Real Madrid remains top of the Football Money League as Sterling’s slide puts brakes on English clubs

Seven English clubs in the Top 20
Fenerbahce become first Turkish club to enter the Football Money League 

Real Madrid remains the world’s largest revenue generating football club, according to the latest Football Money League from business advisory firm Deloitte.  Manchester United and Barcelona finished second and third in the report, which ranks the 20 biggest football clubs in the world based on revenue. Each of the top three clubs generated revenues in excess of €300m.  Analysis in the Football Money League is based on the latest financial information for the 2007/08 season.

Bayern Munich returns to the top five in the Money League for the first time in five years, climbing three places to fourth and is joined in the top five by Chelsea.

Dan Jones, Partner in the Sports Business Group at Deloitte, commented: “Whilst Real Madrid’s 4% revenue growth in 2007/08 is more modest than recent years, the club has now doubled its revenues since 2002 and enjoys a lead of €41m over Manchester United.  With the club having announced that it is budgeting for revenues of €400m in 2008/09, it will be difficult for rivals to replace Real at the top of the Money League next year.”

“Manchester United’s on-pitch success in winning the Premier League and UEFA Champions League contributed to significantly increased revenue for 2007/08, although the depreciation of the Pound against the Euro means they remain in second position.  All bar two of our Money League clubs generated increased revenue in 2007/08 and each club in the top 20 generated more than €100m in revenue in that season.”

Real Madrid increased revenue by €15m (4%) to take their total to €366m (£290m). Manchester United’s performances on the pitch in 2007/08 resulted in a £45m (21%) increase in revenue to £257m, which translates to €325m.  Third placed Barcelona grew its revenue by €19m (6%) to €309m.

The impact of the exchange rate, and the depreciation of the Pound against the Euro has adversely impacted on the number and ranking of English clubs in the top 20.   Jones added: “If the exchange rate value of the Pound had not depreciated, there would have been nine, rather than seven English clubs in the top 20 and Manchester United would have topped the Money League ahead of Real Madrid.”

The global top 20 is entirely populated by European clubs.  In addition to the seven English clubs, Germany and Italy have four representatives each, Spain and France two clubs each, whilst Fenerbahce become the first Turkish club to feature in the top 20 since the creation of the Money League rankings in 1996/97. 

Alan Switzer, Director in the Sports Business Group, says: “Bayern Munich is the biggest climber in this year’s top 10, moving up to fourth position.  Despite not competing in the Champions League, revenues were boosted by the club acquiring 100% ownership of its home ground, the Allianz Arena.

“Fenerbahce and VfB Stuttgart, two of the three new entrants ‘promoted’ into the Money League, gain their top 20 position as a result of the significant revenue boost from competing in the Champions League.  The other new entrant, Manchester City, secured 20th position largely due to the increase in broadcast monies received from the Premier League, in the season prior to the arrival of the club’s Abu Dhabi based owners.”

Football remains a growth sport, especially at the highest level.  The top 20 clubs’ aggregate revenue grew by 6% (€220m) to €3.9 billion (£3.1 billion) in 2007/08.  The top 20 clubs now generate more than three times the combined revenue of the clubs in the first Money League publication in 1996/97.

This year’s Money League is based on the latest available revenue figures in respect of the 2007/08 season, largely before the global economic downturn.  Whilst next year’s Money League will show some early signs of how the changing economic environment is affecting the game’s top clubs (for the current 2008/09 season), it will not be until 2009/10 that there is a fuller picture of the impact. 

Reflecting on the potential impact of the economic downturn on Money League clubs, Paul Rawnsley, Director in the Sports Business Group commented: “The unique nature of the football industry will enable major clubs to be relatively resistant to the economic downturn.  Clubs’ match attendances are holding up well and clubs in each of England, Germany, France and Spain have TV deals secured well into the future at enhanced levels.  However, the clubs are not complacent and will have to work hard to grow further matchday and commercial revenue streams for 2009/10.

“The English Premier League currently generates the highest level of broadcast rights value of any football league in the world.  Despite the challenging economic environment, the Premier League has just secured a record value for live domestic broadcast rights for the seasons 2010/11 to 2012/13, up 4% to £1.782 billion.  Given the worldwide popularity of the Premier League there is likely to be further uplift in value from overseas rights when they are marketed later this year.”

Ends

Note to editors
To review the full findings of the Deloitte Football Money League and to hear a podcast featuring Dan Jones, please visit www.deloitte.co.uk/sportsbusinessgroup

The Deloitte Football Money League – 2007/08 revenue

Source: Deloitte Football Money League 2009

This press release is based on the Deloitte Football Money League published in February 2009.  As explained more fully in the publication, the revenue figures are extracted from each club’s annual financial statements, or other direct sources, for the 2007/08 season.

The three clubs that have dropped out of the Money League for 2007/08 (compared to the top 20 clubs based on 2006/07 revenue) are Celtic, Valencia and Werder Bremen.

There are many ways of examining the relative size, wealth or value of football clubs.  For the Money League, revenue has been used as the most easily available and comparable measure of financial performance. 

Revenue excludes player transfer fees, value added tax and other sales related taxes.  In a few cases adjustments have been made to total revenue figures to enable, in our view, a more meaningful comparison of the football business on a club by club basis.  For instance, where information was available to us, significant non-football activities or capital transactions have been excluded from revenue.  Some revenue differences between clubs, or over time, will arise due to different commercial arrangements and how the transactions are recorded in clubs’ financial statements; or due to different ways in which accounting practice is applied such that the same type of transaction might be recorded in different ways.

We have not performed any verification work or audited any of the information contained in the clubs’ financial statements or other sources for the purpose of the publication.

For the purpose of the international comparisons, all figures for the 2007/08 season have been translated at 30 June 2008 exchange rates (£1 = €1.2632).  The exchange rate for Pound Sterling to the Euro fell by 15% between 30 June 2007 and 30 June 2008.  Comparative figures have been extracted from previous editions of the Money League.

Later this year the Deloitte Annual Review of Football Finance will be published, providing a more detailed analysis of the English and European football finance landscape.

About the Sports Business Group at Deloitte
Over the last 15 years Deloitte has developed a unique focus on the business of sport. Our specialist Sports Business Group offers a multi-disciplined expert service with dedicated people and skills capable of adding significant value to the business of sport. Whether it is benchmarking or strategic business reviews, operational turnarounds, revenue enhancement strategies or stadium/venue development plans, business planning, market and demand analysis, acquisitions, due diligence, expert witness, audits or tax planning; we have worked with more clubs, leagues, governing bodies, stadia developers, event organisers, commercial partners, financiers and investors than any other adviser.

For further information on our services you can access our website at www.deloitte.co.uk/sportsbusinessgroup

About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.  Deloitte is the United Kingdom member firm of Deloitte Touche Tohmatsu ("DTT"), a Swiss Verein whose member firms are separate and independent legal entities.  Neither DTT nor any of its member firms has any liability for each other's acts or omissions.  Services are provided by member firms or their subsidiaries and not by DTT.  Deloitte LLP is authorised and regulated by the Financial Services Authority. 
The information contained in this press release is correct at the time of going to press.
For more information, please visit www.deloitte.co.uk

Last Updated: