Premiership clubs’ finances in good order

Link: Football finances

The firm applauded clubs for the lowest growth in wages since the Premiership’s formation, based on figures for the 2002/3 season.

The salary bill grew by 8% to £761m compared to average annual increases of 25% over the last ten years.

Paul Rawnsley, from the firm’s Sports Business Group, said: ‘As a direct result of Premiership clubs improved business discipline, this summer many English clubs are better placed than their European rivals to attract the best playing talent.’

Another sign of tighter money management was diving transfer fees, down 42% last season to £187m. However, the firm predicted the ‘Chelski effect’ would see that figure climb to around £260m for the season just ended.

The financial near-catastrophe at Leeds United should not be taken to represent the state of other Premiership clubs, the analysis suggested.

Dan Jones, partner with Deloitte, said: ‘The media coverage of the financial difficulties at Elland Road should not overshadow the good work of management at the majority of Premiership clubs whereby costs are being better balanced with revenue.’

The research found that – unlike Manchester United – the Premiership retained its title, in this case as ‘financial champions of the world’.

The league’s operating profitability was second to none, with the average club generating £6.2m before player trading. Operating profit across the league was £124m – a record high since the Premiership came into existence.

But the cost of player amortisation – a legacy of past high transfer spending – meant that only five clubs made a pre-tax profit as pre-tax losses reached £153m.

Despite these losses, the research emphasised the benefits to government of the football industry. Deloitte estimated that in 2002/3 Premiership clubs paid around £395m in tax and that in its 12-year life the competition has lined the taxman?s coffers to the tune of £2.5bn.

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