Football finances: the numbers are not making sense anywhere



By Tony Attwood

By now we are getting used to stories of clubs approaching financial collapse, although few of these stories make much overall sense.

Arsenal making their coaching staff redundant as a financial measure means nothing in the overall structure of the club’s finances, but it is presented as a financial solution.   Selling Maitland Niles for £30m would be profitable, but doesn’t make much sense when he can play well in a multiplicity of positions, and is temperamentally the other end of the scale from Guendouzi.

But at the same time as all the cost cutting and Wolverhampton being caught out by Uefa (we didn’t predict that but we did highlight their financial difficulties) there are the endless stories of the millions Arsenal and other clubs are about to (or should be about to) pay for transfers.

And if that makes no sense, then the tale of Wigan’s demise makes even less sense.  Private Eye has run the most detailed analysis of what happened to the club (which was bought with the promise of glories to come and then almost immediately put into administration), and the fact that it is that magazine tells you something of the underhand business arrangements involved.  One can only hope the League are looking at that, although I suspect even if they are, they won’t be able to unravel far eastern financial jiggery-pokery.

In short it looks like the whole financial situation is in meltdown.  But the media won’t talk about it, at least not when it involves English clubs.   Something that was merely confirmed by the Daily Telegraph article, “La Liga’s big two are sleepwalking into a financial calamity”

“Donny van de Beek, and Christian Eriksen were Madrid’s January targets who mystifyingly failed to arrive, and now the Dutchman is a target once again. So too the Rennes prodigy Eduardo Camavinga – as if this great financial reckoning of Covid-19 was taking place elsewhere, in a country far away.”

But look at the transfer rumours in the English media.  Talk Sport are saying, under the banner “Arsenal news live” that “Coutinho ‘agrees terms’, Arteta’s £100m plan…

Which seems odd, when we are just saving a few millions making 50 staff redundant.  Of course those redundancies are quite legal, providing the jobs really don’t exist any more, and we have suggested why this is the case, but even so…. it is not very clever PR.

Back with the Telegraph, their article talks of “the farmyard effluence that passes for the relentless trade in Madrid transfer stories…”   One wonders what description that might use if they ever turned the light on TalkSprout.

Real Mad’s stadium is said to be funded by a €575 million bond scheme, which is raised as a shock horror story in the Telegraph.   And yet Tottenham’s stadium has left that august club with a bill of £852m – more than double (noting that the Real Mad story is in euros).

Yet are the Telegraph going crazy about that?  Well, actually no, because Tottenham’s approach must be sound since it is run from the UK while Real Mad’s approach is insane because it is run from Spain.

It is true that both Real Madrid and Barcelona are looking for extra loans of €100 million and €120 million respectively.  But that still is nothing like Tottenham’s borrowing.

Which is not to say that Real Mad and Barce (the Barce-loan-us name although silly is rather appropriate these days) are in the clear, that is certainly not the case, but rather that football is in meltdown, but English clubs are not going to be effected because they are…. English.

True, Real Madrid make their accounts balance by the introduction in their books of the “effective evolution of the intangible sport asset”.   It is a meaningless phrase that allows them to increase the value of the club on the grounds that it feels more valuable.   How long before it is used in the Premier League?  Watch out for the next round of reporting.

And as for Barcelona… apparently they don’t publish half yearly reports any more.  Instead they, with Real Mad have “written to the Spanish government asking to be absolved of the financial responsibilities incumbent on boards of sports clubs.”

The problem is that simply making fun of the state of Spanish football, as the Telegraph is doing, doesn’t mean that English football is in a good position.  We are in the situation where Manchester City got away with their activities because Uefa was too slow to prosecute, while Wolverhampton are in a mess because they were too fast to spend money they didn’t have.

And the rest?  Well, I doubt we can rely on the Telegraph to tell us.  Probably in the editorial suite they are saying, “I don’t think English football fans are interested in club finances… unless they are in Spain.”

5 Replies to “Football finances: the numbers are not making sense anywhere”

  1. Hey Tony A, I find your Arsenal articles well written and quite informative, and thanks for reminding us about the ” professor” Arsene Wenger.

  2. Nice to have a demonstration that the voluntary ignorance on data the so called press has shown for decades about refereeing exists in their financial reporting as well.
    The example between Tottenham an Real Madrid is telling, unless it is their way of saying : Totten who?

  3. Now before someone, and you know who you are, tries to read more into this question, can anyone tell me what was meant when this was said in the statement announcing the redundancies

    “We have also received significant financial support from our owners, Kroenke, Sports & Entertainment in terms of refinancing our stadium debt. “

    The only thing I can think is that the Debt Reserve account circa £35 million is now being underwritten by KSE as opposed to your club having to keep that sum on deposit. That is unless they have repaid the bonds early which, in view of the penalties, would make little sense

  4. I hope the FA will never allow an English Club to wield the power that Real Madrid and Barcelona seem to wield in Spain.

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