Who says money can’t buy success? Manchester City today put a price of £93.4m on last season’s Premier League title. That is the amount that City lost during the 2011-12 season.
But that down significantly from the record loss they announced 12 months ago of £189m.
Man City will highlight the positive part of the report, which was that revenues increased 51% to £231.1m, with the club’s first appearance in the Uefa Champions League contributing more than £22m in new revenue. This is the first time that City has broken the £200m barrier.
Man City’s new owners have done a remarkable job growing the revenue of the club. Consider that in 2009, City’s revenue was only £87m. To go from £87m to over £231m in three years, in this economy is very impressive.
The club’s sponsorship deal with Etihad Airways helped commercial partnership revenue double from £48.5m to £97m.
City executives say that they fully support Uefa’s Financial Fair Play regulations and that despite the almost £100m loss, that they can comply with FFP.
The new financial fair play rules will be introduced at the start of the next Barclays Premier League season and require clubs to basically live within their means.
City are confident they can do that as £15m of the losses comes from infrastructure and youth development costs, while approximately £80m comes from contracts that pre-date 2010, from which the club expect to get some kind of relief. Contracts signed before 1 June 2010 do not count towards FFP compliance.
A City statement read:
‘Whilst the 2011-12 financial results represent a further step towards achieving the club’s objective of long-term sustainability both on and off the field, the application of UEFA allowable reliefs for certain categories of expenditure and investment in 2011-12, position the club well for compliance with UEFA’s financial fair play regulations which come into effect in season 2013-14.’
What Man City left unsaid is that they cannot hope to comply with FFP if their wage bill continues to skyrocket out of control. Buried in the City press release was the note that the club’s wage bill rose from £151.6m to £178.1m last season. That is a eye-whopping 77% of revenues. That is a totally unsustainable number.
So while City point out that the £80m in contracts given to the likes of Carlos Tevez, Gareth Barry, Vincent Kompany, Joleon Lescott and Kolo Toure prior to 1 June 2010 don’t count under FFP, at some point City will have to give these players new deals. And those new contact numbers will be pat of FFP. Which is why I cannot see how Man City feel that they can comply with Financial Fair Play.