Bayern Munich are one of Europe's most profitable clubs

The authoritative Swiss Ramble takes a look at Bayern Munich's latest accounts. They are one of the most profitable clubs in Europe. Indeed, they have the highest profit before tax (€46m) of any of the leading clubs that have published 17/18 accounts to date. Amazingly, this is the 26th consecutive year that Bayern have been profitable.

Profit before tax fell from €66m to €46m (profit after tax €29m). Revenue (per Bayern’s definition) rose €17m (3%) to a record high of €657m including €28m profit on player sales, mainly Douglas Costa to Juventus. The board described the figures as 'outstanding'.

Bayern Munich have become increasingly reliant on player sales with average annual profits rising from just €11m between 2009 and 2013 to €41m in the last five years. Excluding player sales, revenue has grown by a third (€155m) in the last three years from €474m to €629m, mainly from broadcasting €71m (67%) and commercial €71m (25%) with match day up €14m (16%). Revenue has doubled since the €321m reported in 2011.

Bayern's revenue advantage over Borussia Dortmund, their closest domestic challenger, increased to €312m in 2017/18, the highest ever gap. In fact, Bayern’s €629m revenue is almost twice as much as Dortmund’s €317m.

They have the fourth highest revenue in the world (per Deloitte Money League 2017, based on 2016/17 results), though they were as high as 2nd in 2003/04. There are three other German clubs in the top 30: Borussia Dortmund, Schalke 04 and Borussia Mönchengladbach.

The club had the highest commercial income of any football club globally in 2016/17 with €343m, ahead of Manchester United €325m, Real Madrid €301m and Barcelona €296m. Closest German clubs are Borussia Dortmund €148m and Schalke 04 €95m. They have an excellent kit deal with Adidas (€60m a year) and good shirt sponsorship agreement with Deutsche Telekom (€35m), though Real Madrid earn almost twice as much.

Bayern have earned significantly more revenue (€284m) from European competition than any other German club in the last five years. Champions League revenue rises by 54% in 2018/19. There is also a new UEFA coefficient payment (based on performance over 10 years), where Bayern has the 3rd highest ranking, guaranteeing them €33m.

Their wage bill shot up €38m (14%) from €265m to €303m in 2017/18, which means that wages have risen by a third since 2015, exactly in line with the revenue growth rate. Wages to turnover ratio held in a healthy narrow band between 44% and 49% in last eight years. Bayern have one of the lowest ratios among the leading clubs, only beaten by Tottenham 41% and Arsenal 47%, but significantly better than Barcelona 70% and (domestically) Dortmund 59%.

Using the broadest definition of debt, Bayern's total liabilities are only €280m, which is one of the lowest of the leading European clubs. Manchester United are almost €1 bln higher at €1234m, followed by Juventus & Tottenham (€700m), then Real Madrid & Arsenal (€600m).

Wolves get raw deal from FFP

I used to see a lifelong Wolves fan for lunch once a month. He was approaching ninety, but still went to games. Sadly he passed away the other week. As football finance guru Kieran Maguire has noted, Wolves continue to be constrained by financial fair play rules. Radio 4 this morning described them as this year's 'crisis club' and the pessimists have certainly been piling in. Martin Samuel wrote sympathetically in the Sunday Times yesterday, saying that the Premier League drives talent away with regulatory red tape: 'Why could Al-Hilal sign Neves? Because Wolves needed the money. And why did Wolves need the money? Because the club had to comply with an artificial construct known as financial fair play. So Wolves are going skint, yes? No. There is no suggestion that Wolves are in financial trouble, only that they are failing to meet the rigours of FFP. Wolves’ owners appear to have the money to run the club, and invest in the club, and in fact came up with a pow

Gold standard ground boosts Tottenham's income

The gold standard in European football grounds is the Tottenham Hotspur stadium in north London, a £1bn construction project completed in 2019. Its impact on the club’s finances has become increasingly clear as the effects of the pandemic have faded. Previously, the average fan would spend less than £2 inside the ground on a typical match day, but now that figure is about £16, thanks to new facilities including the longest bar in Europe and an on-site microbrewery. Capacity has gone up from 36,000 at the club’s previous home of White Hart Lane to 62,000. The new stadium — built on land adjacent to White Hart Lane — has opened the door to a broad range of other events that have helped to push commercial income up from €117mn in 2018 to €215mn in 2022. Last year, Tottenham hosted US singer Beyoncé for five nights on her global Renaissance tour, two NFL matches, as well as rugby games and heavyweight boxing bouts. Money brought in from football has gone up too. Match day income is

Charlton takeover approved

The long awaited takeover of Charlton Athletic by SE7 Partners from Thomas Sandgaard has been approved: https://londonnewsonline.co.uk/se7-partners-obtain-efl-approval-for-charlton-athletic-takeover/ Charlton have had unhappy experiences with owners for over a decade, so how this works out will remain to be seen. There is certainly potential there, but will it be realised? This interview with Charlie Methven gives detail not available elsewhere: https://thecharltondossier.com/charlie-methven-on-the-record/

The Political Economy of Football V2

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