Premier League income tops £2bn – study

Premier League clubs’ revenues smashed through the £2 billion barrier for the first time last year but soaring wages remain a concern for the world’s richest league, a study reported this week.

The 20th Annual Review of Football Finance from Deloitte reported that Premier League clubs earned £2.030 million in 2009/10, a figure which is expected to rise to £2.2 billion in 2010/2011 when new television deals kick in.

However, the report cautioned that the increase in revenues of £49 million was outstripped by the rise in total wage costs of £64 million, taking total payroll costs to more than £1.4 billion or 68 per cent of revenues.

Chelsea were the club with the biggest wage bill (£174 million) followed by Manchester City (£133 million), who nosed ahead of city rivals Manchester United who spent £132 million.

However, City’s mammoth wages represented 107 per cent of the club’s revenue, compared to United, whose wages-to-revenue ration came in at 46 per cent.

City’s spiralling wage costs represent a challenge for the club ahead of the introduction of UEFA’s Financial Fair Play rules, which will seek to make clubs participating in European competition to break even by 2011-2012.

“Cost control remains the biggest challenge facing clubs, at all levels of the professional football pyramid,” Paul Rawnsley, Director in the Sports Business Group at Deloitte said.

The Premier League revenue of £2 billion far exceeded any other European league, leading from Germany (£1.4 billion), Spain and Italy (£1.3 billion each) and France (£0.9 billion).

Meanwhile, the imbalance between wages and revenue was even more pronounced in English football’s second tier, the Championship, with a wages/revenue ratio of 88 per cent.

Other figures in the report showed record pre-tax losses in the Premier League clubs of £445m overall, with gross transfer spending down by more than 20 per cent from the record £713m in 2008-09 to £559m last season.

However, net debt of Premier League clubs fell by 20 per cent from £3.3 billion to £2.6 billion, figures attributed to debt to equity conversions and Arsenal’s successful selling of property in their Highbury Square development.