This article analyses FC Utrecht finances in respect of the 2020/21 season.
Season review
The 2020/21 season was the fiftieth anniversary of the club with celebrations unfortunately muted due to the pandemic. It was another solid season for FC Utrecht as it finished 6th for the third Eredivisie season in a row. However, it was European heartbreak for the club as it lost its European play-off final to Feyenoord. It was also a disappointing season in the cup. After being beaten finalist in 2020, FC Utrecht exited in the second round.
FC Utrecht finances were hit hard by the financial impact of COVID-19, incurring its third successive loss.
FC Utrecht Finances – Revenue
Revenue fell €5.3m (26%) to €14.9m due to lost matchday and commercial revenue as games were played behind closed doors.
Matchday
Matchday revenue fell from €3.9m to €2.2m (42%) as the season was played behind closed doors. Much of this revenue should be recovered in 2022 as restrictions ease.
Broadcast
Broadcast revenue rose from £5.3m to £5.9m (12%). This was due to a rise in distributions received from the Eredivisie, despite similar sporting performance. FC Utrecht performance so far this season is similar to recent seasons, but the club will be hoping to go one step further and qualify for Europe.
Commercial
Commercial revenue fell from €11.0m to €6.7m (39%) as the club played without fans. This reduced commercial opportunities and eliminated the majority of corporate hospitality. This should rebound in 2022. The club also had a new shirt sponsor (T-Mobile) which may explain some of the revenue decline.
FC Utrecht Finances – Revenue summary
Utrecht’s revenue took a hit without fans in the Galgenwaard. The return of this revenue will be very welcome as it looks to achieve profitability. To take revenue to the next level, the club will need to qualify for European competitions.
FC Utrecht Finances – Operating costs
Operating costs fell €3.6m (4%) to €22.3m. FC Utrecht successfully reduced its costs in light of falling revenue. The level of cost cutting was however not enough to stop losses increasing.
Wages
FC Utrecht’s wage bill fell from €14m to €12.8m (9%). This was partly due to the club’s worsened cup performance (lower bonuses) but also the lower squad investment in 2020/21. This saw its wages to revenue ratio worsen from 70% to 86%, above UEFA’s recommended ratio of 70%. The recovery of revenue in 2022 will likely see this ratio fall again towards 70%, closer to the recommended limits.
Other costs
Other operating costs fell from €11.9m to €9.5m as the club saved matchday costs due to no fans at the stadium.
FC Utrecht Finances – Operating costs summary
FC Utrecht begun a ‘new era’ as it commenced a five-year strategy to 2025. This has however been slowed by the pandemic. Despite this, the club did well to cut costs to limit the increase in losses.
FC Utrecht Finances – Transfers
FC Utrecht were quiet in the 2020/21 transfer market, signing no players for a transfer fee. Departing FC Utrecht were Klaiber (€4.3m) and Joosten (€0.6m) for a combined €4.9m.
Profit on player sales
FC Utrecht does not record its player amortisation very clearly from its profit on player sales. Therefore, the below is a combination of player sales and all player amortisation (not just that of the sold players). Profit on player sales doubled from £1.0m to £2.0m following the Klaiber sale. The significant sale of Kerk to Lokomotiv Moscow (€6m) will likely see an uplift in this figure 2022.
Transfers debts
The amount of transfer fees owed to FC Utrecht is not disclosed by the club. However, FC Utrecht owes €0.6m to other clubs.
FC Utrecht Finances – Transfers summary
FC Utrecht is a net seller in the transfer market, relying on small purchases, free transfers, and its academy for talent. The club typically generates a relatively significant part of its income from player sales as a result. This was the case again in 2021/22 and the Kerk sale may assist its return to profitability.
FC Utrecht Finances – Profitability
FC Utrecht recorded its third successive loss in 2021 and will be hoping the return of fans and the sale of Kerk will end this streak.
Operating profit / loss before player trading
Before player trading, FC Utrecht recorded an operating loss of €7.5m. This compares to a €5.8m loss in 2020. This is due to the loss of matchday and commercial revenue, much of which should be recovered in 2022 to reverse this.
Operating profit / loss after player trading
After player trading, FC Utrecht recorded a €5.5m operating loss. This compares to a €4.8m loss in 2020. The sale of Kerk, combined with increasing revenue will likely at least reduce losses and may even help the club record its first profit since 2018.
Profit / loss before tax
Net finance costs of €0.2m resulted in a €5.7m loss before tax. This compares to a €5.1m loss in 2020.
FC Utrecht Finances – Profitability summary
FC Utrecht has had a streak of losses, compounded by the financial impact of the pandemic. The sale of Kerk and return of fans will be significant financial boosts as it looks to end this streak.
FC Utrecht Finances – Assets / Liabilities
FC Utrecht loss-making position led to external funding being necessary as debt levels rose.
Cash flow
FC Utrecht’ cash reserves improved from €8.3m to €12.7m. This was driven by financing cash inflows of €15.2m and transfers (€1.4m). These inflows absorbed cash outflows from operations (€9.4m), capital expenditure (€0.9m) and other investing activities (€1.9m). This leaves FC Utrecht in a comfortable cash position despite the challenges to all clubs in the past two years.
Debt
FC Utrecht’ debt stood at €9.8m at the end of the 2020/21 season. This almost entirely relates exclusively to shareholders with a net €5m of new shareholder debt. This has been secured against the transfer fees owed in respect of Klaiber and future Eredivisie distributions. The remaining cash inflows relates to tax debts/deferrals which have not been included in our calculations.
Net debt
The club is hence in a net cash position of €2.9m following the increased cash reserves.
FC Utrecht Finances – Final Remarks
FC Utrecht is hoping to “reach the top 5” in the Netherlands. This will be challenging as the club looks to manage its losses and achieve profitability in the future. Player sales and strong recruitment will hence be vital to achieving this, while achieving European qualification could be game changing. The club sits in 7th at the time of writing so a strong second half of the season will be critical to its 2022 finances.
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