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.

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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