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Volume 7 No. 149

Finance

Newzoo released its 2019 Global Esports Market Report, which projects global esports revenue will hit $1.1B this year, according to Trent Murray of THE ESPORTS OBSERVER. Of that total, Newzoo projects $409.1M will be generated by North America, with China accounting for $210.3M. According to the report, 82% of total revenue, or $897.2M, will come from brand investments such as media rights, advertising and sponsorships. Newzoo projects this number to reach $1.5B by '22 and account for 87% of total esports revenues. In addition to revenue projections, Newzoo’s report states that the total esports audience will reach 453.8 million in '19. Of that number, 201.2 million will be "Esports Enthusiasts" -- a term Newzoo uses to "refer to a person that watches professional esports content more than once a month." The report projects that Asia-Pacific will account for 57% of all esports enthusiasts in '19, with Europe accounting for 16% and North America making up 12%. In '19, Newzoo projects that global average revenue per esports enthusiast will be $5.45 (TEO, 2/12). REUTERS' Hilary Russ reported esprots has "burst into the mainstream," with its own superstars and leagues, celebrity athlete owners and tournaments that sell out stadiums and award prizes worth millions of dollars. Newzoo CEO Peter Warman said that early investments by big brands "are now taking root." He said, "This is not experimental budgets. This is for the long-term, and it's good amounts of money. It's what the ecosystem needed and what investors wanted to see." For instance, Activision Blizzard's Overwatch League named Coca-Cola its global beverage sponsor for non-alcoholic drinks on Friday (REUTERS, 2/12). Advance Publications, which owns SBJ/SBD, also owns a majority stake in Newzoo (THE DAILY).

For more coverage of the business of esports, visit our partners, esportsobserver.com.

The German Football League (DFL) announced in its annual report on Wednesday that revenues for the Bundesliga and 2nd Bundesliga in '17-18 rose by more than 10% year-on-year to €4.42B, "marking the 14th consecutive year of growth," according to Karolos Grohmann of REUTERS. The DFL said that revenue for the top two divisions in '16-17 was €4.01B while overall revenues have "more than doubled in the last decade." The top league generated revenues of €3.81B, a 13% rise from €3.37B in '16-17. DFL CEO Christian Seifert said, "German professional football has continued its positive development. This is driven in particular by revenue from the current national media contracts, which are reflected in the balance sheets for the first time." German football, on club and national level, has "not enjoyed major success" since the 2014 World Cup win. The Bundesliga, however, "remains successful," with match advertising and media revenues all up from the previous fiscal year. Bundesliga clubs also "pumped" €177M into youth development and academies in '17-18, up from €163M in '16-17 (REUTERS, 2/13).

Juventus has raised further funding since paying €100M to sign Cristiano Ronaldo last year.
Photo: GETTY IMAGES

Juventus tapped int'l bond markets "for the first time," with the Italian football club raising further funding after paying €100M ($113M) to sign Cristiano Ronaldo last year, according to Robert Smith of the FINANCIAL TIMES. The club, which is listed on the Milan Stock Exchange, raised €175M ($197M) of five-year debt, at a yield of 3.5%, having earlier indicated it would raise at least €150M ($169M). The bond’s prospectus indicates that the club "can use the new funds to repay existing debt." As of June, Juventus had €310M of debt, including loans with Italian banks such as Monte dei Paschi di Siena and factoring facilities with lenders including UniCredit. The bond’s investor presentation highlights that the club’s revenues have risen 161% over the past eight years, reaching €402M in the '17-18 period. It also refers to the Agnelli family, which acquired Juventus in 1923 and is still the majority owner, as a “stable and committed” shareholder. One investor who holds Inter Milan's bond said that the yield on the new Juventus deal "was not high enough to tempt him," given that the Milanese club's bond is trading at a 4.6% yield in the secondary market. He added, "[Juventus] stock has been a nice littler earner though" (FT, 2/13).

Scottish Premiership side Celtic announced a net profit of £15.2M ($19.5M) for the first half of the season, despite a 30% fall in revenue. The decrease was "chiefly due" to the club's failure to qualify for the Champions League group stage. But the £19.7M sale of Moussa Dembele to Olympique Lyonnais in August "ensured a surplus" of £17.6M in the transfer market. Profit from trading fell from £23.7M to £6.2M compared with the same six-month period in '17 (BBC, 2/12).

Asics America Group, which includes the U.S., Canada, Mexico and Latin America, saw fourth-quarter growth on brand-owned sites and at key retail accounts driven by the announcement of performance footwear models. In fourth quarter of '18, the brand saw a 58% growth in e-commerce sales since the last quarter (Asics America). 

A venture including the company of the Turkish Football Federation's chair "made the best bid in the tender" to operate Turkey's only legal sports betting company, Iddaa, broadcaster NTV said. The Sans Girisim venture of Demiroren and U.S. firm Scientific Games reportedly made an offer to take 0.2% of revenues under the revenue-sharing scheme, "revising down their previous bid" of 2.1% (REUTERS, 2/13).