Europe's top 20 football clubs see revenues nosedive due to pandemic

05 February 2021 6 min. read
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Europe’s wealthiest football clubs will miss out on revenue of over €2 billion by end of the 2020/21 season, according to a new report. Due to the Covid-19 pandemic, the continent’s richest teams already saw revenues decline by more than €1 billion last season.

While small football clubs have been left on the brink by Covid-19, Europe’s wealthiest sporting institutions have also been left facing a black hole in their budget, thanks to the pandemic. 

A new study has shown how big an impact this has had on some of the richest individual clubs in the game. Deloitte’s Sports Business Group estimates that the continent’s 20 most financially successful football clubs generated €8.2 billion, a decline of 12% compared to their 2018/19 income of €9.3 billion.

Revenues of footbal clubs in 2019 and 2020

First and foremost, the researchers explained this €1.1 billion decrease by pointing to a €937 million drop in broadcast revenue, primarily due to revenue deferral and broadcaster rebates. This 23% fall in income is less than the top clubs might have experienced had their respective leagues ended the season early during the height of the coronavirus’ first wave – but looking ahead, the sustainability of the beautiful game’s reliance on broadcast income inflation has clearly been thrown into question.

Meanwhile, matchday revenue constituted a €257 million hit for Europe’s 20 richest clubs, as with doors closed for fans for much of the last year, they have seen a 17% decline in such income. While this may seem grave, it is liable to be even worse in next year’s analysis, as during the 2019/20 season, games were able to accommodate capacity crowds in the first half of the season. By contrast, all but a handful of game weeks have seen fans completely banned from stadiums – and minimal gatherings in the moments these restrictions have been loosened.

These loses were mildly offset by a 3% increase in commercial revenue. However, the €105 million this represents will not sustain anything like the exponentially growing cost of running a football team seen in recent years. If Europe’s biggest football clubs hope to weather the current storm in this way, they will have to significantly up their game when it comes to fan-engagement in the coming months.

Commenting on this further, Tim Bridge, Director in Deloitte’s Sports Business Group, said, “The Covid-19 pandemic has provided an impetus for clubs to rethink and recalibrate their wider strategic objectives and business models to ensure a strong recovery from the current situation… In particular, the focus on both internal and external digital capabilities has accelerated as digital interaction has become the dominant way in which clubs can engage with their employees and fans. The most agile, and innovative clubs will be the best placed to deliver the greater value to their key stakeholders and be rewarded with the fastest and strongest recovery.”

As things stand, according to Deloitte, the 20 highest revenue generating clubs in world football will have missed out on over €2 billion in revenue by the end of the 2020/21 season.

Set against the context of the global economic and social disruption caused by the Covid-19 pandemic, there is a deferral element and a permanently lost element (notably on matchday income, but also rebates to broadcasters) to the reduction in revenue. In terms of deferral, the disruption to the 2019/20 season in most clubs’ cases meant that approximately one quarter’s revenue from the financial year ending in 2020 has been shifted to the financial year ending in 2021, resulting in 2021 having an additional quarter’s revenue.

Dan Jones, Partner in the Sports Business Group at Deloitte, remarked, “Leagues across the world took different approaches in response to the pandemic with respect to their seasons, ranging from postponement to termination, with final standings determined using different methodologies, to others being annulled entirely… There is no doubt that this is one of the most testing times the football industry has ever had to endure. The absence of fans, postponement and cancellation of matches, rebates to broadcasters and the need to satisfy commercial partners have all significantly affected the compilation of the 2021 Football Money League. As a result, the comparability of relative performance between clubs in this year’s Money League is more challenging than usual.”

Individual clubs

Despite the significantly different conditions across leagues in the 2019/20 season, the Money League’s composition has remained broadly consistent with previous years. The constituents of the top ten remain unchanged, whilst 18 of the 20 clubs were present in last year’s Money League.

Despite a hugely disappointing year on the pitch – and a wage spending crisis minimising the club’s recruitment crisis ahead of the present season – FC Barcelona has retained its position as the world’s wealthiest club, with a revenue of €715.1 million. The club’s revenue fell by more than €100 million over the course of the year – but even so it still placed narrowly ahead of rival Spanish powerhouse Real Madrid. What will be interesting to see is just how much the star-power of Lionel Messi has maintained the Catalan giants’ income – and how the club’s continued proxy-war with its want-away talisman might impact its commercial revenue in the current season.

Champions League winners Bayern Munich rose to third place in this year’s Money League – it’s highest placing in almost a decade. The club had the smallest revenue decrease (4%) of the Money League top ten, benefitting from being able to recognise all of its domestic broadcast revenue in the financial year ending in 2020, due to the earlier completion of the Bundesliga season.

English clubs had less luck by comparison. Manchester United’s revenue of €580.4 million saw them slip to fourth place after a revenue decrease of €131.1 million – or 19% – the largest year-on-year decline in this year’s Money League. Not competing in the 2019/20 UEFA Champions League clearly exacerbated the absence of matchday revenue and broadcast rebates and deferrals. Meanwhile, Liverpool’s club’s on-pitch success of the past few years continues to fuel financial success with the benefits associated with its Premier League triumph spread across the financial years ending in 2020 and 2021 – however it still endured a fall of around €40 million in revenue.