By Juan José Lahuerta
Madrid, May 7 (EFE).- Like the rest of the world’s most powerful clubs, this week’s jubilant first time Champions League finalists, Manchester City, have seen profits plummet since the pandemic struck. But the financial blow has been softened thanks to a spectacular new contract that has boosted their commercial revenues: Puma has entered the Cityzens’ economic sphere with a bang.
The wild feline in the German company’s logo already represents a key to the club’s financial future. In March 2019, Puma reached an agreement with Manchester City, which will receive 700 million euros over the next 10 years to wear the sportswear of a brand that wants to break into a world that is dominated by Nike and Adidas.
The increase is substantial. Nike paid City an annual sum of 20 million euros ($24M) for six years. With Puma, the English club will receive 60 million, only 10 million less than the club with the world’s most lucrative contract, City’s crosstown rivals United, which reached an agreement of 75 million euros a year with Adidas.
In total, Manchester City has lost 11 percent of its revenue this year due to the impact of the coronavirus. But in terms of commercial revenue, the club has increased its assets by 52 percent over last year.
That is largely down to the Puma deal, as well as, albeit to a lesser extent, another deal the club reached with Marathonbet to have the bookies’ name on City’s training kits.
According to Deloitte, the Puma deal still only puts City in sixth place in the world’s top 10 clubs with the highest revenue. They are behind Barcelona, Real Madrid, Bayern Munich, Manchester United and Liverpool.
None of the top six have been spared this season. All have earned less because of the coronavirus. Some have suffered losses as high as 19 and 15 percent, such as Manchester United and Barcelona, respectively.
The 11 percent drop in City’s revenue can be broken down into several parts: 13.13 million pounds less (24 percent) came from football match revenue and 62.9 million less (25 percent) from television broadcasting. These losses were offset by an increase of almost 20 million in commercial revenues, to which Puma contributed.
Of the 549.2 million euros it has retained this year, 52 percent is from commercial exploitation, 39 percent from television rights and 9 percent from match-day revenues.