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 FC Bayern: Money to burn but still with problems to solve
Sports-Business | 01.12.2015

Sport Business

FC Bayern: Money to burn but still with problems to solve

FC Bayern: Money to burn but still with problems to solve. Bayern-CEO Karl-Heinz Rummenigge (Quelle: imago)
Bayern-CEO Karl-Heinz Rummenigge reports the best annual figures in the club's history
Bild: imago
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Bayern Munich reported the best annual figures in the club's history at this year's Annual General Meeting. However, Germany's top club is still facing huge challenges as it attempts to compete with the giants of the game from England and Spain.

Bayern Munich are enjoying a fabulous time on the field once again – they are clear leaders in the Bundesliga, favourites for the title even before Christmas, and have already qualified for the last 16 in the Champions League. The financial situation looks even better: the Bayern Munich group (including the Allianz Arena stadium company and other subsidiaries) reported record EBITDA figures of 111.3 million Euros for the championship-winning 2014/15 season. 

New heights have also been scaled for profits, equity and membership numbers. Despite all this, Germany's top club is still worried about remaining competitive at international level. ISPO.com provides you with the details of the four most important points arising from this AGM.

The executive board of the FC Bayern  (Quelle: imago)
The executive board of the FC Bayern
Bild: imago

1. A picture of health

The Bayern group reported a profit for the 23rd year in succession, posting a record-breaking profit after tax of 23.8 million Euros (compared to 16.5 million in the previous year). Bayern Munich plc now boasts equity of 411.5 million Euros. The financial situation is also helped by the fact that the Allianz Arena, financed to the tune of 346 million Euros in 2005, has now been completely paid off.

The turnover for the entire group may have fallen slightly to 523.7 million Euros (five million less than in the financial year 2013/14) but that does not detract from the overall impression of a club that is doing very well for itself.

2. No. 1 in Germany – but how long?

Bayern Munich's turnover is almost double that of the nearest competitor, Borussia Dortmund (276 million Euros). However, Bayern are only in third place internationally, lagging behind the 600 million Euros declared by the top Spanish clubs, Real Madrid and Barcelona.

This is what really worries Bayern Munich: according to figures from Deloitte, Real Madrid last year became the first club to receive over 200 million Euros from television rights. The biggest names in English football, such as Manchester United, will reach similar revenue levels this season thanks to a new TV deal. From 2016/17 onwards, the Premier League clubs will receive a total of 2.3 billion Euros per season.

This means that even the weakest club in the Premier League will make more money than Bayern Munich, whose TV revenue in 2014/15 was a relatively low 58.7 million Euros.

3. TV rights revenue must increase

If Bayern Munich wants to continue to challenge regularly for the Champions League title in Europe, then TV rights revenue must increase. „Our players are already receiving unbelievable offers from English clubs“, admitted Bayern chairman Karl-Heinz Rummenigge.

Bastian Schweinsteiger has already left for Manchester United, and the club now managed by former Bayern trainer Louis van Gaal has allegedly offered 100 million Euros for top goalscorer Thomas Müller. According to the Süddeutsche Zeitung, Rummenigge has already started discussions with the German Monopolies and Mergers Commission about marketing Bayern independently from other clubs.

This would not mean the end of the controversial centralised marketing system, but is primarily intended to make the most of those rights abroad, and on the internet. Rummenigge remains convinced that it will be possible for Bayern to make 200 million Euros from TV rights – a necessity if the club is to remain competitive.

Members of the FC Bayern were pleased with the results (Quelle: imago)
Members of the FC Bayern were pleased with the results
Bild: imago

4. The “Bayern family” is the foundation 

Despite all the financial records, the most valuable commodity for Bayern Munich remains the people who work there – and this “Bayern family” will also need to be retained in the future. This does not just hold true for a playing squad that “is probably the best we have ever had” (Rummenigge), as well as being the most expensive with a wage bill of 227.3 million Euros.

The club is going to invest an additional 70 million Euros over the next two years to build a new youth football training centre in Munich, providing the best chances for the next generation of the Bayern family. Rummenigge also took the opportunity at the AGM to emphasise the clubs' enduring loyalty to former president Uli Hoeness, now serving his sentence as a day-release prisoner (“he has been a breath of fresh air for our youth teams”).

He also confirmed that the club is standing behind honorary president Franz Beckenbauer, recently the target of criticism due to his unclear role in the bribery scandal surrounding the 2006 World Cup bid (“we have a hell of a lot to thank Franz for”). Membership numbers have more than doubled in the last ten years, with the most recent statistics showing over 270,000 on the books, finally allowing the Bavarian club to overtake Portugal's Benfica. Are there any more records left to be broken?

 

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