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Covid hits revenue at leading clubs

The authoritative Swiss Ramble has been looking at the impact of the Covid-19 pandemic on European clubs.  He comments: 'Although it’s early days in the reporting period for football club accounts from the extended 2019/20 season, we can already see the significant impact of the COVID-19 pandemic in a few selected announcements from some European clubs.'

'Clearly, football clubs are suffering from the impact of the pandemic. This is only a small sample, but it is a sign of things to come at every club, namely large revenue reductions, partly mitigated by cost savings, covered by taking on more debt or capital put in by owners.'

Barcelona have estimated a further €65m reduction in revenue in 2020/21 from €856m to €791m, partly mitigated by including TV money for 2019/20 competitions completed in July and August. That would mean a total revenue loss of nearly half a billion (€471m) over two years.

Barcelona were keen to emphasise that without COVID they would have achieved their objective of reaching €1 bln revenue (including player sales) in 2019/20, i.e. growing €69m from €990m to €1,059m. However, the pandemic caused a €203m loss, reducing revenue to €856m.

It’s obvious that clubs lose match day income when playing games behind closed doors, but what is perhaps more revealing is the substantial reduction in commercial revenue via reduced sponsorship and lower retail sales. If that’s the case at Barcelona, what about others?

Some clubs have partially compensated for their revenue losses by reducing their wage bills, e.g. Juventus €43m (four months salary not paid from May to June), Barcelona€36m (70% cut during lockdown) and Lazio €18m (two months salary given up).

The Swiss Ramble states, 'By my calculations, the AS Roma €204m and Milan €195m losses are the second and third highest losses ever in Italy, only surpassed by Inter€207m in 2006/07. Not far behind largest ever loss of €219m by Manchester City in 2010/11. It is also worth noting that these terrible figures would have been even worse without some hefty profits on player sales.'

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