Middlesbrough’s latest financial accounts covering the period from June 2023 up to June 2024 have been released, and showed the club lost £12.4 million, as the cost of staying competitive in the Championship was laid bare.

Despite the fact that revenue was up 13% at the Riverside to £32.2m, the club still recorded a loss that was almost double the amount in the previous 12 months. As usual, that was largely thanks to the cost of keeping Boro competitive in the race to win promotion to the Championship.

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. They spent a total of £18.8 million on incoming transfers during the period too, which included deals to bring the likes of Rav van den Berg, Emmanuel Latte Lath and Finn Azaz to the club. Here’s what we learned from the latest set of accounts.

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The importance of player trading as Latte Lath is a wanted man

With a need to comply with Championship PSR rules, the importance of player trading was once again highlighted, as big-money sales help keep Boro below the threshold, while allowing them to reinvest in the squad.

The previous year’s losses were largely shrunk to ‘just’ £6.4m thanks to the sales of Marcus Tavernier and Djed Spence, along with a financial settlement that was struck with former Derby County owner Mel Morris.

In these latest figures which cover last season, the sales of Chuba Akpom and Morgan Rogers brought in £19.8m in revenue for the club (with potential bonus payments not factored in). The incoming money allowed Boro to then reinvest £18.8m into their own squad over the course of the 12 months.

It lays bare, in a month when Boro are seeing plenty of interest in star striker Latte Lath, just how important player trading is now to their model - to ensure they are able to strengthen their squad, while staying within PSR. Without the money from sales, Boro’s losses would have been £32.2 million, and the harsh reality is that, at least a couple of the signings made within this 12-month period might not have been made without the sales.

In last summer’s transfer window, not covered in this set of accounts, Boro invested heavily again in their playing squad, only this time without any major sales. Steve Gibson had a bullish response in his desire to fight for promotion this season and turned down big offers or enquiries for Latte Lath, Van den Berg and Hayden Hackney.

While Boro still hope to keep Latte Lath this January amid an offer from MLS side Atlanta United worth up to £20m, the accounts effectively make clear the harsh reality of why Boro will ultimately have to consider serious offers this month. The flipside, however, is that Gibson continues to back the club and will reinvest in the squad if the Ivorian was to leave.

Steve Gibson’s importance

Speaking of the owner, his importance to Boro was once again clear from the accounts. Over the 12- month period, he effectively wrote off over £135m worth of debt owed to his parent company by converting the debt to shares. The practice is perfectly normal and described by financial experts as just a means of cleaning up the balance sheet.

On top of that debt write-off, Gibson also injected a further £13.7m in cash in the year, while the report revealed a further £13.8m more was injected between July and November 2024 (which is outside the timeframe of the financial accounts that are published). In total, it takes Gibson’s investment in Boro to over £250m, of which £94.8m has come in a difficult last ten years for the club.

As far as existing debts as of June 2024 were concerned, there was still £13.5m owed to Gibson and £10.4m to banks. The bank debt was secured against future fees owed from clubs on previous player sales, while debt to Gibson has little day-to-day impact because it is interest free.

PSR

In the Championship, clubs are permitted to lose no more than £39m over a rolling three-year period - though that was slightly adjusted last summer to allow a little extra at £41.5m for one year only.

Unfortunately, it’s impossible to know exactly how close to the limit of PSR that Boro are, with this January in mind, from looking at the available financial information. Certain things such as infrastructure and academy costs are not counted in PSR calculations, while the accounting information released is never detailed enough to break down exactly what the outgoing money is on. Boro do still run a Category 1 level academy though, and the minimum spend per year to keep that status is £5m - though is likely more in reality.

Given Gibson and Boro have been one of the league’s leaders in calling for compliance with PSR amid their Derby County legal battles, it’s safe to assume that Boro are still within their PSR limit this season, though before the sale of Isaiah Jones earlier this month it’s likely to have been tight after the losses of £18.8m over the previous two years before this season.

Having turned down big offers for players last summer, there were no big departures from the club for fees - though Paddy McNair was removed from the wage bill as his high-earning contract came to an end. Despite that, the club continued to invest heavily in its squad, with summer signings such as Aidan Morris and Tommy Conway - the figures for which will come in the next set of accounts which must be submitted no later than April 2026.

With clubs facing fines, transfer embargoes and potentially points reductions for falling foul, as the EFL aim to clamp down on financial mismanagement, the need to comply with PSR is obvious.

Important wage development

Such is the crazy nature of Championship finances as parachute payments create an uneven playing field, clubs not in receipt of them in recent years have had to spend more than 100% of their revenue on wages alone to stay competitive. That’s before factoring in other costs beyond just the playing side.

But, for the first time since the loss of parachute payments, Boro were ‘only’ spending 97% of their revenue on wages. That’s mainly thanks to an increase in revenue over the 12-month period, from £28.6m to £32.2m.

In terms of where the income came from, it was split relativeloy even between commercial, match-day and broadcast, with commercial ever so slightly topping the list £11.7m. Match-day income topped broadcast revenue to highlight the continued importance of supporters attending matches to clubs outside of the Premier League, where broadcast revenue usually trumps all other incoming money streams by some distance. Boro’s run in the Carabao Cup last season helped too.

For the year ahead after these results (covering this current season), Boro will benefit further from the new EFL broadcast deal, though the extra income still pales in comparison to Premier League broadcast money. The wage difference, which at its worst in 2021 was 172%, is an important step in the right direction.