Chelsea lost 70.9 million pounds ($113.7 million) last season despite winning the Premier League and the FA Cup.
Announcing its financial results Monday for the year ending last June 30, the west London club said revenue increased by 1.2 percent to 205.8 million pounds ($330 million) but that a reduction in the value of its roster was the main reason for the loss.
Chelsea chief executive Ron Gourlay said the was cash positive, with a surplus of 3.8 million pounds ($6.1 million) compared to a loss of 16.9 million pounds ($27.1 million) for the previous season.
"The reduction in operating losses and increased sales in 2009-10 shows that we are moving in the right direction, especially when viewed against the difficult macroeconomic environment," Gourlay said. "The club is in a strong position to meet the challenges of UEFA 'financial fair play' initiatives, which will be relevant to the financial statements to be released in early 2013."
UEFA will ban clubs from European competitions, including the lucrative Champions League, starting in 2012 if they go into debt on soccer-related business.
Russian billionaire Roman Abramovich has bankrolled Chelsea since his 2003 takeover, earning three English titles and three FA Cups. In 2009, he converted 340 million pounds ($541 million) of interest-free loans into equity to make the club debt-free.