FC Barcelona is in the midst of a presidential campaign, but the winner might be getting a poisoned challis as Barcelona’s growing debt is set to force the club into a period of dramatic austerity, with the Catalan giants owing €900m to creditors.
The LaLiga side announced during the 2019-20 season that it expected to be the first club to break the €1bn barrier for income in a single year in football, however that figure was blown off course by the coronavirus pandemic.
As a result, the club had a loss of almost $100m last season, and there are concerns this season could be worse.
And according to Catalonia’s leading newspaper La Vanguardia, Barcelona has €480m in long term debt, and €420m in the short term debt, meaning that there is a total debt in the region of €900m.
The piece explains that the next president and his board will have to deal with the situation as a priority, with €420m of that debt owed in the next 12 months.
To make matters worse, the club’s current budget was based on a projection that 25 percent of football stadiums would have fans from December this year and 100 percent from February – figures which do not correspond to the reality, meaning that the budget is significantly higher than what money the club actually has.
In addition to the short-term debt coming due, the club has agreed a pay cut with the players to save €170m in payments this year, that is merely a postponement as it will need to be paid back to the players at a rate of €45m per year over the next four seasons.
This is a huge extra burden on the Nou Camp outfit, which already spend 70 per cent of its budget on transfers and wages. In fact, no football club in the world spends more money on wages than Blaugrana.
One source told La Vanguardia:
‘Those accounts also included expectations of renewal with sponsors such as Rakuten – €55m – or Beko, €19m, which will not be met.’
Fingers are being pointed at Bartomeu and the legacy he is leaving behind, with a series of highly expensive signings having failed to make the grade at Barcelona in the form of Ousmane Dembele, Philippe Coutinho and Antoine Griezmann.
One hugely unpopular move, but financially sound, would be for Barcelona to sell Lionel Messi this month. The club’s best ever player is out of contract at the end of the season and the club simply cannot afford to keep him. Selling Messi brings in much needed cash, as much as €50m, and makes a significant debt in the wage bill.
Offloading the likes of Ousmane Dembele, Philippe Coutinho and Antoine Griezmann this summer would allow Barcelona to get back on solid financial footing and rebuild the team around the likes of Riqui Puig and Ansu Fati.
The big question is whether the new Barcelona president has the stomach to tear down the current squad and rebuild?