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Leeds United face record end of year losses of £23 million

Leeds United is reportedly expecting record losses of just under £23 million for the 2013-14 year after their revenue dropped to £25.3 million and their wage bill rose to more than £22 million.

Italian owner Massimo Cellino bought Leeds in April but is now fighting an attempt by the Football League to disqualify him as owner of the club, was majority shareholder at Elland Road for fewer than three of the 12 months covered by the 2013-14 accounts.

GFH Capital, the Dubai-based arm of GFH, ran United for most of that period, though according to the draft accounts, a restructuring of its stake in the club left Leeds without a majority shareholder during the second half of 2013.

Last week Cellino claimed that he and the Bahraini-based GFH had agreed to inject capital of over £20 million into the club.

According to The Yorkshire Post, draft accounts sent to the Football League which have not been signed off by auditors or Cellino, show that Leeds are in breach of Financial Fair Play rules.

These rules limit clubs in the Championship to a maximum annual loss of £8 million and breaking this means that United face a transfer embargo in the January.

In the year to June 30, 2014, United’s income dropped across the board.

Their gate receipts fell by more than £1 million to £8.5 million and cash generated by broadcasting fees and the sale of merchandise also decreased. Their remaining commercial revenue amounted to £6.6 million, down from more than £8 million in the previous 12 months.

The club’s operating loss climbed to £17.89m, an increase of around £5m, and the wage bill equated to% of turnover.

The biggest liabilities laid out in the draft accounts are the money owed to the club’s shareholders, including both GFH and Cellino.

The accounts state that during 2013-14, Eleonora Sport Limited - the UK firm used by Cellino to purchase Leeds - loaned £8.42 million to the club. Cellino himself made a personal loan of close to £1.3 million.

GFH Capital is reportedly owed £20.91 million by Leeds. Much of that debt was assigned to the company from other creditors, including Brendale Holdings and Berrydale Seventh Sport Holdings.

This was posted in Bdaily's Members' News section by Clare Burnett .