Investment up as top football clubs generate £4bn

Investment up as top football clubs generate £4bn

The 92 Premier League and Football League clubs exceeded £4bn in revenues for the first time ever in 201415, a new record, as clubs’ capital expenditure reached £305 million, the most ever invested in a single season.

According to the 25th Annual Review of Football Finance from the Sports Business Group at Deloitte, Premier League clubs once again saw record revenues, generating £3.3bn as the league continues to benefit from the current broadcast rights cycle, which began in 201314.

Despite the revenue increase being modest (3%) when compared with wage costs growth (7%), Premier League clubs’ operating profitability was still the second highest it has ever been and almost seven times the average of the five years to 201213.

Dan Jones, partner in the Sports Business Group at Deloitte, comments: “The pace of football’s financial growth in two and a half decades is staggering. By half-time of the second televised Premier League game next year, more broadcast revenue will have been generated than during the whole of the First Division season 25 years ago. It is particularly reassuring to see that clubs are looking to spend on improving stadia and infrastructure.

“The impact of the Premier League’s broadcast deal is clear to see. For the first time, the Premier League leads the football world in all three key revenue categories - commercial, matchday and broadcast - and this is driving sustainable profitability. When the enhanced new broadcast deals commence in the 201617 season, operating profits could rise as high as £1 billion.”

Other key findings of the Deloitte Annual Review of Football Finance 2016 include:

·         The combined revenue for the big five European leagues rose by 6% to €12 billion in 201415, with the Premier League more than €2 billion higher than the next highest revenue-generating league, Germany’s Bundesliga, which generated €2.4 billion;

·         The Premier League remained Europe’s most profitable league in 201415, followed by the Bundesliga and La Liga. In contrast, clubs in Italy’s Serie A and France’s Ligue 1, generated combined operating losses; 

·         The Government’s tax take from the top 92 professional football clubs in 201415 was around £1.5 billion, up from £1.4 billion the previous season.

Adam Bull, Senior Consultant in the Sports Business Group at Deloitte, commented: “With promotion to the top flight now worth at least an additional £170m to those Championship clubs not in receipt of a parachute payment, it is no surprise that clubs are doing all they can to put the best talent on the pitch in the hope of reaching the promised land of the Premier League.”

Bull continued: “At the same time, as none of the Championship clubs reported an operating profit in 201415 they need to be mindful that profits from player sales or owner funding are likely to be needed if they do not gain promotion.”