The COVID-19 pandemic will cost Europe's big soccer leagues over $7 billion in lost revenue, and has exposed deep 'flaws' in how the game is run

• The COVID-19 pandemic is expected to cost Europe's elite soccer leagues over $7.3 billion in lost profits by the end of the current season, according to a report from KPMG.
• The international audit company reports that the winners of Europe's big six leagues posted combined losses in revenue of $452 million last season.
• "While the 2019/20 season was the worst yet, the financial impact of the pandemic did not cease with its completion," it said. "The ripple effects of this crisis will still be felt in 2020/21."
• KPMG added that the pandemic has also helped expose "flaws" in how the elite game is run.

The COVID-19 pandemic is expected to cost Europe's elite soccer leagues over $7.3 billion in profits and has exposed the "flaws" in how the financial side of the game is run, according to a report from KPMG.

The international audit company conducted an in-depth study into the financial impacts of the pandemic last season, focusing on the winners of Europe's big six leagues - Real Madrid, Liverpool, Juventus, Paris Saint Germain, Bayern Munich, and Porto.

All six teams recorded big losses in match day, broadcasting, and commercial revenues, amounting to a combined decrease of $452 million year-on-year. French champion PSG suffered the biggest total fall, finding itself $116 million down on its operating revenues from the previous season, while Portuguese champion Porto recorded the heaviest percentage loss, having seen revenues plummet by 50%.

Real Madrid was $72 million down last season compared to 2018/19, Juventus dropped $76 million, and Liverpool's revenues fell $58 million.

German champion and Champions League winner Bayern Munich was, relatively speaking, the least impacted, posting an annual decrease in revenue of $22 million, equivalent to a 3% drop.

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Extending its research beyond the top six teams and into the current season, KPMG said it expected the big six leagues to see profits decline $7.3 billion by the end of the 2020/21 campaign.

"While the 2019/20 season was the worst yet, the financial impact of the pandemic did not cease with its completion," it said. "Rather, the ripple effects of this crisis will still be felt in 2020/21, even if the season is played out in full.

"ECA (The European Clubs Association) estimates overall losses for the 2019/20 and 2020/21 seasons across clubs in the top divisions of Europe to be in excess of €5 billion ($6.1 billion) on operating revenues (excluding transfer impacts) and well over €6 billion ($7.3 billion) on bottom-line profits."

KPMG added that the coronavirus pandemic is not totally to blame for the expected financial downfall of clubs, saying it has merely helped expose flaws that already existed in the way clubs were being run.

"It is crucial to note that, even prior to the pandemic, there was a general consensus that inflated players' salaries, coupled with growing transfer and agent fees, were placing significant strain on clubs' finances," it said.

"The crisis has magnified these flaws in the current business model, where working from home is also not possible. In an industry already characterised by limited liquidity, minor disruptions paling in comparison to COVID-19, such as the volatility of qualification to certain competitions or player trading income, had already driven some clubs into real financial distress.

"The present global health emergency has further exposed the vulnerability of the football ecosystem and thrown its financial sustainability into question, even in the short term."

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