Revenue and profits rise at Atletico Madrid

The authoritative Swiss Ramble has taken a look at the accounts of Atletico Madrid covering their first season in their new stadium. Profit before tax increased from €5m to €12m (after tax down from €5m to €4m), as revenue rose €31m (11%) to a record high of €313m, though profit on player sales fell €20m to €16m.

The main driver of the revenue increase was the move to the new stadium, as match day rose €17m (37%) to €62m and commercial was up €17m (22%) to €93m. Broadcasting slipped slightly to €158m, as lower Champions/Europa League distribution offset higher money from La Liga.

Revenue has grown by nearly €200m (160%) in just five years from €120m in 2013 to €313m in 2018, largely from TV €107m (split between domestic TV deal and Champions League), then commercial €55m and match day €31m. Revenue mix: TV 50%, commercial 30% and match day 20%.

However, the revenue gap to Real Madrid €751m and Barcelona €690m continues to grow and is now €390m-450m. On the other hand, Atletico are significantly outpacing Sevilla and Valencia, generating between €140m and €190m more than these rivals.

Most clubs in La Liga are profitable, so the €4m profit after tax is only around mid-table. Two clubs that have so far published 2017/18 accounts made more money, though they are the leading two: Real Madrid €31m and Barcelona €13m. However, Valencia reported a €36m loss.

Profits have been improving with the last loss coming seven years ago in 2011. Since then, they have reported aggregate profits of €39m, almost all in the last 4 years (including €19m in 2015 and €12m in 2018). This is in stark contrast to the €28m loss in 2009.

However, the €12m profit has been boosted by two exceptional items: (a) €41m sales value of urban rights from old Vicente Calderon stadium; (b) €47m Wanda investment for development of the academy. If these were excluded, the club would have reported a €76m loss.

The club earned €48m from Europe: €32m after group stage exit in the Champions League, before dropping to the Europa League, where they got €16m for winning it. This is €13m lower than the €61m they received the previous season when they reached Champions League semi-finals.

Their recent success in Europe, including twice reaching Champions League final and winning Europa League 3 times, has had a big impact on finances, earning them €272m in last 5 years, almost as much as Barcelona €277m, though well behind Real Madrid €360m.

Following the move from the Vicente Calderon to the newly renovated, 68,000 capacity Wanda Metropolitano in 2017/18, attendance rose from 44,675 to 55,485. The stadium has cost over €300m, though it is hoped to recoup up to €200m from sale of Calderon property rights.

The wage bill shot up €34m (19%) to €212m, partly due to new contracts (Griezmann, Godin, etc), increasing wages to turnover ratio from 63% to 68%. This means that wages have more than tripled from €64m in 2013, though revenue also up from €120m to €313m in same period. Despite the growth, Atletico's €212m wage bill is still a fair way behind Europe’s elite clubs. As one comparison, they are far behind England’s two Europa League representatives: Chelsea €276m and Arsenal €252m.

It's no deal say Spurs insiders over Taiwanese takeover

Senior figures at Tottenham Hotspur insisted on Friday that they had not been informed of any deal to sell Daniel Levy’s stake in the club. A business group, Eight Sports Capital — which is said to include a billionaire Taiwanese financier — claimed that it had an agreement in place to buy a 24.99 per cent stake in ENIC, the club’s majority owners, from Levy, who owns 29.88 per cent. The Times has been told Ng Wing Fai and Brooklyn Earick form part of the group, having both been linked previously to potential takeovers of the Premier League club. The Taiwanese businessman, Richard Tsai, is also said to be part of the consortium. He is reportedly worth £7 billion. Last year Earick, the former DJ and tech entrepreneur, was part of an attempted £4.5 billion takeover, which was “unequivocally rejected” by Spurs. An ENIC spokesperson said: “We can confirm that neither ENIC nor THFC are aware of any sale by Daniel Levy’s Family Trust of its minority stake in ENIC, THFC’...

Reports about Charlton sale exaggerated

Reports have appeared in The Guardian and elsewhere that Charlton has been put up for sale. Richard Cawley is an authoritative local journalist who runs a South London Sport substack site. He reached out to the club yesterday evening to ask for comment on The Guardian’s article. Early indications from the club have been that nothing has changed since the story about them seeking investment, except that it is now a different company doing it. Charlton have since managed to consolidate their place in the Championship, avoiding an instant return to League One, with their women’s side promoted to the WSL, returning to the top flight for the first time since 2007, although staying there is likely to be costly. It would be counter-intuitive for owners Global Football Partners not to progress the club when looking for investment, that the focus remains on driving it forward, that their spend this summer is in line with long-term planning and will see an increase in wages spent on players...

Hull City's 'strange' loan

When football finance guru Kieran Maguire seems flashing lights in a club's loan deal, I become concerned. He is the leading football finance expert in the UK. Hull City have borrowed £55m against their stadium and training ground yet they should get £30m from the Premier League before long. What is going on? https://www.bbc.co.uk/sport/football/articles/cpwel48y51do

The Political Economy of Football V2

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