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Deloitte’s poverty list confirms that Barcelona are in real trouble

A brief pause from Walter’s series on football referees, following our coverage on the BBC web site (see the home page for the latest).   Here’s a piece on Deloitte’s latest figure fest.

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Victory Through Harmony

by Tony Attwood

For some reason the regular table of football club turnover by Deloitte is known in the popular press as the “Rich List”.   It is nothing of the kind. It measures turnover – the money coming into the club.  As Manchester United show us every second of the day, if the money going out is greater, then big turnovers don’t really count for much.

It’s also a bit of a dead beat list in that it doesn’t change much.  The top six are all the same as last year and no one has moved in or out of the top 10.   Here’s the top 10

Revenue figures taken from 2009-10 (previous season’s positions in brackets):

1. (1) Real Madrid £438.6m

2. (2) Barcelona £398.1m

3. (3) Manchester United £349.8m

4. (4) Bayern Munich £323.0m

5. (5) Arsenal £274.1m

6. (6) Chelsea £255.9m

7. (10) Milan £235.8m

8. (7) Liverpool £225.3m

9. (9) Internazionale £224.8m

10. (8) Juventus £205.0m

You need a big factor to make a change in position here; Real Mad have been top for six years.  The only things that might change that would be a reversion to sharing of TV fees in Spain as per England, or the £25m a year bail out money that Barca have got from Qatar for their “sacred” shirts.

Actually that deal is a bit of a clue as to what is going at Barca.  The “sacred” shirt which could never have sponsorship has now been sold – not that long after the club’s finances were in such a terrible state that the club could not even pay its players on time in June last year.

According to the latest Uefa figures (2009), the upper echelon of clubs across Europe saw revenue grow by 4.8%.  But, and this is the killer, costs rose by9.3%.  Cumulative losses were €1.2bn – double the previous level.

56% of the 733 clubs that had an audit done by Uefa suffered a loss.  Chelsea’s latest overall loss was £71m, Manchester United’s was £79.6m – so they are still at it neck and neck.  Following the June financial fiasco Barcelona’s finances were audited to show they have a cumulative debt of  €442m with a year’s loss of more than €77m last season.   So with a little more insane spending Barca could make it up to the top with the big boys.   14 of the 20 EPL clubs made a loss in their most recent accounts.

The abilities of the biggest clubs to generate more revenue than their rivals will become increasingly important as Uefa’s financial fair play rules, and of course that money is based on “more of the same please”.   Any change to the finance model could bring everything tumbling down.  The challenge by the European Court to the country-by-country approach to selling TV rights could well undermine Sky’s position, which then could reduce the income the league gets from its product on TV, and that brings a loss making club tumbling down.

But, against all my hopes, yet in keeping with my fears, clubs like Barca, Chelsea and Man City have watered down the financial fair play rules and Uefa have given in.   Now owners can put €45m into the club over the first two‑year period.  Another rule says that wage bills of players who joined a club before last June can be discounted if it is that which means the club miss the cut.  At the moment the concession is for two years, but with clubs like those above unlikely to be able to qualify even in two years, even with the concessions, it is not looking good for the long term survival of financial fair play.

In one regard Barca, Man City and Chelsea hold the aces.  They can say to Uefa, if you don’t let us in, we’ll go off and form our own league – and they would find many other loss making clubs ready to join them.  Uefa don’t want that, so they water down the regs.

Here’s part two of the poverty list

11. (20) Manchester City £152.8m

12. (15) Tottenham Hotspur £146.3m

13. (11) Hamburg £146.2m

14. (13) Lyons £146.1m

15. (14) Marseilles £141.1m

16. (16) Schalke 04 £139.8m

17. (18) Atletico Madrid £124.5m

18. (12) Roma £122.7m

19. (n/a) Stuttgart £114.8m

20. (n/a) Aston Villa £109.4m

So Tottenham remain about £130m behind Arsenal – a figure that even an extended stadium would not really make up.  They also seem to be in the special group of clubs who like to waste money on stadium projects that never happen.  Liverpool have done it (they are now looking at redeveloping their ground), Everton did it (a feat that included an incredible public attack on the notion of representative democracy in local government, while they were still waiting for the results of their submission from those self-same people who they were attacking) and now Tottenham are at it.

As I write it seems that the Tiny Totts are not going to get their bulldozers on the Olympic Stadium (the Olympic ideal having been to give the stadium to a company run by pornographers).  You would think that they would have then gone back to plan A on which they have spent so much dosh (the doing up of the rather run down bit of real estate at 748 Tottenham High Road) but no.  It seems that they have decided that they don’t want that one either, for reasons that will not become clear at this time.  Latest news is that they are looking at property on the Isle of Dogs.  (Or is that Newcastle?)

Anyway, the Deloittes list is pretty much as ever was.  Most clubs are losing money, Uefa has backed down, the rich are getting poorer, and no one has any sort of solution apart from selling their shirt.

Business as usual then.

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20 comments to Deloitte’s poverty list confirms that Barcelona are in real trouble

  • Mr creosote

    Makes for interesting reading. I wonder what that list would look like if you took into account profit and not just monies in. Which of the so called ‘rich’ clubs would be relegated from the rich list?

  • Phoenix Gunner

    Nice one Tony, very interesting

  • swikrath

    Just love the sarcasm Tony,its brilliant, could you please throw a little more light on how united have announced a net loss of a whopping 79.6m?Considering the huge revenue of 350m. Does that mean a nett 429m has been spent?

  • walter

    What I found worrying is that in the press in my country they quoted a spokesmen from Deloitte a certain mr. Switzer. And he said that the clubs in the EPL would not have any troubles with the FFP rules that are coming their way.

    Does he know more about Uefa making a step back? Or is it the fact that Mr. Dehaene who would be president of the FFP committee is doing what he can do best: making the rules that stupid so everyone can have their own interpretation?

    On the other hand it could also be that this person from Deloitte is like the ones that revising the company Lernie and Hauspie in Belgium. Where the accountants declared that all was well and that there would be profit, profit and even more profit. And than suddenly after one article in the Wall street Journal the bubble burst and L&H went bankrupt and all lost their money.

    So never trust those guys too much I would say….

  • Gf60

    With just about an hour to go before the Olympic Stadium announcement, let’s all keep our fingers crossed that Boris gets into the act.

    Stratford Spuds. Such a good ring to it. My gran, a spudette through and through, would have been so proud. Her surname was Stratford.

    The thought of clean air for a 4 mile radius around the slough of despond must not vanish. Please.

  • Robbie

    As long as UEFA are more dependent on the big clubs than the big clubs are dependent on UEFA, nothing will happen. The Champions League trophy will always be available to the highest bidder. Someone should run a piece about what it costs to buy the CL trophy. It didn’t come cheap to Barca or Moratti.

  • Terence McGovern

    I notice that Dolittle conveniently ommitted our profits from property sales even though they were part of our turnover.

    I suppose that it wouldn’t do to have Arsenal at the very top of the list with almost no debt beyond our mortgage.

    That would be very embarrassing for all concerned especially UEFA who like to promote their pet clubs

  • goonergerry

    This list is meaningless- its just advertising Deloitte- who are as parasitic as agents in our game.
    So Real Madrid are the richest club- would they be if every club was underwritten by their national government? Their spending is obscene in the context of their national finances.
    As for Arsenal well lets see how well we do by generating profit and not spending on the team?

  • IvoryGoonz

    @Walter:
    I think you should interprate his comment this way:
    “they will always have the backup of banks, and will find a way to bypass it…”

  • Johnny Deigh

    I don’t like the way they do these lists either, focusing solely on revenue, but maybe it’s better Arsenal aren’t at the top because then other clubs might try to milk us for more money on potential transfers.

    As to Barcelona not paying its players, that was down to the company that agreed to pay them 1+ Billion for their television rights got into trouble financially and quit paying Barcelona. I believe Barcelona took that as a voiding of the contract and sought a bank loan to be able to pay their players until they found another company to buy their TV rights. So it wasn’t really a problem where Barcelona FC was in serious financial difficulties, just a temporary squeeze.

    You have teams like Manchester United that would normally be profitable except for their external debt by the Glazers. Deloite ranking United highly on this list to me is acceptable because a potential suitor could buy the club and likely make a profit.

    Contrast that to Chelsea that can’t seem to come close to making a profit. Abramovich has lost close to 1 Billion pounds on this club over the years, and their players are on too much wages to make a profit under the current conditions.

    We saw what has happened to Chelsea since they have attempted to break even – they have ended up with a threadbare aging squad and injuries to key players have threatened their spot in the top 4. Chelsea’s solution was to spend 75 million pounds on two players.

  • Ian Trevett

    Read this from Olver Holt feom the Daily Mirror.

    “The FA are now so fed up with England teams being undermined, they are ready to declare war on clubs who try to cheat the system.
    Starting from the next international date, they will ban players who fail to report for England duty from playing for their club the following weekend.
    They were ready to make an example of Newcastle striker Nile Ranger this weekend after he pulled out of Wednesday’s England Under-20 match against France without first being checked over by FA medical staff.
    Ranger was to be banned from playing against Blackburn tomorrow, but they were forced to postpone the action when they realised Manchester United defender Chris Smalling had been allowed to cry off Under-21 duty without reporting to England.”

    Hold on. The FA couldn’t act as it might affect a Manchester United.
    Tony, Walter, Dogface – how can you say the game is bent?

  • Ian Trevett

    That should read Oliver Holt from the Daily Mirror

  • walter

    Ian, in Dutch we have an expression that translates in English would sound: “now my pants are dropping on the floor”.
    This means that this is something so utterly ridiculous that you could aswell run naked over Tower Bridge. That also would be a bit ridiculous. Of course if you like naked people running over Tower Bridge… 😉

    How is this possible…

  • Wrenny

    @Ian
    That is simply outrageous! With Ferdinand and Evans both out injured from tomorrow’s game, banning Smalling would have been a huge blow for Utd.

    Banning players from club games for missing on England duty is ridiculous anyway, but the conduct of the FA is incredulously spineless. They were willing to do it to Newcastle, but backtracked as soon as they realised they would have to do the same to a Man Utd player!

  • Simon Bailey

    So the spuds didnt get a free stadium, ah well. More interesting was the snippet i picked up from BBC news that metioned that manu may well be sold for 1.6 billion to some oil rich types.

    @Ian, I am not surprised in the slightest. it would never do for manu to have to face a level playing field, now would it?

  • ugandan goon

    @Tony,
    I’d like to pick up on the issue of clubs forming a separate league away from U.E.F.A etc. etc.
    it strikes me as akin to one of the monumental double bluffs that is all too often trotted out in the U.K about taxing the super rich or tightening regulation i.e they will emigrate en masse from the city of London to a tax friendlier clime somewhere else, well according to last weeks ‘private eye’s ‘in the city’ column this just doesn’t make sense for the financial services as London is the best place to run global banking business because of it’s time zones in relation to the U.S financial markets, as well as it great social benefits, so contrary to expectations after Labour instituted 50% tax rate, the exodus threatened has not materialised. So the line constantly trotted by both the gov’t and the money men has proved to be a ruse plausible only to the unsophisticated great unwashed who would never delve deeper, while the masters of the universe can continue amassing obscene fortunes with no obligation to contribute to the common good.
    I am highly sceptical of the idea that the super rich clubs / their owners can form a separate league as they are essentially in it for the money or as a toy, it would be such a huge project if they wanted to recruit more teams into it or if they played just among themselves it would be as credible as the harlem globe trotters, i can understand that with the super-wealth they have and the separation from the life of the hoi polloi, it might sound cosy to a typically over indulged prince-ling to have football played for his amusement, but the gameis on oly profitable because millions of ordinary folk have some feeling invested in it.
    Ambition being the watch word as always at Untold towers and at arsene’s arsenal (now more than ever, what with Auntie giving us the glad eye!) perhaps the next big project should be to shout down this mendacious bit of double dealing, because sure as eggs is eggs the wheelers and dealers are out in force lobbying U.E.F.A at great expense(are you obliged to enter bribes into your end of year accounts?,perhaps as an asset?) to water down the rules for the benefit of the conspicuous consumers of football, while of course we are told it is being done for our benefit.
    All aboard the gravy train stopping at all stations through your F.A, governments, switzerland and other tax havens and our final destination Qatar, sorry Fufa(fick’em).
    This idea must be given short shrift, it benefits not us but them!
    Amen.

  • ugandan goon

    Reading back what i wrote, i think spacing and paragraphs are areas i need to work on.
    lol.

  • RedGooner

    Tony, Great Article but just another example of corruption in football at the end of the day. Sad really if they cant even enforce the FFP rules from day 1.

  • Rhys Jaggar

    As usual, Mr Attwood, you display myopic pro-Arsenal bias and Tottenham hatred in this article (it’s your site so you can say what you want!!)

    Why do I say this?

    ‘So Tottenham remain about £130m behind Arsenal – a figure that even an extended stadium would not really make up. ‘

    This is complete bullshit. Arsenal’s figure contains huge amounts of one-off property income which will NEVER repeat NEVER be coming in again.

    Arsenal’s footballing revenue is just over £200m, which will go up if the global TV deal goes up but then so will the Spurs income.

    Arsenal’s true surplus over Spurs is around £60 – 70m. And the excess revenue generated by Emirates Stadium for Arsenal is not far different to that figure.

    So once again, despite your ranting and raving about lying others, you have lied again to try and convince the world of your case.

    Now go away, start writing with accuracy and respect.

    Or face being badged as another trumped up little twister whose true calling should be working in the tabloid press.

    Sir.

  • Laundryender

    Rhys Jaggar

    what does it say on the banner in home page!!!!

    Anyway none of it matters, you are staying put and having to look at new options. Good luck with that.

    Lots of room in Essex