This section presents empirical findings in relation to the proposed hypotheses. The results provide robust support for the positive impact of intellectual capital, as measured by the VAIC framework, on financial performance, confirming Hypothesis 1. Among the components, human capital efficiency has the most pronounced effect, reinforcing its central role in club success. Financial innovation also demonstrates significant positive relationships with both intellectual capital and financial performance, supporting its mediating role as hypothesized in Hypothesis 4. Structural capital and capital employed contribute positively, though to a lesser extent. These findings support the theoretical frameworks underpinning the study, including the resource-based view and dynamic capabilities theory, emphasizing the crucial importance of managing intangible assets and promoting innovation to enhance financial sustainability in European professional football clubs.
Descriptive statistics
Table 3 shows the descriptive statistics for study variables. The results indicate that clubs exhibit negative financial performance, with a mean ROA of -3.1% (ranging from -24.4% to 9.4%) and a ROE of -1.3% (ranging from -70% to 51.3%), highlighting struggles with profitability. This aligns with previous studies that highlight the financial challenges faced by many football clubs (Dimitropoulos and Koumanakos 2015). The high standard deviations in performance measures suggest significant disparities across clubs, consistent with the competitive nature of the industry (Plumley et al. 2017). The standard deviations of ROE (0.301) and NPM (0.17) suggest substantial performance disparities across clubs. The Value-Added Intellectual Coefficient or Intellectual Capital Efficiency (VAIC) averages 1.451, with human capital efficiency (HCE) at 1.277, the highest among its components, indicating clubs ‘ reliance on human resources for value creation. Financial innovation shows a mean R&D investment (InnIn) of 0.025 and patent output (InnOut) of 0.026, with minimum values of zero, suggesting uneven engagement in innovation activities. Control variables reveal club size (CSIZE) at 8.536 (SD = 0.478), financial leverage (LEV) at 0.169 (SD = 0.862), and asset tangibility (TANG), which exhibits high dispersion (SD = 11.716), indicating diverse financial structures and strategies across clubs.
Correlation matrix
Table 4 shows that correlation analysis reveals that ROA exhibits a strong positive association with NPM (0.941, p < 0.05), indicating that professional football clubs with higher asset returns tend to achieve superior profit margins. The findings suggest that Value-Added Intellectual Coefficient (VAIC) shows a positive association with ROA (0.160, p < 0.05), ROE (0.133, p < 0.05), and NPM (0.172, p < 0.05), emphasizing the role of intellectual capital in profitability in addition to a significant positive correlation between intellectual capital measures (HCE, SCE, and CCE) and financial performance (ROA) (r = 0.136, 0.163, 0.112; p < 0.05) respectively. Financial innovation demonstrates a weak yet positive impact on club performance. Innovation input (InnIn) is positively correlated with ROA (0.066, p < 0.05) and ROE (0.119, p < 0.05), but its effect on NPM (0.063, p > 0.05) is insignificant. Similarly, innovation output (InnOut) shows weak positive correlations with ROA (0.092, p < 0.05) and ROE (0.130, p < 0.05), while its relationship with NPM (0.088, p > 0.05) remains statistically insignificant. These findings suggest that while financial innovation contributes to firm performance, its effect on profitability remains limited, supporting the resource-based view that intellectual capital is a key driver of competitive advantage and performance in knowledge-intensive industries, such as football (Kozlenkova et al. 2014; Ricci et al. 2015).
Among the control variables, club size (CSIZE) exhibits an insignificant correlation with ROA (0.035, p > 0.05) and ROE (-0.022, p > 0.05), suggesting limited direct effects on profitability. Financial leverage (LEV) shows a weak positive relationship with ROA (0.099, p > 0.05) and ROE (0.071, p > 0.05), implying that leverage may not substantially enhance financial returns. Conversely, current assets (CATA) show a negative correlation with ROA (-0.119, p < 0.05), suggesting that higher liquidity might decrease profitability. In contrast, tangibility (TANG) exhibits a positive correlation with ROA (0.118, p < 0.05), suggesting that higher tangibility (fixed assets) might increase profitability.
Main effects
Table 5 shows the main effects of intellectual capital on financial performance. The result highlights the critical role of intellectual capital in enhancing profitability, while excessive leverage and asset rigidity hinder financial performance. Intellectual capital significantly improves financial performance. Intellectual capital (VAIC) positively affects ROA (0.094, p < 0.01) and ROE (0.278, p < 0.01), with human capital efficiency (HCE) contributing to both ROA (0.028, p < 0.05) and ROE (0.118, p < 0.01). Structural capital (SCE) and capital employed efficiency (CEE) exhibit strong positive effects on ROA (0.057, p < 0.01) and ROE (0.214, p < 0.01). Among control variables, financial leverage (LEV) negatively impacts ROA (-0.074, p < 0.01). Still, it positively influences ROE (0.073, p < 0.05), indicating professional football clubs with higher debt face lower returns on assets but higher equity returns. Asset tangibility (TANG) and liquidity (LATA) significantly reduce both ROA and ROE, with TANG effects at (-0.258, p < 0.01) for ROA and (-1.105, p < 0.01) for ROE. R2 value shows that VAIC explains 30% of the variation in ROA, suggesting a substantial impact of intellectual capital on professional football clubs’ profitability. In contrast, it only explains 10.7% of the variation in ROE, highlighting that intellectual capital influences shareholder returns less than operational performance.
Table 6 presents the results of an OLS regression analysis examining the impact of intellectual capital on financial innovation, with InnIn (Innovation In) and InnOut (Innovation Out) as independent variables. The findings suggest that intellectual capital, particularly measured by VAIC (Value Added Intellectual Coefficient), is positively and significantly associated with both types of innovation (0.024, p < 0.01) for InnIn and (0.030, p < 0.01) for InnOut, indicating that higher intellectual capital enhances innovative capacity. Human Capital (HCE), Structural Capital (SCE), and capital employed efficiency (CEE) also exhibit positive effects, with significance at the 10% and 5% levels. Control variables, such as Leverage (LEV), show a consistent positive relationship with innovation, underscoring its role in fostering innovation. However, club-specific characteristics such as Club Age (AGE), Club Size (CSIZE), Liquidity (LATA), and Tangibility (TANG) exhibit insignificant effects. Intellectual Capital accounts for approximately 16% of the variation in financial innovation, indicating moderate explanatory power. These findings are consistent with previous studies in the football industry (Guseva and Rogova 2016; Scafarto and Dimitropoulos 2018), extending our understanding of these relationships.
Table 7 presents OLS regression results investigating the impact of innovation on financial performance. Financial innovation (InnIn and InnOut) is positively and significantly associated with financial performance; InnIn shows coefficients of 0.617 (p < 0.01) for ROA and 1.844 (p < 0.05) for ROE, while InnOut has coefficients of 0.641 (p < 0.01) for ROA and 1.828 (p < 0.01) for ROE, indicating that innovation fosters profitability. LEV (Leverage) negatively impacts performance, with coefficients of -0.079 (p < 0.01) for both ROA and ROE, suggesting that higher leverage diminishes profitability. Additionally, Liquidity (LATA) and Tangibility (TANG) have significant negative effects on both performance measures, with LATA coefficients of -0.305 (p < 0.01) and -0.303 (p < 0.01) for ROA and ROE, respectively. TANG showing coefficients of -0.231 (p < 0.01) and -0.229 (p < 0.01). Financial innovation accounts for approximately 29% of the variation in financial performance, indicating moderate explanatory power. The significant positive effects of human capital, structural capital, and capital employed efficiency on financial performance align with the theoretical framework of the resource-based view and dynamic capabilities theory (Teece et al. 1997).
Mediation using the Sobel test
Table 8 shows that intellectual capital (VAIC) has a direct positive effect on ROA (0.094, p < 0.05), while financial innovation (InnIn) has a positive influence on ROA (0.498, p < 0.05). The results indicate that intellectual capital has a positive influence on innovation inputs (0.024, p < 0.01). The mediation analysis in Table 7 reveals that innovation (InnIn) partially mediates the relationship between intellectual capital (VAIC) and financial performance (ROA). The Sobel test in Table 8 indicates a statistically significant indirect effect of 0.012 (p-value = 0.041), accounting for 12.8% of the total effect. This suggests that intellectual capital influences financial performance through innovation, but the direct effect of VAIC on ROA remains significant. According to Baron and Kenny’s approach, this constitutes partial mediation, while Zhao, Lynch, and Chen’s framework identifies it as complementary partial mediation.
We conducted an analysis of innovation outputs to explore the mediating role of innovation outputs on the relationship between intellectual capital and financial performance, as shown in the following Table 9. The findings indicate that intellectual capital (VAIC) exerts a direct positive impact on ROA (0.094, p < 0.05), while financial innovation (InnOut) significantly influences ROA (0.518, p < 0.01). Additionally, intellectual capital positively affects innovation outputs (0.030, p < 0.01). As shown in Table 10, innovation outputs (InnOut) partially mediate the relationship between intellectual capital (VAIC) and financial performance (ROA). The Sobel test results in Table 11 confirm a significant indirect effect of 0.015 (p-value = 0.02), representing 16% of the total effect. This suggests that intellectual capital impacts financial performance through innovation outputs, while the direct effect of VAIC on ROA remains substantial. Based on Baron and Kenny’s methodology, this represents partial mediation, whereas Zhao, Lynch, and Chen’s approach classifies it as complementary partial mediation.
Robustness check
We conducted a robustness check. We measured the financial innovation index using principal component analysis (PCA), in addition to assessing financial performance using the net profit margin (NPM) as an alternative measure, which is consistent with methodological approaches in similar studies (Pratama et al. 2020; Scafarto and Dimitropoulos 2018). This approach enhances the validity of the findings by demonstrating their consistency across different measurement techniques. The results confirm the findings from the last mediation. Table 12 indicates that intellectual capital (VAIC) directly enhances NPM (0.559, p < 0.05) and significantly boosts the innovation index (5.556, p < 0.01), with the innovation index also exerting a positive influence on NPM (0.011, p < 0.10) aligns with the work of (López and Ratkai 2024; Morrow 2013), who emphasized the importance of financial innovation in improving club performance.
The innovation index (Innova) partially mediates the VAIC–NPM relationship, as indicated by the Sobel test (indirect effect = 0.059, p = 0.082), which accounts for 10.6% of the total effect, as presented in Table 13. This finding is particularly relevant in professional football clubs, where rapid technological advancements and changing regulatory environments necessitate continuous innovation (Dimitropoulos and Scafarto 2021; Lardo et al. 2017).
These findings suggest that intellectual capital has a direct and indirect impact on financial performance, via the innovation index, consistent with partial mediation as proposed by Baron and Kenny and complementary partial mediation as suggested by Zhao, Lynch, and Chen. This multifaceted confirmation of the relationships between intellectual capital, innovation, and financial performance underscores the importance of these factors in the strategic management of professional football clubs.
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