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.

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The Political Economy of Football V2

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