OL GROUPE : Revenues in 2009/10

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Revenues in 2009/10: ¤160.2 million
(¤192 million in the previous year)

Revenue excluding player trading up 4.7% to ¤146.1 million
despite the recession and French legislation difficulties

Sluggish early transfer window activity
owing to the World Cup in South Africa (until 12 July 2010),
the global recession and
 new financial fair play regulations.

 

Lyon, 28 July 2010

Revenue from businesses (from 1 July to 30 June)

In ¤ m 30/06/2010* 30/06/2009 % change
Ticketing 24.8 22.4 +10.7%
Sponsoring - Advertising 14.7 21.3 -31.0%
Media rights  78.4 68.1 +15.1%
Brand-related revenue 28.2 27.8 +1.4%
Revenue from businesses, excluding player trading 146.1 139.6 +4.7%
Revenue from sale of player registrations 14.1 52.4 -73.1%
Total revenue from businesses 160.2 192.0 -16.6%

* preliminary, estimated and unaudited figures

In the fourth quarter (1 April to 30 June), total revenue from businesses amounted to ¤34.7 million compared to ¤58.1 million in Q4 2008/09 (of which ¤35.3 million came from the transfer of Karim Benzema).

Football performance 2009/10

For the first time in its history, Olympique Lyonnais reached the semi-final of the UEFA Champions League.  The club finished second in Ligue 1, and for the 11th consecutive time, it will participate in the UEFA Champions League. The women's team won the French Division 1 title for the fourth consecutive time and played in the final of the UEFA Women's Champions League, marking a first for French football clubs. The CFA team won the league title of professional reserves teams for the second time in a row. Other young teams also excelled. The U17 squad played in the final of their league championship, and the U19s finished in second place in their league.

International competitions

A number of Olympique Lyonnais players were selected to play for their national teams:

7 professional players participated in the World Cup in South Africa: Lloris, Réveillère, Govou and Toulalan played for France, Mensah played for Ghana, Makoun played for Cameroon and Bastos played for Brazil. 6 young players represented France at the U19 European Championships: Faure, Kolodzieczak, Réale, Grenier, Tafer and Lacazette.

Revenue from businesses, excluding player trading

Thanks to Olympique Lyonnais' excellent performance in the Champions League, receipts from ticketing reached a record high of ¤24.8 million, up ¤2.4 million from the previous financial year. Revenue from sponsoring and advertising totalled ¤14.7 million net (¤27 million gross). Two factors took a toll on this revenue category: BetClic was not authorised to advertise on players' shirts, and advertisers were reluctant to spend in an uncertain economic climate. Media rights (LFP, FFF, UEFA) amounted to ¤78.4 million, the highest amount so far recorded. The strong growth (up ¤10.3 million from the previous year) follows the club's sporting performance in Europe, where it participated in the semi-final of the UEFA Champions League and came in second place in domestic Ligue 1 play. Brand-related revenue remained resilient at ¤28.2 million despite lacklustre consumer demand for derivative products.

Revenue from sale of player registrations

Revenue from the sale of player registrations was ¤14.1 million (¤52.4 million the previous year). Revenue included the transfers of Keita to Galatasaray, Grosso to Juventus and Mounier to Nice early on in the season. Player trading activity was sluggish and no players were traded at the end of the financial year, because the World Cup, an inauspicious time for transfers, began at the same time that the transfer window opened. Players can still be transferred until 31 August 2010, so the lack of activity in June could be counterbalanced in the early part of the current financial year.

For the first time since OL Groupe was listed, revenues and capital gains from player registration sales were far below the averages of the last five financial years (¤49 million and ¤36.2 million, respectively). The level of proceeds from player transfers recognised over the period (¤14.1 million) will therefore have a highly unfavourable impact on the Group's consolidated 2009/10 earnings, which will be significantly in the red for the first time since 2003/04. OL Groupe has already posted a net loss of ¤8.7 million (Group share) for H1 2009/10.

In addition to the low volume of player trading, a number of other unfavourable events occurred during the 2009/10 financial year. The Group paid compensation to Umbro following early termination of the contract, and sponsorships declined sharply due to difficulties connected with French legislation and the current economic climate. Management deftly steered the group through this difficult period and began systematically to optimise external costs.

Players acquired and sold during summer 2010 (French GAAP)

Following the departure of Govou and Clerc, whose contracts came to an end and were not renewed, Olympique Lyonnais announced in June 2010 that it had signed a four-year contract with French international Jimmy Briand. The amount of the transfer was ¤6 million.

In July 2010, subsequent to the financial year-end, Olympique Lyonnais transferred out two players:

Mathieu Bodmer to PSG for ¤2.5 million, plus potentially another ¤1.5 million in payments related to the Parisian football club's sporting performance. Frédéric Piquionne to West Ham for ¤1.2 million. This amount may be increased by various bonuses up to a maximum of ¤0.45 million depending on West Ham's sporting performance.

In line with objectives to reduce the roster by at least three players, other transfers may take place in the remaining weeks of the summer transfer window, which closes on 31 August.

Future plans and outlook

The Board of Directors has set itself the target of significantly reducing the payroll over the next two financial periods, as other French football clubs seem to be doing. Since his arrival, Claude Puel has endeavoured to smooth the transition of young players trained at the OL Academy into the professional team, and this strategy is starting to pay off. In this context, the second team, consisting of U20 international players, will progressively be integrated into the professional side.

Sponsoring and advertising will rise substantially thanks to new contracts signed with:

Adidas, which is now the club's official kit manufacturer for the next ten years,  Groupama, which will join the club's official sponsors for the next three seasons, and will appear on the back of players' shirts during all Ligue 1 home and away matches, Mangas Gaming, which in June was awarded a licence by Arjel to operate in France, and whose BetClic and Everest Poker brands can now appear on players' shirts.

Discussions with other potential partners, including MDA, LG and the US group Huntsman, via its Araldite brand, are also underway.

Merchandising revenue is likely to increase considerably on account of Adidas' extensive distribution network both in France and other countries.

Although the economic environment remains difficult, OL Groupe has demonstrated its ability to forge ahead with its economic and sporting development, and in particular to pursue the new stadium project.

Two important events have taken place over the last few months with regard to the new stadium project:

On 28 May 2010, UEFA selected France to host the Euro 2016.  The new stadium in Décines will be an important part of the Euro 2016 facilities. In June 2010, eight out of the eleven local authorities consulted responded favourably to Foncière du Montout's request for "public interest" ("intérêt général") status.

In this regard, Olympique Lyonnais will pursue its new stadium project alongside its partners (French government, Greater Lyon, Rhône General Council, Sytral, town of Décines), elected officials, associations and the residents of Greater Lyon. The new stadium will be a benchmark in sustainable development and will contribute to giving the Lyon area visibility at the European level and to boosting economic development in Lyon's eastern suburbs, as well as significantly increasing OL Groupe's financial resources.

As of 30 June 2010, owing to strong earnings over the last five years and significant capital raisings, OL Groupe is in the unique position of having close to ¤168 million in equity, representing 44% of the equity of French football clubs. In this context, OL Groupe's Board of Directors had decided to invest heavily during the 2009/10 financial year, spending ¤95.8 million on new players, whereas sales during the period were limited to ¤14.1 million. The trading target for 2010/11 will be to re-establish a significant excess of player registration sales over purchases. As of 27 July 2010, the market value of the Club's players, according to the www.transfermarkt.de website, was ¤195 million.

Next press release: full-year earnings on 5 October 2010 after the market close

OL Groupe
Olivier Blanc
Tel : +33 4 26 29 67 33
Fax : +33 4 26 29 67 13
E-mail: dirfin@olympiquelyonnais.com
www.olweb.fr
Marché des cotations : Euronext Paris - compartiment C
Indice CAC AllShares
Code ISIN : FR0010428771
Reuters : OLG.PA
Bloomberg : OLG FP
ICB : 5755 Recreational services
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