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The Warsaw Voice » Business » October 27, 2011
Business & Economy
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Money in Soccer
October 27, 2011   
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Lech Poznań topped the latest Ekstraklasa Piłkarskiego Biznesu survey of Poland’s soccer clubs in terms of financial standing compiled by professional services firm Ernst & Young. This is the third straight time Lech Poznań topped the list. Experts say Lech are Poland’s most financially stable soccer club and one that posted a hefty profit last year.

Apart from Lech, only three other Polish premier-league clubs generated a net profit last year. However, Lech’s performance in this year’s Ernst & Young report was not as strong as in the previous one. The national champions in the 2009/2010 season, Lech took first place in terms of financial standing but were beaten by Legia Warsaw and Jagiellonia Białystok in two other categories. The two clubs ranked second and fourth in the Ekstraklasa Piłkarskiego Biznesu survey respectively. Wisła Kraków, Poland’s current champion, ranked third.

The report shows that Polish soccer has a bright future as stadiums have been modernized and Polish soccer players are increasingly professional. Incomes of some of the most successful clubs may soon exceed zl.80 million.

“Polish soccer is now in transition,” says Krzysztof Sachs, partner at Ernst & Young and originator of the report. “We are in the middle of a so-called infrastructure revolution. In the previous report, we could see its negative financial and media consequences. Now, we have more modern stadiums so the clubs’ performance is better. Progress in terms of infrastructure is followed by progress in terms of sporting performance. Lech Poznań performed excellently in the Europa League last year and now we will have two teams in this tournament. This should have an impact on next year’s listings and the results of the clubs.”

The findings of this year’s report indicate that, contrary to popular belief, there is money to be earned from soccer in Poland. Last year, Lech Poznań earned a net profit of zl.7.5 million on revenue of over zl.73 million, a rise of 35.8 percent over a year earlier. Lech owe this sharp increase to their presence in the Europa League, the transfer of player Robert Lewandowski to Germany’s Borussia Dortmund, and funds from the Union of European Football Associations (UEFA) for taking part in the European tournament. Lech had diversified sources of revenue. High liquidity and low debt are other factors behind their financial strength.

KGHM Zagłębie Lubin are Poland’s second best club in terms of financial management while Cracovia Kraków rank third in the respect. Ruch Chorzów are in fourth place, having moved up 12 spots compared with the previous survey, thanks to transfers of key players and excellent profitability. Ruch earned the second highest net profit after Lech last year, at zl.1.7 million. Wisła Kraków had the second highest revenue, mainly thanks to receipts from transfers.

“One should point to a major increase in revenues for premier-league clubs, though one coupled with deteriorating profitability,” says Sachs. “The clubs’ budgets, that is expenses, grew much faster than revenues. This situation forces the owners to inject funds into the clubs or offer them loans. In this year’s table, it is the growing debt of clubs that is especially disquieting.”

In 2010, Legia Warsaw were the club that grabbed the most media attention, ranking ahead of Lech Poznań, Wisła Kraków and Jagiellonia Białystok in this respect. The number of TV broadcasts, turnout at stadiums, press articles and the media value of the club’s shirts were the factors taken into account in ranking the clubs.

Ernst & Young experts say there are some risks to the development of the premier league, but the positives outweigh the negatives at this point. In 2010, the revenues of premier-league clubs grew by 22 percent year on year, while in 2009 they did not rise at all. However, the bad news is that the Big Three—Wisła, Lech and Legia—accounted for most of this increase. After the completion of the stadiums in Gdańsk and Wrocław, the local clubs Lechia and ¦l±sk will probably have a chance to join the top group.

But a big gap in terms of financial and consequently on-field performance may develop between the top five and the other clubs in the future. From the perspective of the premier league as a whole, it is optimistic that this division finally has a key sponsor, T-Mobile, after a long break. Also, broadcasting rights for another season have been sold not only to Canal+ but also another two partners, Polsat and Eurosport, under sublicense. As a result, viewers in 22 Central and Eastern European countries can now watch Polish premier-league clubs in action.
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