Finances show why Crystal Palace feared the drop

WHEN CRYSTAL PALACE sacked Patrick Vieira in March, there were a few raised eyebrows concerning the wisdom of their decision. Admittedly, Vieira’s team had gone through a 12-game spell without a win and were three points clear of the drop, but he was supposed to represent a brave new world for Palace. 

Indeed, Steve Parish, in the financial statements for 2021-22, recalled that the club had “an exciting new manager and many new faces on the pitch” and that there was “definitely a feeling of positive change, optimism and energy surrounding the club.” But it all went wrong and with the reinstallation of Roy Hodgson, this did ask some questions about the club’s vision for the future.

However, Palace’s nervousness about being close to the relegation zone is understandable when you look at the stark financial facts. Life in the Premier is lucrative and falling out of the elite band can be very damaging for any club. Palace are enjoying their longest spell at the first level – the 2022-23 campaign is their 10th consecutive in the Premier League. In total, Palace have had just 23 years as a top flight club in their long and recently revised history. Why would you want that to come to an end?

Palace generated record revenues in 2021-22, a total of £ 160 million, representing a rise of 21% on 2020-21. All aspects of the club’s operations had an upward trajectory, from matchday revenues going back to pre-covid levels (up by £ 11 million to £ 11.4 million), commercial income up to £ 22.6 million, thanks to new sponsorship deals, and broadcasting hitting an all-time high of £ 126 million.

The club made a pre-tax loss of £ 24.2 million, an improvement on the £ 40 million lost in 2020-21 and £ 61.1 million deficit of 2019-20. Parish added that the club is “in the best shape since I joined in 2010.” It is hard to disagree too much with that statement.

Palace’s wages went down by around 5% to £ 123.8 million, which equated to 77% of income. This was a favourable development on the previous season when the wages consumed 99% of revenues. The club’s wages are roughly just below mid-table in the Premier.

Palace spent £ 89 million in the transfer market in 2021-22, their highest outlay since 2017, and in doing so acquired some interesting talent. They paid £ 23 million for Chelsea’s young central defender Marc Guéhi, who has since won three England caps and £ 17.5 million for Lyon’s Joachim Anderson. Another promising signing was Reading’s Michael Olise who cost £ 9.3 million. 

On the other side of the balance sheet, Palace have been somewhat inconsistent in their player trading efforts. The financials show no profit whatsoever in 2021-22, but in the previous two seasons the combined profit was only £ 10 million. 2018-19 was the last strong year, a positive of £ 46.2 million. 

Palace have some good youngsters and they may benefit in the market in the near future. Their current crown jewel, Wilfried Zaha, is now 30 and his contract expires in June 2023. In all probability, he will finally be moving this summer and there will be no shortage of takers. Arsenal, Marseille, Borussia Dortmund and Roma are all said to be interested in the Ivorian international. He has, allegedly, turned down the chance of linking up with Cristiano Ronaldo at Al Nassr.

In 2021-22, Palace finished 12th in the Premier and they are currently occupying that position in the table. They have won their last three league games, all against relegation-worried teams – Leicester City, Leeds United and Southampton –  but these are their only victories in 2023. They are nine points clear of the bottom three.

With 10 years in the Premier, Palace have become accustomed to a life of relative luxury, so they will be desperate to ensure that continues. It looks like an 11th year is almost guaranteed, but presumably, they will be looking for a new coach in the close season which will mean more change at Selhurst. Their rivals down on the south coast, Brighton, have shown what a club can do with a decent manager and a realistic approach to team building.

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