Football finance special: United

May 31, 2007

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Old Trafford

MANCHESTER United's total wage bill for the 2005/2006 Premiership season was £85million - £29m less than Chelsea.

The figures are revealed in accountant Deloitte's annual football finance review.

The report also predicts that £200,000 per week wages will be paid within the next three seasons.

Key points of the report:

::Premiership clubs’ total wage costs for 2005/06 increased by 9% - (£69m) to £854m - the year before the clubs’ total wage costs reduced by 3% for the first time in the history of the Premier League.

::The wages/turnover ratio, a key performance indicator, increased to 62% in 2005/06.

::Five English clubs have total wages costs each season greater than £50m - Chelsea (£114m), Manchester United (£85m), Arsenal (£83m). Liverpool (£69m) and Newcastle (£52m). Tottenham were sixth (£41m).

::Five Premier League clubs cut wages costs in 2005/06 - in particular Fulham (down £3.8m) and Manchester City (down £3.3m).

::The highest proportional wage rises came at Tottenham (up £7.5m), Everton (up £6.1m), Charlton (up £5.3m), Aston Villa (up £5.1m).

::Average annual gross annual earnings for a Premier League player next season estimated at £1.1m (2005/06: £0.9m).

::Championship clubs’ total wage costs for 2005/06 increased by 5% to £228m with the overall wages/turnover ratio remaining 72%.

::Premier League revenues are set to exceed £1.7billion next season, the first year of new broadcasting deals - £680million higher than the next highest-earning league, Italy’s Serie A.

::The 92 English clubs’ revenues increased by 4% (£66m) to £1,860m - Premier League clubs’ revenues increased by 3% (£45m) in 2005/06, an average of £69m per club.

::The gap between the average Premier League and Championship club’s revenue was a record £56m in 2005/06 and is likely to increase to over £70m next season.

::Operating profits in the Premier League fell for the first time since 1999/00 to £138m (down 15%) and the number of Premier League clubs reporting operating losses increased from two in 2004/05 (Chelsea and Fulham) to four in 2005/06 (Aston Villa, Charlton Athletic, Chelsea and Fulham).

::Overseas clubs continued to be financial beneficiaries of the Premiership’s success. Net transfer fees leaving the English game were £187m.

::Fees to agents from Premier League and Football League clubs in 2005/06 were estimated to be over £50m.

::The monies redistributed to Football League clubs from the Premier League increased to £48m in 2005/06 (2004/05: £28m); the highest level since the Premier League began.

::Arsenal’s borrowing arrangements for their new 60,000 capacity Emirates Stadium have significantly increased the club’s overall level of debt in recent years. By the end of the 2005/06 season Arsenal’s net debt was £262m, ahead of Chelsea (£180m), Fulham (£167m) and Manchester City (£94m).

::By the end of the 2005/06 season, Roman Abramovich had injected around £485m of new money into Chelsea, through a combination of debt and equity.

::At summer 2006, Manchester United (£203m) topped the table for overall shareholders’ funds - being the excess of assets over liabilities/debt - followed by Arsenal (£131m) and Chelsea (£81m).

::At least 11 Championship clubs have net debt of more than £10m.

What do you make of the figures? Have your say.

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Gerry, Glastonbury (31/05/2007 at 10:27)

The figures are really scarey and no matter what any ex pro says the wages are obscene and driving clubs into debt. The reliance on TV money is a crash waiting to happen.
I'm surprised there's only four with an operating loss but it says a lot that clubs like Chelsea, Villa and City, who all get decent gates, can't make any money! On top of that the likes of City and Chelsea have horrendous debts to service. The picture I fear has to get worse as transfer fees have gone mad again and just how many more millionaires are going to be willing to bale their clubs out?
To think that half of the championship sides have significant debt is of real concern.

Birdy, Ireland (31/05/2007 at 10:46)

Unbelievable amount of money in the game. One thing i would say is that, even though its increased, theres not enough money from the Premier league going to lower leagues. This should be increased substantially. If English players are to come through then there needs to be more money available so clubs can afford to run their academies and give the young players every help they can. Theres more than enough money in the Premier league that they could at least double whats going to the lower league clibs

DC, Amsterdam (31/05/2007 at 11:24)

So much money in the game, yet amateurs who play sunday league football are forced to pay ever rising subs fees, and amateur clubs forced to fold because they can't afford to pay the council for the use of a football pitch. Imagine the difference it would make to every amateur football club, of any age, in the country, if PL players gave up one week's wages towards grass roots development of football. What a utopia.

bobbydazzler (31/05/2007 at 11:38)

gerry and what about our debt and service charge 62m + and rising

dpkmanc, Levenshulme (31/05/2007 at 11:39)

Gerry, Glastonbury - we have tremendous debts to service? I note that you and the article fail to mention the astronomical debts that your club has - believe me, they will come back to haunt you just as sure as ours are about to disappear. Get a grip on reality mate, don't believe all the pro-rag hype you read in this paper.

Gerry, Glastonbury (31/05/2007 at 12:15)

dpk / bobbydazler - my views are on the general state of affairs and not particularly about United but I take your point. United or not, the scenario is very dangerous and it's very easy to see what happened at Leeds United happening again.
Players on ridiculous money, incoming players costing stupid fees and 60%+ of the club's revenue going on those hyper wages. And what is it that's underpining all this outlay? Not much of a long term nature is the answer.
I suppose it's a bit of comfort if you averge 40 - 50,000 every home game but it's foundations built on sand for some clubs in my opinion.

djay (31/05/2007 at 18:15)

The fact is every penny is generated by the fans paying far too much money for football. Before Sky monopolised the TV rights it was still possible to attend matches at a reasonable price and although players wages had increased to many times that of the ordinary fans they still had the "short career" excuse to fall back on. Not so now. Just one season of premier league wages sets them up for life. Of course the scarcity of "home grown" talent is obvious since "ready made" foreigners are bought to slot into a team rather than develop local players. I hope that the greedy mentality of the clubs, players and agents will eventually drive the fans away from attending matches leaving grounds half empty and devoid of atmosphere and result in Sky losing subscribers, so we can get our game back. Perhaps the way forward is the FC United philosophy and not the £10 programme, £5 burger and the £95 seat.

blue is the colour, gorton (31/05/2007 at 21:03)

BEEN A CITY FAN IT HURTS ME TO SAY,UTD & ARESNAL ARE THE ONLY TWO ATTACKING TEAMS WORTH WATCHING.THE LIKES OF BOLTON,BORO,EVERTON ETC EVAN CHELSEA AND LIVERPOOL BORING. LOST COUNT THE NUMBER OF TIMES THE TV BEEN TURN OFF OR OVER. NOT BEFORE LONG TEAMS WILL GO BUST.I JUST WONDER HOW MANY FANS WILL START THERE OWN CLUB LIKE FC UTD OR FOLLOW THEIR LOCAL NON LEAGUE TEAM. REPORT TODAY ONLY 1 IN 10 FANS THAT GO TO GAMES ARE UNDER 24 .HOW BIG CAN THE PREMIERSHIP BUBBLE BE ONLY TIME WILL TELL.

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