Arsenal Holdings, the company behind the football club, yesterday revealed that debts had risen to £45.8m in the past six months because of the costs of its planned new stadium at Ashburton Grove.
However, the figure was lower than had been predicted and Arsenal also announced a pre-tax profit of £4.5m for the year ending 31 May, compared with a loss of £20.6m in the previous 12 months. The club said the improvement had been due to increased television, ticket and retail sales, and income from property development - which, alone, brought in £13.8m.
Managing director Keith Edelman said that the club had separated out the football and the property businesses. "They are separately run, separately funded and separately operated", he said. "The property business does not impact the amount of money the football business has. What will happen if we are successful in the development of the new stadium is that extra cash will be thrown back into the football club."
Ashburton Grove, which includes housing, a waste recycling centre and transport links, is estimated to cost more than £400m and is already two years behind schedule but Arsenal insist it has "reasonable control of the overheads". Financing, it is hoped, will be in place by the end of the year.
Arsenal was feeling the benefit of a seven-year agreement with Nike that will bring in £55m. The club has also sold £10m worth of debentures and will receive £30m from Granada, which will raise its stake in Arsenal Holdings from 5 per cent to 9.99 per cent. Revenues rose by 29 per cent to £117.8m, with £51.8m coming from broadcasting, while wages fell to £60.6m from £61.5m - largely because the club, which only won the FA Cup last season, did not have to pay bonuses. Several senior players - including captain Tony Adams - also left while no major signings were made.