Borussia Dortmund continue in profit

The authoritative Swiss Ramble reviews the 2018/19 accounts of Borussia Dortmund. Profit before tax decreased €13m from €35m to €22m (profit after tax €17m), despite revenue rising €60m (19%) from €317m to €377m, as profit on player sales fell €49m from €126m to €77m and total expenses were up €26m, but net interest payable was €3m lower. Although they have reported solid profits, they are a long way below the leading English clubs.

All revenue streams increased, though the largest growth by far was in broadcasting, up €45m (37%) to €167m. In addition, commercial rose €9m (6%) to €157m, match operations €2m (6%) to €45m and other operating income €4m to €8m.

The club has been consistently profitable with 2010 being the last time the club reported a (small) loss. In the 9 years since then, they have accumulated €227m profits, averaging €25m a season. The board expects to post another profit in 2019/20.

They have become increasingly reliant on player sales with average annual profits rising from just €11m in 2010-15 to a hefty €78m in the last 4 years. Without these profits, Dortmund would have been loss-making, but their strategy of developing young players has paid off.

For the first time, broadcasting is the most important revenue stream at the club with 44%, having overtaken commercial 42%. TV has more than doubled since 20% share in 2010, while commercial has fallen from 57%. Match operations has also declined from 22% to 12%.

They have €20m Evonik shirt sponsorship to 2025 (4th highest in Germany), €15m Puma kit supplier to 2020 (in negotiations for €20-30m deal), €9m Opel sleeve sponsor to 2022 & €5.8m Signal Iduna stadium naming rights partner to 2026. That’s pretty good, but far below Bayern.

Bundesliga clubs including #BVB have benefited from the new 4-year TV deal from 2017/18, which shot up 85% over previous period. However, other leagues will see large growth this season, so Premier League and La Liga will extend the difference, while Ligue 1 will narrow the gap.

They have earned a healthy €195m from European competition in the last 5 years, only surpassed in Germany by Bayern €319m, but with a chunky €124m shortfall. However, a fair way above Schalke €118m, Leverkusen €109m, Mönchengladbach €64m, Wolfsburg €61m and RB Leipzig €50m.

They had the highest attendance in Germany of 80,841 (including 55,000 season tickets – capped to ensure adequate supply of tickets on match day), around 6,000 more than Bayern and 20,000 higher than Schalke. The strategy is to keep ticket prices low to maintain atmosphere.

Thewage bill rose €18m (10%) from €187m to €205m, as base salaries and performance-related bonuses both increased. Wages have grown by €87m (74%) since 2015 with wages to turnover ratio worsening from 42% to 54% (still very respectable).

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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