European football making billions in revenues and TV cash

The Sports Business Group at Deloitte’s Annual Review of Football Finance is the only study of its kind, analysing the financial situation of football for the 2011/12 season and providing pointers to future performance.

For the first time this year, you can download a copy of the Annual Review of Football Finance Highlights.

The reviews covers the financial performance of clubs in the 20th Premier League season, and illustrates the phenomenal growth that the sport has enjoyed.

The Deloitte Sports Business Group presents the Annual Review of Football Finance 2013

In 1991/92 the 22 clubs of the then Football League First Division had collective revenue of £170m – in 2011/12 the revenue of the 20 Premier League clubs was almost 14 times greater at over £2.3 billion, while five clubs each generated revenue greater than that of the entire First Division twenty years previously.

English club football’s profile, exposure and increasingly global interest have continued to drive revenue growth, allowing the clubs to invest in top quality playing talent who in turn help to boost the league’s popularity and support further revenue growth, completing a virtuous circle.

Next season is the first in the Premier League’s seventh set of broadcast deals, which have delivered another step change in values. Live domestic rights have been sold for over £1 billion per season, a staggering increase of almost 70% in value, and when all media rights are included the total value is around £5.5 billion over the deals’ three season duration.

Overall its clubs are likely to see a £600m increase in revenues to over £3 billion in 2013/14.

Europe’s premier leagues

• In 2011/12 the European football market grew to €19.4 billion (up 11%), of which the ‘big five’ leagues had a market share of 48% (€9.3 billion). In particular, the top end of the game continues to show resilience in the face of wider economic challenges in Europe.

• With a gap of €1 billion over the second placed Bundesliga in 2011/12, the Premier League retains its status as the football world’s leading revenue generating club competition, with the clubs’ revenue growing 16% (as measured in euros, and up 4%

measured in sterling).

• The relative strength of Germany’s corporate sector and economy is reflected in commercial/sponsorship contributing almost half of the clubs’ total revenue in 2011/12. Average revenue for a Bundesliga club was €104m (up 7%), compared with €146m (£118m) for a Premier League club.

• The lower revenue growth for La Liga and Serie A clubs is reflective of the challenging economic conditions in these countries. La Liga remains highly polarised, with €1 billion (56%) of 2011/12 revenues relating to Real Madrid and Barcelona, exacerbated by their ability to sell their own broadcast rights.

• Italian clubs continue to be most heavily reliant on broadcast revenue, which contributes 59% (€0.9 billion) of their total revenues. Already relatively weak matchday revenues declined further (down 3%), and contribute just 12% of Serie A clubs’ overall revenues. Juventus bucked this trend and demonstrate how investment in stadia facilities can improve the matchday experience, attendance levels and revenues.

• Matchday revenue is also relatively weak for Ligue 1 clubs, contributing just 11% of their overall revenues. New investment in stadia ahead of France hosting UEFA EURO 2016 should help drive up match attendances and revenues in future. The 9% growth in Ligue 1 revenues in 2011/12 was almost entirely due to “the PSG project”, with the Paris club’s revenue remarkably increasing 120%.

• Elsewhere in Europe, Russia has the next highest revenue generating top tier league (€636m), followed by Turkey (€444m) and the Netherlands (€434m). England’s second tier Football League Championship is positioned seventh in Europe with total revenues of €588m (£476m).