MANCHESTER CITY HAVE announced record annual losses of £121m in the year up to 31 May after spending more on wages than their entire turnover.

The figures are not surprising and would be totally unsustainable in most businesses.

However the Eastlands club are backed by wealthy Abu Dhabi businessman Sheikh Mansour bin Zayed Al Nahyan who is determined to turn City – without a trophy in 34 years – into a success.

Wage costs of £133m exceeded a turnover of £125m and City have spent £300m on players since Sheikh Mansour took over  from the former Thai prime minister Thaksin Shinawatra in late 2008.

City are desperate to break into the top four and secure Champions League football next season with Roberto Mancini’s side having to make do with the Europa League this season where they drew 1-1 with Juventus last night.

In a letter to the fans on the club’s official website, Sheikh Mansour challenged his board to make the club a success on and off the pitch:

The challenge I set my Board and Executive Leadership Team is to develop City so that it is one of the most successful clubs both on and off the pitch, but to do so without losing any of the characteristics that make it so special.

Manchester City have insisted that they intend to make their club financially sustainable in the same way that Chelsea did when they announced record losses of £141m in 2004/05 following the takeover by Russian oligarch Roman Abramovich.

UEFA are to introduce financial fair play rules from next year with the possibility of exclusion from competitions if clubs cannot not meet the terms set out.

A copy of Manchester City’s annual report is available here.