Of Antonio Sanges – Sports Company Accountants
As of 30 June 2022 (2021/22 football season), only two top-flight clubs closed their financial statements with a profit: Atalanta (+35.1 million euros) and Fiorentina (+46.8 million), while the remaining 18 clubs reported “negative balance sheets”: Bologna (-46.7 million), Cagliari (-16.2 million), Empoli (3.5 million), Genoa (-42.3 million), Inter (-140.1 million), Juventus ( -239.3), Lazio (-17.4), Milan (-66.5), Naples (-52), Rome (-219.3), Salernitana (-16.8), Sampdoria (-24.4 ), Sassuolo (-13.9), Spezia (-17.7), Turin (-37.8), Udinese (-69.1), Venice (-23.8), Verona (-5.1). (Source Gazzetta dello Sport).
Also on that date, the Serie A football company determined the following balance sheet values: aggregate losses (1,051 billion euros), revenues net of capital gains (2.5 billion), management costs (3.9 billion), payables (3.3 billion), payables to banks (1.5 billion), payables to the tax authorities (739 million euros).
For Serie A companies, the Covid19 emergency, he quantified “lower revenues for a value of 2.8 billion euros”.
In relation to the above data, the 12th edition of Report Calcio 2022 confirms that the Italian football company detects clear critical issues regarding “economic-financial sustainability”, with the related “structural imbalance”, which even before the pandemic was particularly highlighted.
From the document developed by the FIGC Study Center in collaboration with AREL (Research and Legislation Agency) and PwC Italia (PricewaterhouseCoopers), it can be seen that in the 12 years analyzed before the impact of Covid-19 (from 07-08 to 18-19) , Italian professional football produced an aggregate ‘loss’ of around €4.1bn (almost €1m per day). (Football&Finance source)
This figure shows that 79% of the financial statements of football clubs, at the end of their football season, closed with a “loss for the year” value.
The Covid19 pandemic has confirmed a ‘structural’ crisis in the Italian football system, with the determination of the “value of the total loss” increasing from 412 million in 2018-2019 to 878 in 2019-2020, up to over 1.3 billion in 2020- 2021.
The “two championships played with a Covid-19 impact” (19-20 and 20-21) have resulted in a negative value of “aggregate operating losses” for the Italian football company, equal to over 2.2 billion euros , with the related “financial debt” increasing from 4.8 billion euros in 2018-2019 to almost 5.4 in 2020-2021.
Even the survey activated by SWG, shows that the “Italian football system” is in serious crisis, and the same would need a profound renewal. (Source Gazzetta dello Sport)
Fans and enthusiasts interviewed by SWG highlighted “criticalities of the Italian football company”, proposing the following corrective measures: 1) increase in investments in young players (91% of those interviewed), 2) salary limit with activation of the salary cup ( 90%), 3) reductions in fixed management costs instead of an increase in revenues (78%), 4) sustainable company financial statements as an improvement element, compared to a sporting success determined with pharaonic expenses (76%).
Meanwhile, on 15 July the new rules on “business crisis” (Legislative Decree 14/19) came into force, modified to implement the “insolvency directive” (n.2019/1023).
The art. 2 of the legislation in question, defines the concept of “crisis” according to which, the state of the debtor which makes insolvency probable, manifests itself with the inadequacy of prospective cash flows to meet the obligations in the following twelve months.
Based on this legislation, what will be the impact of the “business crisis law” on the business strategies of Italian football clubs?
Football company “participated with the fans”, to win the challenge of “football austerity”!