Deloitte Annual Review of Football Finance

According to the Deloitte & Touche Annual Review of Football Finance report, in the 2003-03 season the English Premier League is keeping its title as ‘financial champions of Europe’, generating £ 1.2bn in income, stretching its lead over the Italian Serie A clubs who generated income of £ 0.8bn – that is an average of £ 62m per club in the Premiership compared to £ 45m in Serie A. The clubs in England’s top four divisions generated total income of almost £ 1.7bn. The English clubs have also begun to bring their finances under control, with teams cutting spending on player transfers and wages. It was the first time player costs have decreased since the Premiership started in 1992. The Premiership's transfer spending was down 41% to £ 187m. In the Football League, the situation is even more acute and only £ 16m was spent on transfer fees, an 81% decrease. Dan Jones, a sports business group partner with the firm, said that eventually, in few years, transfer fees will only be paid for the star players. “Finally clubs are starting to abandon what we have always thought to be the risky strategy of buying players in the belief that, if things go wrong, they can always be sold. The process is not going to occur instantly, but Long-term, that is an unsustainable position and one that needs to end” told Jones to media. Most clubs in European Football are now “turning a corner” financially, as revenue continues to grow and costs are slowly coming under control, according to this year’s report. Italy’s Serie A, is the second on the income list, while French top-flight clubs cumulatively earned the least of the ‘Big Five’ leagues (England, Italy, Spain, Germany and France), making £0.5bn. Overall, the five leagues earned £3.9bn between them in the period. The average Premiership wage bill grew 8% to £ 38m per club, compared with an average annual inflation rate of 25% over the past decade. Serie A clubs were the only other to show a decrease in wages and salary costs (90%, down to 76%).  The average wages-to-turnover percentage fell to 45% in Germany – the lowest in Europe – while Italian clubs also started showing signs of restraint in this area. Three clubs in the English PL reported a wages-to-turnover ratio of under 50% - West Bromwich Albion (41%), Manchester United (45%) and Newcastle United (47%). Of the main revenue streams, Serie A clubs continued to be the most reliant on broadcasting income, with an average 55% of total revenue gained by this means. This compares with English PL clubs (44%), while German 1.Bundesliga clubs are the least reliant on TV income (33%). German top-flight clubs also led the way on controlling costs, as was the case last year. English clubs continue to use its facilities as revenue generators well, although D&T believes there was still around £19m-worth of empty seats at PL matches in 2002-03, and £16m in 2003-04. However, capacity utilisation at English PL stadia was around 94%. English PL club Manchester United has the highest revenue-generating stadium in Europe, despite its Old Trafford ground only just making the top-10 list of highest ground capacity. In the big five leagues, Spanish Primera Liga clubs Barcelona (98,000) and Real Madrid (82,000), Italian clubs Roma / SS Lazio (82,400) and the two Milan clubs (85,700), hold more supporters. The top five profit English clubs: Manchester United £47.8m, Newcastle £27.6m, Liverpool £19.8m, Arsenal £19.5m, Tottenham £11.0m. The top five loss English clubs: Leeds £25.4m, Fulham £13.8m, Derby £ 9m, Ipswich £7.7m, Watford £7.6m.  The top five net debt English clubs: Fulham £133m, Leeds £78m, Chelsea £75m, Arsenal £60m, Middlesbrough £57m.

Source: euFootball.BIZ © Copyright 2006 - All rights reserved.