The Premier League was the only one of Europe’s “big five” leagues where clubs improved their overall operating profits in the Covid-stricken 2020/21 season, Deloitte’s Annual Review of Football Finance also showed how play across the continent became increasingly polarized.
While the campaign boosted revenue in the European market by 10 per cent to €27.6bn despite an almost complete loss of matchday earnings, the success of the postponed Euro 2020 tournament.
The company’s 31st market valuation, meanwhile, forecast Premier League revenue would reach £5.5bn for the 2021/22 season.
England’s elite competition, for example, saw growth of 8 per cent from £4.5bn to £4.9bn, with operating profits rising from £49m to £479m.
That saw the ‘Big Five’ leagues – England, Germany, Spain, Italy and France – grow by 3% to €15.1bn from 2019/20, although the Premier League’s huge share of that shows where the Power in continental football lies. As expected, this was largely due to broadcasting revenues.
This means Premier League clubs’ payroll costs have actually increased by 5 per cent to £3.5bn in 2020/21.
Elsewhere, Series A saw the largest percentage growth in total revenue, again due to delays, which rose 23 percent to €2.5 billion. La Liga was down 6 percent to €2.9 billion and the Bundesliga was down 6 percent to €3 billion. Ligue 1 – the only one of the Big Five to shorten its 2019/20 season – consequently saw revenue growth of just 1 per cent to €1.6 billion.
Excluding the Premier League, the total operating losses of the other four of this quintet jumped from €461m to €901m.
These “Big Five” together represent a 57 percent share of the continent’s football market.
Further down in England, the report highlights how league clubs’ net debt rose 32 per cent to £1.8bn at the end of the 2020/21 season, with wage bills exceeding revenue for the fourth straight season. The wage-income ratio reached a record value of 125 percent.
However, Tim Bridge, Lead Partner in the Sports Business Group at Deloitte, issued a warning for the Premier League.
“The Premier League is entering its fourth decade and is further ahead of the competition than ever, having emerged from the pandemic without as significant a rise in net debt as many might have expected. However, the stark reality is that the league was last pre-tax break in the 2017/18 season, underscoring the critical need for strong governance and financial planning in the years to come.”
The report, meanwhile, noted how industry resilience is reflected in an “investment boom,” with 15 investments made in the “Big Five” in 2021. That was three more than 2019 and 2020 combined. The majority, 87 percent, came from high net worth individuals and private equity firms, with more than two-thirds from the United States.
“Multi-club ownership (MCO) has grown in popularity,” the report points out, “with over 70 MCOs said to exist now, more than doubling the number five years ago (28). Nine of the 20 Premier League clubs operate within an MCO model.”
https://www.independent.co.uk/sport/football/premier-league-deloitte-report-finances-b2146899.html Premier League financially ‘further than ever before’ after Covid hit season, Deloitte report says