The Political Economy of Football V2

Wolverhampton Wanderers’ latest set of accounts contained few surprises. The gist of the results for the 2023-24 financial year had been well-trailed in messages from the club in recent times. So it was widely expected that the club would make another loss, but that the figure would be much smaller than in the previous two seasons. With the Premier League’s rules on permitted losses clear in their minds, Wolves made a concerted effort at the start of the financial year to sell players to ensure they complied. And the policy worked, with Wolves avoiding any sanctions. For the third year in a row, Wolves made a pre-tax loss but the figure was hugely reduced from £67.2million ($85.4m) in 2023 to £14.3m in 2023-24.   Turnover rose from £168.6m in 2023 to £177.7m in 2024, while the net player trading loss — a metric the club uses which combines player sale profits with amortisation and contract impairments — was reduced from £38.6m in 2023 to £2.6m in 2024. The latest figures take...

The minority Everton shareholders, who fear the recent takeover of the club has led to a dramatic collapse in the value of their stakes, have had a request to meet the new owner, The Friedkin Group (TFG), rejected. As The Times reported in January, there are about 1,500 supporters who own approximately 8,000 shares, which before Everton were sold by Farhad Moshiri to TFG in December, amounted to 5 per cent of the club. As recently as November last year, shares were being traded in private sales for £3,400. But the £400million takeover has led to the total number of shares increasing from 135,000 to more than 1.6million, with the supporters’ collective stake now less than 0.5 per cent, and concerned fans estimating that each individual share has plummeted in value to as little as £175. Ian Kilbride, a lifelong fan of the club and businessman, who last year committed £2million to support Everton disability and literacy programmes, calculates that his own stake has dropped ...

Grimsby Town have moved from a modest profit to a more substantial loss:  https://www.insidermedia.com/news/yorkshire/grimsby-town-post-loss-as-income-returns-to-normal-results-show-how-challenging-it-is-for-lower-league-clubs-to-find-a-route-to-financial-sustainability Last year's turnover was boosted by a FA Cup run and from player sales. The club hopes that the arrival of an independent financial regulator will lead to a fairer distribution of revenues within football, but the legislation may yet to be watered down.

Historic Coatbridge club Albion Rovers is near collapse.   With the club now playing in the Lowland League it has proved difficult to attract investment:  https://www.thescottishsun.co.uk/sport/14425233/albion-rovers-brink-financial-collapse/

John Burn-Murdoch, the chief data reporter at the Financial Times., has produced a scorching analysis of Manchester United under the influence of Jim Ratcliffe.   The key message is that it is one thing turning around a struggling chemicals company by cutting costs: quite another to use that technique to restore a football club to greatness. ‘Ratcliffe, who bought about a 25 per cent stake in Manchester United early last year, might have seemed a sensible choice as a co-shareholder for the Glazer family given his business record. But rejuvenating a football team requires more than standard corporate measures such as streamlining processes or cutting the cost base. It requires much more cultural and strategic change. This is clear from the very financial accounts Ratcliffe has been tasked with turning around. There is no mystery as to why United’s finances have deteriorated so rapidly in recent years. On the revenue side, commercial and match-day income have held up well. But...

Brighton and Hove Albion posted a profit of £73.3m for their 2023/24 season after their Europa League appearance kept them in the black.  The pre-tax profit follows positive accounts a year prior, where the club made a profit of £130.7m. A significant chunk of the earnings Brighton, whose chairman is Tony Bloom, made came from the £115m transfer fee for Caicedo and the £25m payment for Sanchez – both to Chelsea – while the Stamford Bridge club handed Brighton £62m for Marc Cucurella and £21.5m for Graham Potter the year prior. Turnover for the year ending 20 June 2024 hit over £220m, the highest in the club’s history for a 12-month period. Bloom stated: “In recent months our chief executive and deputy chairman Paul Barber has outlined a medium to long-term strategic plan for our club, under the title of Vision 2030. His work here, alongside how he leads the club day to day, further underline his exceptional leadership skills, and it is very reassuring to know he’s commit...

Liverpool have reported a loss before tax of £57million for the financial year after the club were left counting the cost of missing out on Champions League qualification. The figures for the 12-month period up to May 31, 2024 also show that it now costs £600million a year to run Liverpool after administrative expenses rose by £38million. Of that amount, the club’s wage bill stands at £386million, which represents an 86 per cent increase from £208million in 2018. Included in that top-line figure for wages are contractual payments of £9.6million to Jürgen Klopp and more than ten members of his staff when they left at the end of the previous campaign. Liverpool’s fifth-place finish in 2022-23 resulted in them playing in the Europa League last season, which is not nearly as lucrative as Champions League football. There was a £38million drop in media revenue, to £204million, largely as a consequence of not being at Europe’s top table. That was partly...

Movers and shakers from the world of football gathered in London this week for the annual Financial Times Business of Football summit.   Here are a few highlights. The long-term prospects for football’s broadcast model is always a hot topic of debate, but Chelsea chair Todd Boehly floated one idea: sell global Premier League rights to Netflix.   Boehly’s interests in sports include stakes in the LA Dodgers baseball team and the LA Lakers in the NBA, and he has a history of making moves when it comes to media rights. So he’s someone worth listening to. His point was that the Premier League is a rare beast: content that is in demand globally. “If you really think about what it could do to unlock a global media platform, there’s nothing like this. I’m not saying that is the direct answer right this minute, but I think that’s where we’re headed,” he said. Illegal feeds have long been a big problem for football rights holders and their partner broadcasters. Some of the f...