Covid-19 impact leaves major European football clubs with €1bn loss | Finances

Twenty of Europe’s biggest clubs lost more than €1bn in revenue over the past year while almost 10% has been knocked off players’ average values as the game struggles with the economic impact of the Covid-19 pandemic, according to a study by the market analyst KPMG.

The European Champions Report, focused on the league winners across the six major leagues and carried out by the Football Benchmark Team, found Juventus, Paris Saint-Germain and Porto had double-digit percentage drops in revenue while Bayern Munich, Liverpool and Real Madrid experienced more modest revenue decline. Madrid and Bayern still posted profits, with the Spanish club boasting the highest income with €681.2m (£607m). They are followed by Bayern’s income of €607.2m, Liverpool’s €557m and PSG’s €540.6m.

Madrid returned a profit despite income dropping by 8% through cost-cutting measures including 10% salary cuts applied to all their players and summer sales. They did not sign anyone in the summer and while they have the biggest budget in the study it has reduced by more than €200m this season. Liverpool are estimated to have the most valuable squad.

According to KPMG’s figures, Kylian Mbappé is the world’s most valuable player at €200m while there are four Englishmen in the top 10 – Raheem Sterling (second, €132.5m), Jadon Sancho (third, €130m), Harry Kane (fifth, €120m) and Marcus Rashford (€112,2m). Lionel Messi is 12th on €101.3m. Cristiano Ronaldo is outside the top 50, valued at €63.2m. Mohamed Salah (€122.2m), Sadio Mané (€120m) and Trent Alexander-Arnold (€107.1m) are rated as Liverpool’s most valuable. Madrid’s most valuable player is the defensive midfielder Casemiro.

A broader, 20-team sample of European teams calculated an aggregate loss of revenue of €1bn, with an 18.5% decline in revenue at Manchester United, 12.3% at Tottenham and 7.9% at Liverpool. Celtic were down 15.5%, while Porto had the continent’s biggest drop, at 50.5%. Liverpool’s decrease, a result of having to play behind closed doors and their early exit from the Champions League, where they were knocked out by Atlético Madrid just before lockdown, was mitigated by a 14% rise in commercial revue.

Of the sampled teams – which included three from England, Spain, and Italy, plus two from the Netherlands, Germany, France, Portugal and Turkey as well as Celtic – only Sevilla and Borussia Dortmund had an increase in revenue over last season. The study cited the European Club Association figures that predict player salaries could reach more than 70% of clubs’ average budget over the coming year, a figure that is unsustainable.

Liverpool’s operating revenues decreased 8% year on year to €557m over the past 12 months, with a 14% decrease in matchday income a key factor. They also failed to match the €111.1m in Champions League TV money that they earned the previous season. That situation has continued into the new season, but the study calculated the value of the club to still be growing at €2.658bn.

According to a report from CIEA there was a 43% drop in transfer activity in Europe’s five biggest leagues over the summer, and KPMG estimated that half a billion euros had been taken off the market values of the 500 most expensive players. On average, players’ values are down 9.6%, the study found. It calculated the market value of Liverpool’s squad at €1,094.3m, with Bayern at €943.4m, Madrid at €874.2m, PSG at €806.6m and Juventus at €734.8m.