Newcastle 25th place in football richlist

It's the time of year that I love more than anything else. We start to get facts and figures trickling through, which suits my analytical and accounting penchant no end!

Geeky? Probably, but it's something I enjoy doing so there. Suck on that!

Anyway, the latest Deloitte Football Richlist has been released which details the top twenty richest clubs in Europe. If you wish to download the 44 page report, free of charge, you can do so from here although the nuts of it is that Newcastle United currently sit outside of the top twenty in 25th place.

The figures show that Newcastle brought in €98m (note the Euro symbol!) last season, but what are the figures? How do Deloitte come up with this? Well if you download the report for yourself you will see why, but the short answer is that income is split into three categories - commercial, matchday and broadcast. Please note that transfer fees are NOT included as this report is to measure financial strength of a club, which one off transfer fees don't come under. It is purely the money generated from the day to day running of the club.

As you can see, to the right are the top clubs and how much they've brought in. If you can't see it, click on the graph to enlarge it then use the back button on your browser to return to us.

The first thing to do is discount an awful lot of those clubs. Quite simply we cannot compete with them in terms of finances. I'm talking about the likes of Real Madrid, Barcelona, Manchester United, the Milan clubs, Bayern Munich, in fact you can discount everyone else apart from Liverpool and Tottenham.

Why? Simple really. They are the teams at the level we are competing with at the moment and I just want to illustrate the gulf in finance between ourselves and those two clubs. First let's take a look at Tottenham, who are often used as an example of how to keep hold of players after the Luka Modric affair.

Their income is pretty much double ours as they raked in a total of €181m (again, Euros!) largely thanks to their participation in the Champions League and the increased prize money, broadcast revenue and matchday income from having more home games at White Hart Lane.

Liverpool are the other team I want to focus on. They brought in more than Tottenham and more than double what we did (€203.3m) in the 2010-2011 season despite a lack of Champions League football. Their main driver is commercial revenue which totalled €85.7m - just €12.3m short of what Newcastle earned in total!

Unfortunately, as Newcastle are out of the fabled top twenty, there aren't any detailed figures for them, but we do have the headline figure of €98m, which puts us just behind Aston Villa who raked in €99.3m. I think it's fairly obvious to see why we can't really compete in terms of wages with those above us...

So what does the future hold?

Well the important thing to remember is that these figures are from last season - our return to the Premier League. How is the trend from there though? Is it up or down? Can we expect our income to grow when the next set come out in 12 months time?

In short yes, but not because of player sales - remember they aren't counted for this particular report. The first reason why I believe our income is growing is because of the match attendance. We currently have a higher average attendance than last season, and with gates staying high that average looks set to continue for the remainder of the season, especially if we carry on doing what we are doing on the pitch!

The second reason is that we have a new sponsorship deal with Virgin Money. Last season we still had the not so lucrative deal with Northern Rock which was signed when we were in the Championship. The Virgin Money deal is worth more to us and could be worth £10m a season providing certain targets are reached which will of course tilt the figures upwards.

The third reason is TV money. We've been on the box more often this season which brings about an increase in TV revenue of course.

The final reason is prize money. Erring on the side of caution, if we finished 7th for example, the club would pocket an extra £3m in Premier League prize money when compared to what we picked up last season.

Conclusion

The gap between us and the next highest financial rival is huge. In terms of finances we are on the same level as Aston Villa, Everton and Sunderland based on this report. However the trending is up and come this time next year I expect us to be sitting in 21st place, or even inside the top twenty should we manage to qualify for Europe.

A new TV deal kicks in next season so all Premier League clubs will benefit from it, not just us, but that combined with everything else I've pointed out might be enough to get us back into the top twenty although that depends on what other clubs are doing aswell.

What do you make of it all? Has it given you a clearer indication of our ability to compete with other clubs?