Premier League revenue closes £6 billion

English Premier League revenues are expected to exceed £6bn this season for the first time, quickly ahead of their European rivals.

Premier League clubs earned £4.9bn in the 2020/21 season, according to Deloitte's latest annual football finance review, despite a near-total loss of matchday revenue due to Covid-19. That was up 8% from a year earlier, while Germany's Bundesliga and Spain's La Liga were hit by a 6% drop in revenues.

Deloitte expects the English top flight to earn £5.5bn in 2021/22 and will exceed £6bn in the current season, which started in early August. The English game continues to gain popularity around the world and has benefited from a significant increase in its rights to international broadcasting.

While the Premier League was the only one of the five European leagues to boast an improvement in overall operating profit, which increased sharply from £49 million to £479 million, losses before tax remained significant, although dropping from £991 million to £669 million. 

Net debts of Premier League clubs rose 4% to £4.1bn.

"As the Premier League enters its fourth decade, it is ahead of the competition even more than ever before, emerging from the pandemic without a significant increase in net debt, as many might have expected," said Tim Bridge, lead partner in Deloitte's sports business group.

Teams in England's second tier, known as the Championship, are less financially healthy. Their revenues fell by £101 million to £16 million in the 2020/21 season due to the fact that most matches were held behind closed doors. 

Championship teams have nothing close to top-flight broadcast revenues, and consequently the ratio of average salary to league earnings has risen to a record high of 125%, despite an 8% drop in payroll spending.

Championship teams and other lower English divisions are currently discussing with the Premier League a larger revenue distribution that could help the small clubs' long-term sustainability, with the threat of calling an external intermediary if the various parties fail to agree on a solution.

Elsewhere, Deloitte said there has been a boom in investment in Europe's five largest leagues, with more than two-thirds of them coming from U.S. investors. According to the report, there are now more than 70 groups of owners of several clubs, up from 28 five years earlier.

While the Premier League has enjoyed rising revenues from overseas broadcasts, Italy's Serie A has suffered a "significant decline" in the value of its international rights as it has failed to enter into a renewed contract with beIN and matches have been streamed instead on YouTube, Deloitte said. 

Meanwhile, the Bundesliga signed an agreement on its domestic broadcasting rights, which was 5% lower than during the previous cycle.