Report author Dan Jones explains why he is optimistic about English football finances
The Premier League saw its revenues soar by 26% in the 2007/08 season to nearly £2bn ($3.15bn; 2.2bn euros), a report into football finances has said.
The revenues of top-flight English sides were £1.93bn, up from £1.5bn a year earlier, Deloitte said.
Despite the downturn, 11 of the 20 top league clubs made an operating profit in 2007/08, from eight a year before.
But Premier League salary costs topped £1bn for the first time, and the clubs' total net debt was £3.1bn.
PREMIER LEAGUE TEAMS WITH MOST DEBT 2007/08
Chelsea - £711m
Manchester Utd - £649m
Arsenal - £318m
Liverpool - £300m
Newcastle Utd - £245m
Figures are net debt at end of 2007/08 season
Two-thirds of the debt was carried by the big four of Manchester United, Liverpool, Chelsea and Arsenal, but Dan Jones, the editor of Deloitte's Annual Review of Football Finance, said those clubs all had business plans "that they feel make sense".
The strong revenue growth outstripped the ever-upwards salary growth, which boomed by 23% to £1.2bn, the biggest annual increase in absolute terms recorded by the Premier League.
"In season 2007/08 the big change was the new broadcasting deal - most of the growth came from there, " Mr Jones told the BBC.
The current three-year broadcasting deal - worth £1.7bn - began in August 2007.
"In the season that has just finished [2008/09] we think the growth is going to be a little bit lower, but it is going to get clubs up to that magical £2bn mark - which is a remarkable achievement, an average of £100m a club in the Premier League."
But he warned that the approaching summer months would reveal the extent to which fans and sponsors were willing to match their previous levels of demand, with clubs having to closely examine their marketing and pricing strategies.
"This summer will be critical for football clubs, it will be very interesting to see how the season ticket renewals go, how the corporate hospitality renewals go," said Mr Jones.
"I think that is why we are seeing a lot of clubs freezing season ticket prices, reducing prices. They are very sensitive to the fans and their corporate sponsors and the problems they are facing."
However, he said English football - at both Premier League and Football League level - was proving more resilient in the face of downturn than many other industries.
The wages to turnover ratio in the Premier League dropped slightly to 62%, a small decline, but still close to the previous year's high of 63%.
Wages paid by top-flight English sides grew by 23% from the previous season to £1.2bn.
Clubs like Arsenal have benefited from the latest Premier League TV deal
Sunderland saw its wage bill soar by 56% and Derby County by 51%. Chelsea once again had the highest wage bill, totalling £172.1m
Premier League clubs increased commercial revenues to £447m, up by 12%, whereas matchday revenues grew more modestly, by 3%, to £554m.
Meanwhile, revenues in the Championship increased by 2% to £336m in 2007/08, with total revenues of the total 72 Football League clubs exceeding £500m for the first time.
FANCY THAT: 2007/08 SEASON FACTS
Chelsea became the first club to report over £80m gross transfer spending in one season
Championship clubs' total wage costs increased by £32m to £291m
Total investment in English stadia and facilities was £187m
However, despite revenue growth, improved profitability has remained elusive.
"For many owners, Premier League clubs represent 'trophy assets' with the potential to deliver a long term return but which at best break even annually, rather then a cash cow delivering an ongoing 'dividend'," said Mr Jones.
Indeed, of the total net debt of £3.1bn in the Premier League, a total of £1.2bn was in non-interest bearing "soft loans" from club owners.
Mr Jones also pointed out that while footballer's wages often attracted headlines, the amount of cash the industry put into national coffers was often ignored.
"One thing that does not draw much attention in the midst of all these huge numbers around football is the tax side of things," he said.
PREMIER LEAGUE CLUBS WITH LOWEST STADIUM UTILISATION 2007/08
Wigan Athletic - 73%
Blackburn Rovers - 74.9%
Bolton Wanderers - 80.7%
Middlesbrough - 81%
Sunderland - 82%
Figure relates to average % of stadium filled for home games
"So, in 2007/08 season we think the overall tax payment to the government from professional football in England was about £860m.
"When the new top rate of tax comes in that will go up to £1bn."
However, he said that despite reports of elaborate tax avoidance schemes around players wages, Deloitte was not aware of any being widely adopted by clubs.
As well as looking at the English Premier League and Football League the Deloitte report also studies Germany, France, Italy and Spain.
Italy's Serie A was the fastest growing league in terms of revenue, thanks mainly to the change in clubs in the league, including the return of Juventus, in 2007/08.
In joint second place after the Premier League, in terms of gross revenues, was Spain's La Liga and Germany's Bundesliga.
The Bundesliga, France's Ligue 1, and the English Premier League have been boosted by having secured long-term broadcast deals which deliver significant proportions of total revenue.
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