KPMG’s Football Clubs’ Valuation: The European Elite report found that United retained top spot once more, followed by Real Madrid (€2.92 billion) and Barcelona (€2.78 billion), with the top ten containing six English Premier League teams in total.
The firm based its ranking on five key criteria: profitability, popularity, sporting potential, broadcasting rights, and ownership of stadiums.
KPMG classifies clubs worth over €2 billion as “enterprise level”, with just six teams attaining such a level. Outside of the three leaders, this includes Bayern Munich, Manchester City, and Arsenal. The report is based off the 2015-16 and 2016-17 seasons respectively.
The list was as follows:
1. Manchester United – €3.255 billion
2. Real Madrid – €2.92 billion
3. Barcelona – €2.78 billion
4. Bayern Munich – €2.55 billion
5. Manchester City – €2.16 billion
6. Arsenal – €2.10 billion
7. Chelsea – €1.76 billion
8. Liverpool – €1.58 billion
9. Juventus – €1.30 billion
10.Tottenham – €1.29 billion
Some Key Headlines
- The overall value of top-level football clubs has increased by 9%
to €32.5 billion. In 2016, the top 32 teams were worth €26 billion.
- Man Utd retained top spot thanks to lower staff costs (i.e. players’ contracts) compared to Real and Barca.
- Real, in particular, has the “biggest payroll in world football” coming in at a staggering €400 million.
Not So Much Turkish Delight – Clubs Who Fared The Worst This Season
This year’s report highlighted how certain self-inflicted mistakes can really impact football team’s financial performance, as well as factors outside their control.
The case in point of this is the three biggest sides in Turkish football, new champions Galatasaray SK, Fenerbahce SK, and Besiktas.
- The Bad: Galatasaray suffered badly this year. Galatasaray was banned from European competitions for the entire season of 2016/17, denying them money from UEFA, especially as they are perennial qualifiers for European tournaments.
- The Bad #2: Meanwhile, bitter rivals Fenerbahce also suffered badly, with the club suffering a heavy pre-tax loss, with revenues declining also. Importantly, outside factors, such as the devaluation of the Turkish Lira also dented the club’s financial performance.
- The Good: In the midst of this, Besiktas secured a whopping growth of 52%, according to KPMG, thanks to moving into their shiny, new
Vodafone Arena stadium.
“Despite lower than the previous year’s 14% growth, the football industry continues its pace. Overall growth is driven by various factors, one of these
being the increase of operating revenues of the top 32, at 8%.”
“In addition, eye-catching transfer deals and spiralling staff costs have not prevented such clubs from registering a striking upward trend, as the profits before taxes increased by some 17 times in comparison to the previous year. One of the reasons can be found in the significant pull exercised by English clubs, as well as the improved financial health of many mid-size clubs in our ranking.”
The Red Devils Continue To Dominate
Overall, Man Utd, despite a number of poor seasons in terms of the on-the-park performance, is still in a great financial shape. It recently reported an 8% increase in quarterly sales year-on-year, while Deloitte’s well-respected football report also had the club topping the table for revenue generation. Not only this, despite finishing a distant second to fierce rivals Man City, the club also earned more money (£149.77 million) from the English Premier League, than the new champions.
However, a word of caution, KPMG’s view on Utd’s performance was that it held top spot due to lower staff costs. Given that this report does not take into account last year when Utd spent heavily on high-profile signings, their place on top of the pile may be under threat in the coming years.