English Premier League clubs will enjoy a revenue boost of almost 25 percent next season due to new television deals.
June 10, 2013 : The combined revenue of the 92 clubs of England’s top four division’s football is estimated to be more than 3 billion pounds ($ 4.6 million) for the first time next season. According to the 22nd edition of the annual review of football finance by Deloitte, revenues from premier league’s 20 clubs increased from 4 % to almost £ 2.4 billion ($ 3.71 b) marking yet another year of astounding growth. The league is boosted by sponsorship deals for Manchester United and Manchester City with Deutsche Post, DHL and Etihad Airways. It is expected to grow by another 25 percent, by £ 600 million, when the league’s new broadcast deal kicks in. An average of £ 73 million is expected to be received from TV rights, which make up 50 percent of revenues, this coming season. Nearly 75 percent of the premier league club’s revenue in 2011-12 was spent on salaries. Wages are estimated to increase to roughly £ 1.8 billion in the 2012-13 season.
“Despite operating in a challenging economic environment, English football’s profile, exposure and the increased global interest have continued to drive growth for top clubs.” Dan Jones, a partner in Deloitte’s Sports Business Group said in a statement.
“The premier league clubs have agreed to a system of enhanced financial regulations, designed to improve the sustainability of its clubs” Alan Switzer, Director of Sports Business Group in Deloitte said. The successful implementation of these rules, coupled with the imminent boost to broadcast revenues, could provide huge benefits to the long term development, growth and stability of the game and its clubs”.
Spain’s La Liga, the third richest European club, had a combined sales increase of 3 percent to 1.8 billion Euros. Revenue in Italy’s Serie ‘A’ rose to 1 percent and France’s Ligue had a 9 percent increase to 1.1 billion Euros. The lower revenue growth in Spain and Italy was mainly due to sluggish economies, Deloitte said in its report. The government generated a tax of around 1.3 billion in 2011-12. The clubs have also splashed a huge amount of money on player’s wages. Last year an estimated £ 1.66 billion was paid to the players. Manchester City was the best paying club during 2011-12 with wages of £ 202 million. Swansea city was at the lowest which paid its players £ 35 million. The clubs are expected to pay around £ 480 million of the extra TV cash into wages. Manchester United earned the most in 2011-12, with revenues of £ 320 million, while Wigan Athletic earned the lowest £ 53 million. The report has also revealed that the clubs paid 70 percent of their revenues as wages. The report also said clubs should manage the rise carefully so as to leave funds available to be invested in stadium improvements, youth development and controlling losses. Aston Villa spent the biggest slice of its revenues on wages, at 94%, while Norwich City spent just 49% of their revenues on wages.
In comparison with the rest of Europe, the premier league clubs continue to have the highest revenue, £ 2.4 billion compared to Germany’s £ 1.5 billion and Spain’s £ 1.4 billion.
“Increased profitability will allow greater long term investment in stadium and training infrastructure, youth development and community programmes”, the report mentioned.