To the victors, the spoils. Last night saw Tottenham Hotspur were crowned Europa League champions after a 1-0 win over Manchester United at the Estadio de San Mames in Bilbao.
It was Spurs’ first piece of silverware since 2008 and the first European crown since 1984. It was truly a moment to savour for Spurs fans, players and their embattled head coach Ange Postecoglou, who may still have run out of time to save himself from an exit from the club at the end of this season.
Football is all about the glory, of course. But money makes a big difference in terms of how quickly that success can be achieved in the modern game, and last night’s final clash in Spain was a game of high stakes for both.
This Premier League campaign has almost reached its conclusion and for both Spurs and Manchester United it has been one of utter misery, with both clubs at risk of being the team to finish just one spot above the drop zone. For two of the supposed ‘big six’, agitators of the European Super League four years ago, it has been a season of staggering underachievement.
From pretty early on it was apparent that the Europa League run would be of huge importance due to the fact that there was a route through to the league phase of the UEFA Champions League and its riches next season for the winners of the competition.
Both clubs needed it for different reasons. Spurs, while not at risk of breaching the Premier League’s profit and sustainability rules (PSR) or UEFA’s squad cost ratio rule, needed a cash boost to allow them to better cash flow the business into next season when it came to bringing in new talent without having to aggressively player trade in order to do so.
For Spurs, winning the Europa League final last night was worth £125m. For a Europa League success, Spurs have received, through participation fees, prize money and the value pillar that dishes out funds based on league market size and coefficients, a sum of £35.4m.
Taking into account matchday revenue for the home games played in the competition, average ticket income per home game of £4.9m for Spurs, that has provided additional revenue of £34.3m.
That brings the total prize pot for Europa League success to £69.7m for Spurs, and that is before taking into account how transformative Champions League revenue can be to clubs.
Qualification for the Champions League yields enormous success. With participation alone worth £15.6m and every victory and draw in the revamped competition’s league phase delivering an additional £1.7m and £580,000. Just making it to the league phase can bring in, conservatively, around £20m, and that is before factoring in any progression to the knockout stages, where the money continues on a steep incline. The Champions League value pillar is more lucrative than that of the Europa League and is worth another £20m to clubs.
Matchday revenue then plays another significant role. Playing in the league phase guarantees four home games for each team, adding £19.6m to Spurs, and that is before any knockout games or money for progression comes into play.
And what about the summer window? Well, for Spurs, it has just become a whole lot easier to plan for a revamp or rebuild, with the additional income able to offset some of the pain of a far lower merit payment that will be received this season, with the club potentially looking at a drop in central payments from the Premier League related to their finishing position of as much as £31.5m based on last year’s figures.
But prize money from the Champions League and the additional home games in the league phase that will effectively wipe out that loss, means that the club can engage in the market, because they had a real problem to solve if they would have fallen to defeat in Bilbao on Wednesday evening.
Much of Spurs’ transfer debt has been on credit in recent years, and as of the 2023/24 accounts, published last month, the transfer payables, which is the money the club owes to other clubs still for transfer fees, stood at £337m, an increase of around £250m from the £88m it stood at back in 2019, the year they moved into their new Tottenham Hotspur Stadium home. Sitting behind only Chelsea’s £479m, Spurs’ transfer debt is the second largest in the Premier League.
In terms of what is coming the other way, Spurs are owed £58m in transfer receivables from clubs, meaning that there is a £279m difference between the two, and that is not insignificant.
Given the way that PSR looks at allowable losses of £105m with permitted deductions for investment into infrastructure, the women’s team, the academy and community initiatives, Spurs’ heavy debt, much of it attributable to the new stadium, means that they are still in a good PSR spot, especially given their significant commercial and matchday revenue, and the low wages to revenue ratio that they have.
But cash in the bank as of March 31, 2024, stood at £79m, down from £198m the previous financial year. Spurs have been eating into the cash reserve in the past 18 months, and there was the potential of another lean year if they had missed out on the Champions League next season. They didn’t, though, and while it’s hard to paint the season as a storming success, a trophy and Champions League football means Spurs can be more active in the market and it makes them more attractive to potential new signings, as well as commercial partners who either are looking to renew or come on board for the first time. Potential investors, too, would also value the return to the top table of European club football.
Spurs have managed to salvage real hope from the wreckage of a dismal domestic campaign. They’ll have to learn some major lessons from it.
