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Squad Market Value vs. Performance – Premier League

With the end of the Premier League won by Liverpool 30 years later and with Jamie Vardy as the leading scorer, we present you the relationship between the squads’ market value and the league standings as well as the impact on that valuation due to the COVID-19 pandemic.

The big winner in this analysis is undoubtedly Sheffield United, reaching the 9th position in the championship, presenting the squad with the lowest market value (47 million Euros on 07/2019 and 120 million on 07/2020). The good performances of Chris Basham, John Egan, Jack O’Connell, and Oliver McBurnie contributed to this achievement. We recall that Sheffield United, this season, also presented the lowest average salary per player in the competition as we previously presented here.

Burnley also stood out, reaching 10th place in the championship with the 5th least valued squad at the beginning of the competition and the 4th lowest average salary per player in the Premier League. In the season that has now ended, James Tarkowski, Dwight McNeil, and Chris Wood stood out with 14 goals scored.

On the other hand, the biggest disappointments turned out to be West Ham and Bournemouth which, with squads currently valued at around 288 and 247 million Euros, respectively, and the 9th and 11th most valued squads at the beginning of the season, were unable to abandon the 16th and 18th places in the English league.

Between the 1st of April and the 15th of June, the market values ​​of the squads suffered an abrupt drop due to the pandemic, around 18%, with Manchester City being the most harmed due to the devaluation of its players by about 244 million Euros. With the resumption of the championships, these values ​​have been slowly rising in some cases.

Market values corresponding to 7/15/2019 and 7/15/2020.

COVID-19 impact (difference between the values at 4/1/2020 and 6/15/2020).

Values in million of Euros.

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Performance vs. Salaries per Player – Premier League

Article originally published at www.totalfootballanalysis.com.

We start publishing today a set of articles that examine the relationship between sporting performance and the average annual salaries paid per player by clubs from the “Big-5” (Barclays Premier League, Bundesliga, La Liga, Ligue 1 and Serie A). We will start by the state-of-the-art Barclays Premier League.

First, we will look at each season between 2016/2017 and 2019/2020 (until matchday 29) to analyze which clubs achieved better results between these variables. Then, we will examine the 14 clubs that remained on the Premier League during these seasons and how they performed compared with how much they paid on average per player.

2016/2017

In the edition of 2016/2017 of the Barclays Premier League, Chelsea won the competition presenting the 3rd highest annual average salary per player.

From a positive perspective, Bournemouth achieved the 9th position in the competition with only the 19th highest salary value. In the opposite perspective, Sunderland was the case with less success finishing in the last place with the 13th highest average annual salary per player.

Only Hull City presented the same position in the salaries ranking as it did in the competition.

2017/2018

In the following season, Manchester City was crowned champion with the 2nd highest annual average salary per player.

Burnley was the surprise achieving the 7th position in the league with only the 18th highest salary value. On the opposite side, West Bromwich was the case with less success finishing in the last place with the 12th highest average annual salary per player.

Crystal Palace, Everton, and Leicester presented the same position in the salaries ranking as they did in the competition.

2018/2019

In the last edition of the Barclays Premier League, Manchester City won once more the competition presenting the 2nd highest annual average salary per player.

From a positive perspective, Wolverhampton achieved the 7th position in the competition with the 14th highest salary value. In the opposite perspective, Manchester United and Southampton were the cases with less success finishing in 6th and 16th place with the 1st and 11th highest average annual salaries per player.

Only Chelsea and Arsenal presented the same position in the salaries ranking as they did in the Premier League.

2019/2020

With 29 matches played, Liverpool is very close to being crowned champions with the 3rd highest annual average salary per player of the league.

On the positive side, Sheffield United is performing incredibly well in the 6th position in the competition with the lowest salary value. In the opposite perspective, West Ham is, until now, the case with less success occupying the 16th place with the 9th highest average annual salaries per player.

Only Newcastle has, so far, presented the same position in the salaries ranking as they did in the Premier League.

2016/2017 to 2019/2020 – Which club profits more from the players’ salaries

Finally, we analyzed the performance and salaries of the 14 clubs that took part in the Barclays Premier League between 2016/2017 and 2019/2020.

The two giants from Manchester are the clubs with a higher average annual salary per player. Burnley, with recent brilliant campaigns, is the club with more success when comparing sporting performance and salaries since, on average, it achieved the 12th place with only the 18th highest average amount per player.

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KPMG Football Clubs’ Valuation: The European Elite 2020

KPMG Football Benchmark released last Thursday its 5th edition of the report on the enterprise value of clubs. Thus, due to the crisis caused by the pandemic of COVID-19, these values ​​will tend to fall due to the necessary market adjustments.

As in previous reports, Real Madrid and Manchester United occupy the first two places in the ranking followed by Barcelona, ​​who came to occupy the third position that belonged to Bayern Munchen, a club that in 27 years has never presented negative financial results.

Another surprise of this edition is the lack of Serie A clubs in the Top-10 since Juventus dropped to 11th place.

Galatasaray was the club that grew the most compared to the previous year (49%) followed by Paris Saint-Germain and Internazionale.

On the other hand, Real Madrid takes 1st place for the third time since 2016 mainly due to the three UEFA Champions League won and a 41% growth in commercial revenues. Manchester United maintained the 2nd position due to the strength of its brand and a significant accumulated EBIT. In 3rd place, Barcelona recorded a 50% growth in operating revenues and 52% in commercial revenues since 2016, thus leading it to rise in one place compared to last year.

Taking into account the group of 32 clubs that are part of this ranking, between 2016 and 2020, its value has always grown (51% accumulated) mainly due to a 44% increase in operating revenues over this period. All revenue streams increased, with broadcasting revenues being the main highlight with an increase of 65% while matchday and commercial revenues grew by 22% and 39%, respectively. Another important fact is the decreasing dependence of 25 of the 32 clubs on matchday revenues.

At the same time, it is important to note that, over the 5 editions of this report, the weight of the Top-10 in the total enterprise value of the 32 clubs has decreased by 4% to 66%.

Regarding individual clubs, in percentage terms, since 2016, Olympique Lyonnais was the club whose value grew the most (193%) followed by Tottenham and Internazionale. In absolute terms, Liverpool was the one that most saw its enterprise value grow (1,385 million euros). On the other hand, AC Milan was the only one to lose value over the years. Concerning financial results (EBIT), Tottenham is the outstanding club with an accumulated value of 439 million Euros.

Celtic FC (Scotland), PSV Eindhoven (Netherlands), Olympique de Marseille and AS Monaco (France), Fenerbahçe SK (Turkey), and Sporting CP (Portugal) were almost at the Top-32 in 2020.

Enterprise Value Ranking (Top-32)

 

Clubs’ Enterprise Value Variation Ranking (2016-2020)

 

Enterprise Value Variation Ranking by Country (2016-2020)

Looking at the clubs that were part of the editions of this report between 2016 and 2020, and aggregating them by the country, it appears that the value of the clubs from Ligue 1 has been the one that has gone up the most (74%). In absolute terms, the 1st place belongs to the Premier League clubs (6,225 million Euros).

 

Finally, between 2016 and 2020, English clubs were the ones that gained the most weight in the total value of the top-32, comprising 39% of it in 2016 and 41% in 2020.

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