European football finance goes back to the future in the latest UEFA benchmarking report, reviewing 20 years of huge growth in club revenue and wages.
UEFA has released its seventh club licensing benchmarking report on European club football. The report offers a unique and exclusive review of the continental club game – and a thorough analysis of the financial development of European football after the first decade of club licensing.
The report casts an eye back over the last 20 years of huge growth in European club revenue and wages; analyses in detail trends across Europe over the past five years (pre and post-financial fair play implementation); while also looking to the future of commercial and broadcast deals in an increasingly global game.
The report shows that the financial health of European club football has been turned around with bottom-line losses cut by 70%, record operating profits generated last year and club balance sheets strengthened by 50% in the first three years of UEFA's financial fair play regulations.
In his foreword to the report, UEFA General Secretary Gianni Infantino states: "While we should remain cautious, it appears that the worst financial excesses of European football reported in 2010 and 2011 are potentially behind us. This year's edition of the report highlights some notable improvements that have taken place in the last three years, coinciding with the introduction of financial fair play."
And he adds: "This report provides an in-depth analysis of the current situation, allowing national associations, leagues and clubs to benchmark their performance and all readers to better understand the context in which clubs across the 54 UEFA member associations operate."
The report underlines some notable improvements that have taken place in the past three years, coinciding with the introduction of financial fair play, with club football's remarkable ability to grow revenues year after year increasingly being matched by a willingness to adopt more sustainable plans for the future:
Here are some key findings:
- European top-division club revenues topped €15bn in 2013 and approached €16bn in 2014, having first exceeded €12bn as recently as 2010.
- The record underlying operating losses of 2011 have been transformed into the largest combined operating profits that European club football has ever produced. European top-division clubs reported the first operating profit for five years in 2013, followed by the highest operating profit in history of €805m in 2014.
- Bottom-line net losses, after financing and transfer activity, have been cut in three in the three years since the FFP break-even rules started being applied, from a low of €1.67bn in 2011 to a much improved aggregate loss of €485m in 2014.
- Club net debt has decreased by more than €1bn and the balance between club assets and liabilities has improved dramatically, with club net assets increasing by 50% over the first three years of FFP break-even rules.
- Financial fair play has encouraged owner investment in assets. Club balance sheet net assets have risen by more than €1.6 billion in the last three years with FFP boosting owner contributions, which have comfortably exceeded losses. Club balance sheet assets now exceed all debts and liabilities by €4.9bn.
The report is unique in its depth and scale and in the quality of the data that underpins its analysis. The underlying basis for this report consists of up to 170 separate line items per year and per club from club financial statements and their notes. In total, reaching back over nine years, the UEFA club database includes over two million items, thus forming an unrivalled basis for the financial analysis of club football.
One of the features of this year's report – published online today and in print at the beginning of November – are a series of top-20 lists of clubs. UEFA Head of Club Licensing and Financial Fair Play, Andrea Traverso, explained the concept in the report's introduction: "Previous versions of this report have been welcomed for bringing more transparency to club finances, by presenting authoritative analysis of trends across 700 clubs a season. This year's report takes us to a new level of financial disclosure.
"For the first time, Europe's clubs are individually ranked in a series of top-20 lists, covering TV money, gate receipts, UEFA prize money, wages, other operating costs, underlying operating and 'bottom-line' net profitability, stadium assets, squad costs and transfer incomes and spend."