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Premier League Remains World's Richest Thanks To Lucrative TV Deals

The Premier League "is set to remain by far the world’s richest football league," Deloitte's annual review of football finances indicated, according to David Conn of the London GUARDIAN. EPL clubs earned approximately €2B "more collectively" than those in Europe's second-richest league, the Bundesliga, in '15-16. The total £3.6B earnings of Premier League clubs in '15-16 "are projected to have increased" to £4.5B last season, the first of the league's "vastly more lucrative" '16-19 TV deals. The size of the league's domestic and int'l TV rights sales, £2.8B ($3.2B) per season, £8.4B ($9.6B) in total over three years, "is approximately double that of the Bundesliga’s own improved deals," which are expected to pay around €1.4B ($1.6B) annually to the clubs in Germany's top two divisions. Although England’s clubs will not publish their '16-17 accounts for several months yet, the EPL already disclosed its distribution of TV and sponsorship money last season, which Deloitte calculated was 45% higher than in '15-16 (GUARDIAN, 7/11). In London, Ben Rumsby reported Deloitte found EPL clubs' revenues increased by 9% in '15-16, with each generating more on average (£182M) than all 22 top-flight teams combined managed in '91-92 -- "the final season before the competition began." Despite wage costs increasing by 12% to £2.3B, Premier League clubs were also found to have recorded a third consecutive season of operating profits in excess of £500M -- "although they did make a collective pre-tax loss" (TELEGRAPH, 7/12).

STEEP PRICE: REUTERS' Neil Robinson reported while Leicester City won the Premier League in '15-16 despite being ranked 15th by wage costs, and Chelsea "finished eight places lower" than its ranking, the report said that the subsequent '16-17 season showed a "stronger correlation between wage costs and league position," with the division's top six wage spenders in '15-16 filling the top six wage positions in '16-17. The report "also revealed the price for those chasing a share of Premier League riches," with League Championship clubs spending more on wages than revenue "for the third time in four seasons." The second-tier clubs recorded a "record combined operating loss" of £261M, with net debt rising to £1.3B as owners "continued to gamble on reaching the Premier League" (REUTERS, 7/12). The BBC's Bill Wilson reported a new domestic TV deal which kicked in last year "means overall revenues continue to grow strongly." Deloitte Sports Business Group partner Dan Jones said, "Even in the final year of its old broadcast contracts, Premier League revenues continued to set new records." Jones said that Premier League clubs "were now reaping the benefit" of a new broadcast rights cycle which started in '16-17, plus new commercial agreements and matchday revenue growth from new and expanded stadia. Meanwhile, Premier League net debt "fell for the third consecutive season," by £125M (5%) to £2.2B at the end of the '15-16 season (BBC, 7/12).

'RELENTLESS': In London, James Benge reported the city's clubs are playing a "key role" in the Premier League's "relentless revenue growth." Just under a third of the revenue generated by English clubs was created by the 16 English Football League and Premier League clubs in the Greater London area, "with four of the top eight earners hailing from the capital." Arsenal’s £350M revenue, a 6% increase on the '14-15 season, was "eclipsed only" by Man City and ManU, though the latter "appeared to be pulling clear" of its rival by increasing its earnings by 30% to £515.3M (EVENING STANDARD, 7/11). In London, Murad Ahmed reported new broadcasting deals "have pushed the revenues of Europe's biggest football leagues to record highs." The combined revenues for clubs in the "big five" divisions in England, Germany, Spain, Italy and France increased to more than €13.4B in the '15-16 season, a 12% rise from the previous season. Much of the new money was spent on the field, with wage costs of clubs in the top five leagues increasing 10% to €8.2B year-on-year. Money and Football: A Soccernomics Guide author Stefan Szymanski said, "These clubs are not run as businesses where making money is the number one priority. The number one priority is winning" (FINANCIAL TIMES, 7/12).

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