EPL clubs post record profits in 2016-17: Deloitte

LONDON • English Premier League teams made a collective pre-tax profit of £500 million (S$924 million) in the 2016-17 season, more than doubling the previous record of £200 million set three years earlier, according to a report published yesterday by Deloitte's Sports Business Group.

Revenue was boosted by a domestic broadcast deal with BT and Sky worth more than £5.1 billion over three years.

That was also up from a previous £3 billion arrangement, resulting in England's top-flight football clubs posting a record operating profit of £1 billion, double the figure for the previous season.

While players' wages rose by 9 per cent to £2.5 billion in the 2016-17 season, "this increase is nowhere near the (25 per cent) level of revenue growth noted," said Dan Jones, partner and head of Deloitte's Sports Business Group.

Deloitte says clubs have recorded a collective pre-tax profit in three of the last four years, making them more attractive to investors.

Eighteen of the 20 clubs were profitable at a pre-tax level in the 2016-17 season, the firm added. Even 14th-placed West Ham are delivering solid earnings, registering a profit of £43 million.

Broadcast revenue, which amounted to nearly £100 million in the 2016-17 season for the lowest-placed club in the league, drops to about £6 million in the second-tier Championship.

Although the league has had difficulties in selling the next set of domestic broadcast rights this year, it makes a growing amount of revenue from overseas deals.

Jones also forecast that clubs would continue to record impressive financial figures.

"Despite the lack of growth in domestic broadcast deals announced to date, we still expect to see overall revenue growth in the coming seasons, and if this is complemented with prudent cost control, we expect that pre-tax profits will be achieved for the foreseeable future," he explained.

Deloitte remains confident the league is well-placed to continue to compete with the other major European leagues like Italy's Serie A and the Spanish LaLiga, with significant player movement expected before and after the World Cup .

"We have already seen some clubs utilising their revenue increases, with a record £1.9 billion spent on transfers in the 2017-18 season," said Tim Bridge, a senior Deloitte consultant.

"We may again see similar levels of spending in the coming season, with the (June 14-July 15) World Cup providing the perfect shop window."

AGENCE-FRANCE PRESSE, BLOOMBERG

A version of this article appeared in the print edition of The Straits Times on April 21, 2018, with the headline 'EPL clubs post record profits in 2016-17: Deloitte'. Print Edition | Subscribe