ENGLAND’S FOOTBALL PREMIER LEAGUE DIVISION CLUBS COLLECTIVELY FAIL TO GENERATE A SINGLE PENNY OF ECONOMIC PROFIT SINCE 2009
London 10th July 2017.
vysyble announces the release of the 2nd edition of its football finance report entitled ‘We’re So Rich It’s Unbelievable! – The Illusion of Wealth Within Football.’ The report covers the economic performance of the participant clubs in the English Premier League from 2008-9 to 2015-16 (the latest accounting period) ie 34 clubs. Over 260 individual club balance sheets were analysed as part of the research process.
‘We believe that this is the most comprehensive financial analysis of English football to date. Our goal is to determine the economic performance of Premier League clubs over the most recent 8-year period by the calculation of economic profit (where all the costs of doing business including tax, interest and capital charges are considered) for each club and for each statement of accounts. The resulting data has enabled us to identify significant areas of risk to the current financial model including an over-reliance on broadcasting revenues’ said Roger Bell.
Selected findings include:
- Cumulative revenue for the Premier League division over the period was £21.4bn
- Cumulative economic losses for the period totalled £2.0bn
- Daily economic losses for the 2015-16 season Premier League clubs collectively amounted to £876,700 per day
- Only 5 clubs achieved economic profit in 2015-16, the worst performance since 2012-13
- Over the eight-year period, the Premier League division has collectively failed to generate a single penny in economic profit
‘It is clear from our analysis that the Premier League division is never going to be a bastion of profitability. However, judging from our research, the only reason why the division gets away with such financial largesse is the reliance on domestic TV income. If that were ever threatened, a breakaway group going into a different league format, perhaps a European Super League, is a distinct possibility leaving behind a rump of clubs with significantly diminished appeal and value to broadcasters’ added Roger Bell.
The report also includes the first iteration of the vysyble Football Profitability Index™ which measures the financial efficiency of clubs in the achievement of economic profit. With this new indexing capability, Investors, analysts and commentators can view the economic performance between clubs on a like-for-like basis as well as their financial efficiency performance against their Premier League standings.
vysyble was launched in August 2016 and has gained international recognition in the calculation and examination of companies and market sectors in generating Economic Profit and shareholder value. vysyble provides sector-level reports and individual company assessments on a paid-for basis.