in players. There have been hits and misses in terms of recruitment.
“I think the finger will be pointed at Manuel Pellegrini. He has ambitions and the club had ambitions with him as well, and that relationship didn’t really work out.
“Included in that 94% of wages to turnover ratio is the fact that it cost West Ham £3.5million to get rid of Pellegrini.
“It will come down for two reasons. First of all, Pellegrini is gone so you won’t have that repeated cost. Secondly, they will have substantially higher revenues off the back of a successful season this year.
“Also, Sebastien Haller is no longer there. While he was unsuccessful on the pitch, he was so expensive.”
The East London club is set to see profits increase next year as broadcast revenue soars, as revealed by Maguire.
Their balance sheets could be given another boost if West Ham qualify for the Champions League this season with the club currently 5th in the league table.