LONDON (Reuters) - Roman Abramovich's Chelsea moved into profit last year thanks to the proceeds of a share deal as well as their exploits in winning the Champions League, the Premier League club's annual accounts showed.
The London club said in November that they had made a profit of 1.4 million pounds in the year to end-June 2012, the first time they had been in the black since Russian oligarch Abramovich bought the club in 2003.
However, the figures were flattered by an 18.4-million-pound profit relating to the cancellation of non-equity preference shares previously owned by pay TV company BSkyB, accounts lodged on Wednesday with Britain's Companies House showed.
The earnings were also lifted by 28.8 million pounds gained on the sale of players including Yuri Zhirkov to Russia's Anzhi Makhachkala, Nicolas Anelka to Shanghai Shenhua in China and Alex to Paris St Germain.
Chelsea's fortunes have been transformed thanks to the hundreds of millions of pounds pumped into the club by Abramovich. They have won the Premier League three times since the Russian took over and claimed Europe's top club trophy in May for the first time.
UEFA, European soccer's governing body, is introducing new rules designed to force clubs to curb their losses or ultimately face exclusion from competitions such as the Champions League.
Chelsea described these Financial Fair Play rules as "a significant challenge".
"The football club needs to balance success on the field together with the financial imperatives of this new regime," club secretary Alan Shaw wrote in the accounts.
"The result recorded in this financial year puts us in a good position to meet the assessment criteria for the initial periods," he added.
Chelsea suffered a blow in December when they failed to make it past the group stages of this season's Champions League - a setback that means they will have to play in the less lucrative Europa League.
Writing by Keith Weir, Editing by Clare Fallon