Football finance expert Adam Williams has taken a closer look at Tottenham’s finances and whether the club can afford to make some big moves in the final days of the transfer window.
While Tottenham have had a solid start to the season under Thomas Frank, most Spurs fans will feel that the squad is in desperate need of at least two more top-class additions.
That is the only way that Frank can fulfil his stated desire of competing on all four fronts this season.
Given that Tottenham were ready to spend big on Morgan Gibbs-White and Eberechi Eze this summer, it appears that the Lilywhites do have the funds for a late spending spree.
Tottenham’s debt and expenses are expected to rise
Adam Williams has now explained that Tottenham’s transfer debt, which was already one of the highest in the Premier League, is about to go up even further.
He claimed that the club’s wage bill and their expenses are also likely to increase, predicting the Lilywhites would need around £630m to cover their costs.
Williams told TBR Football: “Historically, Spurs have funded most of their transfer business through instalments. That means they have very high transfer debt. In 2023-24, which is the last published financial year, it was £337m. That was behind only Chelsea in the Premier League.
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“At the same time, they were only owed £58m by other clubs. So you have a net commitment of nearly £280m there. £146m of that was due before the end of 2024-25, so that will have significantly impacted cash flow in a year with no Champions League income.
“If they spend another £100m or so on Savinho and another midfielder, their spend this summer is going to be close to £200m if they don’t make any further sales. It’s likely that at least a third of that has been paid upfront. Looking at the business they’ve done, I don’t think that transfer debt figure is going to move too much.
“The annual wage bill is going to rise above the record £251m in 2022-23. My conservative forecast would be about £300m. On top of that, they had operating expenses of £160m in 2023-24. Costs have risen since then. Being back in the Champions League costs a lot in terms of logistics, while services and utilities are more expensive than ever. Let’s say £175m. So that’s £475m in costs before any fees associated with transfers. Add £150m there and they’re over £600m in terms of total costs. Then, you’ve got interest at about £30m per season.
“These are very rough calculations and there’s some margin for error, but they won’t be too far off. So they need £630m or so to cover those costs, plus investments in infrastructure, like the on-site hotel.”
A good Champions League run will help Spurs balance their books
All through the summer, it has been reported that ENIC have injected some cash into Tottenham in order to allow the club to spend freely this summer.
However, Williams doubts that any cash injection has come from Spurs’ owners, pointing out that a decent Champions League run would help the North London side cover their rising costs.
The football finance expert added: “So how are they affording this? Personally, I don’t think they need any financial help from the owners just yet. They’ll be aiming for revenue of £650m with a good season on the pitch. Getting out of the league phase in the Champions League is absolutely key here. Commercial revenue is going to continue growing, as is matchday.
“They have a credit facility – which is basically an overdraft – with about £50m of capacity they can draw from, although that comes with interest. Their cash balance was £79m at the end of the last accounting date too, though that will have come down in the last 12 months
“So while I think they’re probably pushing the limits of what’s available with their current cash reserves and revenue, I don’t think their current level of spending necessarily requires a cash injection from ENIC. If there had been an injection of money through equity, that would be documented in Companies House. They would have one month to file that with Companies House, so unless it has taken place in the last month, we would know about it.
“It’s possible that there could have been an investment from ENIC via a loan agreement, but that would be a complete departure from what we have seen from ENIC in 25 years at the club. I think it’s possible that there could be a plan to inject money into the club at some point in the season, depending on revenue projections, but I’m fairly confident it hasn’t happened yet.
“There was talk of a naming rights deal being close, but there have been many, many false dawns in the past. I don’t think we’re likely to see that until next season at the earliest. It would be a left-field move to do it mid-season.”
