By David Owen
July 28 – The European football market shrank by 13% to €25.2 billion in 2019-20 – the first reduction in revenues since the global financial crisis, according to new data from Deloitte, the professional services firm.
But the ‘Big Five’ leagues – the Premier League, Bundesliga, La Liga, Serie A and Ligue 1 – saw their share of the overall market reach a record high 60%, as their combined top-line contraction was held to 11%.
In another familiar story, wage costs at the top of the pyramid did not fall, remaining flat across the top five leagues and actually rising by 4% in the Premier League. “What we can see clearly,” according to Dan Jones, partner and head of Deloitte’s Sports Business Group, “is the relatively fixed nature of elite clubs’ cost base and in particular wage costs”. He continued: “Due to the multi-year structure of player contracts, clubs have found it very difficult to offset the shock to revenue caused by covid-19 by reducing wage costs.”
Deloitte’s 30th Annual Review of Football Finance showed that the revenue-fall in the biggest national league of all – the Premier League – was bang in line with the overall figure at 13%. The decline – from £5.2 billion in 2018-19 to £4.5 billion – was, the firm said, the first drop in total revenue in Premier League history.
Germany’s Bundesliga, by contrast, reported a relatively small fall of just 4%. Indeed, its €3.2 billion of revenue saw it surpass Spain’s La Liga in 2019-20 as the second-highest revenue-generating league in Europe.
La Liga revenues dipped 8% to €3.1 billion, Deloitte calculated. This put it still well ahead of new European champions Italy’s Serie A, where revenues tumbled 18% to €2.1bn. France’s Ligue 1, the only “big five” European league to cancel its season in response to the pandemic, endured a 16% fall in revenues to €1.6 billion.
Covid-19 also took its toll on profits, with Deloitte saying that its impact saw a record level of combined pre-tax losses by Premier League clubs totalling £966 million.
This is identical to the running total published by this website earlier this month, along with the latest Premier League of Profits table. http://www.insideworldfootball.com/2021/07/08/will-premier-league-clubs-exceed-1bn-red-ink-newcastle/
That table had one set of figures missing, however – those from the Tyneside club Newcastle United. So, with a quick check indicating that Magpies’ 2019-20 accounts have still not been published by Companies House, it would appear that the final tally of Premier League pre-tax losses might still exceed an eye-watering £1 billion – the equivalent of an average loss of £50 million per club, or just under £1 million per club per week.
Either that, or Newcastle, an efficiently-run club in business terms, broke even in a season when only four of its 19 rivals managed to post a pre-tax profit. Watch this space, as they say.
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