Chelsea have announced losses of £65.7million for the past financial year, with the club revealing they paid £23.1m in compensation after the departures of Jose Mourinho and Avram Grant.

The club revealed they had achieved "record group turnover and reduced losses for a third successive season" but said the results included "exceptional items", a reference to the compensation paid to two managers and five coaching staff. The figure does not account for compensation paid to Luiz Felipe Scolari, who was sacked as manager earlier this week, and accounts on for the period up to June 30, 2008.

The loss is lower than last year's figure of £74.8m, which was in turn an improvement on the £80.2m loss announced the previous year. The club announced record losses of £140m in 2004/2005.

Peter Kenyon, the Chelsea chief executive, said that despite the losses the club were moving towards being able to survive without the support of Roman Abramovich, the owner.

"We have consistently advocated the aim of self-sufficiency, which has always been supported by the owner," Kenyon said. "We are hopeful of being close to these targets in the time frames we have set given the underlying strengths of the business.

"Success on the field is a key part of this. But in line with our long stated business aims, any squad restructuring in the summer will be funded predominantly by sales as we have consistently reduced our net transfer spend over the last five years and will attempt to continue this trend.

"This is the fifth set of financial accounts since the takeover and Chelsea has made huge progress during that period as a football club and a business.

"In that time we have had significant on-field success, our turnover has increased by 96 per cent, which ranks us fifth in the world, and our fan base has increased hugely. That gives us great confidence for the next five years."

Today's figures also revealed that wages, excluding compensation payments, were up to £148.5m from 132.8m in 2006/7, and that shareholder loans have been reduced to £339.8m while shareholder capital/equity has increased to £369.9m.

Bruce Buck, the Chelsea chairman, added: "Following the conversion of half of the interest-free loans into equity there should now be no doubt as to the owner's commitment to the club and the stability of the company's funding structure."