UEFA reports rising losses for clubs
NYON, Switzerland (AP)
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Europe's top football clubs collectively lost more than €1.6 billion ($2 billion) in 2010 and their debts are still rising despite the imminent arrival of sanctions for overspending.
With wealthy owners keen to buy success by pumping massive amounts into buying top players, accounts from about 650 clubs reveal 56 percent lost money in the 2010 financial year, and their total debt was €8.4 billion ($10.9 billion).
UEFA general secretary Gianni Infantino said it was ''a last wake-up call'' with clubs having been subject to UEFA's financial fair play monitoring since July 2011.
''We must end this negative spiral and gamble for success,'' Infantino told reporters at a briefing.
UEFA's study showed clubs' combined annual loss rose 36 percent, about €400 million ($520 million), on 2009 figures.
This was despite rising revenues totaling €12.8 billion ($16.6 billion) for top-tier European clubs, an increased income of 6.6 percent.
Still, UEFA's research showed that richer and more successful clubs were more likely to spend and lose money.
Of more than 200 clubs playing in UEFA's Champions League and Europa League competitions two years ago, 65 percent spent more than they earned.
Three out of every four clubs earning more than €50 million ($65 million) annually also recorded a loss.
''Clubs tend to spend more in order to obtain a competitive advantage,'' said Andrea Traverso, the head of UEFA's financial fair play project.
UEFA says clubs who overspend in an initial two-year monitoring period can be excluded from its competitions from the 2014-15 season.
Financial fair play (FFP) rules allow clubs to make a total loss of €5 million ($6.5 million) in the first assessment period, or up to €45 million ($58 million) if a wealthy owner makes a one-off donation to wipe out losses. UEFA will phase in tighter monitoring rules in future years.
UEFA acknowledged that 13 clubs, including several from England, would have failed its break-even tests on their 2010 accounts. The clubs were not identified.
UEFA points to the fact that 31 clubs, including four this season, have been refused entry to its two main club competitions since financial licensing was introduced in 2004.
However, clubs barred this season were from the small-market leagues of Ireland, Kazakhstan, Lithuania and Romania.
Skepticism has grown over UEFA's willingness to take on big-spending clubs such as Premier League leader Manchester City, whose owners from Abu Dhabi funded a 194.9-million-pound (then $318 million) loss for 2010-11, the final season before FFP took effect.
French league leader Paris Saint-Germain spent €82 million ($107 million) on players last offseason after being bought by Qatari owners.
UEFA's project was backed by Jean-Michel Aulas, the president of Lyon whose standing in France is threatened by PSG's revival.
Aulas described a ''dichotomy'' between clubs spending ''easy money and money for investment.''
''Tomorrow's paradigm (for clubs) must be built on building stadiums and building youth academies - tangible assets that can benefit football in general,'' Aulas said.