Kenyon wins £3.5m bonanza despite Chelsea's £90m loss

Chelsea Football Club will tomorrow reveal that its chief executive, Peter Kenyon, was paid £3.53m last year - as the club slumped to a £90m loss, the biggest in its 100-year history.

Chelsea Football Club will tomorrow reveal that its chief executive, Peter Kenyon, was paid £3.53m last year - as the club slumped to a £90m loss, the biggest in its 100-year history.

Full-year results from the club, which is owned by Russian billionaire Roman Abramovich, will show that despite a 40 per cent jump in turnover, pre-tax losses came in at £87.8m.

The loss is largely down to payroll costs of £115.5m, the bulk of which is player wages. It represents around 76 per cent of turnover, a rate Mr Kenyon admitted was too high. "You don't need to be a mathematician to work out that is not sustainable. We clearly had a squad that was too large and too expensive."

The loss is believed to be the biggest in footballing history. Leeds United's last published accounts, in October 2003, revealed a pre-tax loss of £49.5m.

Mr Kenyon's remuneration included his basic salary, an amount for loss of benefits and a signing-on fee. Mr Kenyon joined a year ago from Manchester United. Chairman Bruce Buck added that the payment included a "very significant sum" which is returnable dependent on certain events, but declined to divulge further details.

Mr Kenyon's pay packet outstrips that of his replacement at Manchester United, David Gill, who was paid a total of £909,000. The most recent accounts filed by Arsenal, Chelsea's closest rivals, reveal that vice-chairman David Dein was paid £250,00 in the year to 31 May 2004.

Mr Abramovich bought Chelsea in 2003 in a £140m deal before embarking on a £200m spending spree. His investment in the club also includes a £115m interest-free loan. Mr Kenyon said that would be repaid but Mr Abramovich had not specified when.

However, he reiterated that Mr Abramovich had no intention of quitting the club, adding: "It's important to stress that the board, the company and the owner have a long-term vision of Chelsea that everyone has bought into. This is a long-term and serious business."

Following its recent separation from kit sponsor Umbro, Chelsea has signed an eight-year deal with Adidas worth £12m a year, while negotiations for a new shirt sponsor continue. Its current deal with Emirates expires at the end of the season.

Mr Kenyon said Chelsea, which wants to become a global brand on a par with Manchester United, had reduced the squad and offloaded its highest-paid players. It had also invested in an academy and would seek to bolster revenue, so reducing the impact of the wages bill. However, the one-off severance payment to Umbro of £24.6m was not included in the most recent numbers.

Mr Kenyon said his long-term business plan and budgets were based on the assumption that Chelsea would qualify for Champions League football every year.