Riding the challenge Annual Review of Football Finance 2021 Sports Business Group
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Riding the challenge
Annual Review of Football
Finance 2021
Sports Business Group
July 2021
A
Annual Review of Football Finance 2021 |
Section title goes here
The European football market
contracted by 13% in 2019/20,
the first reduction since the global
financial crisis in 2008/09 and the
Premier League experienced its first
ever decline in revenue.
B
Annual Review of Football Finance 2021 |
Contents
Contents
Foreword 02 Edited by
Dan Jones
Delivering results worldwide 07
Sub-editor
A heavy challenge 08 Chris Wood
Trusted backline 10 Authors
Theo Ajadi, Tom Ambler, Sumeet Dhillon, Chris Hanson,
Europe’s premier leagues 12 Zal Udwadia and Izzy Wray
Impact of COVID-19 on investment into football 24 Sports Business Group
Telephone: +44 (0)161 455 8787
Premier League clubs 28 The Hanover Building, Corporation Street, Manchester M4 4AH
E-mail: sportsteamuk@deloitte.co.uk
The women’s game 40 www.deloitte.co.uk/sportsbusinessgroup
Football League clubs 42 July 2021
NFTs and the iteration of football fandom 50
Player transfers 52
Football and climate – a sporting chance? 54 Please visit our website at
www.deloitte.co.uk/sportsbusinessgroup
The leading team in the business of sport 56 to download a copy of the full report.
The critical challenge: How is football tackling 58 Databook price £1,000
(Discounted price for students and educational
racism and discrimination? establishments £100).
01
Annual Review of Football Finance 2021 |
Foreword
Riding the challenge
Welcome to the 30th edition of the Annual Review of Football Too much pressure Of the ‘big five’ leagues the Bundesliga reported
The 2019/20 financial year saw total revenue the smallest fall in total revenue as fixtures were
Finance, the publication that remains the most comprehensive fall across each of the ‘big five’ leagues as the completed pre-financial year end meaning the
analysis of the financial trends in, and prospects for, the impact of completing seasons behind closed vast majority of broadcast revenue has been
doors and rebate payments to broadcasters recognised in 2019/20, and minimal rebates
football industry. was felt by clubs. In total the revenue generated were paid to broadcasters. This has led to the
by clubs from the ‘big five’ leagues fell by 11% Bundesliga displacing La Liga as the second
The 2020 edition of the Annual Review of Ghost town to €15.1 billion. It should be noted that aside highest revenue generating league of the
Football Finance was published only a few Disruption to the 2019/20 European football from the Bundesliga and Ligue 1, the other ‘big five’ in 2019/20. We do however expect
months into the COVID-19 pandemic, at a season began in March 2020, initially with ‘big five’ leagues completed their seasons after that La Liga will reclaim this position in the
time where its impact on the professional matches being held behind closed doors, before their clubs’ typical financial reporting period next edition. The revenue decrease of 4% in
football industry and more importantly the suspensions and in some cases cancellations of and hence a portion of revenue associated with Germany was driven entirely by the decline in
socio-economic impact on our day-to-day lives competitions were announced. the 2019/20 season, mainly linked to broadcast matchday revenue as the season concluded
was highly uncertain. As we write it is now 16 agreements, will be deferred into the financial without fans in stadia which was slightly offset
months after the first raft of suspensions and Across Europe, the 2020/21 season has year ending in 2021. by improved commercial performance.
cancellations of European football, and the scale largely been completed behind closed doors,
of the financial impact of COVID-19 across the with crowds returning to varying degrees The Premier League, which was won In contrast to revenue from matchday and
industry is becoming somewhat clearer. towards the end of the 2020/21 season comfortably by Liverpool in 2019/20 after a broadcast sources, commercial revenue grew
and at the postponed 2020 UEFA European few months pause to end a 30 year drought, in two of the ‘big five’ leagues as agreements
The analysis in this report focuses on the Championships played during June and July remains considerably ahead of the other ‘big signed pre-pandemic delivered revenue growth.
2019/20 financial year, and hence covers a 2021. It remains to be seen if fans will take a five’ leagues in terms of revenue generation. It remains to be seen how commercial partners
unique season across the 30 year history of the cautious approach to returning to club stadia The gap temporarily decreased between the approach the industry in the coming seasons
Annual Review of Football Finance, reflecting across Europe during the 2021/22 season, but Premier League and second placed league from and what level of value they place on being
the financial impact of the first few months of based on the evidence from the 2020 UEFA €2.5 billion in 2018/19, a gap of 73% (in EUR), associated with leading European football
COVID-19. We have also sought to consider European Championships, it is fair to expect to under €2 billion in 2019/20, a gap of 60%, clubs, particularly if they face their own financial
and quantify the future impact of COVID-19, there to be significant pent up demand to due to the impact of COVID-19. Premier League challenges, but we expect this revenue stream to
particularly on financial results for 2020/21, attend live matches. We hope that with the clubs’ total revenue fell by 13% from a record be resilient in the 2020/21 season and beyond.
which we will cover in depth in next year’s continued roll out of the COVID-19 vaccine the £5.2 billion in 2018/19 to £4.5 billion in 2019/20
edition. We believe that the full extent of the 2021/22 season will see a return of football as matchday and broadcast revenue fell by 12% Serie A and Ligue 1 saw declines in revenue of
impact may take a number of years to become crowds so missed by players, fans, broadcasters and 23% respectively. 18% and 16% respectively in 2019/20. Moreover
apparent. and viewers over the course of the pandemic. both leagues have faced significant challenges in
respect of their broadcast environment. Serie A
02
Annual Review of Football Finance 2021 |
Foreword
spent much of the 2020/21 season in drawn out
negotiations with Sky Italia and DAZN in respect
of both the impact of COVID-19 on their match
calendar and audience and their next domestic
broadcast cycle beginning in 2021/22. The new
domestic deals have reportedly resulted in a
5% decrease in average annual value compared
to the previous cycle. In France the turmoil was
even greater as Ligue 1 first cancelled their
2019/20 season due to the pandemic and then
their domestic rights deal with Mediapro due
to missed payments. This triggered an ongoing
series of events that has led to a new broadcast
agreement with Amazon and legal action being
taken against the LFP by long-term partner
Canal Plus. In this context the Premier League
agreeing to roll over its domestic broadcast
rights arrangements with the same partners for
the same values for three further years feels like
a wise safe harbour amid the tumult caused by
COVID-19.
Diversifying revenue sources, particularly
through embracing digital technology, has been
a focus of leading European football clubs in
recent years. The impact of COVID-19 highlighted
the importance of this and accelerated some
more progressive clubs’ and leagues’ efforts.
Clubs across Europe created additional content
or initiatives for fans to maintain and strengthen
relationships and generate new revenue. The
EFL allowed its clubs to stream non-televised
03
Annual Review of Football Finance 2021 |
Foreword
games through its iFollow platform which completion of seasons and some financial
enabled clubs to both maintain a connection reporting periods we expect that some wage
with fans and generate some revenue that costs relating to the 2019/20 season including
otherwise may have been lost. The latest trend end of season bonuses may be recognised
catching the industry’s attention is Non Fungible in the next financial year and potentially
Tokens (‘NFTs’) which the NBA in particular has some temporary pay cuts will be reversed.
had significant success with. We explore this Nonetheless it will be interesting to see how
further in the article NFTs and the iteration of the balance of wages and revenues develops in
football fandom later in the report. 2020/21 and beyond, and whether the hitherto
seemingly inexorable growth in wages slows,
stops or reverses.
(Dawning of a) New Era
Given the relatively fixed nature of wage costs in Premier League clubs largely avoided using the
the short term across the ‘big five’ leagues and UK Government’s furlough COVID-19 support,
the falls in total revenue, it was arithmetically with only a handful of clubs utilising the scheme,
inevitable that wage to revenue ratios would and some reversing their initial decision to apply
increase considerably in 2019/20. Both the after vociferous public criticism.
Premier League (73%) and Ligue 1 (89%) posted
their highest ever ratios with La Liga, Serie A The English Football League’s (‘EFL’) clubs
and Bundesliga reporting their highest for over are more reliant on matchday revenue than
15 years. those in the Premier League and other ‘big
five’ leagues and have been more acutely
Behind this immediate headline though is a impacted by COVID-19. League 1 and League
potentially more interesting development. 2 both had their 2019/20 season cancelled,
In aggregate, clubs across the ‘big five’ have while the Championship was completed behind
managed to almost halt the relentless year- closed doors. Thankfully the lost matchday
on-year wage increases that have been a revenue was somewhat offset by the start of
feature of the last decade with only a handful a new broadcast rights cycle that accounted
of exceptions. Serie A reported an 8% decline for a reported 35% increase on the previous
in wage costs while the other ‘big five’ reported agreement, although this could not stop
increases of between 0.4% and 4% . It should operating losses increasing in the Championship
be noted that due to the misalignment of the and League 1.
04
Annual Review of Football Finance 2021 |
Foreword
The summer 2021 These losses were despite the EFL’s clubs more
extensive use of Government support schemes
or release players in order to reduce costs to
register new signings, and even to agree for
transfer window has that included the furloughing of staff. The losses
and associated cash challenges reportedly
its greatest ever player to reportedly halve his
pay. If one of the traditional ‘super clubs’ finds
seen limited activity piqued the interest of TPG Capital, who were
understood to be considering providing a
itself in this position it should act as a stark
warning to rest of European club football and
to date, and buyers £300m injection into the EFL for a share in the
EFL’s commercial rights. Ultimately this deal
act as a catalyst for all to work to exercise the
necessary control over player costs to ensure
appear to be few and did not proceed, but in March 2021 the EFL
announced it has secured a £117.5m funding
sustainability.
far between, as a package from MetLife Investment Management
to supports its member clubs with managing
Aggregate operating losses increased in Serie A
and Ligue 1 by €257m and €269m respectively.
number of major clubs the impact of COVID-19. Meanwhile, total operating profits reduced by
60% and 45% in La Liga and the Bundesliga
are in a position where Do nothing
respectively and fell from £837m to £55m in the
Premier League. At a pre-tax level, the Premier
sales are required Despite the relatively modest increases in wage
costs during 2019/20, there is evidence that a
League clubs reported a collective loss of
£966m, their largest ever.
before purchases can prolonged period of paying significant wages
and the COVID-19 driven fall in revenue is These financial difficulties, along with the
be made. beginning to impact even the largest clubs. seemingly unshakeable interest in, and appetite
for, top level football content as evidenced
The summer 2021 transfer window has seen by the historic growth of broadcast and
limited activity to date, and buyers appear to commercial revenue, acted as a trigger for the
be few and far between, as a number of major unprecedented level of interest we have seen in
clubs are in a position where sales are required European football from institutional investors
before purchases can be made. over the past 16 months. This interest has also
notably been more focused at a league wide
FC Barcelona currently finds itself in a position level, rather than the more volatile individual
where it is unable to register new players due to club level, than has historically been the norm.
being in breach of La Liga’s economic controls
around squad cost, requiring the club to sell
05
Annual Review of Football Finance 2021 |
Foreword
Over the course of the Some stakeholders have been amenable to collapsed in disarray in just a few days.
exploring this interest and see raising additional The importance of solidarity in European
recently completed 2020/21 funding through external sources as part of football in securing the sport’s continued
season there have been the solution. In addition to the EFL, Serie A, strength has never been more evident or more
Bundesliga and La Liga have been subject emphatically stated.
numerous cases of racist to approaches from private equity giants.
abuse mainly emanating In the case of Serie A and the Bundesliga,
the proposed investment was in return for A message to you
from anonymous social a stake, and some level of control over, the European football is going through its most
media profiles but with some league’s commercial rights, while the proposed challenging time in recent history and is faced
investment in La Liga was focused on their with serious uncertainty due to the financial
high-profile on pitch and in technology services unit, La Liga Tech. Ligue 1 issues presented by COVID-19, as detailed
stadium incidents too. has taken steps to prepare itself for potential throughout this report, but it is also subject to Enjoy yourself
investment through the creation of a commercial significant wider social challenges. Finally, I would like to thank my colleagues
subsidiary but this still requires approvals from who have contributed to this year’s edition
the French government. The potential deals Over the course of the recently completed of the Annual Review of Football Finance in
mentioned have not been completed with the 2020/21 season there have been numerous challenging circumstances. I am very grateful
Bundesliga clubs ultimately voting strongly cases of racist abuse mainly emanating from for the support we receive in creating this
against the proposed investment and Serie A’s anonymous social media profiles but with report from across the football ecosystem and
discussions are currently on hold. some high-profile on pitch and in stadium to Henry Wong for his design expertise. As we
incidents too. This reached its nadir in the look forward, the next edition will be launched
The most seismic financial and structural disgraceful abuse of England’s black penalty months before the 2022 FIFA World Cup after
development mooted in European football takers after the final of the 2020 UEFA European what we all hope is a less disrupted European
was the ill-judged and unlamented failed Championships. It is vital that clubs, governing football season. Until then, stay safe and well
breakaway by some of the richest clubs from bodies, leagues, governments and social media and I hope you enjoy the return to football
three countries from the current competition companies work together to educate the public matches and this edition of the Annual Review
structure towards a guaranteed place in a and punish those that commit such offences of Football Finance.
European Super League. This reflected the and in doing so make it clear that there is
desperation of some and the fear of missing out absolutely no place in football, at any level, for Dan Jones, Partner
among others. It was remarkable that a project racism or bigotry. www.deloitte.co.uk/sportsbusinessgroup
that had been rumoured for over 20 years as
a threat hanging over European club football
06
Annual Review of Football Finance 2021 |
Sports Business Group
Delivering results worldwide
Deloitte has a unique focus on the sports sector, led from Investment advisory and Financial regulation
due diligence advisory services
the UK and operating across the world. Our experience, Assisted The Friedkin Group Assistance to FIA and
long-standing relationships and understanding of the throughout the lifecycle of Formula E to support the
their purchase of AS Roma feasibility assessment, and
industry mean we bring valuable expertise to any project including market assessment, subsequent development,
from day one. due diligence services and of Financial Regulations for
post transaction strategy Formula E.
assistance.
For more than a quarter of a century, across For further details on how Deloitte can add
over 40 countries, we have worked with more value to your project and your business,
organisations in sport than any other advisers. visit our website www.deloitte.co.uk/ Consulting services Market analysis and
Our specialist Sports Business Group at Deloitte sportsbusinessgroup and contact us on: Support in the assessment benchmarking
provides services including: of the financial impact of Supported FIFA in mapping
Telephone: +44 (0)161 455 8787 potential changes to the global out the women’s football
•• Corporate finance advisory Email: sportsteamuk@deloitte.co.uk Rugby Union calendar. landscape to accelerate the
•• Due diligence professionalisation of
•• Business planning the game.
•• Revenue enhancement and cost control
•• Market analysis and benchmarking
•• Strategic review Strategy development
•• Economic impact studies Assisting World Athletics with
•• Venue feasibility and development development of the World Plan
•• Sports regulation advice for Athletics.
•• Business improvement and restructuring
•• Forensic and dispute services
•• Digital strategy and transformation Consulting services
Assistance with the Sport
Deloitte are also audit and tax advisers to Survival Package.
many sports businesses.
07
Annual Review of Football Finance 2021 |
COVID-19
A heavy challenge – how COVID-19 impacted
the 2019/20 European football season
As COVID-19 began spreading across western Europe in The ‘big five’ at a glance
Bundesliga
the spring of 2020, it quickly became apparent that elite level
Date suspended: 13 March 2020
sport, including the ‘big five’ European leagues, would be
significantly impacted. Date resumed: 16 May 2020
Date completed: 27 June 2020
2019/20 matches played in FY21: 0
Serie A became the first of the ‘big five’ to consider. Across this section, we provide a brief
suspend its season on 9 March 2020 after description of how the initial onset of COVID-19 Rebate to broadcasters: Minimal
an announcement from the Prime Minister affected the ‘big five’ European leagues and how
requiring all sport to be ceased. The remainder it has impacted the reporting and analysis in this Broadcast revenue recognition for
of the ‘big five’ followed within days of the Italian edition of the Annual Review of Football Finance. 2019/20 season: FY20
announcement. Aside from Ligue 1, which was Premier League
controversially cancelled on 28 April 2020, (a These potential discrepancies are largely
decision which was challenged but upheld in the driven by two factors. First, the extent of the Date suspended: 13 March 2020
French High Court) the other leagues resumed delay in completing seasons, excluding for the
Date resumed: 17 June 2020
behind closed doors and belatedly completed Bundesliga and Ligue 1, meant the seasons
the 2019/20 season during the summer of 2020. became misaligned with the majority of clubs’ Date completed: 26 July 2020 La Liga
financial reporting periods with a particular
In addition to the human and logistical impact in respect of recognition of season long 2019/20 matches played in FY21: 66 Date suspended: 12 March 2020
challenges faced by professional football due revenue, notably broadcasting revenue, and
Rebate to broadcasters: Yes – Date resumed: 11 June 2020
to COVID-19, it has become clear that there has wage costs between financial years. Secondly,
reported c.£330m shared across
been significant financial and administrative rebates were requested by broadcasters for all clubs over the remaining period Date completed: 19 July 2020
burdens placed on clubs, leagues and governing the delay, cancellation or behind closed doors of the broadcast rights cycle
bodies. This 30th edition of the Annual Review nature of matches. For example, the majority (end 2021/22) 2019/20 matches played in FY21: 57
of Football Finance has been prepared during of Premier League clubs have a financial year
Broadcast revenue recognition for Rebate to broadcasters: Yes –
an unprecedented time for the professional ending on 30 June, with a half dozen on 31 May,
2019/20 season: Across FY20 and reported c.€100m spread across all
football industry and while we have sought which in an uninterrupted season would allow FY21 La Liga and Segunda Division clubs
to maximise the comparability of this edition for the season to be completed. However, as
to previous and subsequent editions there the Premier League season in 2019/20 was not Broadcast revenue recognition
are a number of potential discrepancies to completed until 26 July 2020, a misalignment for 2019/20 season: Across FY20
and FY21
08Annual Review of Football Finance 2021 |
COVID-19
with the financial reporting period has been The timing differences between financial
UEFA club competitions created, albeit five Premier League clubs chose reporting periods and the season’s completion
to extend their financial reporting period in some leagues as previously outlined has
Date suspended: 15 March 2020
to 13 months to 31 July 2020 to capture the raised revenue recognition questions. This is
Serie A
Date resumed: 5 August 2020
whole season. further complicated where there are significant
Date suspended: 9 March 2020 merit related payments associated with final
Date completed: 23 August 2020 league position with clubs choosing a number
Date resumed: 20 June 2020 England
Our approach of different approaches to recognition. Some
Germany England
2019/20 matches played in FY21: 11
As outlined in the graphic, thereSpain
are numerous of the different approaches taken by clubs
Germany
Date completed: 2 August 2020 Ligue 1 (UCL), 15 (UEL)
potential impacts on club by clubItalyfinancial included recognising
Spain the revenue based on
2019/20 matches played in FY21: 98 Date suspended: 13 March 2020 Rebate to broadcasters: Yes – reporting due to the disruption France
caused by the club’s actual
Italy
league position at its financial
England France
reported c.€575m spread across the COVID-19 pandemic. In this edition of the year-end, the position the club would have
Germany
Rebate to broadcasters: Yes – Date cancelled: 28 April 2020 five years Annual Review of Football Finance we have achieved historically with its points total at
Spain
reported c.€130m
Italy sought to keep our reporting as simple as the financial year-end or the lowest position
Date completed: n/a Broadcast revenue recognition
Broadcast revenue recognition
France
for 2019/20 season: Across FY20
possible to enable comparability across historic theoretically possible given its points total at the
for 2019/20 season: Across FY20 2019/20 matches played in FY21: 0 and FY21 and future editions once the full financial impact financial year-end.
and FY21 of COVID-19 has been realised.
Rebate to broadcasters: Yes – It should be considered that this edition
reported c.€123m
A small number of clubs have submitted includes analysis of the 2019/20 season and
Broadcast revenue recognition for
financial statements considering a 13 month only represents the financial impact of the first
2019/20 season: FY20 period, typically ending 31 July 2020 to capture three to four months of COVID-19 with clubs
the full 2019/20 season. We have not made generating matchday revenue for the majority of
adjustments to align these numbers to a the season. Next year’s edition along with future
12 month period and the ‘normal’ season as editions will start to reveal the full financial
we typically would. Likewise in instances where impact of COVID-19 as clubs feel the impact
clubs have reported financial performance of empty stadia throughout the vast majority
across a 12 month period, typically ending of the 2020/21 season, and broadcasters and
30 June 2020, we have not sought to extrapolate commercial partners re-evaluate the value of
their financial results to ‘fit’ into the extended live football in a post pandemic environment.
seasons.
Note: For the purposes of this
analysis FY21 is considered to begin
on 1 July 2020.
09Annual Review of Football Finance 2021 |
Sports Business Group
Trusted backline Division One
clubs’ total
revenues of
£170m. The first
Premier League
season kicks off
in August, with Sepp Blatter
the first BSkyB
This is the 30th edition of the Deloitte Annual Review of TV deal worth
becomes
President of FIFA.
£38m per season
Football Finance. As we did in 2011 for our 20th edition, Manchester
United top the
Formation of
Supporters
we have set out a timeline capturing some of the most Following the
first Deloitte
Football Money
Direct
and the Football
significant events over the past 30 years that have shaped Taylor Report,
all clubs in the
League. France
wins the World
Foundation.
European
today’s football industry landscape. top two divisions
require all-seater
Cup on home
soil, becoming
Commission
challenge against
stadia from England hosts the seventh the player
1994/95 season. Euro 96. nation to do so. transfer system.
Whilst we addressed and predicted the Producing the Annual Review is a team effort
seismic impact of COVID-19 in last year’s which year on year relies on a dedicated 1992 1994 1996 1998 2000
edition, this is also the first Annual Review in pool of not just editors, sub-editors, authors
which the profound effects of the pandemic and co-authors but numerous others who
on the football industry are reflected in the contribute to the report and its accompanying 1993 1995 1997 1999 2001
historic financial data and trends we report databook. We are also of course always
Manchester European Court BSkyB’s Leeds United
on. None of our team preparing the 20th grateful to the clubs and football bodies that United win of Justice ruling proposed ”living the
edition could have foreseen that a decade continue to provide information to enable inaugural on Bosman case. acquisition of dream” up to
Premier League, Premier League Manchester Champions
later a global pandemic would be the cause the report’s production in a timely manner.
and have been streamlined to United blocked. League semi-
of a revenue decline across European football. As well as striving to produce interesting champions 12 20 clubs. Richard final.
and useful analysis and commentary, we are more times Scudamore
since. appointed as
Sadly, that is indeed the case but as in all dedicated to serving clients in the business of
CEO of Premier
previous editions we have continued to sport and will continue to be involved in many League.
12 stock market
produce the Annual Review to the same of the significant developments both in the flotations of
exacting standards as ever. Our priority football and wider sports industry. English clubs
during the
remains to provide the most comprehensive
1996/97 season.
picture possible of English professional More detail on our team, services and 125 foreign
football’s finance, documenting clubs’ clients can be found at www.deloitte. co.uk/ players with
Premier League
business and commercial performance within sportsbusinessgroup. Please contact us if
clubs (1992: 11).
the context of the wider European game. you wish to discuss your specific sports
business needs.
Telephone: +44 (0)161 455 8787
E-mail: sportsteamuk@deloitte.co.uk
10Annual Review of Football Finance 2021 |
Sports Business Group
Record five
teams competing
in the UEFA
Premier League Champions
live domestic League help
The Football rights sell for
League and drive Premier
over £1 billion League record
Championship per season
clubs agree revenue and two
Premier League from the A year after record transfer COVID-19
Implementation Portsmouth to implement 2013/14 season, narrowly avoiding pandemic from
of UEFA’s club financial fair play windows. The
suffer insolvency. combined relegation FA Women’s March 2020 sees
ITV Digital licensing system. Football League regulations. Premier League Leicester City remainder of the
Super League
collapses. 10 attendances club revenues wins the Premier becomes fully 2019/20 season
Football League reach 50 year exceed £3 billion. League, only the professional. delayed and played
clubs enter Manchester high. Approval First season sixth club to do behind closed
insolvency in New domestic TV City acquired by of UEFA’s clubs subject so and the fourth doors. European
year. Premier deals for Premier Sheikh Mansour. financial fair play to sanctions consecutive Championships
League clubs’ League agreed, European Club regulations. resulting from different winner postponed to 2021.
revenues exceed worth around Association England lose UEFA FFP for the first time in Liverpool wins its
£1 billion for first £650m per replaces G14 bid to host FIFA break even the competition’s first league title
time. season. Group. World Cup. requirement. history. since 1990.
2002 2004 2006 2008 2010 2012 2014 2016 2018 2020
2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
FIFA introduce European Deloitte report Premier League Six Premier Liverpool lift the Ongoing
player transfer Commission that Premier clubs’ total League clubs in UEFA Champions COVID-19
windows. issue White League clubs’ revenues of 2014/15 each League for pandemic sees
Football League Paper on Sport. annual wage £2.3 billion. generated the sixth time. the majority
introduce good Opening of the costs exceed The 30th new more revenue Tottenham of the season
governance new Wembley £1 billion for first club stadium than the whole Hotspur’s new across Europe
initiatives. Stadium. Michel time. built in England top division stadium opens. played behind
Roman Platini becomes and Wales since combined did in Premier League Bury FC becomes closed doors.
Abramovich UEFA President. 1992 opens 1991/92. China clubs’ aggregate the first Football Some fans
acquires Chelsea. in Brighton. Media Capital revenue exceeds League club to go return towards
Glazer family BT invests
Trust-owned acquire minority £4 billion for the out of business the end of the
takes control of heavily in its
AFC Wimbledon stake in City first time and no since 1992. 2020/21 season,
Manchester rights portfolio
promoted to Football Group. clubs reported an including at the
United. to launch
Football League, operating loss. multi-location
Structural review the BT Sport
of The Football just nine years channel. Sir Alex European
Association. after formation. Ferguson retires Championships.
as Manchester
United manager
after 26 years
and 38 trophies.
11Annual Review of Football Finance 2021 |
Europe’s premier leagues
Europe’s premier leagues
The European football market FIFA also reacted quickly, establishing a
COVID-19 Relief Plan and making $1.5 billion
contracted by 13% in 2019/20, available to National Associations, of which
as overall revenues fell by $340m had been released in 2020, over half of
which was grant funding.
€3.7 billion to €25.2 billion.
This is the first reduction in Whilst the pandemic affected clubs of all sizes,
and in relative terms the impact was greatest
revenues since the impact of on those most reliant on matchday revenue, in
the global financial crisis was absolute terms the ‘big five’ European leagues
bore the brunt of the immediate impact.
felt in 2008/09. Combined revenues for the ‘big five’ leagues for
the 2019/20 financial year fell 11% to €15.1 billion,
yet this still represented a record high share of
European football market 60% of the European football market.
All parties across European football have been
affected by COVID-19, not least UEFA, with its The repercussions of the pandemic can be
revenues falling by 21% to €3 billion following seen through the reduced activity in the
the postponement of the 2020 European delayed summer 2020 transfer market: a
Championships and rebates to broadcast c.40% fall in gross transfer expenditure
and commercial partners in respect of UEFA across the ‘big five’ leagues, from c.€5.5 billion
club competitions. to c.€3.4 billion, lowering the amounts that
would otherwise have been redistributed
UEFA worked closely with its Member across other European leagues.
Associations, leagues and clubs to manage the
initial postponement and subsequent return of One of the positives to take from the pandemic
football, and to mitigate the associated financial was the collective response of football bodies,
strain. UEFA provided advance payments reacting with pragmatism and agility to
to Member Associations and maintained resume play (where deemed safe to do so)
distributions to clubs, with repayments to and providing much needed entertainment
broadcast and commercial partners staggered and a sense of normality to fans of the sport.
over future seasons. The record broadcast audience numbers
12Annual Review of Football Finance 2021 |
Europe’s premier leagues
Chart 1: European football market size – 2018/19 and 2019/20 (€ billion) The noise around the European Super League The differing responses from each league, in
somewhat overshadowed the announcement terms of recommencement of matches, rebates
by UEFA of a major change to the competition to broadcasters, negotiations with commercial
2.7 1.9
9% 8% structure of its club competitions from 2024/25 partners, financial measures to support clubs
2.9 0.7 2.6 0.6 onwards. UEFA believes that the revised ‘Swiss and other domestic leagues, and competition
2% 2%
10% 10% model’ format and increased number of changes, drove the different financial outcomes
matches will continue the cycle-on-cycle growth for each league.
€28.9 billion €25.2 billion in media and commercial revenues, which
2018/19 2019/20 increased by c.30% in the 2018/19 to 2020/21 Most strikingly, whilst the aggregate revenues
5.6 5.0
20% 17.0 20% 15.1 cycle; and significant uplifts in value have of the ‘big five’ leagues decreased by 11% to
59% 60%
been reported in some key territories for the €15.1 billion in 2019/20, total wage costs
rights to UEFA club competitions for the period remained flat. This produced one short-term
commencing in 2021/22. dramatic impact as the aggregate club wages
to revenue ratios for the Premier League and
2021/22 will also see the commencement of the Ligue 1 reached record levels, and the other
UEFA Europa Conference League, introduced three ‘big five’ leagues reached their highest
upon resumption of football in many countries ‘Big five’ European leagues by UEFA to increase the inclusivity of its levels since the early years of this century.
evidenced this appetite from fans. Non ‘big five’ top leagues competitions and foster solidarity amongst Nonetheless, as the influence on revenues of
‘Big five’ countries’ other leagues some of the smaller Member Associations. COVID-19 recedes, the longer-term picture,
Yet despite this sense of unity across football FIFA, UEFA and National Indeed, it is this sense of solidarity, so vital in particularly for 2021/22 and beyond, may be of
stakeholders, as discussions over the future Associations riding the challenges presented by COVID-19, healthier restraint and improved financial
format of European club competitions reached Non ‘big five’ other leagues that will be critical to the longer-term recovery sustainability if wage growth remains under
their culmination in April 2021, news broke and growth of the sport. control, as it did in 2019/20.
that 12 clubs from across three of the ‘big
five’ European leagues had agreed to launch Source: Leagues; UEFA; FIFA; This section focuses on each of the other ‘big
a European Super League, in place of the Deloitte analysis. ‘Big five’ European leagues overview five’ European leagues in turn, with the Premier
existing midweek UEFA club competitions. Each of the ‘big five’ European leagues was League numbers presented in EUR € terms
The strong unanimous negative reaction affected by the COVID-19-enforced for comparability. A more detailed analysis
from governments, football governing bodies, postponement to matches in March 2020. of England’s top division can be found in the
leagues, clubs, broadcasters, pundits and most However, the financial impact on each league, Premier League section of the report.
importantly fans saw the idea flounder, with both in the short and medium term, has varied,
nine of the 12 clubs announcing their intention as each league has forged its own path through
to withdraw within the week. the crisis.
13Annual Review of Football Finance 2021 |
Europe’s premier leagues
Germany Despite the disruption to the season caused Chart 2: ‘Big five’ European league clubs’ revenue – 2019/20 (€m)
by COVID-19, the DFL pressed ahead with
6,000
its tender for domestic media rights for the Matchday
Revenue 2021/22 to 2024/25 period. Sky Deutschland 5,134 Broadcasting
The Bundesliga was the first major European and DAZN have acquired the majority of live 5,000 1,782 Matchday
Sponsorship/Commercial
35%
sports league to resume matches following the rights to the Bundesliga for the four-year period, Other commercial
pandemic-enforced pause in March 2020, and with total rights values averaging €1.1 billion per Broadcasting
4,000
the only ‘big five’ league to complete its season season, a 5% decrease on the previous rights 3,208 3,117 Sponsorship/Comm
within the 2019/20 financial year. As such, cycle (€1.16 billion per season); a satisfactory 2,669 466 Notes: Commercial revenue is not
3,000 52% 15% 997
total revenues only declined by 4% (€137m) outcome given the economic context, lack of 32% disaggregated into ‘sponsorship’
889
to €3.2 billion, driven by a 30% (€156m) fall in new bidders for the major rights packages and 28% 2,052 and ‘other commercial’ Other commercial
for clubs in
matchday revenues as all matches were played the 85% increase in domestic rights values for 2,000 1,711 628 1,598 England, Spain and Italy.
1,489 55% 31% 265
behind closed doors following the competition’s the previous cycle that commenced in 2017/18. 46% 16%
1,190 473
resumption in May 2020. 58% 30% 2019/20 average attendances and
1,000
A failure to agree a deal in the MENA region 364 409 234 690 170 utilisation are up to the point of
683 43%
11% 13% 11% 11%
Commercial revenues from advertising and declines in value in Latin America and 13%
suspension of each respective
and merchandise decreased in 2019/20, across Asian markets (exc. China and Japan) has 0 England Germany Spain Italy France league.
a 6% (€30m) drop on the prior year, whilst reportedly seen the value of international rights Average revenue per club (€m)
sponsorship revenues actually increased by fall by c.€50m to €200m in 2020/21, despite Source: Leagues; Deloitte analysis.
257 178 156 103 80
5% (€43m) due to increases at a number of the league agreeing new deals at improved
clubs, including those participating in UEFA values in the US and Japan (both from 2020/21). Average match attendance
competitions who are not regular qualifiers for Encouragingly, further deals have been
those competitions. announced in multiple markets from 2021/22, 39,591 40,444 28,862 26,352 22,546
including in Italy with Sky Italia, and a long-term
The 18 Bundesliga clubs reported similar deal with NENT Group across nine European Stadium utilisation (%)
aggregate broadcast revenues to 2018/19, as countries, pointing to increased international
98 91 75 66 73
the Bundesliga was able to avoid paying any demand for the Bundesliga.
significant rebates to broadcast partners in
2019/20. At €1.5 billion, broadcast revenues In light of the financial challenges caused by
represented a record high proportion of 46% of COVID-19 and in an effort to promote stability
total Bundesliga revenues in 2019/20. and greater solidarity, in December 2020
the DFL announced a change to the revenue
14Annual Review of Football Finance 2021 |
Europe’s premier leagues
distribution model for media rights revenues With the domestic and the majority of
for the 2021/22 to 2024/25 period, which will international media rights deals secured for Mutual interests: Private equity across the ‘big five’
see a higher proportion of both domestic and the immediate future, and a positive trend in
international revenues distributed equally commercial interest in German football, the European leagues
between Bundesliga clubs. Bundesliga appears to have weathered the
worst of the COVID-19 storm, helped largely Serie A was the first of the ‘big five’ leagues in May 2021 the Bundesliga and 2.Bundesliga
by the collective foundations of economic to publicly announce investor interest in May clubs announced that they would not pursue
Wages sustainability that German clubs have built over 2020. Private equity group CVC Capital this further for the time being.
The Bundesliga’s wages to revenue ratio rose to the past 20 years. Partners, together with Advent International
56%, with total wages increasing only marginally and Italian state-backed Fondo Strategico LaLiga’s discussions with private equity have
(by 0.5%) to €1.8 billion, as Christian Seifert, Italiano, eventually agreed a deal reportedly reportedly been focused on its technology
the DFL’s CEO, acknowledged the challenge of The Bundesliga was the worth €1.7 billion for a 10% interest in a new services unit, LaLiga Tech, with private
trying to rapidly cut contractually agreed costs.
first major European sports company set up to manage the media and equity investors contemplating acquiring up
Whilst this represents the Bundesliga’s highest commercial rights of the league. The offer to a 60% interest in the unit, which has a
wages to revenue ratio in 20 years, this remains league to resume matches reportedly lapsed in February 2021, and the reported enterprise value of €650m.
the lowest across the ‘big five‘ European
following the pandemic- deal appears to have stalled amid reports Over the last seven years, LaLiga Tech has
leagues and in line with the DFL’s Future Task that the Serie A clubs failed to reach developed various services including
Force recommendations for a commitment to enforced pause in March consensus on the deal terms. streaming platform LaLiga Sports TV, a
sustainability in German football.
2020, and the only ‘big five’ player performance analysis platform, fan
Prior to the COVID-19 pandemic, the German management services and anti-piracy
league to complete its DFL had reportedly begun conversations software, that is already used by other
Operating profit
season within the 2019/20 with private investors regarding a minority rights holders.
The 4% fall in total revenues coupled with an equity interest in two newly-created
inability to immediately cut costs, saw combined financial year. subsidiaries, including one that would be In December 2020, Ligue 1 and Ligue 2
operating profits of the Bundesliga clubs drop granted a license to both the Bundesliga’s clubs approved the creation of a
by 45% from €394m to €215m in 2019/20, its and 2.Bundesliga’s international media and commercial subsidiary for the LFP. The
lowest level since 2011/12. Nonetheless, the DFL commercial rights, as well as the rights to approval by the clubs, which still requires
reports that 16 of 18 clubs recorded positive operate and distribute the Bundesliga’s OTT French government support, stipulated that
EBITDA and the Bundesliga remains, along with platform. The opportunity reportedly the LFP must hold no less than 80% of the
the Premier League, the only ‘big five’ league attracted interest from over 30 potential capital and voting rights, opening the door
to have reported aggregate club operating bidders, but following careful assessment, for potential equity investment.
profitability every year for over 20 years.
15Annual Review of Football Finance 2021 |
Europe’s premier leagues
Spain to go to market for the next domestic rights
cycle towards the end of 2021, with reports that
new rights packages will be created to entice
Revenue new bidders, and the option to agree deals
Aggregate revenues of the 20 La Liga clubs fell beyond the historical three-year term following
8% (€261m) to €3.1 billion in 2019/20, as the the Spanish competition authority’s ruling to
postponement of fixtures and extension of the remove this term limit in European markets.
season into the 2020/21 financial year resulted
in the Bundesliga supplanting La Liga as the Total commercial revenues fell marginally (by
second-highest revenue generating league in 3%) to €997m in 2019/20. Whilst over half of the
Europe. consistent La Liga clubs recorded an increase
in commercial revenues, these were offset by
Prior to the pandemic, the first half of the significant reductions for Atlético de Madrid
season had seen Spanish clubs report rising (€17m) and Barcelona (€44m). Despite this 11%
attendances, with La Liga match goers up 5% on reduction in commercial revenues for Barca,
the prior year period. Unfortunately, this trend they, together with Real Madrid, remained the
was halted by the suspension of football from top two clubs in the Deloitte Football Money
12 March 2020, and the resumption behind League and continued their commercial
closed doors on 11 June 2020 meant La Liga dominance of La Liga, together accounting for
clubs’ combined matchday revenues fell by 19% 70% of commercial revenues in 2019/20.
from €506m to €409m in 2019/20.
Since 2016, LaLiga and La Liga clubs’ commercial
Rebates to broadcast partners reportedly revenues have benefitted from the league’s
totalling c.€100m (spread over multiple years), internationalisation strategy, which includes
along with a deferral of some broadcast commercial joint ventures to grow its profile
revenues into the 2020/21 financial year (to through localised content, grassroots initiatives
reflect when matches were played), saw total and commercial partnerships. This approach
revenues from media rights fall by €133m (7%) to has facilitated better conversations with local
€1.7 billion 2019/20, despite this being the broadcasters, and in May 2021, the league
first year of new domestic and international took advantage of competition in the US
broadcast rights agreements. LaLiga is expected sports media market to secure an eight-year
16Annual Review of Football Finance 2021 |
Europe’s premier leagues
Chart 3: ‘Big five’ European league clubs’ revenue – 2017/18 to 2021/22 broadcast rights deal with ESPN for a reported Operating profit
(€ billion) €145m ($175m) per season, a 75% increase The combined operating profits of the La
in US Dollar terms on the reported value of Liga clubs fell by 60% from €455m to €183m
7.0
England the previously agreed deal, for which LaLiga in 2019/20. Nonetheless, 15 clubs reported
5.8
6.1 Germany bought back the rights from beIN Sports. operating profits despite the impact of COVID-19,
6.0 5.7 Spain England demonstrating the influence on financial
5.4
Italy Germany sustainability that LaLiga’s economic controls
5.1
France Spain Wages have had since their introduction in 2013.
5.0
Italy La Liga clubs’ total wage expenditure rose only
France marginally (0.4%) to €2.1 billion in 2019/20. Continued international expansion, sustained
4.0 The league’s economic controls on each club’s demand from domestic and international
3.4 3.4
3.2 3.2 3.1 squad costs encourage sustainability, and likely broadcast partners, and continued financial
3.3
3.0 3.1 3.1
2.9 3.0 contributed to the significant decreases in responsibility should provide a degree of
2.5
2.2 2.1
2.3 2.3 wage expenditure shown by Atlético de Madrid comfort for La Liga clubs as the constraints
(down €29m (12%)) and Barcelona (down €55m caused by COVID-19 begin to ease. Nonetheless,
2.0 1.9
1.7 1.7 (10%)). Excluding these two clubs, total wage given the heavy bias of global fan interest
1.6 1.6
expenditure rose by €91m (7%) across the 15 towards, and hence financial dominance of,
1.0 other consistent clubs. This, combined with La Liga’s biggest clubs, continued unity will be
Projected the drop in revenues, resulted in the wages to required for Spanish football to benefit from the
0 17/18 18/19 19/20 20/21 21/22 revenue ratio for the league rising to 67%, its foundations that LaLiga has laid.
highest level for 17 years.
Source: Leagues; Deloitte analysis. In its attempts to help Spanish clubs manage In its attempts to help Spanish
the financial repercussions of COVID-19,
clubs manage the financial
LaLiga reduced the collective squad cost limits
(amounts spent on player wages and transfers) repercussions of COVID-19,
by c.24% for the 2020/21 season, to
LaLiga reduced the collective
c.€2.3 billion prior to the summer 2020 transfer
window, working closely with clubs to find squad costs limits by c.24%
solutions for long-term sustainability.
for the 2020/21 season.
17Annual Review of Football Finance 2021 |
Europe’s premier leagues
Italy commercial revenues should remain resilient in Chart 4: ‘Big five’ European league clubs’ revenue and wage costs – 2018/19 and 2019/20 (€m)
2020/21, as the season saw a host of new club
7,000
sponsorship deals announced, whilst Serie A
Revenue launched a new commercial strategy that saw
Serie A clubs’ combined revenues fell 18% it become the first of the ‘big five’ leagues to 6,000
5,843
(€443m) to €2.1 billion in 2019/20, as Italy create official sponsorship categories for Video
became the initial focal point for COVID-19 in Assisted Refereeing and Goal Line Technology. 5,134
5,000
Europe, which halted play on 9 March 2020.
Withheld broadcast payments (reportedly
The behind closed doors return of football in worth c.€130m) and the deferral of payments 4,000
3,741
Italy on 20 June 2020 resulted in a €50m (18%) into the 2020/21 season saw aggregate 3,579
3,345 3,378
drop in matchday revenues to €234m, but given broadcast revenues fall by €273m (19%) to 3,208 3,117
3,000
the historic lack of investment into Italian stadia €1.2 billion in 2019/20. Much of the focus has 2,495
(and therefore relatively low matchday revenue), been on the new domestic and international 2,093 2,102 2,052
2,000 1,902 1,598
in absolute terms the decrease in matchday rights deals from 2021/22. After a protracted 1,798 1,807 1,757 1,610
revenues was almost half that reported by tender process, domestic rights deals with 1,389 1,416
the Premier League and La Liga, and one third DAZN and Sky Italia have been secured for a 1,000
of the fall in Bundesliga matchday revenues. combined average value of c.€928m per season,
A ‘stadium fund’ was reported to be part of 5% lower than in the prior rights cycle, albeit the 0 18/19 19/20 18/19 19/20 18/19 19/20 18/19 19/20 18/19 19/20
the proposed private equity investment into league will also reportedly save €50-60m per England Germany Spain Italy France
the league (see Mutual interests box) but any season in commission payments previously Wages/revenue ratio (%)
such investment will take time to bear fruit, made to the Infront agency. Serie A international
particularly given the repeated struggles to media rights values dropped more markedly, to 61 73 54 56 62 67 70 78 73 89
progress major Italian football stadium projects. a reported c.€196m per season from 2021/22 to
Average club wages (€m)
2023/24, with the MENA region unsold at
Serie A clubs’ total commercial revenues present. With incumbent MENA broadcast 179 187 100 100 105 105 88 81 69 71
fell €120m (16%) to €628m in 2019/20, with partner beIN Sports apparently declining to take
Internazionale’s commercial revenue decrease part in the initial rights tender, the league seems
alone representing almost half of this amount, unlikely to make up the shortfall. Revenue Wage costs Source: Leagues; Deloitte analysis.
as profiled in the 2021 Deloitte Football Money
League. Despite the ongoing challenges,
18Annual Review of Football Finance 2021 |
Europe’s premier leagues
Wages Operating losses
The Italian top flight was the only ‘big five’ league Serie A clubs’ combined operating losses
to reduce total wage expenditure in 2019/20, significantly worsened in 2019/20, from €17m
with aggregate wages falling €147m (8%) to to €274m, their worst result since 2001/02. It
€1.6 billion. Nonetheless, the reduction in should be noted that the combined operating
revenues caused by COVID-19 resulted in losses of AC Milan and AS Roma accounted for
the wages to revenue ratio rising to 78%, the almost two thirds of this amount. The road back
highest level in 16 years, as three clubs spent to collective profitability in future seasons looks
more on wages than they earned in revenues. challenging for all the reasons described above.
The 2020/21 outturn for a season played
almost entirely with no fans in stadia will also A truly collaborative effort across the Italian
be challenging, but if wage restraint persists football ecosystem will be required to arrest
then the 2021/22 season may present a more this trend, and promisingly, in May 2021, the
encouraging balance between wages and Italian Football Federation created a working
revenues. group including all Serie A and Serie B clubs to
address the financial crisis facing Italian football,
In response to this situation and to assist including an option to explore a return to an 18
clubs in exercising better financial discipline, team Serie A from 2023/24.
the Italian Football Federation is reportedly
seeking to introduce financial regulations
to encourage clubs to reduce wage costs The Italian top flight was the
over the coming years, with those looking to
only ‘big five’ league to reduce
increase expenditure required to provide bank
guarantees to demonstrate the sustainability of total wage expenditure in
any investments.
2019/20, with aggregate
wages falling €147m (8%) to
€1.6 billion.
19Annual Review of Football Finance 2021 |
Europe’s premier leagues
France instalments. The LFP subsequently agreed a Aggregate commercial revenues for Ligue 1
deal with Canal Plus for the rights previously clubs fell by 8% (€62m) to €738m in 2019/20,
held by Mediapro, which meant that the total as the cancellation of the season and
Revenue value of Ligue 1 and Ligue 2 domestic rights postponement of other events hit ticketing,
Ligue 1 clubs’ total revenues fell 16% (€304m) to for the 2020/21 season was reportedly c.€670m, catering, merchandising and the clubs’ ability to
€1.6 billion in 2019/20, more than €450m behind a 42% reduction on the €1.15 billion per season fulfil commercial agreements. PSG’s commercial
their nearest ‘big five’ rivals (Serie A), as Ligue 1 that domestic rights for the 2020/21 cycle revenues of €299m were over six times more
became the only top flight European league to had originally been sold for, and similar to the than the next highest (Marseille), according
cancel its season in response to the pandemic. average annual value in the 2008/09 cycle. to the financial information presented by the
As a result, matchday revenue decreased by DNCG, emphasising the disparity in revenue
15% (€31m) to €170m in 2019/20, albeit the After lengthy discussions and legal challenges, generating potential among Ligue 1 clubs.
financial impact on this revenue stream of the rights to the eight weekly Ligue 1 matches
cancellation is obviously not materially different originally held by Mediapro were awarded to Wage costs
to continuing behind closed doors. Amazon for the 2021/22 to 2023/24 period, for Despite Ligue 1 clubs’ total wage expenditure
a reported €250m per season (compared with increasing at its slowest rate for five years, by
Rebates to broadcast partners reportedly the €780m per season agreed with Mediapro). 2% to €1.4 billion, the huge revenue reduction
totalling c.€123m (between domestic and This prompted Canal Plus, the league’s long- resulted in the wages to revenue ratio increasing
international rights holders) contributed to term partner, to take legal action against the to 89% in 2019/20, the second-highest level ever
aggregate broadcast revenues falling 23% from LFP and to announce it intends to pull out of recorded across the ‘big five’ European leagues.
€901m to €690m in 2019/20, as Ligue 1 remains its commitment to show two Ligue 1 matches Worryingly for the sustainability of French
the only ‘big five’ league whose clubs earn less per match week, reportedly worth €332m football, only two clubs had a wages to revenue
than €1 billion from this revenue source. To per season through to 2023/24. Canal Plus ratio below 70%, and six clubs spent more on
help its clubs mitigate against these losses, the sublicenses these rights from beIN Sports, as wages than they earned in revenues. Following
LFP secured government guarantees which are part of a five-year distribution deal between the termination of the broadcast rights deal
repayable within five years and will be offset the two broadcasters. At the time of writing it with Mediapro, the LFP and France’s National
against future broadcast rights income. appears that the sale to Amazon of the majority Union of Professional Footballers encouraged
of Ligue 1 rights, including the top ten matches players to consider accepting wage reductions
French football was further destabilised by the per season, has triggered yet further problems to “save professional football”.
cancellation of the domestic rights deal with for Ligue 1 and its clubs’ financial futures.
Mediapro in December 2020, following the
agency’s failure to pay scheduled rights fee
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