British teams still dominate the top ten most valuable clubs with six teams.
After three years of stability on the podium, this year sees Real Madrid leapfrogging Manchester United at the top, with Barcelona slipping to the 4th spot, allowing Bayern München take the 3rd position. The aggregate enterprise value (EV) of the top 32 clubs in consideration has increased by 9% year on year, demonstrating that the football business is growing at a significantly faster pace than Europe’s economy in general.
In UK news, British teams still dominate the top ten most valuable clubs with six teams – Manchester United, Manchester City, Chelsea FC, Liverpool FC, Arsenal FC and Tottenham Hotspur – all appearing. Both Champions League finalists, Liverpool and Tottenham, have increased their value by over 30% year on year, the second and third biggest growth of the entire list respectively, and FA Cup winner, Manchester City has grown by 14% in the last 12 months.
Real Madrid jumped above the EUR 3 billion EV level for the first time, however, their current EV is lower than Manchester United’s EV was last year, which has decreased by EUR 48 million over the year. Similarly, the Bavarians’ current EV is lower than the Blaugrana’s EV was in 2018. Real Madrid can attribute their success primarily to the massive UEFA prize money awarded to them following three UEFA Champions League titles in a row. In addition, they benefitted from their improvement in profitability and from a cumulated 29% operating revenue growth, driven mainly by increasing commercial revenues over the past four years.
Further changes in the top 10 include Tottenham Hotspur surpassing Juventus to reach the 9th position, and Arsenal dropping two spots to land in 8th, surpassed by Chelsea and Liverpool. The latter two clubs boast an EV in excess of EUR 2 billion for the first time, making eight of the top 10 clubs to have now more than EUR 2 billion EV.
The two 2019 UEFA Champions League finalists boast remarkable financial performance in the past season: Liverpool’s 33% annual EV growth is second only to Inter Milan’s 41% year-on-year increase in our ranking, while Tottenham came in third with a 31% growth. They also registered record levels of pre-tax profit – EUR 157 million for Spurs and EUR 136 million for the Reds. Tottenham’s 39% staff costs-to-revenue ratio is also the lowest among the 32 clubs.
The representation of the big 5 football leagues remained the same, with 27 clubs in the top 32, with the English Premier League confirming its dominance having nine clubs on the list and accounting for 43% of the total aggregate value. This year, Scotland is a new joiner, represented by Celtic, raising the number of participating countries to nine for the first time during the four years analyzed.
“For the third consecutive year, the overall EV of the 32 most prominent European football clubs has increased by 9% (35% over the past three years). This growth rate is in contrast with the overall trend of the major European Stock Exchanges, notably the STOXX Europe 50 Index1, showing a year-on-year decrease of -13% (-9% from 2016), and demonstrating the different pace at which the football industry is evolving. The transition of major clubs into media and entertainment companies, with global brand exposure, also helps create more stable and predictable cash flows and consequently better warranties to investors and financiers. It comes as no surprise, that such remarkable growth has heated the debate concerning the transformation of European clubs’ competition structure. However, the stakeholders involved do not necessarily share the same interests and instead have opposing positions that are likely to make future decisions even more challenging”, Andrea Sartori, KPMG’s Global Head of Sports and the author of the football clubs’ valuation report series commented.
Notes to editors:
The “Football Clubs’ Valuation: The European Elite 2019” report, prepared by the KPMG Football Benchmark team, provides an indication of the enterprise value of the 32 most prominent European football clubs as at 1 January 2019.
32 clubs Enterprise Value ranking:
|y-o-y change (%)|
|1||Real Madrid CF||3,224||10%|
|2||Manchester United FC||3,207||-1%|
|3||FC Bayern München||2,696||6%|
|5||Manchester City FC||2,460||14%|
|9||Tottenham Hotspur FC||1,679||31%|
|11||Paris Saint-Germain FC||1,315||15%|
|13||Atlético de Madrid||1,004||12%|
|14||FC Schalke 04||765||14%|
|15||FC Internazionale Milano||692||41%|
|16||Leicester City FC||633||6%|
|17||West Ham United FC||578||9%|
|25||Athletic Club Bilbao||336||1%|
|29||AS Monaco FC||255||-2%|
Methodology: The foundation of this report is an analysis of the latest publicly available financial statements for 38 European football clubs that meet our selection criteria, and of which the top 32 by EV are selected for the purposes of this publication. Thus, it is important to note that this report does not consider the business and sporting results achieved by each club in the 2018/19 football season. The proprietary algorithm developed by KPMG and applied for the purposes of this report is consistent with the one applied in the past three editions of our analysis. It is based on the Revenue Multiple approach and takes into consideration five football-specific metrics: profitability, popularity, sporting potential, broadcasting rights and stadium ownership.
For inquiries on the report, please contact:
KPMG Football Benchmark
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T: +44 (0) 207 694 8773
Angela Pink, KPMG Corporate Communications
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