Article Taxonomy: Football Finance

Articles and reports on financial issues within football – soccer – from The Political Economy of Football.

New era at Rangers?

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The Dave King consortium has acquired control of Rangers leading to hopes of a new era at the troubled club.  King is an exiled Glaswegian living in South Africa, where he has pleaded guilty to charges of tax evasion.  He is generally seen in a favourable light by supporters given the performance of the old board.    He will, however, have to pass a fit and proper person test.

Clubs turn to learned counsel

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We have often commented on the growing number of sports lawyers for whom football is an important and potentially lucrative area of work.   EU competition law is also highly relevant and it is often forgotten that the way in which Premier League television rights are sold in seven packages was a formula devised to satisfy the European Commission after an investigation.

The cost of rugby versus football

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This interesting site compares the cost of rugby and football.   It’s written from an egg chasing perspective, but it is well designed with some nice graphics and interesting comparative information.   For example, the average weekly wage of a Super League player is £1,300 (worth getting out of bed for all those knocks and bruises?) compared with £43,717 for a Premier League footballer.

Points deduction for not sorting out finances

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The Dutch football authorities have deduced FC Twente three points for failing to make progress on required financial reforms.

One wonders if this could be used more widely given that fines are not a big constraint for wealthy clubs and even transfer embargoes or squad restrictions have their limitations.   It could, of course, only be applied at a domestic level.

Leicester in FFP talks

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Leicester City are bottom of the Premier League and increasingly look unlikely to escape relegation.  Now they face the additional problems of talks with the Football League about their £20.8m loss in the last financial year and whether it represents a breach of financial fair play rules.

From the League’s perspective it is in excess of the £8m permissible loss, but Leicester consider that £13m of the losses are due to the costs of promotion.   They have also reduced losses from £34m in the year ending May 2013.

Liverpool back in the black

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Liverpool FC have reported a profit for the first time in seven years.   The margin of pre-tax profit for the year ending May 2014 is only £0.9m, but it has a broader significance.   It suggests that a club can challenge for a top four spot while still operating on at least a break even basis.

It is really increased revenues that have helped the club.   They were up 19 per cent at £255.6m. Between 2009 and today, they have increased from around £170m to over £250m.

QPR report substantially reduced losses

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QPR have reported substantially reduced losses for the last financial year.   They are down to £9.8m in contrast to a massive £65.4m in the year ending May 2013.  Expenditure is down £22m, largely due to lower player costs.   Shareholders have also written off £60m in loans.

The club has faced difficulties over compliance with financial fair play rules, but these results should help their position.  

Rams could be hit by parachute payments

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Derby County are playing well, if sometimes they are a little too prone to concede goals, and have reasonable expectations of being promoted to the Premier League this season.   Even if they did only survive one season, they would be set up financially for years to come.

How to balance the books

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I have been looking at the accounts for a tier two Conference club.   The shareholders are supporters and the shares are quite widely dispersed, although there are five or so individuals who have larger holdings.

The club reported profits of £52,000 on a turnover of £267,000 in the year ending 30 June.   This compared with £21,000 in the previous twelve months.