Barcelona in the red after €203m coronavirus hit
Written by Rother Radio News on 05/10/2020
Football giant Barcelona has slumped into the red after the coronavirus took a €203m (£181m) chunk out of its revenues.
The Spanish club, which last year topped the league of football’s highest earning clubs, reported a post-tax loss of €97m (£87m) for the year to the end of June, compared with a €5m (£4m) profit a year ago.
Its figures are the latest to illustrate the stark but contrasting ways in which the pandemic is squeezing the game’s finances from top to bottom.
While clubs lower down the pyramid fear financial ruin, for Barcelona the crisis has thwarted its ambition to become the first to post annual revenues of more than €1bn.
Barcelona instead reported revenues of €855m (£766m), down 14% from a year earlier. The club said they would have been €203m higher if not for the pandemic.
It said it suffered a “considerable loss of income” from games being played behind closed doors as well as the cancellation of the basketball Euroleague, in which the club also competes.
Ticket refunds and lower sales accounted for a €47m drop-off in expected earnings while income from media and TV rights fell short by €35m.
The club took a €37m hit on sponsorship deals that were “at an advanced state of negotiation before the pandemic” but could not be completed.
Meanwhile a slump in tourist trips to Barcelona took its toll on numbers visiting the world-famous club’s Camp Nou Experience as well as the sale of products in official stores.
The club partly mitigated the slump by cutting costs by €74m via agreed salary reductions and temporary redundancies.
Without the pandemic, it estimated, Barcelona would have achieved a profit of €2m for the year.
The club expects to post another drop in revenues in the current year to €791m – based on the assumption that its stadium will partially reopen from December with 25% capacity, increasing to 100% by February.
It is the latest of Europe’s big clubs to reveal the financial impact of the pandemic, with Italy’s Juventus last month reporting a €71.4m (£63.8m) annual loss for 2019/20.
Manchester United, the Premier League’s biggest revenue earner, has not yet disclosed full-year financial results but reported a £22.8m loss for the third quarter to the end of the March, blamed on the pandemic.
The European Club Association has estimated that top-flight clubs face a €4bn (£3.6bn) hit to revenue over two seasons thanks to the pandemic.
Accountants Deloitte have estimated a £1bn impact on the Premier League alone.
Barcelona’s financial setback comes after it suffered a humiliating 8-2 defeat to Bayern Munich in the Champions League in August and a much-publicised saga over the possible departure of star player Lionel Messi – who in the end reluctantly agreed to stay.
© Sky News 2020