The Swiss Ramble reports from Zurich on the latest financial results of Juventus. One interesting general point to emerge is that Juventus are yet another club who have become increasingly reliant on player trading, but it is a volatile source of funds, especially after the pandemic.
Juventus remained in 10th place in the Deloitte Money
League, based on 2019/20 revenue, having overtaken Arsenal the previous season.
However, their €255m revenue growth since 2010 is the lowest in the top 10,
miles below the likes of PSG, Manchester City, Barcelona, Liverpool and Spurs.
They are still very much the biggest club in Italy,
certainly in financial terms. Although the 2021/22 season will deliver another
large loss, the club expects the economic performance to “improve significantly
starting from 2020/23 financial year.”
The pre-tax loss more than doubled from €82m to €208m (€210m
after tax), despite revenue rising €43m (11%) from €407m to €450m, mainly
because profit on player sales fell €136m from €167m to €31m. Operating
expenses also increased by €37m (6%). Unsurprisingly,
Juventus huge €208m pre-tax loss is the worst in Italy, though their figures
are the only ones to include a full year of the pandemic. In fact, it is the
highest ever in Italy.
After four years
of profits up to 2017, Juventus have now reported losses four years in a row,
adding up to a €326m deficit in that period, including €289m in the last two
years alone. COVID has exacerbated their losses. Club expects 2021/22 to also
show a “significant loss”.
The club estimate the impact of COVID on 2021 revenue as
€70m (match day and retail sales), while overall loss for 3-year period between
2020 & 2022, including lower player sales from less liquid transfer market,
will amount to hefty €320m (assuming gradual recovery in 2022).
COVID has impacted Juventus ability to make big money from
player sales. In the four years up to 2020 they averaged annual €132m profit
from this activity, but only managed to realise €31m in 2021. The
importance of player trading to Juventus business model is illustrated by them
making €563m profit from player sales in the 5 years up to 2020. This is nearly
€200m more than the next best performer in Italy, namely Roma €372m, followed
by Napoli €325m and Inter €226m.
Despite reflecting a full season of COVID, Juventus €450m
revenue is still highest in Italy, well ahead of Inter €302m, Napoli €179m,
Milan €172m, Roma €149m & Lazio €106m (2019/20).
Broadcasting
revenue shot up €69m (41%) from €166m to €235m, a club record for this revenue
stream, benefiting from income deferred from 2019/20 for games played after
end-June accounting close. It is the highest
in Italy by far, but below average in Europe (in a normal year).
It is imperative that Juventus do well in the Champions
League to boost their broadcasting income, as the TV rights in Serie A are
relatively low. The Champions League is
extremely important for Juventus, who have earned an impressive €454m from
Europe in last five seasons, which is significantly higher than other Italian
clubs.
Commercial income rose €9m (5%) to €194m, as new sponsorship
deals, up €16m (13%) to €146m, offset €6m reductions in sale of products. This
resilience holds Juve in good stead, as other Italian clubs have suffered, e.g.
Inter’s Chinese sponsors have reduced.
The wage bill rose €39m (14%) from €284m to €323m, partly due to players giving up some salary in 2020 because of COVID. It is almost back to €328m club high in 2019. Wages have grown more than any other Italian club (€124m since 2015), but will fall after CR7’s departure.
The wage bill of €323m is significantly higher
than the rest of Serie A with closest clubs being over €100m lower: Inter €198m,
Milan €161m, Roma €155m and Napoli €141m. However, a fair bit less than
European peers, e.g. Barcelona €443m, PSG €414m.
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