Finances

News and commentary around Financial Fair Play and revenues of the top teams in Europe.

La Liga, Barcelona

Barcelona’s Massive Debt Approaches €1B

Lionel Messi Priceless

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.

Bundesliga, Juventus, La Liga, Ligue 1, Liverpool, Premier League, Real Madrid, Serie A

COVID Expected To Cost Football Clubs Over €5B This Season

Lost Revenue Due To COVID

An eye-watering £4.5billion loss is expected to be suffered across Europe’s top six leagues as a result of the coronavirus pandemic, according to a new report from KMPG.

The international audit company have compiled an in-depth study into the effects the ongoing Covid-19 chaos caused last season, with particular focus given to the 2020/21 champions of the major European divisions.

All six champions, Real Madrid, Juventus, Liverpool, Porto, PSG and Bayern Munich, saw a decrease in operating revenues with estimated losses in that department across those six divisions reaching -€5B.

La Liga, Barcelona, Real Madrid

La Liga Slashes Barcelona’s Wage Cap By Almost 300m

La Liga Wage Cap 2020

La Liga has reduced Barcelona’s wage cap from €671 million last season to €382.7m this season, a fall of €288.3m in the wake of the financial pressures caused by the Covid-19 pandemic.

Barcelona will have nearly €383 million to spend on salaries, compared to €671 million euros last season. Madrid has the biggest cap this season at €468 million, down from €641 million euros a year ago, while Atletico Madrid are at €252.7m from €384.5m.

The wage caps that La Liga have imposed on other clubs include Sevilla at €186 million, Villarreal €145 million and Valencia at €103 million euros. Promoted Elche will have the smallest salary cap at €34 million euros ($40 million).

La Liga, Barcelona

Fifa Not Aware Of Agreement For Barcelona To Join European Super League

Bartomeu

Fifa says it is not aware of any agreement for Barcelona to join a European Super League. Outgoing Barca president Josep Maria Bartomeu said the club had begun proceedings as he announced his resignation on Tuesday.

In a press conference on Tuesday, Bartomeu announced that the Spanish club has agreed to join the proposed European Super League in an attempt to guarantee the club’s future financial sustainability.

“I can announce some news that will in an extraordinary way change the club’s revenue prospects for the coming years,” Bartomeu said towards the end of his press conference.

Barcelona, La Liga

Barcelona Players Sign Extensions With Lower Wages

Four senior Barcelona players have signed new contracts which include a temporary salary reduction because of the impact of coronavirus.

The signings is a big win for embattled Barcelona president Josep Maria Bartomeu as they bat back criticism that he and the board have lost the dressing room. That Bartomeu was able to get Pique and ter Stegen to sign new deals with club is a big win for him.

Long-serving centre-back Gerard Pique, keeper Marc-Andre ter Stegen, defender Clement Lenglet and midfielder Frenkie de Jong have extended their deals.

Man Utd.

Manchester United Finances Hit Hard By COVID

Manchester United Old Trafford

Manchester United suffered a £70m drop in revenue in the period to 30 June 2020 as a direct result of the coronavirus pandemic.

United’s overall revenue was down 18.8% from £627.1m to £509m, but part of this was due to the club not qualifying for last season’s Champions League. In last year’s statement, United had estimated revenues could reach £580m.

Overall, United made a net £18.9m profit in 2018-19 and a net £23.2m loss in the most recent financial year.

It was also confirmed within the results that the Glazers still took an additional £23.23m out of the club in the form of share dividends.

La Liga, Man City

La Liga President Unhappy With Manchester City FFP Decision

UEFA

La Liga president Javier Tebas has criticized the decision to overturn Manchester City’s two-season ban from European football.

The Court of Arbitration for Sport (CAS) confirmed on Monday that the Premier League club had been cleared of “disguising equity funds as sponsorship contributions” and would be allowed to enter into European competitions as normal.

Back in February, the club had received a two-year ban from playing in the Champions League or Europa League following a lengthy investigation from UEFA.

“We have to reassess whether the CAS is the appropriate body to which to appeal institutional decisions in football,” Tebas said on Monday, as quoted by BBC Sport’s Simon Stone.

Champions League, Man City, Premier League

Manchester City Champions League Ban Overturned

Manchester City Tickets

Manchester City have won their battle with UEFA and their two-year Champions League ban has been lifted.

The Premier League club were banned from European football for two years in February after UEFA found they had committed ‘serious breaches’ of its Financial Fair Play regulations.

But many of the alleged breaches were more than five years old while City, adamant that they had done nothing wrong, appealed to the Court of Arbitration for Sport (CAS), who heard the case last month.

Man Utd., Premier League

Manchester United Financials Show Impact Of Shutdown

Manchester United Old Trafford

Manchester United’s executive vice-chairman, Ed Woodward, addressed the club’s investors on Thursday to discuss the club’s latest set of financial results, the numbers sounded bleak.

Over a 40 per cent increase in net debt, revenues down and an estimated £23 million ($28m) already lost due to Covid-19 made up the headlines, and the worst is yet to come as these numbers are through only the end of March.

Games behind closed doors, the club’s shop and museum remaining closed and a huge reduction in broadcast revenue will ensure the next quarter’s results have a similarly negative impact.

Juventus, Serie A

Juventus Impose Salary Cap

Juventus were the first big club to demand wage concessions from their players when Serie A stopped playing, a move that others across Europe quickly followed.

Are Juve trendsetters again as they have become the first Italian club to launch their own salary cap? Will other clubs follow this lead, leading to a reduction in wages across the top clubs in Europe?

From next season, the Serie A giants will hand out contracts worth a maximum of €9million a year, which works out at around €173,000 a week.