This past week saw Middlesbrough publish its accounts for the 2023/24 financial year, a season when Boro finished eighth in the Championship and reached the semi-finals of the EFL Cup.

The headline figures were that the club, despite revenue increasing 13% year-on-year to reach £32.2m, the club posted a loss almost double that of the previous 2022/23 financial year, a figure of £12.4m that showed the continuing challenges of being a club that wants to be competitive in English football’s second tier.

But looking a little more deeply into the numbers shows some positive trends for Boro, who have ambitions to make it back to the Premier League, but on a sustainable financial footing. Doing that against the backdrop of clubs coming down from the top tier who benefit from parachute payments is not easy, though.

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Football, in the main, is a loss-making business. While the biggest clubs in the Premier League might turn the odd profitable year in here and there, the clubs that do tend to be in the black are those who player trade effectively, such as Brighton & Hove Albion.

Middlesbrough ’s own player recruitment strategy has started to shift to a younger profile of player for that very reason, that the best way to positively impact the balance sheet is by handing young talent that has been well recruited the platform to shine.

Middlesbrough’s profit from player sales dropped from £22.3m to £17.1m, but that was still enough to see them place third on the list when it compared to Championship rivals. It was a figure that was aided by the sales of Chuba Akpom and, of course, Morgan Rogers, but given that it is often the case that those who generate the highest sums from player trading are clubs that have been relegated and forced to sell their best assets, usually back to Premier League clubs, that Boro have managed to get to third in a list where the rest of the top five were all relegated within the last three years, is a reason to be positive around player trading and its prospects for future seasons.

Looking at the wage bill, the initial figure that jumps out is that wages rose six per cent for the year and were the second highest in the division of clubs not in receipt of Premier League parachute payments. But the wages to turnover ratio improved from 104% to 97%, which is the first time that they have managed to reduce this to below 100% since parachute payments ceased for the club. Wages have more than halved from the £65m peak in the Premier League, falling by £34m.

The reality is that for most Championship clubs, the wages to turnover ratio operates at completely unsustainable levels, so in making moves to drive that figure down, even though it remains extraordinarily high, is a positive step.

According to figures presented by football finance expert Swiss Ramble, when it comes to being PSR compliant, Boro should be well under the radar when it comes to any possible sanctions for breaches from the EFL.

Championship clubs are permitted to lose no more than £39m over a three-year rolling period. Looking at Boro’s last three years, that sees them take in losses of £19m, £6m and £12m, a total of £38m. Allowable deductions of £9m per year, which includes £5m for the Category 1 level academy, amounts to £26m, giving a net PSR position of negative £10m, against a £39m limit.

That, adding in the £3m allowed due to the impact of COVID-19 in the 2021/22 accounts, means the club are under the threshold, with £29m headroom. That figure should only improve from next year as the heavy loss of £19m from 2021/22 drops off the three-year assessment period.

Commercially, Boro are moving very much in the right direction. The £11.7m in commercial revenue for 2023/24 marked the highest ever for Boro, even higher than their Premier League days when it topped out at £11.1m in 2017. The rise in just two years stands at around 40%, something that shows confidence from partners in terms of the status as the club as a brand, and strong work in broadening the commercial activity at the club by the commercial department. Were the club to return to the Premier League they would find that the incline they are currently on with this particular revenue stream would continue further.

Steve Gibson ’s importance to Boro was underscored in a significant manner as the gross debt was slashed from £154m to £24m, with Gibson converting £149m into equity. The £24m was made up of bank loans and overdrafts to the tune of £10.4m, and £13.5m still owed to Gibson. The club settled the final £3m of an EFL loan taken on in 2021 during the pandemic.

The high level view of the financials at Boro is one of a club that, while posting a loss, has made major strides to significantly strengthen its balance sheet and drive down the high ratio of spend in key areas in relation to revenue.

Markers such as commercial growth being in such an incline also give strong indicators of a club that is moving in the right direction, but it is unlikely that creating headroom when it comes to financial regulations in the EFL will result in frivolous spending. The dye appears to be cast in terms of Boro’s longer term strategy to get back to the Premier League, and doing it in a manner that is sustainable and doesn’t put the club in financial peril chasing a dream, seems a strong theme.