Spanish soccer giant Barcelona reported record revenue of €708 million on Monday or $770 million based on average exchange rates over the last 12 months. It tops the $765 million for Manchester United for the 2015-16 season, which previously ranked as the highest in the history of sports.
It was a disappointing season for Barcelona on the pitch as it finished behind rival Real Madrid in the La Liga standings and lost in the quarterfinals of the Champions League, but total revenue was $14 million more than the club’s projected figure and up $31 million from the 2015-16 season.
Barcelona recently ranked fourth overall in Forbes annual look at the world’s most valuable sports franchises at $3.64 billion. Only the Dallas Cowboys ($4.2 billion), New York Yankees ($3.7 billion) and Man United ($3.69 billion) are worth more.
Barcelona says the team’s debt-to-earnings ratio is roughly two-to-one meaning earnings before interest, taxes, depreciation and amortization clocked in at more than $130 million for the season. Revenue will get a boost next season when Japanese online firm Rakuten takes over shirt sponsorship rights from Qatar Airways in a deal worth more than $60 million annually. An extension to its Nike deal kicks in the following season worth at least $168 million per season, crushing the previous high of $111 million for United’s deal with Adidas.
Barcelona allocated 66% of its expenditures for “payment of salaries to athletes.” No player cost more than the five-time player of the year Lionel Messi, who earned more than $50 million in salary and bonuses from Barça and ranked as the second highest-paid soccer player in the world behind Cristiano Ronaldo. Messi signed a three-year contract extension this month to remain at Camp Nou through 2021.
The Catalan club has a “strategic plan” in place through 2021 with the central tenant the renovation of its home stadium, Camp Nou. The plan calls for revenue to reach €1 billion by 2021. Barcelona affirmed those plans are on track on Monday.
The renovation project will modernize the stadium and expand capacity to 105,000 seats. It is expected to cost in the neighborhood of $650 million. Barcelona President Josep Maria Bartomeu discussed the cost of the renovation this month on a Catalonia-based radio show. “We said it in the 2014 referendum, when we presented it, that a third of it is from the naming rights for the stadium, and another third of it is Barça being able to go to a bank and get a loan. The other third is the new income that we will receive,” said Bartomeu.
Bartomeu said the outlook is even stronger now. “We tested the market for the naming rights, and it’s going to end up being more money than we thought at the beginning,” he stated. “Which makes us pretty happy, because when we go to the banks, we don’t have to ask for as much money.”
Manchester United will report its fiscal year results in September. The Red Devils raised its revenue projections in May to £560million to £570million versus £515 million for the previous season, which set a club record. But Great Britain’s vote in 2016 to leave the European Union battered the value of the British pound. United’s revenue should top out at $722 million in dollar terms. One caveat with Barcelona’s reported revenue. It includes profits from player sales, while United and Real Madrid both exclude those sales from their revenue figures.