£4.5 billion Premier League clubs dominate Europe's football rich list
Premier League wages reached an all-time high of £2.5 billion – however, the beginning of a huge television rights deal meant that clubs actually turned a large profit in the 2016/17 season. Manchester United meanwhile retained their place as the club with the highest revenue in Europe, despite an absence from the UEFA Champions League last year.
According to the latest annual review of top clubs' finances from Big Four firm Deloitte, record revenues in the English Premier League (EPL) hit £4.5 billion in the 2016/17 campaign – a boost of nearly £1 billion on the previous term – chiefly thanks to new television rights deals kicking in, including the landmark £5.1 billion domestic package shared between broadcast giants Sky and BT. While players' collective salaries also continued to rise by 9% during the 2016/17 campaign, as club revenues leapt up by 25%, Deloitte's researchers found that that the wage to revenue ratio in the league was at its lowest level since 1997/98 – a 55% gap.
Premier League footballers raked in an eye-watering £2.5 billion in wages last season, the highest amount ever seen in England’s top flight. However, pay growth was at its weakest for 20 years contrasted with surging club revenues – as club owners looked to increase profitability. This follows last year’s release from Deloitte, which discovered that Premier League football clubs had recorded their first combined pre-tax loss since the 2012/13 season. In spite of colossal revenues of £3.6 billion – up 9% from 2014/15 (£3.4 billion) – the league’s collective wage-bill continued to climb, growing by 12% to £2.3 billion, compounding a combination of increasing amortisation debt charges and record transfer spending, meant the 20 clubs still lost a total of £110 million.
While fans hearts are unlikely to bleed for top paid players, who still collected a weekly wage packet totalling £48 million during the 2016/17 campaign, the analysis does show that football clubs are willing to employ similar tactics to standard employees – seeking to at least slow wage growth in order to boost bottom-lines. Certainly, the tactic will have boosted the profitability of England’s elite clubs, a record ten of whom occupy spaces in the top 20 European football teams with the largest 2016/17 revenues.
With Everton (20th), Southampton (18th), West Ham (17th) Leicester (14th) and Tottenham Hotspur (11th) all making the list, five English teams took up residence in the top ten. Liverpool and 2016/17 champions Chelsea both held their ranks from the previous year, in ninth and eighth respectively. Meanwhile, Arsenal saw their position improve by one, following a third FA Cup triumph in four years, although their failure to reach Europe’s elite tournament – the UEFA Champions League – for the first time since 1998 will likely impact on their income in next year’s report.
United top the list
One place above, in fifth, Manchester City enjoyed a frustrating first season under Pep Guardiola, ending the campaign without silverware. Despite this, the club managed to maintain its position in the ranking, and are likely to improve next year, following an enhanced Champions League outing in 2017/18, and a Premier League triumph, which saw the team crowned champions with five games to spare. For a second consecutive year, meanwhile, Manchester United topped Deloitte’s football money league outright – landing the EFL Cup and Europa League trophies in Jose Mourinho’s first year at the helm of the club.
However, the year’s contest between Europe’s best financial performers was the tightest Deloitte has ever reported. While Zinidine Zidane’s Real Madrid side made history by becoming the first team to retain the Champions League in its current form, they came incredibly close to catching the revenues of Manchester United, while Catalan giants Barcelona also closed ground on the Red Devils – whose absence from the UEFA Champions League impacted on revenues – which declined slightly on the year previous.
United’s financial performance was still underpinned by a colossal commercial revenue though, which continues to see them outperform their competitors in spite of this. With the welcome return to the Champions League in the 2017/18, the club will have received a boost to both matchday and broadcast revenue that will likely see them retain the top spot next year. According to Deloitte, the challenge for United will now be whether they can retain their commercial supremacy during the next round of sponsorship renewals, but few would bet against them doing just that, given the global popularity of their brand.
