The Political Economy of Football V2

A useful review of the finances of Aberdeen FC in the wale of their European qualification.    Despite bringing in record sums in 2024, they still lost money:  https://www.pressandjournal.co.uk/fp/business/6796357/aberdeen-fc-inside-look-at-the-finances-of-the-dons/

Aberdeen’s 2023/24 accounts covered a season that was a bit of a mixed bag. As chief executive Alan Burrows said, “The 2023/24 campaign wasn’t without its challenges. We finished seventh in the Scottish Premiership and had to change managers mid-season, which is not where any club ever wants to be.” On the other hand, the club played in a European group stage for the first time in fifteen years, though they did not progress to the knockout stages of the Europa Conference League. In 2019 Dave Cormack, an Aberdonian and lifelong Dons fan, replaced Stewart Milne as chairman after 22 years. Major League Soccer side Atlanta United acquired a minority stake (less than 10%) as part of a strategic alliance between the two clubs. This group provided £5m, which helped finance development of the training ground, and significant funding since the initial investment. Largely due to the European group stage football and domestic cup runs, Aberdeen’s revenue shot up by £7.8m (50%) from £15.8m...

Congratulations to Aberdeen FC on being transparent about their finances and reporting a record revenue up by 49 per cent:  https://www.afc.co.uk/2024/11/23/aberdeen-fc-reveals-record-breaking-turnover-in-latest-accounts/ As they claim, they look like a we ll-run, financially sustainable club.   A somewhat different story in my ancestral city of Inverness.

Celtic have earned €36.1m from the Champions League, which is much more than Rangers’ €20.2m in the Europa League and Aberdeen’s €4.8m in the Europa Conference. This is despite the fact that Celtic finished bottom of their group, while Rangers came first in their group, thus proceeding to the last 16. Celtic were Scotland’s sole representative in the Champions League group stage this season, earning €36.1m, which was made up of €15.6m participation fee, €4.0m prize money, €10.2m UEFA coefficient payment and €6.2m TV pool.   In other words, nearly half of their income is just for making it to the group stage, i.e. in the shape of the €15.6m participation fee. Rangers’ overall UEFA ranking was a bit behind Celtic’s at 58th, but their UEFA coefficient payment in the Europa League was much smaller.   Rangers will have a better coefficient next season, as they will drop a season without any ranking points, possibly overtaking Celtic. Rangers have earned €20.2m, including €5.0...

Aberdeen’s better results in 2022/23 on the pitch also helped with their finances, as they swung from a £2.2m net loss to a £1.1m profit. Profit from player sales shot up from £1.0m to £7.5m, which more than offset a £6.3m operating loss. Revenue rose £1.9m (14%) from £13.9m to £15.8m, but operating expenses were up by even more, increasing by £2.8m (15%) from £19.2m to £22.0m. Two of Aberdeen’s revenue streams grew: gate receipts were up by more than a third (£1.1m) from £3.0m to £4.1m, while commercial also rose £1.1m (15%) from £7.3m to £8.4m. On the other hand, broadcasting dropped £0.3m (8%) from £3.6m to £3.3m. Not all clubs have published accounts for 2022/23, but Aberdeen’s £1.1m profit is currently the second best financial result in Scotland for last season, albeit miles below Celtic’s record-breaking £33m profit. In general, Scottish clubs tend to run a tight ship, so almost all of them were in a narrow range between £2m profit and £2m loss, i.e. effectively break-ev...

Clubs building new stadia face rising interest rates and a significant increase in construction costs, but bigger teams should have few problems securing capital. Sport finance experts tell Off The Pitch global interest rates, the Covid-19 pandemic and the war in Ukraine are raising the cost of materials, labour and borrowing for large infrastructure projects. Last month, Aberdeen chairman Dave Cormack said the club's new stadium was likely to cost between £70 million and £75 million, up to £30 million more than was estimated five years ago. Cormack blamed "construction inflation" for the increase. The Scottish Premiership club hope to move into the stadium by 2025. Dutch Eredivisie club Feyenoord have also abandoned plans for a new stadium, blaming "through the roof" prices for building materials and rising mortgage interest rates. Greg Carey, a managing director at Goldman Sachs with almost 40 years' experience in stadium and infrastructure financing...

From his fastness in Zurich, the authoritative Swiss Ramble has been reviewing the 2019/20 accounts of Scottish Premiership clubs. Most Scottish Premiership clubs aim for break-even with five making small profits, led by Hearts £0.5m and Motherwell £0.3m. Rangers’ £17.5m post-tax loss is the big outlier, especially compared to Celtic’s£0.4m deficit, largely due to their recent investment in the squad. Celtic had the highest revenue with £70m, though the gap to Rangers £59m has narrowed. Both Glasgow clubs earn at least four times as much as other Scottish clubs with closest challengers being Aberdeen £14m, Hearts £12m, Hibernian £9m and Kilmarnock £5m. However, it is worth noting that Celtic were boosted by £24m profit from player sales, largely due to Kieran Tierney’s move to Arsenal, which was significantly higher than other Scottish clubs. The next highest were Kilmarnock £1.2m, Motherwell £1.0m. The Old Firm had by far the largest operating losses (i.e. excluding player sales...

Aberdeen supporters have voted overwhelmingly to stay in a location by the North Sea rather than move inland:  https://www.eveningexpress.co.uk/fp/sport/football/aberdeen-fc/donsnews/aberdeen-supporters-vote-overwhelmingly-in-favour-of-building-a-new-stadium-at-the-beach-instead-of-kingsford/ There was a time when I was on the FlyBe Birminghan-Aberdeen flight quite often and one supporter showed me the stadium from the outside.  They're hardy types up there like my Scottish ancestors and I think any new stadium should be by the beach.

The authoritative Swiss Ramble reports on the 2019/20 accounts of Aberdeen FC. In 2019/20 Aberdeen's loss narrowed from £5.0m to £3.2m, largely because prior year included £4.3m impairment of Pittodrie. Revenue dropped £1.6m (10%) to £14.3m due to COVID, while wages rose £0.5m (6%) to £9.8m. Debt cut from £7.2m to £1.3m after equity conversion. Overall revenue declined £15.9m to £14.3m. Match day revenue was down because of the effects of the pandemic, a fall of 32 per cent from £5.4m to £3.7m. Broadcasting was more or less steady at £3m, a third of that coming from European competitions. The wages to turnover ratio went up from 58 per cent to 68 per cent, still within UEFA guidelines. In many clubs across Europe player sales are an important contributor to revenue. However, Aberdeen showed a small deficit of £0.2m after a small surplus of £0.3 the previous year.

Aberdeen have reported an operating loss of nearly £3m compared with £1m last year and the effects of the pandemic and fans being locked out of the ground could mean a £5m loss in the coming year.  The club might have to take unspecified 'painful measures':  https://www.afc.co.uk/2020/11/20/2019-20-financial-update/

Aberdeen may stay at Pittodrie beyond 2023: If we can't raise the money we can't do it The Dons are ready to proceed to phase two of their planned new stadium at Kingsford as they finalise the completion of phase one, the training ground and community hub at Cormack Park, but incoming chairman Dave Cormack insists the move will only happen if the economic climate is right and the team is successful on the pitch.

The authoritative Swiss Ramble takes a look at Aberdeen's financial results for 2018/19. Aberdeen’s loss widened from £0.4m to £5.0m, almost entirely due to the £4.3m impairment of Pittodrie stadium. However, revenue rose £0.5m (3%) to another club record of £15.9m, though profit on player sales was unchanged at £0.3m. The only club in Scotland to generate sizeable profits from this activity was Celtic £17.7m, followed by Rangers £3.1m. Aberdeen’s revenue growth was driven by gate receipts, which increased £0.6m (13%) to £5.4m, due to the cup runs, and commercial income, up £0.5m (7%) to £7.4m, despite a reduction in sponsorship. Broadcasting fell £0.6m (17%) to £3.1m. The good news is that Aberdeen’s £16m revenue is the third highest in Scotland, but the bad news is that they are miles behind the big two Glasgow clubs. They are around a fifth of Celtic’s £83m and less than a third of Rangers’ £53m. The revenue gap between Aberdeen and Rangers has been increasing, as their riva...

Last night's Europa League qualifier between Aberdeen and Burnley brought home the financial gap between English and Scottish football. Aberdeen received £2.3m for their fourth consecutive runners up finish in the SPL. Burnley were paid £120m for finishing seventh in the Premier League. Work on a new £50m stadium for Aberdeen is scheduled to start this summer for completion in autumn 2019 with a 20,000 capacity. Th new stadium is situated in Kingsford to the west of Aberdeen and has been held up by local protests: New stadium