Arsenal vs Ajax
- 1. Financial Accounting Presentation Comparison of the financial statements of the football clubs Arsenal & Ajax
- 2. The Football Industry Wether to invest or not in Arsenal F.C. and A.F.C. Ajax • Exponential growth of the industry in the last 50 years • The “King of Sports” for many people • Top 10 Euro Clubs revenues sum up to more than 3 billion euros • Clubs have been entering the stock market in the recent years • Revenues connected to the capital structure and sporting results
- 3. Capital Structure (Revenues) FORMED BY: • Season tickets • Sponsorship deals • TV rights share • Merchandising • Matchday tickets • Investments (Youth team, etc.) • Player sales • Bank or ownership loans
- 4. The Financial Fair Play (FFP) SITUATION: • Increasing debt in the football industry • Bigger teams have economical advantage LEAD UEFA TO INSTITUTE FFP: • Obligation for clubs to balance their books or break even • Obligation to respect payment commitments at all times • Clubs who fail to do that will be required to provide budgets detailing their strategic plans
- 5. Ajax and Arsenal • Fame • Success in football • Examples for other clubs • Discover youngsters • Top stadium, training facilities, flourishing youth teams
- 6. Season tickets and average attendance (2011) • Ajax : Season tickets: 40% Average attendance: 95% Stadium capacity: 52,342 seats • Arsenal Season tickets: 98% Average attendance: 100% Stadium capacity: 60,361 seats
- 7. Internet (Media overview) • Ajax has an official Twitter and Facebook account, the latter has 382,839 likes. • Arsenal has the same accounts, with almost 8.5 million likes.
- 8. Support spread (Europe, mil. supporters) -Arsenal is in the 7° position with 21,3 million fans in Europe -Ajax occupies the 19° position, with 6,5 million fans in its continent.
- 9. Revenues 250 200 Revenues in million $ 150 100 50 0 2002 2003 2004 2005 2006 2007 2008 Ajax 55.38 76.52 64.23 66.63 74.43 64.89 61.89 Arsenal 90.97 117.83 156.89 138.4 137.24 200.84 222.97
- 10. Net income 30 20 10 Net income in million $ 0 -10 -20 -30 2002 2003 2004 2005 2006 2007 2008 Ajax -25.79 -4.04 9.77 2.85 -6.63 -10.42 7.77 Arsenal -20.56 4.01 8.15 8.29 7.9 2.82 25.73
- 11. Debt ratios 1 0.9 0.8 0.7 0.6 Debt ratios 0.5 0.4 0.3 0.2 0.1 0 2002 2003 2004 2005 2006 2007 2008 Ajax 0.43 0.43 0.31 0.34 0.36 0.38 0.48 Arsenal 0.27 0.54 0.66 0.67 0.75 0.77 0.69
- 12. Current ratio Current Ratio Ajax Arsenal 2010 0,72 4,5 2009 1,05 2,72 2008 1,37 3,04 2007 1,29 3,67 2006 1,31 2,73 2005 1,64 2,8 2004 1,58 2,42 2003 1 1,93 2002 0,9 1,31
- 13. Equity (In $x10) Equity Ajax Arsenal 2010 39.3 204,3 2009 61,8 195,6 2008 65,4 111,9 2007 57,8 77,9 2006 68,3 36,3 2005 75,5 93,2 2004 73,5 108,7 2003 63,5 92,3 2002 66,4 98,3 2001 93,4 117,3
- 14. Intangible fixed assets (In mil.Euros) Intangible fixed assets Ajax Arsenal 2010 38,8 63,9 2009 44,3 71,9 2008 31,8 78,4 2007 37,4 98,3 2006 29,7 97,2 2005 28,3 42,7 2004 28,4 52,4
- 15. Tangible fixed assets (In mil. Euros) Tangible fixed assets Ajax Arsenal 2010 11,2 43,3 2009 9,4 41,4 2008 8,4 40,1 2007 10,1 52,9 2006 10,7 39,5 2005 11,8 25,1 2004 12,3 23,2
- 16. Stock turnover Stock turnover Ajax Arsenal 2010 60,3 98,14 2009 50,3 112,32 2008 122,62 150,62 2007 85,73 119,62 2006 97,23 244,22 2005 152,37 161,85 2004 203,01 164,37 2003 191,03 128,77 2002 158,6 199,13
- 17. Strenghts Arsenal Ajax Revenues of 380 million euros Ownership of stadium Ownership of stadium Most famoust team in the Netherlands More than 1k euros earned per share Great European club tradition Quality trademark Quality of youth team 3° most supported football team in the Good debt ratio world
- 18. Weaknesses Arsenal Ajax Profit connected with sporting results Recent years dry spell High long term debt Well supported only in the Netherlands Marketing almost fully developed in Best players are often sold to break Europe even Main players left or are about to leave Unstable first team leadership the team
- 19. Opportunities Arsenal Ajax New Kroenke ownership New De Boer’s coaching Young football prospects Promising and young first team players Brand expansion in Asia Brand expansion in Asia and southern Europe Stadium-connected revenues Not defined leadership in Dutch football in the most recent years
- 20. Threats Arsenal Ajax Start of the FFP Has not been very successful lately Correlation between football Correlation between sporting performance and the ability to pay performance and brand growth back the debt Possibility that Wenger leaves if Best youngsters will leave if investments on new players are not investments are not made made Inability to pay back the debt Overall decline of Dutch football
- 21. Final analysis: Should an investor put money in either company? • Both teams wouldn’t be profitable for a small money investor • Both teams, and especially Arsenal, are and could be very profitable for their owners or major shareholders WOULD BE PROFITABLE TO OWN BECAUSE: • Both teams represent a good way of running a football club • Ajax has huge inexpressed merchandising and marketing potential • Arsenal’s brand has very few rivals in the world