Newcastle United's accounts, released today, reveal the club transferred ownership of St James' Park to a sister company controlled by the same shareholders, booking a substantial accounting gain in the process.
The 72-year leasehold on the 52,264-capacity ground was sold to PZ Holdings Ltd, an entity owned by Saudi Arabia's Public Investment Fund and the Reuben Brothers, for £172.1m.
This internal transaction generated £129m in paper profit for the Magpies.
Without the stadium sale, Newcastle would have posted a club-record deficit of £98.4m for the 2024/25 financial year.
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Instead, the accounting manoeuvre enabled the Tyneside outfit to declare a pre-tax profit of £34.7m, marking their first profitable year since PIF acquired majority control in October 2021.
Chief financial officer Simon Capper addressed journalists ahead of the accounts' publication, outlining the rationale for the transaction.
Capper said: "The motivation was very much to reorganise our property assets and get them into the correct legal boxes to allow us to go forward with our potential development, either at St James' Park or for a new stadium, and to facilitate that with financing and other similar items."
He acknowledged that further similar deals could follow depending on the club's eventual stadium plans.
Newcastle United's accounts, released today, reveal the club transferred ownership of St James' Park to a sister company controlled by the same shareholders
|GETTY
The CFO conceded the arrangement produces considerable financial flexibility under profitability and sustainability regulations, though he framed this as a byproduct rather than the primary objective.
Capper admitted: "So it does create a very significant accounting profit because of that."
The Premier League assessed the transaction as representing fair market value, a requirement for intragroup deals under league regulations.
Newcastle's stadium will be leased back from the new holding company for the next half-century.
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This internal transaction generated £129m in paper profit for the Magpies
|GETTY
This approach mirrors tactics employed by Chelsea in recent seasons, where the west London club sold hotels and their women's team to related entities to satisfy financial rules.
The new ownership structure means any borrowing required for future ground development would sit with PZ Holdings Ltd rather than burdening the football club directly.
However, Capper noted that much of the PSR benefit would prove temporary, as Uefa's financial regulations do not permit such internal asset sales to count towards compliance calculations, while the Premier League is transitioning to squad cost rules.
Despite missing out on European competition entirely last season, Newcastle achieved a record turnover of £335.3million, representing a £15million improvement on the previous campaign when they participated in the Champions League.
Newcastle's stadium will be leased back from the new holding company for the next half-century
|GETTY
Commercial income drove much of this growth, surpassing £100m for the first time and placing the club alongside only the Premier League's traditional elite in that regard.
A new kit partnership with Adidas contributed approximately £34m, roughly triple the sum earned under the previous arrangement with Castore.
The club's return to Europe's premier competition this term should push annual revenues beyond £400m, making Newcastle the first English club outside the established top six to reach that threshold.
Gate receipts have doubled since the current ownership assumed control.
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