Form of ownership and economic and sports results of football clubs in Poland

Abstract

The article analysed the extent of state ownership in enterprises that manage football clubs in Poland and to examine whether there are differences in business and sports activity results between state-owned and private entities. The study covered selected enterprises operating as commercial companies, which managed football clubs at the three highest levels of football in Poland in 2017-2019. Selected results were used to compare the clubs’ financial and sports condition. To demonstrate the relationship between groups of companies and their results, descriptive statistics were calculated and the median test was conducted for two independent samples. Annual financial reports published on the clubs’ websites and submitted to the National Court Register in an electronic form were used in this study. The analysis has shown that local government units are significant shareholders in companies that manage football clubs in Poland. It has also been shown that private clubs are in better financial condition and their sports results are better than clubs managed by local governments. Clubs managed by local governments have worse debt ratios, sales profitability and financial liquidity indices. Examination with a non-parametric Mann-Whitney test confirmed statistically significant differences in most economic and sports results achieved by companies depending on the form of ownership. Due to the larger income and the commercial nature of private clubs, they are “more” professional than those run by public sector units. They are more capable of generating cash for their basic activities, i.e. they achieve higher revenue from sales of tickets, from sponsoring, from television rights and from trade activities. Despite the absence of a significant difference in the amount of liabilities in both groups, negative equity was found in clubs managed by local governments. The analysis of liabilities towards related entities and income from the issue of shares shows that cash deficits were financed by issuing new shares, while private clubs finance them by loans from their owners. The financial results in the clubs under study depend on the sports results, which makes financial planning and assessment of their activity effectiveness considerably more difficult. This uncertainty and instability of the sources of financing threaten their solvency.