Championship: The Financial Chaos of England's Second Division

This week, we continue exploring the incredible 德勤 study, the Annual Review of Football Finance 2024.

Every year, the company also analyzes the Championship, England's second division.

In my opinion, there is little global media coverage on the financial chaos that is the Championship's numbers.

The Eldorado Pursuit: The Premier League

The main focus of financial management in the second division is to ascend clubs to the Premier League, which reached a revenue of ￡ 6.1 billion in 2023.

Premier League TV revenue-2023

The team that receives the least from Premier League TV rights earns ￡104 million per year.

This has resulted in an extremely leveraged Championship, spending far more than it earns and accumulating high debts.

Expenditures Far Exceed Revenues

Championship clubs' revenues reached ￡749 million in the 2022-23 season. A significant portion of this comes from the so-called "parachute payments" to clubs relegated from the Premier League, which provide extra financial support.

These parachute payments represented ￡200 million, or 27% of the league's total revenues.

Excluding these Premier League payments, the broadcast rights revenue for all clubs is only ￡197 million.

Championship- Revenues & Wages- ￡ million,

However, the wage expenditures of the teams are extremely high and completely out of touch with reality. Wage costs were ￡ 706 million in 2023.

As a whole, the league has a wage-to-revenue ratio of 94%, compared to 66% in the Premier League or 55% in the Bundesliga. Notably, this year's ratio is the best in a long time, usually exceeding 100%.

Luton Town Football Club , with 150% of wage-to-revenue ratio leads the financial imbalance, followed by Wigan Athletic F.C. with 146% and Birmingham City FC with 142%. There is many clubs with terrible financial imbalance.

As a result, teams show heavy operating losses, amounting to ￡316 million in 2023. Over the past 10 years, operational losses totaled ￡3.2 billion.

These losses are generally mitigated through players transfers.

Debts reached ￡1.6 billion

With this irresponsible management, Championship teams have accumulated debts totaling ￡1.6 billion.

Of this amount, ￡1.1 billion are soft loans from teams′ owners. In 2023 alone, owners injected ￡200 million to keep their teams operational.

Only two teams, Sunderland and Swansea City, did not present debts in 2023.