Big gap between one and two in Germany

The latest club accounts to be subjected to forensic security by the Swiss Ramble from Zurich are those of Borussia Dortmund.

The club’s pre-tax loss widened from €47m to €73m, as revenue dropped €35m (9%) from €379m to €345m and profit on player sales fell €25m from €40m to €15m, partly offset by cutting operating expenses by €31m and net interest payable decreasing €2m.

The €73m pre-tax loss is the highest in Germany, 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 eight of the 18 clubs lost more than €20m.

After nine consecutive years of profits, which generated €227m between 2011 and 2019, BVB have now posted losses in each of the last two years, amounting to €120m. The board expects another net loss in 2021/22, albeit much lower (between €12m and €17m)

The €35m revenue fall was due to COVID driven reductions in match operations, down €32m (98%) to €1m, and commercial, down €21m (12%) to €147m. On the other hand, broadcasting rose €17m (10%) to €187m, mainly Champions League money, while other income was up €1m to €10m.

Clearly COVID has had a significant effect on club finances. The Swiss Ramble estimates the revenue loss in 2020/21 to be around €64m (match day €32m, catering & hospitality €29m and UEFA TV rebate €3m). Without this impact, the revenue would have been €408m, a club record.

The profit on player sales fell €25m from €40m to €15m with the only sizeable sale being Toprak to Werder Bremen. Jadon Sancho’s big money move to Manchester United came after these accounts. Despite the slowdown in 2021, transfer deals have become an important part of the club’s strategy with €358m player trading profit in the 5 years up to 2020, one of the highest in Europe

The revenue gap between BVB and Bayern Munich has narrowed in recent years, but was still €268m in 2020. Put another way, Bayern’s €634m revenue was 73% higher than Dortmund’s €366m (Money League figures), which is a huge difference between the first and second ranked clubs.

They have earned a hefty €294m from European competition in the last five years, much less than Bayern Munich €427m, but a fair way above RB Leipzig €171m, Leverkusen €111m and Mönchengladbach €86m. From 2021/22 the German TV rights will be 70% higher (DAZN, Amazon & ZDF).

The wage bill increased slightly by €1m to €216m, which is the club’s highest ever, despite some salary cuts due to COVID. Wages have grown by almost €100m since €118m in 2015, though the gap to Bayern Munich (€340m) was still a substantial €125m in 2020.

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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