The authoritative Swiss Ramble provides a forensic analysis of the latest accounts of Ajax.
Ajax swung from
€27m pre-tax profit to €12m loss (€8m loss after tax), a €39m decline, largely
due to revenue dropping €37m (23%) from €162m to €125m. Profit on player sales
rose €2m to €86m, while operating expenses were up €1m.
The €12m pre-tax
loss is the highest in the Netherlands, though it should be emphasised that
these accounts are the first published for the 2020/21 season, so the only ones
that include a full year of the pandemic. In 2019/20 no fewer than 11 of the 18
clubs were profitable.
The €8m post-tax loss is dwarfed by the massive losses
reported by other leading European clubs for the COVID impacted 2020/21 season,
including Barcelona €481m, Inter €246m, Juventus €210m.
Ajax have a sustainable business model, so their 2021 loss
was only the second they have reported since 2010 (the other loss was less than
€1m in 2016). In fact, in the last 10 years they have accumulated nearly a
quarter of a billion Euros profit, averaging €24m a season.
They are very reliant on player sales, earning a thumping
great €461m from this activity in the last decade, including €361m in last 5
years alone. However, transfer results of this season’s summer window were
lower than expected, due to COVID depressing the market. [Clubs across Europe have become
increasingly reliant on player sales, but it is a volatile source of income].
They are known for their strategy of developing and selling
players, as highlighted by the €275m profit made in the 4 years up to 2020,
much higher than PSV €102m, AZ €70m and Heerenveen €41m. In fact, this was more
than many leading European clubs.
The €37m revenue fall was mainly due to COVID driven
reductions in match day, down €40m (95%) to €2m, partly offset by commercial
increasing €4m (5%) to €68m, including €11m NOW pandemic subsidy, Broadcasting
fell €1m to €55m, largely from UEFA distributions.
Revenue has
fallen by €74m (37%) in the past two years from the €199m peak to €125m, though
still club’s third highest ever. Reduction driven by lower UEFA TV money, and
especially match day, down to €2m as games played behind closed doors, so just
2% of total revenue.
Clearly COVID has had a significant effect on club
finances. The Swiss Ramble estimates
the revenue loss in 2020/21 to be around €38m (mainly match day), partially
offset by €13m expense savings. Excluding the net €25m impact, the club would
have posted a €13m pre-tax profit.
Ajax dropped from
23rd to 27th in the Deloitte Money League, just behind West Ham. This is a good achievement, though their
revenue is still far below the European elite. In the last 10 years the gap to
top 20 has held steady, but has greatly widened to the leading clubs.
To reinforce the enormous revenue disparity for Dutch clubs,
the Eredivisie €530m revenue in 2020 was around 10% of the Premier League €5.1
bn. It was also miles behind Germany
€3.2 bn, Spain €3.1 bn, Italy €2.1 bn and
France €1.6 bn. Also below Russia €877m & Turkey €670m.
Based on the Swiss Ramble’s estimate, Ajax earned €46m from
Europe in 2020/21: €42m from the Champions League group stage plus another €4m
after dropping down to the Europa League. It was slightly less than the previous
season, due to lower UEFA coefficient and COVID rebate.
They have earned
a hefty €194m from European competition in the last five years, which is even
more impressive considering that they reach the group stage of the Champions
League or Europa League in 2018. The importance of Champions League
qualification to the business model
cannot be over-stated with their €194m European TV money in last 5 years being
considerably more than PSV €72m and Feyenoord €44m.
The €68m commercial revenue is the highest in the
Eredivisie, well ahead of Feyenoord €42m and PSV €40m, but it is less than a
fifth of the elite European clubs, such as Real Madrid €383m, Bayern Munich
€361m and Barcelona €340m.
The wage bill
rose €2m (3%) to €95m, as higher performance bonuses offset a reduction in
salaries. By some distance the highest in Eredivisie, twice as much as PSV
€47m, followed by Feyenoord €38m. There is then a further big gap to AZ €22m,
Twente €15m and Vitesse €14m. Following
the decrease in revenue, the wages to turnover ratio rose from 57% to 76%
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