42
QUANTIFYING THE COSTS OF INTEGRITY BREACHES
Prior to the scandal,
Forbes
estimated Juventus was worth $687 million. If
the club’s value had appreciated at the average rate of other major European
clubs, it would have been worth $1.0 billion by 2010. In that year, however,
Juve’s estimated valuation totalled $656 million. The cost of the integrity
breach therefore constituted value destruction of $355 million, or 35 per cent
of its expected value before the scandal (Figure 4.4).
FIGURE 4.4: JUVENTUS F.C., ACTUAL VS. EXPECTED CLUB VALUE, 2006–2010
Juve’s demotion resulted in the renegotiation of several key broadcast and
commercial contracts, which contributed to a 39 per cent decline in club rev-
enue from 2006 to 2007. Concurrently, average home match attendance fell
37 per cent. In the two years after the scandal, average attendance for Juve
matches declined at 15.4 per cent annually, while attendance for other Serie
A clubs grew around five per cent. Falling attendance reduced gate receipts,
contributing to decline in revenue by $173.5 million (over 43 per cent) from
$400
$600
$800
$1000
$1200
2006
2008
2009
2007
2010
Expected Club Value (Pre-Scandal)
1
Actual Club Value (Post-Scandal)
2
$224 MM
28.2% Loss
$400 MM
44% Loss
$383 MM
39% Loss
$355 MM
35% Loss
$687.0
$567.0
$600.0
$656.0
$790.6
$909.9
$982.7
$510.0
$1011.2
$ Millions
Note:
1
Pre-scandal scenario assumes that Juventus’ actual value would have grown at the average rate of other major European football
clubs from 2006-2008 (15.1% CAGR) and 8% and 2.9% in 2009 and 2010, respectively;
2
Post-scandal value figures are based on
Forbes
published estimates.
Source: Deloitte Football Money League 2008;
Forbes.
© MONITOR QUEST LTD. 2011
GUARDING THE GAME Preserving the Integrity of Sport
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