Premier League Clubs Hit “collective” Profit

26 Mar 2015 | sigadmin

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Figures released by Deloitte have revealed that Premier League clubs are collectively in profit for the first time in 15 years, with the combined pre-tax profit for all 20 Premier League sides during the 2013/14 season standing at £190m.

The figure smashes the previous record of £49m set in 1997/98 and in stark contrast to the £2.6bn of pre-tax losses accumulated over the past decade.

An increase in broadcasting and commercial revenues have contributed towards the rise, combined with the introduction of new cost control rules by UEFA and the Premier League.

The report also showed that clubs had a combined operating profit of £620m in 2013/14 which is over three times more than the previous record of £185m in 2007/08.

Dan Jones, partner in the Sports Business Group at Deloitte, said: “In the first year of the preceding two broadcast deals, 56% and 81% of respective revenue growth was absorbed by wage costs. This time it is less than 20%.

“Over the previous 10 seasons wages grew by around 9% per year, which is higher than the average annual revenue growth of 7% over that period, demonstrating further what a remarkable turnaround the 2013/14 figures represent.

“Revenue increases show no sign of ending and should make this kind of profit a regular thing. Such profits provide clubs with an opportunity to invest further in youth development and facilities. But they will also no doubt make Premier League clubs even more attractive to investors.”

Adam Bull, senior consultant, Deloitte Business Group, added: “The introduction of cost control regulations at both a European and domestic level has caused many clubs to watch their spending more closely than ever before and created a useful tool for clubs to reduce the inflationary pressures during negotiations with players and agents.

“Also, the current broadcast deal has given Premier League clubs such a large revenue advantage over the vast majority of European clubs that they can still attract the top playing talent without overstretching themselves financially.”

“The primary aim of a football club is, and always should be, on-pitch success for the fans.

“However, we do welcome these results, which show that the Premier League clubs are starting to convert their impressive revenue growth into a more sustainable net result.

“With the recent announcement of another record Premier League broadcast deal, the revenue increases show no sign of ending and should make this season’s profit a regular outcome.”