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Borussia Dortmund rely on player sales

The authoritative Swiss Ramble reviews the 2019/20 accounts of Borussia Dortmund.   They went from €22m profit before tax to €47m loss (€44m after tax), mainly due to profit on player sales falling €43m to €40m. Despite the COVID restrictions, revenue was basically flat at €379m, but operating expenses rose €25m and net interest payable was €2m higher.

The €47m loss was their first since 2010. In the nine years up to 2019, they generated €227m profits, averaging €25m a season. In light of the high degree of uncertainty related to all revenue streams, the board expects a net loss in 2021 between €70m and €75m.

The only revenue item to decrease was match operations, down €12m (27%) to €33m, but the pandemic restricted growth in broadcasting, up €3m (1%) to €170m, commercial, up €10m (6%) to €168m, and other operating income, up €1m to €9m.

In 2018/19, i.e. before the pandemic, the €22m pre-tax profit was fifth highest in the Bundesliga, only surpassed by Bayern Munich €75m, Eintracht Frankfurt €56m, Hoffenheim €26m and Mainz 05 €25m. Their €17m after tax was fourth best.

BVB have been increasing their profits from player sales, although a fair way below the Italian clubs. The club benefited from €40m profit on player sales, mainly Diallo to PSG, Alacer to Villarreal, Weigl to Benfica, Philipp to Dynamo Moscow and Bruun Larsen to Hoffenheim, though €43m lower than prior year.

Broadcasting is (just) the most important revenue stream at the club with 45%, having overtaken commercial (44%) in the last two years. TV share has more than doubled since 2010, while commercial has fallen from 57%. Match operations has also declined from 22% to 9%

Bundesliga clubs including BVB benefited from the new TV deal in 2017/18, which shot up 85%, but the new deal from 2021/22 will see a 4% reduction. Still third best in Europe, though a long way below Premier League and La Liga, while Ligue 1 will narrow the gap.

Based on the Swiss Ramble's estimate, the club earned €69m from the Champions League after going out in the last 16, a bit higher than prior season’s €66m. Worth noting the influence on Champions League money of UEFA coefficient payment (based on performances over 10 years), where they have 10th highest ranking of clubs competing this season, giving them €25m.

The club have earned a healthy €232m from European competition in the last five years, though Bayern Munich €402m is almost twice as much.

The wage bill rose €10m (5%) from €205m to €215m, which means wages have grown by almost €100m since 2015 with wages to turnover ratio worsening from 42% to 57% (still very respectable). Players and coaching staff have taken pay cuts, saving “a double-digit millions amount”. Despite the growth over this period, the wage bill is still significantly lower than Bayern Munich: in 2018/19 the gap was higher than it has ever been at €151m (€205m vs. €356m).



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