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Fri 10 Jun 2011 10:13 AM

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Wage bills at top Euro clubs exceed $8bn, says Deloitte

Despite economic headwinds, Europe's big five leagues see revenues grow 4% in 2009-10

Wage bills at top Euro clubs exceed $8bn, says Deloitte
FA Cup winners Manchester City, owned by Abu Dhabi, are one of the biggest spenders in European football. (Getty Images)

Wage bills at football clubs in the ‘big five’ European leagues increased by more than €400m to exceed €5.5bn ($8bn) in 2009/10, an increase of eight percent. 

Despite significant economic headwinds, England, Italy and France wages growth exceeded the absolute level of revenue growth, while in Germany revenue and wages grew by similar amounts, a new report by Deloitte has revealed.

In Spain, aggregate wages excluding Barcelona and Real Madrid fell and the overall wages/revenue ratio of 60 percent represented a 10-year low.

One of the biggest spenders in Europe over the past two years has been Abu Dhabi-owned Manchester City.

Abu Dhabi’s Sheikh Mansour bin Zayed Al Nahyan has spent more than $805m on the team since acquiring it in 2008 from former Thai Prime Minister Thaksin Shinawatra.

Last month, Manchester City chairman Khaldoon Al Mubarak said the club was being managed "prudently" and he had no worries about meeting new financial targets being set by governing body UEFA.

Al Mubarak said he was "very comfortable" with the financial operation at the club.

Overall, the European football market grew by four percent in revenue terms to €16.3bn in 2009/10, Deloitte's research showed. 

All of Europe’s ‘big five’ leagues reported revenue growth, to a collective total of €8.4bn while broadcasting revenue (up seven percent) was the main driver of growth and now stands at over €4bn across the five leagues.

The English Premier League remained the highest revenue generating league in world football, with its clubs’ revenues increasing to €2.5bn in 2009/10, up from €2.3bn in 2008/09.

The gap to the second ranked German Bundesliga increased to more than €800m, Deloitte's report added.

Spain’s La Liga achieved the highest revenue growth of eight percent, much of which was driven by increased revenues at both Real Madrid and Barcelona, who between them generate more than half (52 percent) of the revenue.

Revenues in Italy’s Serie A increased by €38m to €1.5bn, leaving Italy in fourth position ahead of France’s Ligue 1, whose revenues grew by the smallest amount (two percent) among the ‘big five’ leagues.

Dan Jones, partner in the Sports Business Group at Deloitte, said: “The growth in revenues in all of Europe’s ‘big five’ leagues in 2009/10 during the economic downturn is an impressive achievement.

"Top flight European football is one of television’s most desirable products and, in revenue terms, football continues to be a stellar economic success story in almost all European countries. However, football’s biggest challenge remains the same – the need for greater cost control, notably over players’ wages and transfer fees.”

The Bundesliga remained Europe’s most profitable league, despite a fall in operating profits from €172m to €138m.

England’s Premier League narrowed the gap, with operating profits rising to €101m while Serie A and Ligue 1 remained loss making.

In Spain, Barcelona and Real Madrid generated substantial operating profits but the remaining clubs recorded a significant aggregate operating loss.

Deloitte said Europe’s top 20 revenue generating clubs earned over €4.3bn in 2009/10, around 26% of the entire European football market. 

Outside of the ‘big five’ countries, The Netherlands (€420m), Turkey (€378m) and Russia (€368m) have the largest revenue generating leagues – although the English Football League Championship was actually Europe’s sixth largest league in revenue terms in 2009/10, at €497m.

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