Spurs, the profitable club

The authoritative Swiss Ramble has now provided commentary on Tottenham Hotspur's 2016/17 accounts on Twitter. He provides comparisons with other Premier League clubs and a temporal dimension.

He notes, 'The £58m profit before tax was the secod highest in the Premier League, only surpassed by Leicester City at £92m, boosted by their Champions League exploits, but ahead of Manchester United £57m, Arsenal £45m and West Ham £43m. Thanks to TV money, all clubs that have published 2016/17 accounts are profitable.

'The £58m profit before tax in 2016/17 is actually the fourth highest ever made in the Premier League. However, it is not Spurs’ record profit, which was the £80m made in 2013/14, due to the highly lucrative sale of Gareth Bale to Real Madrid. It should be no surprise that Spurs posted a profit, as they have only reported two (small) losses in the last 13 seasons. In the last four years they have aggregated a highly impressive £188m of profits.'

'The profit from player sales has had a major impact on the club's figures, contributing £355m to the last 12 years, turning a £112m loss into £243m profit. Next year will again benefit from big money sales, including Walker to Manchester City, Wimmer to Stoke and Bentaleb to Schalke.'

'Tottenham's£306m revenue is still a fair way behind their rivals, e.g. Manchester United £581m are a full £275m higher,) followed by Manchester City £473m and Arsenal £423m. That said, the gap to Liverpool £364m and Chelsea £361m has narrowed.'

'Revenue has increased at Spurs five years in a row, more than doubling from £147m in 2013 to £306m in 2017. Most of the £159m growth in this period was driven by TV money (£126m), but there has been solid commercial growth (£28m), though match day has been relatively flat (£5m).' The new stadium will markedly improve this figure. Revenue should be at least £20m higher before taking account of naming rights.

'Despite the enormous increases in Premier League distributions, European participation can still make a difference for the leading clubs. Spurs have earned €84m from Europe in the last five years, but this is much less than Manchester City €244m, Arsenal €213m, Chelsea €193m and Manchester United €167m.'

Commercial revenue was up 24 per cent (£14m) from £59m to £73m, the 6th highest in England, though still a long way below rest of Big Six, e.g. Manchester United £276m is almost four times as much. The facilities at the new stadium should help close the gap, e.g. NFL games & other major events. Commercial income will rise significantly in 2017/18, thanks to two major new deals. AIA shirt sponsorship has been extended to 2021/22 season, increasing from £16m to £35m, while Nike have replaced Under Armour, reportedly doubling the payment from £15m to £30m.'

'One area where Spurs wages “lead the way” is directors’ remuneration, up from £4.8m to £9.0m. Chairman Daniel Levy’s pay surged from £2.8m to £6.0m, far more than Ivan Gazidis (Arsenal) and Ed Woodward (Manchester United), both £2.6m. The figure apparently included backdated pay rise and bonuses. As a result of higher PL TV money, all clubs have reduced their wages to turnover ratio in 2016/17, but none are lower than Spurs at 41 per cent. The next lowest are Manchester United 45 per cent and Arsenal 47 per cent.'

'The club's £185m gross debt is 3rd highest debt in the Premier League, only behind Manchester United's £503m (Glazers’ leveraged buy-out) and Arsenal £227m (Emirates stadium loan) It will surely rise as the investment in the new stadium increases, which will present a major financial challenge. Levy underlined the club's delicate balancing act, “We are in an historic period for the club and there is a growing sense of excitement. There will, however, be many challenges in the coming months as we near the latter stages of the construction of the new stadium and its opening.”'