COVID-19 consequences – European Football Clubs suffer huge losses

With the pandemic hindering the financial stability and growth of every sector around the world, the football industry was no exception. According to the ‘KPMG Football Benchmark’s Report’, the pandemic has adversely affected the overall business of Europe’s top leagues in the 2019/20 season. Prominent clubs like Juventus FC, Paris Saint-Germain FC and FC Porto faced a double digit year on year drop. While other clubs went through dire losses, FC Bayern Munich, Liverpool FC and Real Madrid CF made some net profits for the months of May/June 2020 along with a moderate drop in their operating revenues. With many matches being called off and played in empty stadiums, the match day income bore the biggest brunt by almost every club. Real Madrid FC was the worst hit with the loss of -EUR 34.9 million . Broadcasting revenue took a backseat as well due to the reduced number of matches being played. Clubs like Real Madrid FC, Juventus FC and Liverpool FC suffered a yearly loss of 12%, 19% and 22% respectively. However, UEFA Finalists FC Bayern Munich and Paris Saint Germain FC saw only a 4% drop in their TV income. While FC Porto and PSG bore an 18% drop, Juventus FC remained static. Nevertheless, Liverpool FC, Bayern Munich and Real Madrid CF could be expected to increase their earnings from commercial activities. Although many clubs reduced their player’s wages, thanks to the agreed pay/wage cuts by the playing staff, all of them could not particularly bring down the operating costs in relation to the sharp decline in operating revenue. FC Bayern Munich (16%) and Juventus FC (13%) successfully cut down the staff costs. Real Madrid CF registered a 4% increase in their staff costs, amounting to the sum of EUR 411 million, even though the players gave a nod to 10% temporary wage cut during the season. PSG’s staff costs rose even higher to 10% because of their new signings and France’s high employee social tax charges. The Pandemic has clearly unveiled the instability and uncertainty surrounding the glamorous European Club Football ecosystems. With the year gone by bringing huge financial losses and the current situation in Europe getting worse due to the coronavirus’ new strain, the condition seems unlikely to improve in near future.


Share The Article:

Leave A Reply

Related news