Burnley facing significant financial decision if Clarets join Hull City in Championship

The stakes at play in Burnley’s fight against relegation have been brought into sharp relief after the club’s financial results showed they would face a “significant” loan repayment if they drop into the Championship, and join Hull City in next season's second-tier.

Financial results for last season, during which ALK Capital completed a leveraged takeover, show the club suffered a pre-tax loss of £3m after the absence of fans during the pandemic saw turnover fall from £134m to £115m, while the club finished the season with £50m cash in hand.

But the accounts up until July 31 2021 also confirm the debt now carried by Burnley following a takeover in which former Wall Street financier Alan Pace’s ALK Capital bought out former chairman Mike Garlick and John Banaskiewicz in a deal which used much of the club’s own money.

Included in that debt is a £65m loan which, as things stand, is due for repayment in December 2025 but much of which will become due imminently if the club is relegated. Burnley sit 16th in the Premier League table, two points clear of the bottom three, having taken 10 points from a possible 12 since the surprise sacking of Sean Dyche last month.

“In the event of the club’s relegation from the Premier League, the repayment scheduled for the capital element of the loan is brought forward, with a significant proportion falling due for repayment shortly after the end of the football season in which the relegation event takes place,” the accounts state.

“This repayment would, therefore, be expected to fall due within less than one year from the balance sheet date in these circumstances. In a continuing relegation scenario, a further significant reduction of the loan balance would also take place the following