LaLiga’s business suffers from the pandemic. The ordinary turnover of the First Division clubs fell by 6.5% year-on-year, to 2,920 million euros in the 2019-2020 season, the last for which complete data is available, as a result of the coronavirus pandemic, which forced the competition to be suspended, which returned behind closed doors in June.
Overall, taking into account the First and Second data, LaLiga clubs billed more than 3,322 million euros in the 2019-2020 season, excluding transfers and other non-ordinary income, which represents a 6% year-on-year drop, such and as reported in the Facts & Figures report, Football finances, club by club.
Facts & Figures: The finances of football, club by club
Up to thirteen clubs that have competed in the First Division this season saw their income fall last season below the turnover of the 2018-2019 season, the last pre-ndemic. At a percentage level, Villarreal and Real Betis, with 26% and 20%, were the most affected clubs, although if the invoiced figure is taken into account, FC Barcelona and Real Madrid were the hardest hit, dropping 128.4 and 62.5 million euros respectively. Although it must be taken into account that some income accrued beyond the end of the accounting year, and not all clubs adopted the same criteria to compute them.
In total, the twenty clubs that have played in the First Division this year lost 64.89 million euros in the 2019-2020 season, a figure that is largely attributable to the problems of FC Barcelona, which closed the year with losses of more than 97 million euros. It contrasts, for example, with the more than 16 million earnings of Getafe CF, the largest in the club’s history, thanks to a record turnover resulting from its participation in the Europa League.
The main sources of income for the clubs were, in order of importance, broadcasting, that is, the audiovisual rights (42.5%); marketing and advertising (29.3%); competitions (12.9%), and subscribers (9.8%).
The importance of television is demonstrated in that it represented more than 80% of the income of up to six clubs
One more season television remained the main source of income for LaLiga Santander clubs, representing more than 1,240 million euros, 42.5% of total income, showing the dependence that Spanish football has on audiovisual rights. Although they fell by 8% year-on-year, their importance on the total volume of income has only fallen by half a point.
In some clubs, especially the small ones, the weight of television is much higher than the average: in the 2019-2020 season it accounted for almost 90% of the total income of clubs such as Getafe CF or SD Eibar.
This data is particularly relevant considering that LaLiga’s current national television rights cycle expires at the end of the 2021-2022 season. The tender for the next cycle is expected to take place in the middle of this year. With Movistar and Mediapro as great allies so far, LaLiga has opened the door to the emergence of new players to maximize their income, which aims “to grow slightly, without reaching double digits,” as explained Javier Tebas, president of LaLiga, just under a month ago.
The LaLiga leader warned that “the emergence of new platforms over-the-top (OTT) are bringing a decrease in revenue”, Referring to the appearance of some such as Eleven or Dazn, and“ that make negotiations with companies like Telefónica more complicated ”.
LaLiga faces the new competition for national audiovisual rights anticipating a change in format and with doubts about Orange’s participation
In the middle of April, Tebas anticipated that the contest will be “disruptive”, through packages but with a different configuration, offering up to four possibilities to go to the tender differently. LaLiga intends to change the system to open up to a greater number of fans. Five years ago there were 3.4 million pay TV subscribers to football, a figure that has dropped to 2.5 million due to market and supply constraints.
Euskatel, Másmovil and Vodafone do not broadcast football, and Orange has questioned whether to continue integrating it into its service offering due to the high cost. The goodbye of the French company would be an added difficulty for LaLiga because it has 500,000 subscribers who would lose the option of hiring football.
On the other hand, marketing and advertising revenues fell by more than 6% in the 2019-2020 season, to 854.45 million euros, due to the adaptations of the sponsorship contracts after the competition was stopped. And on the horizon, in addition to the consequences of the pandemic, the entry into force of the regulations governing the advertising of betting houses, approved in November by the Council of Ministers, which allowed to maintain the conditions of the agreements of sponsorship already signed at least until August 2021, but will prohibit sponsorship on jerseys or sports kits beyond that date, as well as title rights. Quite a problem, considering that the season started with eleven clubs showing the sportsbook logo as the main sponsor on the front of their jersey.
More than 83% of LaLiga Santander’s marketing and advertising revenue is attributable to FC Barcelona, Real Madrid and Atlético de Madrid
In any case, Barça, Madrid and Atleti distort the total volume of income from the marketing and advertising category by jointly representing more than 83% of the total income from this concept.
The clubs are watching the evolution of the pandemic to also see how it will affect advertising, awaiting the return of the public to all stadiums and face-to-face marketing activations. Although the market is beginning to show signs of slowing down, as has been verified by Barcelona, which has renewed with Rakuten, reducing the fixed income of this sponsorship by almost 50%.
On the other hand, competition revenue fell more than 26% to € 376.4 million, in a section in which Barça, Madrid, Atleti and Valencia, participants in the Champions League, and Sevilla FC, champion of that edition of the Europa League, together added more than 96% of these revenues.
To see how the mess of the Super League is finally resolved, an alternative competition to the Champions League promoted by twelve founding clubs, with Madrid, Barça and Atleti as promoters, although the rojiblancos distanced themselves from the project a few hours after its presentation. Uefa has opened disciplinary proceedings against Real Madrid, FC Barcelona and Juventus, but the Swiss Ministry of Justice has notified the governing bodies of football in Europe and on a global scale that they must respect the rights of the promoters of the competition.
Uefa has responded to the Super League by approving the renewal of the Champions League
Uefa presented in April the renewed Champions League format, which will come into force from 2024, and will mean going from 32 to 36 teams, to play a greater number of matches and that, consequently, there is a greater impact on the media and greater income from television rights.
Finally, subscriber revenues were lowered by more than 24% year-on-year to 284.8 million euros, after the adjustments made by the clubs due to having to close the season behind closed doors. An income game that in 2020-2021 will probably be the most affected, since practically the entire course has been played behind closed doors, and waiting to see what happens for next season.
The Minister of Culture and Sports, José Manuel Rodríguez Uribes, predicted on Monday that “seeing how the situation is going, It seems to me that the League in August, when it starts, would have to twist a lot so that it was not with the public”. “We have already finished this with the public, in a symbolic way, in the territories with less incidence,” he said in Zero Wave.
Second’s business shrank more than 4%
Total turnover of Second Division clubs it fell in 2019-2020 by more than 4.2% to € 401.4 million, with television rights representing the largest source of income of the 22 clubs participating in the competition, although it was slightly reduced by the adjustments derived from the coronavirus pandemic. The calculation of the exact amount is not possible because some clubs have not published their balances in detail. In addition, the pandemic dyed the accounts of up to eight clubs red, although the overall result is positive for more than 46 million euros.
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