By Nick Harris

28 February 2010

Arsenal’s ongoing elevation within the ranks of European football’s financial superpowers will be underlined this week when they are named as one of the top five clubs in Deloitte’s annual ‘Rich List’ of the world’s biggest 20 clubs by revenue. The report is due out on Tuesday.

Arsenal, whose win yesterday at Stoke leaves them just three points behind table-toppers Chelsea, have leap-frogged Chelsea in the Rich List. Chelsea’s revenues actually declined in 2008-09. Roman Abramovich’s club is now outside the top five, and losing pace on the genuinely big boys in the world game.

Deloitte’s report will show that Real Madrid retain their No1 status in the list, having earned 407m euros in 2008-09, or £347.9m using the exchange rate of 1.17 euros = £1 that was applicable on 30 June 2009. It is understood Deloitte use this rate of exchange (as they’ve used the corresponding rate in previous years), although sportingintelligence would like to make clear there has been no “leak” of Deloitte’s report.

As usual, their report is a useful round-up service, but contains data mostly accessible if you know where to look, and mostly in the public domain already.

Real Madrid at No1 are followed at No2 by fellow Spanish giants, Barcelona, who made 385m euros in 2008-09, or 365m euros from football when exceptional property income is stripped out. Barca, who won the Champions League final last May, leapfrog the team they beat in that final – Manchester United – to move into second.

United are thus third, with income of £278.5m, ahead of Bayern Munich in fourth place (269m euros / £230m), and then come Arsenal, storming into the top five with £225.1m income in the year from football alone.

Deloitte’s report is expected to reveal some information not already in the public domain, most interestingly the 2008-09 figures for Liverpool and Milan. That pair, plus Juventus and Chelsea, are scrapping at the margins of the top five. Deloitte enjoy privileged access to accounts as official auditors of numerous clubs. It is also notable that Liverpool’s numbers, in recent years, have been first available via one Deloitte round-up or another rather than presented by the club directly.

Arsenal’s growth is, in many ways, the good news story of English football in the current economic climate. Here is a club that got into debt specifically in order to build a new 60,000-seat stadium, and then kept its belt tightened in recent years to ensure that that outlay wouldn’t come back to hurt it.

But with the property redevelopment at Arsenal’s former home, Highbury, coming to fruition with large amounts of sales, that debt is tumbling and profits are up. Half-yearly figures released on Friday show their debts have plummeted by almost £100m to £203.6m, and they made £35.2m in pre-tax half-year profits. These details and others can be found in a piece written for the sports page of today’s Sunday Times.

To summarise what I wrote there: despite Arsenal’s ongoing (and understandable) reluctance to talk up their spending power, they have a big kitty this summer. If Arsene Wenger wanted to, he could buy two £20m players and pay them £80,000 per week each. With Wenger, that’s always a big “if”, of course.

He is among the most prudent and cautious dealers in top-level football. And it looks almost certain, say insiders, that Bordeaux’s Moroccan international striker, Marouane Chamakh, 26, will arrive on a free in the summer.

Arsenal’s team-building has also been happening from within; they’ve given 17 contract extensions to first-team players in recent times, including a deal for Theo Walcott that takes him from £40,000 per week to £60,000 according to Emirates gossip, and one for Robin van Persie that apparently moves the Dutchman from £60,000 to £80,000 a week.

But those contracts, and an inflated wage bill, are the bedrock of a bright future that might even pay early dividends on the pitch if Arsenal keep winning while Chelsea and Manchester United keep faltering. For all the talk of Wenger needing “just one or two key players” – as the popular chat among Gunners’ fans has it – they are just three points from the summit today, and have a run of five winnable League fixtures immediately ahead: Burnley (h), Hull (a), West Ham (h), Birmingham (a) and Wolves (h).

As well as Arsenal’s cash reserves growing from £75m to £100m (some of that is earmarked for loan repayments, some for players and wages), it is anticipated that property sales should add £50m to the company’s bottom line over the next two years.

This estimated £50m is the “quantum” that Peter Hill-Wood, the non-executive chairman, quaintly declined to specify when he wrote in his half-yearly report: “There has been remarkable progress at Highbury Square over the last twelve months and it is clear that the next couple of years will see our property activities delivering surplus cash. This is very good news, although I would not want to speculate on the exact quantum or timing of this.  How we will use this surplus remains undecided but, in addition to investing in the team, I think we will examine investment in Club projects and infrastructure, both in and around Emirates Stadium, which will provide a long lasting benefit to the club and our tremendous, loyal supporters.”

Arsenal have some way to go to catch Spain’s big two in financial terms, or Manchester United for that matter. But Chelsea are now firmly in the rear view mirror economically, as well in sight in the League table.

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