17th July 2017

Football Profitability Index®

The Football Profitability Index (FPI) enables the comparison between English Premier League club on a like-for-like basis in terms of their efficiency in achieving Economic Profit (EP). We calculate the relationship between revenue and the EP number to arrive at an EP/R value® which is also known as the FPI value. The FPI values can be tabulated into an index and the ranking of the resulting index values will indicate the relative performance of EP efficiency on a club-by-club basis. Not only can we see the absolute financial performance of each club, we can also measure just how good (or bad) they are at achieving Economic Profit.

It works like this:

The top 3 English Premier League clubs by revenue and their most recent 3-year revenue performance is illustrated below:

 Revenue £m 2014-15 2015-16 2016-17
Manchester United £395.16 £515.35 £581.20
Manchester City £351.77 £391.77 £473.40
Arsenal £344.52 £353.54 £423.96

Graphically, it looks like this:

All the clubs have increased their revenue over the last three years albeit at different rates.

The EP performance for each club over the same period is as follows:

 £m 2014-15 2015-16 2016-17
Manchester United -£39.77 -£17.39 -£16.30
Manchester City -£40.50 -£43.00 -£64.55
Arsenal -£17.38 -£40.40 -£4.42

Graphically, it looks like this:

Despite, or possibly because of, the increase in revenue, the EP performance reveals that the clubs are still struggling to produce a return higher than the sum of all costs incurred (in other words to be EP positive – see our football report for more details).

When we apply the FPI value calculation to individual club performance, the results reveal some interesting underlying trends and shifts.

FPI value 2014-15 2015-16 2016-17
Manchester United 89.94 96.63 97.19
Manchester City 88.49 89.02 86.36
Arsenal 94.96 88.57 98.97

The FPI values can be converted to illustrate a monetary value in terms of EP efficiency. For instance, in Manchester United’s 2014/15 accounting period, the club achieved an FPI value of 89.94 – thus for every £100 of revenue, the club generated an economic loss of -£10.06 (ie 89.94 – £100).

Arsenal’s FPI value (94.96 – for every £100 of revenue, the club generated an economic loss of -£5.04 ie 94.96 – £100) for the same accounting period is the highest of the three clubs and ahead of Manchester United, a feat previously achieved in 2009-10 and 2011-12. Arsenal’s overall FPI performance during the three-year period is near-neutral whilst Manchester City’s has dropped back based on the latest available year.

However, the FPI value chart also shows that Manchester City briefly overtook Arsenal in 2015-16 in terms of economic profit efficiency before managing to become more ecomically inefficient in 2016-17 despite the increase in revenues from the new domestic TV cycle and being one of only three clubs in the Premier League in this particular year to do so, the others being Tottenham Hotspur and Watford.


The longer-term trend in FPI values highlights a shallow decline for Arsenal whilst Manchester United has flitted between periods of achieving economic profit and losses following its title-winning and very economically profitable season of 2008-9. The stand-out performer of the three clubs is Manchester City which has failed to achieve an economic profit since we began monitoring performance in 2008-9.

It is disturbingly clear from the above chart that the top English football clubs are generally inefficient in generating economic profits with the three clubs only achieving economic profits on 5 occasions out of a possible 27 between 2008-9 and 2016-17. Despite successive increases in revenue throughout the period, the clubs have not generally mastered the ability to spend less than their revenue. Manchester City stands out from a FPI perspective as a serial killer of value whilst Manchester United’s quest for another title has brought about a series of consistent economic losses since 2012-13 when the club last lifted the Premier League trophy.

The index has gone on to prove a direct link between relegation and economic efficiency with the club with the lowest FPI value outside of the Top 6 clubs by revenue being relegated every year from 2012-13 to 2016-17 (latest available accounts).