Premier league revenues to rise by 25%
Premier League clubs’ revenue reached a record £2.36bn in 2011-12, according to football finance experts at Deloitte.
It estimates revenue grew to £2.5bn in 2012-13, and will grow by a further £600m, or 25%, in 2013-14, when the league’s new broadcast deal kicks in.
Deloitte says this should take the projected revenue of Premier League clubs above £3bn for the first time.
It says this cash, plus new spending rules, “could provide huge benefits to the long-term development” of football.
“Despite operating in a challenging economic environment, English club football’s profile, exposure and increasingly global interest have continued to drive revenue growth for the top clubs,” said Dan Jones, partner in the Sports Business Group at Deloitte.
The total wage bill, across all employees, of Premier League clubs in 2011-12 was £1,658m (up 4%), ranging from £202m (Manchester City) down to £35m (Swansea City)”
Deloitte Annual Review of Football Finance 2013
Across English football, the revenue of the top 92 clubs exceeded £3bn for the first time in 2011-12.
However, worries remain about the proportion of revenues being spent on player wages.
Almost 75% of the Premier League clubs’ revenue increase in 2011-12 was spent on wages, which increased by £64m, or 4%, to £1.7bn. It meant the overall Premier League wages-to-revenue ratio remained at 70%.
“It is the age-old picture; revenues continue to be healthy and wage levels continue to be a concern,” said Mr Jones.
In the second tier of English Football – the Championship – spending on wages increased by £53m (13%) to £476m in 2011-12. Deloitte says this was driven in part by the number of clubs being in receipt of parachute payments from the Premier League and the change in the mix of clubs.
“Championship clubs continue to overstretch off the field as they seek playing success to reach the Premier League,” Mr Jones said.
In the summer of 2012, the Premier League clubs had a total debt of £2.4bn.
Of that, some £1.4bn was in interest-free soft loans from owners (2011: £1.5bn), of which around 90% related to three clubs: Chelsea (£895m), Newcastle United (£267m) and Queens Park Rangers (£93m).
The remaining £1bn interest-bearing debt was equivalent to about 40% of total annual revenues.
Mr Jones said that debt in the Premier League was much less of a concern than it was four or five years ago, adding, “when you look at how much of that is in soft loans, the interest-paying debt that is left is not that much”.
Deloitte also said that a number of financial fair play rules, including those introduced by the Premier League and Championship (independently of those also drawn up by European governing body Uefa) should focus the minds of clubs in respect to overall spending.
Author: Moses Echodu
Moses is a Ugandan writer and blogger. Studied information technology with major interests in Journalism.He is passionate about sports but at times ventures into other fields
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