City show off four of their new signings with boss Mancini in the summer

Manchester City have announced losses of £121m for the 12 months leading up to 31 May this year, having spent more on wages than their entire turnover.

The financial losses, up from £92.5m for the previous year, represent one of the heaviest in Premier League history.

Chief executive Garry Cook says City will now scale back on new signings.

"Player acquisitions on the scale we have seen in recent transfer windows will no longer be required," said Cook. "The squad is in ideal shape."

He added: "In 2009-10, we narrowly fell short of our goals on the pitch, but still achieved nine club records including our best-ever result in the Premier League."

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Wage costs of £133m exceeded a turnover of £125m last year, which in the vast majority of businesses would be unsustainable. But City are owned by wealthy Sheikh Mansour of Abu Dhabi, who wants to see the club competing at the very top.

He has spent more than £300m on players since buying City - who have not won a trophy for 34 years - from the former Thai prime minister Thaksin Shinawatra in 2008.

World-renowned stars such as Carlos Tevez, James Milner, David Silva and Yaya Toure have joined the club on big weekly wages as Roberto Mancini's squad bid to break into the top four of the English Premier League, having just missed out in fifth place last season.

"Two years ago I was fortunate enough to become part of the Manchester City story and I remain grateful for the warmth of the welcome that you have given me," Sheikh Mansour bin Zayed Al Nahyan said in a letter posted on the club's official website.

"The ownership of a club like Manchester City, with such a rich heritage and diverse community of stakeholders, carries a unique set of obligations to the fans, staff and broader Manchester community.

CITY'S SPENDING (June '09-May '10) £17m: Roque Santa Cruz £12m: Gareth Barry £25.5m: Carlos Tevez £25m: Emmanuel Adebayor £16m: Kolo Toure £22m: Joleon Lescott £7m: Adam Johnson Frees: Stuart Taylor, Sylvinho, Patrick Vieira

"This is something I do not take lightly.

"Therefore 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."

The highest financial Premier League loss was Chelsea's in 2004-2005, with the London club losing £141m at the end of the first full year following the takeover by Russian oligarch Roman Abramovich.

Though City's wage bill rose from £83m to £133m following Sheikh Mansour's first full year of ownership, the club has appointed a further 106 non-playing staff during the period in question.

It also increased earnings from £87m in 2008-2009 to £125m, with all 35,000 season tickets sold for the season and "partnership income" - chiefly sponsorship deals - rising by almost 400% to £32.4m.

As with Chelsea, Manchester City have stressed that they intend for their business to eventually become far more financially sustainable.

European football's governing body Uefa is set to introduce new financial fair play rulings from next year, with sanctions such as exclusion from European competition if they are not met fully.

Arsenal manager Arsene Wenger, who sold Kolo Toure and Emmanuel Adebayor to City in 2009, says it should be the aim of every club to live within their means.

"I am convinced that, in every single club, the biggest pride is to achieve the maximum with the resources you have available and that is what we try to achieve," said Wenger.

"You know my position. I have not seen the [City] numbers because I was in a training session, because I find that more interesting… but as you said before, with the financial fair play that will come in, it will be the same level of resources for all the big clubs."

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