The Political Economy of Football V2

C eltic PLC on Friday reported a decline in profit for a first half that saw a "great deal of change and disruption", with the football club on its third manager of the season.   Celtic won a fourth Scottish league title in succession in May, but results on the pitch since have not been as emphatic this term. It believes there is "all to play for", however. In the six months to December 31, Celtic's pretax profit slumped 70% to £13.2 million from £43.9 million a year prior, with revenue sliding 29% to GBP59.4 million from GBP83.5 million.   Profit from player trading fell to £14.1 million from £21.5 million a year prior. The revenue decline, Celtic said, was due to it participating in the UEFA Europa League, the secondary European competition, instead of the Champions League like a year prior. In the current 2025/2026 season, Celtic exited the Champions League before the league phase began. In the prior season, it made it out of the league phase and into the Feb...

Calculations by the authoritative Swiss Ramble suggest that three clubs have already received more than €90m from this season’s Champions League, namely Liverpool €100m, Arsenal €91m and Barcelona €90m.  They are closely followed by Bayer Leverkusen €89m, Atletico Madrid €86m and Inter €86m.   The top eight clubs have all banked more than €30m in prize money, ranging from Liverpool’s €38.3m to Aston Villa’s €32.7m The country that has earned most to date from the Champions League is Germany with €349m, just ahead of England €340m, followed by Italy €310m, Spain €291m and France €272m.   There is then a big gap from the Big Five leagues to Portugal €112m and Netherlands €107m, both of whom have two clubs in this season’s Champions League. If we instead look at the average per club, then the dominance of the Premier League becomes apparent, as England are by far the highest with €85m, comfortably ahead of Spain €73m, Germany €70m, France €68m and Italy €62m. Clea...

When I was at Strathclyde University taking a MSc in 1968/9 we were discussing the rise of Scottish Nationalism and the sources of Scottish identity.   The tutor was expecting us to come up with the conventional answers: education system; legal system; Church of Scotland.   I knew that the Celtic Supporters Club was the largest student organisation at Strathclyde (reflecting the then composition of the student body).  I suggested that the national team -  together with the separate national competition - reinforced a distinct identity in a nation that was fitba’ crazy. The tutor, who was from Missouri, asked what hypothesis I would advance to test the relevant importance of football compared with other sources of identity, a methodologically impossible task.   However, I did know that his American colleagues were sneaking into Old Firm matches when they could.    They simply had nothing like it back home.     (English expats tende...

Celtic’s financial results for 2023/24 were very good, as they posted a £17.8m pre-tax profit (£13.4m after tax). That said, this was down £22.9m from the previous year’s huge £40.7m profit, though in fairness that was a record for Scottish clubs. This was mainly because 2022/23 included a couple of material once-off items, amounting to £13.5m, made up of a £10m business interruption insurance claim and £3.5m compensation received from Tottenham for Ange Postecoglou. In addition, profit from player sales more than halved from £14.4m to £6.6m, though revenue rose £5m (4%) from £120m to £125m, which was a new record for the club (and indeed Scotland). However, operating expenses increased by £9m (8%) to £117m. Celtic have managed to grow their revenue by £41m (49%) since before the pandemic, up from £83m in 2018/19 to £125m. In fact, they have set a new club record in each of the last two seasons with decent growth in all three revenue streams.   The expectation is that Celtic’...

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...

Celtic’s pre-tax profit  in 2022/23 surged from £6.1m to £40.7m, a record for Scottish clubs, though chief executive Peter Lawwell pointed out that this included “some material items of a one off nature” which amounted to £13.5m. This was thanks to a £10.0m business interruption insurance claim and £3.5m compensation received following Big Ange’s departure. Revenue rose £31.7m (36%) from £88.2m to £119.9m, another Scottish record, though profit on player sales more than halved from £29.0m to £14.4m. The main reason for Celtic’s revenue increase was participation in the Champions League, as opposed to the prior season’s Europa League. This resulted in healthy growth in both broadcasting, which more than doubled from £13m to £31m, and match day, up £8m (18%) from £43m to £51m.   To complete the “financial treble”, commercial also rose £6m (18%) from £32m to £38m. Celtic have posted profits seven times in the last eight years, the only exception being the COVID-impacted los...

The authoritative Swiss Ramble reviews the finances of Celtic.   He concludes that they are in good shape financially, despite the pandemic, thanks to their sustainable approach, though this owes a lot to their player trading model. Champions League qualification is also important, so the expanded format should help future prospects. Comparing their cash flow with Rangers in the last 10 years, we can see a big difference in approach. Celtic have made much more money from operations and player sales, which Rangers nearly matched via £78m loans and £38m share capital. The £2.5m debt is small, even by Scottish standards, and is a long way below Rangers £16.9m, which would have been even higher without them converting £66m of loans into shares in the last four seasons. Note: Celtic’s figure excludes £4.2m convertible preference shares. Celtic spent £38m on player purchases in 2021/22 after Postecoglou’s arrival, easily a club record, including Jota, Carter-Vickers, Furuhashi...

The authoritative Swiss Ramble looks at the money to be earned from the Champions League. Champions League overall prize money is 3.6 times the Europa League and 5.5 times the Europa Conference, but this varies by round. In general, the difference becomes smaller the further a club progresses, e.g. last 16 it’s 8x and 16x, while for the winners it’s only 2.3x and 4x. In 2022/23 each of the 32 clubs qualifying for Champions League group stage gets €15.64m plus €2.8m for a win and €930k for a draw. Additional prize money for each further stage reached: last 16 €9.6m, quarter-final €10.6m, semi-final €12.5m, final €15.5m and winners €20m. Each club in the Europa League group stage get €3.63m plus €630k for a win and €210k for a draw. Additional prize money: win group €1.1m (runners-up €550k), knockout round €500k, last 16 €1.2m, quarter-final €1.8m, semi-final €2.8m, final €4.6m and winners €8.6m. Each club in the Europa Conference group stage get €2.94m plus €500k for a win and €16...

The Swiss Ramble responds from Zurich to requests about how much Rangers earned for reaching the Europa League final.  His estimate is £17m (€19.3m) TV money.   They would have got another €4m if they had won the final. This compare to Celtic’s £9m (€10.5m) for group stage plus Conference League knockout round. Celtic’s earnings boosted by having a higher UEFA coefficient payment (€3.4m) than Rangers(€0.9m), as they are ranked higher based on performances in UEFA tournaments over the last 10 years (Celtic 38th vs Rangers 98th). Figures will be updated after this season. In addition, both clubs' revenue will include money for additional gate receipts and bonuses in commercial deals, partially offset by higher variable compensation for players and other staff.

The authoritative Swiss Ramble reviews the latest accounts of Celtic. The club swung a from £0.1m pre-tax profit to £11.5m loss (£12.6m after tax), as revenue fell £9m (13%) from £70m to £61m and profit on player sales fell £15m from £24m to £9m, partly offset by £5m other income (business interruption coverage) and £9m (9%) reduction in expenses. The pre-tax loss in 2020/21 is the first since 2014/15, breaking a sequence of five profitable years in a row. In fact, they have generated profits in seven of the last nine seasons, amounting to a net £42m gain over that period, despite last year’s £11m deficit. Celtic mitigated revenue losses by “tight cost control” with lower wages, down £4.5m (8%) from (restated) £56.2m to £51.7m; player amortisation, down £0.4m to £11.8m; player impairment, down £2.1m; and other expenses, down £1.7m (8%). Includes £0.6m for Neil Lennon departure. Clearly, the pandemic has had a major impact on the financials at all clubs with the cumulative revenue...

Celtic have published an abbreviated set of financial data for 2020/21, reports Kieran Maguire. Income held up well due to record sales of merchandise and somehow generating £20m from the stadium operations during lockdown. Day to day losses just under £25m but reduced by £5m ‘other income’ and player sales. Celtic balance sheet strong with £19m cash in bank mainly from season ticket sales receipts for 2021/22. The full statements is here, referring to the club's 'robust business model':  https://www.celticfc.com/news/2021/september/Celtic-plc-annual-results-2021/

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...

The idea of 18-team British League including Celtic and Rangers as an alternative to the failed Super League does not stack up in my view and football finance guru Kieran Maguire thinks so as well:  https://www.scotsman.com/sport/football/celtic/celtic-and-rangers-in-british-premier-league-doubts-from-football-finance-expert-3222422

Celtic lost £5.1m in the six months to the end of December compared with a profit of £19.3m in the same period a year earlier.  Revenue fell 23.7 per cent to £40.7m. Revenue from football and stadium operations fell to more than half as fans remain barred from matches. Profits from player sales fell from £23.1m to £1m. Chairman Ian Bankier admitted that the club's performance levels had not been good enough. arguing that it had been impacted by the absence of the club's passionate support. Celtic have chosen not to draw on a £13m revolving credit facility with the Co-operative Bank. 

The authoritative Swiss Ramble reports on Celtic's 2019/20 accounts.   They posted a small £0.1m pre-tax profit (£0.4m loss after tax), despite revenue falling £13m due to COVID. Figures boosted by £24m profit on player sales. This year’s figures will likely see a large loss due to COVID, but the club “remain committed to the strategy of careful use of our financial resources”. This will probably mean the profitable sale of some of their better players like talented French striker Odsonne Edouard. All three revenue streams were lower, especially match day, which fell £7.5m (17%) from £43.3m to £35.8m. Commercial dropped £3.6m (15%) from £24.4m to £20.8m, while broadcasting was also down £2.0m (13%) from £15.7m to £13.7m. The club have posted pre-tax profits five years in a row, amounting to a £36m surplus in that period. In fact, they have generated profits in seven of the last eight seasons with the sole loss in 2014/15 being only £4m. The figures greatly benefited from £24...

The authoritative @SwissRamble has been producing two page financial fact sheets on leading clubs which can be viewed on his twitter feed. His summary for Celtic is 'they have been profitable for the last four years, helped by good profits from player sales. Revenue fell in 2019, due to not qualifying for Champions League group stage. Low debt, high cash balance, declining net transfer spend. Highest revenue, wages and profit in Scotland.' 'Rangers have lost money in the last five years, partly due to low profits from player sales. However, revenue has more than tripled since 2015, driven by improved performance in Europe. Largest loss, debt and transfer spend in Scotland in 2019. Wages up to £34m (65% of turnover).'

Kieran Maguire of the Price of Football reviews the financial condition of Celtic and Rangers: Never let me down It is the strongest rivalry in British football and it is often a case of lighting blue touch paper and retiring when commenting on them as a neutral. Maguire concludes: 'Celtic have a noticeable advantage over Rangers in terms of income generation and profitability, partly due to their ability to buy low and sell high in terms of player trading, and this has allowed them to pay higher wages, which is usually, but not always, reflected on the pitch. Even so, Rangers is potentially going to continue to lose money unless a more successful player trading policy and a resolution to ongoing legal disputes is achieved.'

In the 1990s listing football clubs on the stock exchange was all the rage. With lucrative TV deals still getting off the ground, it offered a welcome source of funds. There are just two listed football clubs in the UK after Stan Kroenke took Arsenal private last year (it was listed on the Nex exchange). Manchester United is listed in New York. Its shares have fallen from $18.70 to $18.20 this year. Celtic is the only club listed on a mainstream exchange, the UK's Aim. Dermot Desmond, the Irish entrepreneur who owns 35 per cent of Celtic, says that the objective is to allow 'the Celtic family' to own a small piece of it, not to attract rich investors. In three years Celtic's share price has risen from 75p to 162.5p, despite paying no dividend, valuing it at £151m. With Rangers still recovering from its demotion to the fourth tier in 2012, Celtic is the dominant football force in Scotland. It has won the 'treble treble' in the last three seasons. Its l...

KPMG's fourth annual football valuation report ranks the 32 most prominent clubs in Europe according to their value: The European elite 'After three years of stability on the podium, this year brought some turbulence, with Real Madrid CF leapfrogging Manchester United FC at the top, and FC Barcelona slipping to the 4th spot, letting FC Bayern München take the 3rd position. Further changes among the top 10 include Tottenham Hotspur FC surpassing Juventus FC to reach the 9th position, and Arsenal FC dropping two spots to land in the 8th position, surpassed by Chelsea FC and Liverpool FC.' Scottish treble winner Celtic are included in the list of 32 major clubs, the first team from the country to be so. Andrea Sartori, KPMG's global head of sports and the report's author, said the overall value of the football industry had grown by 9% over the past year. 'The overall enterprise value of the top 32 clubs is driven primarily by an aggregate 5% increase in total ...

The authoritative Swiss Ramble has taken an in depth look at the recently published accounts of Hearts. Here are some of the highlights from his comments. The last loss Hearts reported was £0.9m in 2014/15, when they won the Scottish Championship. Since promotion, they have been profitable three seasons in a row. Hearts £12m revenue is the fourth highest in Scotland, within striking distance of Aberdeen £15m, but only around a third of Rangers £33m, while Celtic’s £102m is miles ahead. Indeed the revenue gap between Hearts and the big two Glasgow clubs is now at its highest for a while: £89m to Celtic and £20m to Rangers. On the other hand, they are £2.7m higher than Edinburgh rivals Hibernian. Given Hearts stadium investment, they did well to deliver the second largest profit in the SPFL Premiership with their £1.8m only beaten by Celtic £15.4m. That said, eight of the 12 clubs in the Scottish top flight make money with only Rangers reporting a sizeable £14.3m loss. One reason Ce...