NEWCASTLE United managing director Derek Llambias gave the credit for the club’s financial turnaround wholly to owner Mike Ashley.
The club today revealed a loss of just £3.9m for the 2010-11 financial year, compared to £33.5m in 2009/10 and £37.7m in 2008/9.
Llambias said: “The club’s financal results for the year end June 2011 are extremely strong.
“We can now count ourselves amongst very few clubs across the UK and Europe who are operating at close to break-even.
“What is particularly pleasing is that we have achieved this whilst also ensuring we have a strong squad sitting firmly in the top third of the table and currently pushing for a European place.
“Some of the key financial principles we set in place when Mike bought the club back in 2007 are now beginning to reap rewards.
“Most notably, our adherence to a strict transfer policy which avoids, or limits wherever possible, the acceptance of dated payments for players bought or sold.
“We believe it is a far healthier financial model to settle full transfer fees for players up front, not dated over a period of years.
“We have dealt wisely in the transfer market and reinvested the income received from player sales into improving the squad.
“Our net cash spend on player transfers to June 2011, which includes the sale of Andy Carroll, was a receipt of £5.4m, with a further £25m in cash spent on transfers and players’ wages since June 2011.
“We have also worked hard to address an inherited wages-to-turnover ratio which was unsustainable.
“Wages now account for just over 60 per cent of turnover, and we feel this is a healthy and affordable level.
“A further significant achievement has been to clear all of the club’s interest-bearing debt, which in 2006/7 was costing £6.5m a year just to finance the debt.
“Mike Ashley continues to provide loans totalling £140m interest-free, for which we are extraordinarily fortunate.
“Once again, Mike has not taken any money out of the club.”
The full annual accounts, including the financial statements of the group and the Independent Auditors’ Report for the year have been submitted to Companies House today.