Villa bang on the big six's glass ceiling

Having lived in the Midlands for over 50 years, I regard Aston Villa as the leading regional club, a status that has gone from aspiration to fulfillment.  My chiropodist is a keen season ticket holder so we always discuss the club’s progress.

Here I rely on the latest assessment by the Swiss Ramble of the club’s 2024/25 accounts.  He has an unrivalled data set and forensic financial skills which he applies from his Zurich base.   Read more on his Substack page.

This has the makings of another fine season for Aston Villa, as they on course for fourth place in the Premier League, while they have guaranteed their qualification for the Champions League.

In addition, they could get their hands on some silverware by winning the Europa League, as they are favourites to beat German side Freiburg in this week’s final in Istanbul.

It bears remembering how far Villa have progressed under owners Nassef Sawiris and Wes Edens, who bought the club in July 2018.   They have invested big money in order to compete with the traditional elite, which is reflected in the club’s financials, but in addition it “has made significant progress against its stated objective of delivering sustainable improvement on and off the pitch.”

However, Villa have had to contend with restrictions imposed by PSR, which represent a major challenge for aspirational clubs.    Arguably, Villa have been victims of their own success, as qualification for Europe brings with it the need to comply with UEFA’s financial regulations, which are much tougher than those applied in the Premier league.

As per the accounts, things look pretty good, as Villa swung from an £86m pre-tax loss to a £17m profit, with revenue shooting up £102m (37%) from £276m to a club record £378m, though profit on player sales fell by £13m (20%) from £65m to £52m.  This was offset by steep cost growth, as operating expenses rose £92m (22%) from £426m to £518m, while net interest payable was up £3.6m (66%) from £5.3m to £8.9m.

However, the year-on-year improvement was entirely due to the £114m profit they made on the disposal of a couple of investments to another group company, namely the women’s team and the operating rights to The Warehouse property.

Record revenue streams

All three main revenue streams set new club records, mainly thanks to more success on the pitch, including participation in the Champions League.  Broadcasting was the star of the show, rising £57m (31%) from £184m to £241m, but there was also good growth in the other revenue streams. Commercial increased by £31m (52%) from £60m to £91m, while gate receipts rose £10m (37%) from £28m to £38m.

In recent years Villa have stepped on the gas with player trading, which has become a necessary evil in a PSR world. As a result, they have made a substantial £237m in the last four seasons, which is almost nine times as much as the £27m in the preceding 4-year period.

In absolute terms, Villa’s £200m revenue growth in the last three years has only been outpaced by Arsenal £321m, while their 112% increase was actually the best in the Premier League, comfortably ahead of Arsenal 87% and Newcastle United 86%.

Following this significant growth, Villa’s £378m revenue is now seventh highest in the Premier League, though they are still a fair way behind the Big Six. Indeed, four of those clubs generate around £300m more than Villa, led by Liverpool £703m, Manchester City £604m, Arsenal £690m and Manchester United £667m.

Villa received €83.7m after reaching the quarter-finals of the Champions League, before losing to Paris Saint-Germain. This compromised €18.6m participation fee, €45.2m prize money and €19.8m value pillar (the replacement for the TV pool and UEFA coefficient).

This season Villa have already earned €35.2m after reaching the Europa League final, made up of participation fee €4.3m, prize money €22.0m and value pillar €8.9m. If they do manage to win the trophy, they would earn another €6.0m plus €4.0m for making the UEFA Super Cup.

Villa have suffered from having a much smaller stadium than most of their competitors with Villa Park’s capacity being only 42,657. There have been various proposals on increasing this over the last few years, but they have all come to nothing, due to issues largely relating to the surrounding infrastructure.

Villa’s wage bill increased £21m (8%) from £252m to £273m, which means that this has almost doubled in just three years.

Shillings in the meter?

There was a colossal increase in Villa’s other expenses, which surged £57m (80%) from £71m to £128m.  Most fans will overlook this cost category, focusing on wages and transfers, but this has become an increasingly important factor for football clubs. In fact, it has more than tripled at Villa in the last three years.  Like other clubs, they had to cope with the inflationary impact on a number of services, especially utilities, but this growth still seems pretty extraordinary.

To underline how big an issue this is for Villa, their other expenses accounted for 34% of turnover, the second highest in the Premier League, only surpassed by Tottenham’s 36%.

Villa spent £162m on player purchases in 2024/25, around the same level as the previous season, which the club said was needed “to remain competitive”.   This was the fifth highest in the Premier League, but only around half of the top three clubs, namely Manchester City £353m, Manchester United £343m and Chelsea £305m.

Debt and owner funding

Villa’s gross financial debt more than doubled from £69m to £146m, driven by a steep £91m increase in external debt from £20m to £111m.  They repaid a £20m overdraft, but drew down £78m from a £100m revolving facility and added a £33m loan, factored on receivables, both taken out with Goldman Sachs.

Sawiris and Edens have significantly increased the club’s investment in facilities, adding up to £139m in the last seven years, which is around ten times as much as the £14m in the preceding 7-year period.  As well as hospitality renovation at Villa Park, a lot has been spent on the Bodymoor Heath training ground, including a hotel for players and staff, new pitches and improving facilities for the academy and women’s team, plus investments in new retail stores.

There is little doubt that Sawiris and Edens have “put their money where their mouth is”, as the owners have injected nearly £700m of capital in the seven years since their arrival, including £94m last season. That means that they have stumped up £366m in the last three years alone.   The previous owners were not exactly slouches, though their funding was a lot lower at £177m in the 7-year period between 2012 and 2018.

The Swiss Ramble concludes: ‘Their operating losses of around £140m in each of the last three seasons is a better representation of the club’s financial position than booked profit, though UEFA’s sanctions for breaching their PSR regulations had already provided a fairly strong indication of their issues.

The financial challenge remains, despite Villa setting a big new club record for revenue, not far short of £400m, after they grew this at a faster rate than any other club in the Premier League.   The losses are symptomatic of the investment required for a club aspiring to challenge the leading clubs, due to to funding investment in the squad. In Villa’s case, this has helped drive strong improvement on the pitch, leading to qualification for the Champions League and a possible victory in the Europa League.’