Newcastle United have promised manager Kenny Dalglish cash for more players - but the club are facing a spiralling wage bill. Salaries for players and coaching staff soared by more than £4 million last year, the club's annual report revealed yesterday.

The arrival of several new stars such as England striker Alan Shearer, as well as new manager Kenny Dalglish and a new backroom team, has seen the St James' Park wage costs reach new heights.

Newcastle now spend £15.4 million a year on wages for their staff of around 200, having spent £10.2 million the year before. Manchester United spend considerably more - £22 million for their 412 full-time employees - having had a 70 per cent rise on the year before.

Newcastle plc chairman Sir Terence Harrison says in the report: "Of the increase, £4.1 million relates directly to footballing personnel."

The Tyneside club have made an operating profit before tax of £8.3 million, compared to a loss of £23.6 million the year before - the loss mostly due to Shearer's £15 million transfer and purchase of other players.

Transfer costs this year have been offset by sales of some players, notably Les Ferdinand and David Ginola to Tottenham.

Harrison said Dalglish would continue to be given money "for selective squad strengthening", but the report also added that transfers have to be funded through profits alone.

Newcastle will also push ahead with plans to build a new 55,000seater stadium near to St James' Park, although they are still waiting for a decision from the city council.

Harrison also looks to the future, saying the arrival of digital television will enable the club to boost TV revenue still further.

Chief executive Freddie Fletcher added that the club were in talks "with a number of partners" about launching a special Newcastle channel once multi-channel digital broadcasting begins in Britain next year.