Football finances & business

Money League

Deloitte’s Sports Business Group publishes two reviews each year which I look out for:

  • Football Money League
  • Annual Review Of Football Finance

They are minefields of information on the business and finance of football globally.

The Football Money League 2009 has been released last weekBBC News reports on the following highlights:

  • Real Madrid remain ahead of Manchester United as the richest club in the world.
  • Chelsea, Arsenal and Liverpool are fifth, sixth and seventh respectively.  The other English clubs in the top 20 are Tottenham Hotspur (14th), Newcastle United (17th) and Manchester City (20th).
  • “If the exchange rate value of the pound had not depreciated, there would have been nine, rather than seven English clubs in the top 20 and Manchester United would have topped the Money League ahead of Real Madrid,” said Dan Jones, partner in the Sports Business Group at Deloitte.
  • All the top 20 clubs represent Europe. Germany and Italy have four clubs each in the top 20, Spain and France have two clubs each.

The top 20 are:

Club Revenue
1. Real Madrid (Spain) €365.8m (£289.6m)
2. Manchester United (England) €324.8m (£257.1m)
3. FC Barcelona (Spain) €308.8m (£244.4m)
4. Bayern Munich (Germany) €295.3m (£233.8m)
5. Chelsea (England) €268.9m (£212.9m)
6. Arsenal (England) €264.4m (£209.3m)
7. Liverpool (England) €210.9m (£167.0m)
8. AC Milan (Italy) €209.5m (£165.8m)
9. AS Roma (Italy) €175.4m (£138.9m)
10. Internazionale (Italy) €172.9m (£136.9m)
11. Juventus (Italy) €167.5m (£132.6m)
12. Olympique Lyonnais (France) €155.7m (£123.3m)
13. Schalke 04 (Germany) €148.4m (£117.5m)
14. Tottenham Hotspur (England) €145.0m (£114.8m)
15. Hamburger SV (Germany) €127.9m (£101.3m)
16. Olympique de Marseille (France) €126.8m (£100.4m)
17. Newcastle United (England) €125.6m (£99.4m)
18. Vfb Stuttgart (Germany) €111.5m (£88.3m)
19. Fenerbahce (Turkey) €111.3m (£88.1m)
20. Manchester City (England) €104.0m (£82.3m)

Earning huge revenue in sport is one thing, but how much does it cost to earn that level of revenue?  At some point, it has been more about prestige than profit.  Whether it is sustainable in the present economic climate is another matter.

On BBC Sport yesterday:

Chelsea owner Roman Abramovich has seen his wealth reduced by about $9bn (£6.3bn) in the financial crisis, according to a business magazine.

Abramovich held on to second place among Russia’s wealthiest people with a fortune of $13.9bn, said Finans magazine.

Last year, American magazine Forbes estimated Abramovich was worth $23.5bn.

Last week, it had been reported:

Chelsea Football Club has revealed a £65.7m ($95m) loss for the financial year to the end of June 2008.

The amount includes a total of £23m in compensation paid to Jose Mourinho, Avram Grant and five coaches who left the club during the year.

However, it does not cover the sacking of Luiz Felipe Scolari, who was axed from Stamford Bridge this week.

The latest in a string of hefty losses will ultimately be borne by Chelsea’s Russian owner, Roman Abramovich.

The BBC has learned that Mr Abramovich’s investment in the club has reached £710m.

He has now changed part of that investment from an interest-free loan into shares in the club, as a sign of continuing commitment to Chelsea.

£25m may be nothing compared to £6.3bn or even £65.7m, but according to the Daily Mirror yesterday, that’s the size of Portsmouth’s “massive new cash crisis – with the club’s bankers planning to pull out of football to leave them looking for someone to pick up around £25 million of debts.”


8 thoughts on “Money League

  1. At the other end of the scale, Weymouth of the Conference Premier have debts of around around £300,000 and have not paid their players this year.

    A million shares, worth fifty pence each, will now be sold in an effort to raise funds.

    If the move is unsuccessful the club could face administration or liquidation.

    The lengths financially struggling clubs will go to for just £500 – in this case, Fisher Athletic of the Conference South.

  2. Continuing from here, the debts of Manchester United and Liverpool are leveraged on making further inroads in international markets. The irony is the bigger the debt, the greater the availability of re-financing if needed. The credit crunch only confirms that you can’t let the biggest players fail. Everyone else can.

    The ownership and fan base of both Manchester United and Liverpool are international. They are no longer English clubs. The ownership of Manchester City, Chelsea and Aston Villa are international, and they’re looking to expand their international fan base. Arsenal are looking to go the same way – the only real question is whether the new owner is American or Uzbek. Arsenal’s international fan base already exists, just that it’s fallen well behind those of Manchester United and Liverpool. The players at the top level of English club football have been international for even longer. The real competitors to the top “English” clubs for international players, fan base, and markets are not other English clubs, but top clubs elsewhere in Europe. Even if a European Super League doesn’t (yet) exist in football terms, it already exists commercially.

    As you go down the levels, the ownership and the fan base becomes more English.

    Perhaps it is a broader reflection on English society. Perhaps it is reflected in the fact that most English people would have used the word “foreign” rather than “international”. Best not to delve further.

    I found this strangely amusing:

    Manchester United has signed a £10m ($15m) sponsorship deal with India’s largest mobile phone network Airtel.

    Under the deal, Airtel’s 92 million subscribers will be able to view Man Utd content on their phones, including matches and interviews.

    United said it recognised the growing potential of doing business in India.

    The club is also looking for a new shirt sponsor after US insurer AIG said in January that it would not renew its contract when it runs out next year.

    AIG had come under pressure in the US to end its shirt sponsorship deal with Manchester United after the insurer required a multi-billion dollar bail-out from the US government.

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