Thread by @SwissRamble

Deloitte’s annual Football Money League has become essential reading, but it only ranks the world’s leading football clubs by revenue. The following thread adds details for expenses, profits and balance sheet for an “enhanced” version of the money league.

First, we will include some handy one-pagers that include the details for the Top 20 Money League clubs, both in Sterling and Euros. Then, we will drill into each of these in turn to highlight how each club has performed in various categories (only in Sterling).

The revenue overview includes details for each revenue stream (match day, broadcasting and commercial) with broadcasting further split between domestic and UEFA competitions. Other revenue is mainly player loans that are not always included in the Deloitte definition of revenue.

The expenses overview details wages (and wages to turnover ratio), player amortisation, player impairment, depreciation, other expenses and net interest payable. Other expenses include transport, rent, maintenance, utilities, insurance, security, consultants, etc.

The profit and loss overview includes various definitions of profit: EBITDA, operating profit, profit on player sales, profit before tax and profit after tax. It also shows exceptional (once-off) items, other player management, property sales and tax.

The balance sheet overview includes several definitions of debt: financial debt, transfer debt and total liabilities. Financial debt is shown gross and net (less cash), while transfer debt is split between payables, receivables and net. Also show squad value per the accounts.

The TLDR brigade could probably stop at this point, but if you want to see the top 20 clubs ranked in order for each of these categories in a neat graph, please carry on.

#FCBarcelona £741m have the highest revenue, ahead of Spanish rivals #RealMadrid £667m, and are the first club to break through the £700m barrier. Other clubs with revenue above £500m are #MUFC £627m, #FCBayern £582m, #PSG £560m, #MCFC £538m and #LFC £533m.

#FCBarcelona £140m and #RealMadrid £128m have the highest match day revenue, ahead of #MUFC £106m and #PSG £102m. The lowest was reported by #SSCNapoli £14m and #EFC £15m.

Even though #AFC match day revenue of £96m only placed them in 5th place, they still had the highest percentage of revenue from this stream with 25%, well ahead of the 19% at the next highest clubs (#RealMadrid, #FCBarcelona and #TeamOL).

Three clubs earned more than a quarter of a billion pounds from broadcasting: #LFC £264m, #FCBarcelona £263m and #MCFC £253m, closely followed by #THFC £244m and #MUFC £241m. The lowest revenue was #TeamOL with £108m.

The importance of the Premier League TV deal to medium-size English clubs is highlighted by #EFC and #WHUFC generating 71% and 67% respectively of their revenue from broadcasting, despite not qualifying for Europe. Top placed clubs are far less reliant on TV than smaller clubs.

Thanks to that lucrative Premier League deal, English clubs fill 8 of the top 10 places in domestic TV, led by #MCFC £171m, #LFC £166m and #CFC £159m. Only exceptions are #FCBarcelona (4th) and #RealMadrid (7th). Relatively low French TV deal puts #PSG and #TeamOL at the bottom.

However, the importance of Champions League is also evident, especially after 50% increase in prize money in 2018/19. The highest revenue from UEFA competitions came at #FCBarcelona £104m, #LFC £98m, #THFC £90m, #Juventus £84m, #MUFC £82m and #MCFC £82m.

Commercially, there was significant growth at #FCBarcelona, up £52m to £338m, and #PSG, up £43m to £320m, but it was flat at #FCBayern £314m, #RealMadrid £313m, #MUFC £280m and #MCFC £230m.

Well over half of the total income at #PSG 57% and #FCBayern 54% comes from commercial income, followed by #RealMadrid 47%, #FCBarcelona 46% and #MUFC 45%. This revenue stream has increasingly become the distinguishing factor between elite clubs.

Total expenses, including wages, player amortisation and impairment, depreciation and other expenses, have steadily risen in line with revenue. Highest at the Spanish giants, #FCBarcelona £824m and #RealMadrid £706m, ahead of #PSG £621m, #FCBayern £599m, #MUFC £583m & #CFC £583m.

Even after excluding other sports, #FCBarcelona £442m wage bill is over £100m more than the next highest club. There are 6 clubs with wages in a narrow £22m range: #MUFC £332m, #PSG £327m, #RealMadrid £319m, #MCFC £315m, #FCBayern £314m and #LFC £310m.

Most of the leading clubs have a wages to turnover ratio within the 50-60% range. The highest (worst) are #EFC 85%, #ASRoma 78%, #WHUFC 71%, #Juventus 66%, #CFC 63%, #Atleti 63% and #SSCNapoli 62%. The three lowest (best) ratios are Schalke 38%, #THFC 39% and #RealMadrid 48%.

#CFC £168m have by far the highest player amortisation, the annual charge to write-off transfer fees over the contract length. There is then a big gap to #Juventus £131m, #FCBarcelona £128m, #MCFC £127m and #MUFC £126m. Lowest are #TeamOL £28m, #FCBayern £43m and #THFC £48m.

Highest depreciation is £25m at #THFC, due to the investment in their new stadium, followed by #FCBayern £24m, then #Inter £19m, #TeamOL £18m and #AFC £15m. Note: #PSG depreciation detail not available in the accounts I have seen.

Other expenses can be high at some clubs (including include transport, rent, maintenance, utilities, insurance, security, consultants, legal fees, etc). The highest were reported at #FCBayern £219m, #RealMadrid £211m, #FCBarcelona £210m and #PSG £186m.

Five clubs had net interest payable over £20m, namely #Inter £26m, #THFC £25m, #ASRoma £25m, #Atleti £25m and #MUFC £23m. In contrast, five clubs’ interest was less than £2m: #PSG, #MCFC, #BVB, #RealMadrid and #CFC, while #FCBayern and #SSCNapoli had net interest receivable.

Almost all clubs are profitable in terms of EBITDA (Earnings Before Interest, Taxation, Depreciation and Amortisation) with 4 English clubs generating the most: #MUFC £186m, #THFC £168m, #LFC £124m and #MCFC £118m. The only negatives were #ASRoma £25m, #EFC £15m and #TeamOL £4k.

Some clubs were adversely impacted by once-off, exceptional charges, the four largest being due to changes in the manager and his coaching team: #CFC £27m, #Inter £23m, #MUFC £20m and #Juventus £15m. #EFC  £10m was mainly fees for the new stadium.

Deducting player amortisation, depreciation and exceptional items from EBITDA gives us operating profit. Almost all clubs post operating losses with the highest at #CFC £163m, #EFC £127m and #Juventus £125m. The only profitable exceptions are #THFC £96m, #THFC £24m and #LFC £1m.

Operating losses are partially offset by profit on player sales. The highest profits from this activity were delivered by #ASRoma £113m, #Juventus £112m, #FCBarcelona £89m and #RealMadrid £87m. The London trio, #WHUFC, #AFC and #THFC, only made £13m, £12m and £11m respectively.

12 of the top 20 clubs reported profits before tax, with the largest surpluses coming from #THFC £87m, #FCBayern £66m, #RealMadrid £47m, #SSCNapoli £42m and #LFC £42m. The highest losses by some distance were at #EFC £112m and #CFC £102m.

Highest tax charges came at #FCBayern £20m, #THFC £19m, #Atleti £17m and #SSCNapoli £16m. The clubs benefiting from largest tax credits were #CFC and #AFC, both £5m.

After all that, 12 clubs were profitable after tax with the top 5 being #THFC £69m, #FCBayern £46m, #RealMadrid £34m, #LFC £33m and #SSCNapoli £26m. Largest losses: #EFC £112m, #CFC £97m, #Inter £43m and #Juventus £35m.

The clubs with the highest squad value per the accounts, i.e. cost less accumulated depreciation, are #CFC £477m, #FCBarcelona £462m and #MCFC £445m. Note that this is not the same as market value, which would be much higher. Also homegrown players have no value in the books.

The highest financial debt is at two English clubs, #THFC £658m (new stadium) and #MUFC £511m (Glazers’ leveraged buy-out), followed by two Italian clubs, #Juventus £417m and #Inter £407m.

Seven clubs had cash balances over £100m as at June 2019: #MUFC £308m, #AFC £167m, #FCBayern £140m, #FCBarcelona £140m, #RealMadrid £137m, #MCFC £130m and #THFC £123m. These will be much lower now, due to payment of liabilities and COVID losses.

The highest net debt (gross debt less cash) was at #THFC £534m, #Juventus £408m, Inter £358m and #EFC £309m. Five clubs actually had net funds (cash higher than financial debt), namely #FCBayern £140m, #SSCNapoli £93m, #RealMadrid £64m, #MCFC £57m and #BVB £39m.

All clubs pay transfer fees in stages, so transfer debt is an important liability on top of financial debt. The highest payables were: #FCBarcelona £230m, #Juventus £195m, #MUFC £188m and #LFC £167m. Where clubs do not separate transfer debt, I have taken 90% of Trade Creditors.

On the other hand, clubs are owed money for player sales they have made. The highest transfer receivables were #Juventus £176m, #FCBarcelona £157m, #PSG £157m, #CFC £141m, #Inter £116m and #LFC £108m. Where clubs do not separate transfer debt, I have taken 90% of Trade Debtors.

The highest net transfer debt (payables less receivables) by far was #MUFC with £169m, then a big gap to #Atleti £87m, #THFC £83m, #ASRoma £77m, #FCBarcelona £73m and #WHUFC £73m. Two French clubs had net amounts owed to them: #PSG £51m and #TeamOL £46m.

Total liabilities is the broadest definition of debt, including bank debt, transfer debt, tax liabilities, trade creditors, staff debt, provisions, accrued expenses and even deferred income. Here, 3 clubs owe over £1 bln: #THFC £1,291m, #MUFC £1,081m and #FCBarcelona £1,281m.

Hopefully, this analysis has given you a good overview of the top 20 clubs’ financial situation, highlighting the different business models and the challenges they face. Revenue is obviously important, but the other metrics are also vital to better understand their position.