Individuals and organizations spent €1.25 billion in the Belgian economy in 19/20 thanks to Belgian professional football, despite COVID-19, but aggregate revenues are expected to decrease by 21-33% in the next seasons has been saved
Individuals and organizations spent €1.25 billion in the Belgian economy in 19/20 thanks to Belgian professional football, despite COVID-19, but aggregate revenues are expected to decrease by 21-33% in the next seasons
Deloitte Pro League report 2021
Aggregate revenues are likely to fall due to the majority of the matches being played behind closed doors in the season 20/21. The impact will materialize in the seasons 20/21, 21/22 and potentially 22/23. The decrease in revenues will reach between €80 million and €120 million.
Brussels – 2 June 2021
Deloitte today issued the fourth “Socio-economic impact study of the Pro League on the Belgian economy”, a report that quantitatively and qualitatively measures the socio-economic impact generated by Belgian professional football. The clubs’ turnover slightly slowed down last year, representing €373.5 million in 19/20 compared to €378.5 million in 18/19 and €321 million in 17/18. The financial impact of the COVID-19 crisis on the 19/20 season was lower than anticipated, but is expected to be spread over the seasons 20/21, 21/22 and potentially 22/23.
- UEFA prize money for Belgian clubs showed a 25% increase, reaching €79.3 million.
- Belgian clubs recorded a positive net result from transfers amounting to €109.2 million, representing a strong increase of €87 million compared to 18/19.
- Belgian clubs witnessed a decrease of €16 million in their ticketing and commercial revenues in 19/20, due to the COVID-19 crisis.
- Belgian professional football contributed €837 million to our economy, compared to €630 million 18/19.
- The budget for social activities reached €1.93 million in 2020, an increase of 6% compared to the previous year.
Revenue growth only slightly affected by the COVID-19 crisis in 19/20
After years of steady revenue growth, the Belgian Pro League clubs were impacted by the COVID-19 crisis during the last months of the season 19/20. Clubs noted a slight decrease in the total amount of revenues, down from €378.5 million in 18/19 to €375.5 million in 19/20 (only -1.3%).
Directly linked to the number of matches played, ticketing and commercial revenues fell significantly compared to the previous season 18/19, by 6% and 18% respectively. But, as the second most important source of income, broadcasting revenues reached around €80 million in 19/20 for the third consecutive year, thanks to the renewal of the broadcasting contract in 2017 with Belgian providers. The UEFA prize money significantly increased in 19/20 to reach €79.3 million (+25%) thanks to the successful performance of our clubs in European campaigns, compensating for the drop in ticketing and commercial revenues. Sponsorship and advertisement revenues remained stable in 19/20, with a total of €76.4 million compared to €76.2 million the year before. The betting sector represents the biggest contributor, closely followed by the industrial sector and the clothing, banking, telecom and transport industry.
Sam Sluismans, Partner at Deloitte Belgium: “As transfers are a very important aspect of the business model of the Belgian clubs we estimate that the slowdown of the transfer market caused by COVID-19 will negatively impact the financial situation of the Belgian clubs in the 20/21 season. On the positive side, the importance of broadcasting revenues for Belgian clubs is expected to increase with the outcome of the Eleven Sports deal from 20/21 to 24/25 with €100 million annually.”
UEFA prize money increased significantly, but European ticket mix at risk for coming seasons
Thanks to the successful performance of the five clubs participating in European campaigns in the 19/20 season, the total amount of UEFA prize money reached €79.3 million, a substantial increase compared to the previous season (+25%). This source of revenues represents around 21% of the total revenues of all the clubs in 19/20.
Pierre François, CEO Pro League: “However, there is a major risk for 21/22, since the good performance of the 16/17 season will not be included in the computation of the five-year UEFA coefficient. Depending on the next European season, Belgium could drop out of the top 10 in the UEFA ranking and lose a direct ticket to the UEFA Champions League group stage. The performance of the Belgian clubs will therefore be crucial in 20/21 as it will have a strong impact on our clubs at European level for the next few years.”
Furthermore, the structure of European football will change significantly with the introduction of the UEFA Europa Conference League in 2021, and the recently announced changes to the format of the Champions League as of 24/25.
COVID-19 impact expected to reach €80-120 million in the coming three seasons
The aggregated revenue amount in 19/20 is close to that of 18/19, as the impact of the crisis was limited to the last part of the season and the UEFA prize money was able to compensate for the decrease. Nevertheless, the estimated impact of COVID-19 on Belgian professional football revenues represents in total a decrease of 21%-33% on aggregate revenues due to the season 20/21 being played almost entirely behind closed doors. The impact will materialize in the 20/21, 21/22 seasons and potentially 22/23 (depending on clubs’ reimbursement policies and agreements regarding sponsorship deals, etc.) The decrease in revenues will reach between €80 million and €120 million.
Sam Sluismans, Partner at Deloitte Belgium: “Since most games were played behind closed doors, the crisis will heavily affect ticketing and commercial revenues for the 20/21 and 21/22 seasons. The clubs’ budget for 20/21 indicates a 55% drop in their ticketing revenues due to a decrease in gate receipts and season passes and a 60% drop in their commercial revenues as a result of a decrease in merchandising and food and beverages sales. As far as sponsorship revenues are concerned, the clubs’ budget does not foresee a decrease but a 6% increase, thanks to an increase in revenues from related parties.”
The five-year deal with Eleven Sports, worth around €100 million annually, will compensate for a part of the net impact of COVID-19 for the clubs (up from €80 million in the previous cycle).
Belgian clubs recorded positive results from transfers
Player transfers are another important aspect in the financial wellbeing of clubs in Belgium as the country has a strong emphasis on being a training league for the ‘Big Five’ competitions. Looking at the 19/20 season, Belgian clubs recorded a positive net result from transfers amounting to €109.2 million. This represents a very strong €87 million increase compared to the previous season, which positively impacted the financial loss recorded by clubs. Thanks to this positive result, Belgian clubs recorded a loss of €54 million in 19/20 compared to €91 million in 18/19.
Sam Sluismans, Partner at Deloitte Belgium: “Despite a decline in operational revenues, partially linked to COVID-19, clubs were able to significantly increase their transfer revenues thanks to a very dynamic transfer market. Clubs also keep spending an increasing amount of money to attract talented players to their teams. Total player value reached €200 million in 19/20, compared to €172.3 million in 18/19.”
Agent fees are another variable affecting the net transfer result. In Belgium, agent commissions have been on the rise in recent years. With around 316 active agents, a total of €46.6 million was paid in agent commissions in the 19/20 season, a €1.2 million increase compared to 18/19. The largest part of agent commissions still comes from contract negotiations (52%). A large proportion of these amounts are still distributed to a limited group: the top five agents receive just under a third of the commissions (31%).
Player salaries show mixed results
The total amount for player salaries reached €236.5 million in 19/20, compared to €249.1 million in 18/19. This decrease may be explained on the one hand by the measures taken in the context of COVID-19 and on the other hand by the unavailability of data for three clubs in the 1B Pro League (R.E. Virton, KSC Lokeren, and SV Roeselare).
Even though the total amount paid in player salaries decreased in 19/20, the average gross annual salary (including group insurance) of professional football players in 1A and 1B increased from €233,000 to €249,000 (+7%). This was driven by a higher average salary for players in G5 clubs, which represent a more important proportion of the total players than in the last seasons (mainly due to the unavailability of data for three clubs in the 1B Pro League). The average gross salary for a Jupiler Pro League player was €280,000, of which €35,000 was a contribution to group insurance (12.5% of total gross salary).
The payroll cost/revenue ratio increased in 19/20 from 55.2% to 61.2%, excluding transfers but including other operational revenues. This evolution is driven by higher total costs for player salaries—the main cost for clubs—which outpaced the increase of total revenues (excluding transfers but including other operational revenues). It is important to highlight that the salaries for the 19/20 season were mostly agreed upon prior to the COVID-19 crisis started.
Despite having the highest player salaries, G5 clubs still scored below the average payroll cost/revenue ratio with 57.4% while 1B Pro League clubs scored above average with 84.5%.
Direct jobs in decline
The Pro League and Belgian clubs provided 3,540 jobs in the Belgian economy in 19/20, a number which decreased by 555 (4,095 jobs in the 18/19 season). This is driven by a decrease in direct job creation (direct employees such as players of the clubs, employees of the club working the stadium bar, etc.) from 1,986 to 1,717, partially explained by the missing data from three clubs and the decision of some clubs to streamline both their player squads as well as supporting employee staff. Indirect and induced jobs account for 1,300 and 523 jobs, respectively.
Strong engagement to support social projects and youth players
Even though clubs could not carry out all social projects as planned (191 social projects in 2020 compared to 300 in 2019), the total budget for social initiatives reached €1.93 million in 2020, compared to €1.82 million the previous year. The Pro League and its clubs supported various causes: Younited Belgium, Belgian federation of Food Banks, Tele-Onthaal/Télé-Accueil, World Autism Day, Racism & Discrimination Hotline, etc. They decided to put their focus on social projects supporting people in light of the COVID-19 crisis.
Pierre François, CEO Pro League: “A total number of 275 Belgian youth players (under 23 years) had a full-time or part-time contract during the 19/20 season, a 5% increase compared to the previous year. They played a total of 74,935 minutes together, representing a 25% decrease compared to 18/19, due to the early end of the season. Young players played around 11% of the total minutes played by all players, a similar ratio compared to the 18/19 season. While the clubs were legally required to invest €26.9 million in 2019, they invested €49.3 million in their youth, representing 1.8 times more effort than requested.”
About the survey
Numbers in the report are based on data from the annual reports of the Pro League and its 24 clubs unless stated otherwise to describe the revenue and cost evolution. Using economic indicators made available by the Belgian Federal Planning Bureau, Deloitte has quantified the economic impact of the clubs. The case studies are based on qualitative interviews performed with the selected clubs. www.deloitte.com/be/pro-league
Deloitte in Belgium
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About Pro League Football & Community
Building on its social role, the Pro League supports the professional football clubs in the development of their community and social initiatives. The support comes through bi-monthly meetings, continuous exchange of best practices and yearly training programmes for the clubs in collaboration with the academic world.The objective of this support is to ensure a strong and sustainable local community programme for all the clubs: to provide the professional clubs with the capabilities to offer a social programme in collaboration with local governments and social partners to target audiences in the area, both locally and (inter)nationally.
Furthermore, the Pro League organises several national awareness-raising and informative initiatives in collaboration with governments: the Christmas initiative, an action to collect funds for social partner Damiaanactie/Action Damien, a national school tournament for primary schools. Also in collaboration with its partners, the Pro League is currently investigating the possibility to launch an initiative supporting refugee minors.
The Pro League and its partners are the driving force behind the Football Kick Off, an annual football tournament for disabled youth. Finally, the Pro League supports Younited Belgium, the integration project for homeless people.