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Football: AC Milan announces loss of €195million

Italian football giant, A.C. Milan has announced a loss of €195million in the fiscal year of 2019/20.

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Associazione Calcio Milan, commonly known as AC Milan announced losses of €195million in the fiscal year of 2019/20, which was due to ‘extraordinary circumstances’ compared to the €145.9million loss in the 2018/19 fiscal year.

According to Sports Business, the Italian side posted a loss of €145.9m for the 2018-19 financial year and a loss of €125m for 2017-18. It has now registered cumulative losses of nearly €700m over the past seven seasons, due mainly to dropping out of the Uefa Champions League over that period.

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The draft financial statement of the fiscal year 2019/2020 which ended by June 30, 2020, was approved by the Board of Directors of AC Milan as of last Friday. The draft is planned to be submitted in the next Shareholders meeting scheduled for 28 October 2020.

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An official statement from the club said the 2019/20 season was heavily affected by the global pandemic and it was also due to the situation inherited from the previous ownership.

READ: Over €250 million up for grabs as English teams battle for Europe Silverware

The club said the health emergency affected the financial statement which as a result caused low revenue from the San Siro Stadium and other retail stores like Museum, Store, Casa Milan, etc.

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In addition, the club referenced the impact of the pandemic on revenues of Serie A media shared by clubs, which led to the postponement of the TV rights to the 2020/21 season. The club also referenced their ban from the Uefa Europa League after breaching the Financial Fair Play rule.

READ: Chelsea FC posts N46.42 billion loss in 2019

However, the club qualified for the Uefa Europa League after they finished 6th in the 2019/20 season and won their playoffs. They are hopeful they’ll be able to recover the amount lost due to their ban last season. They said, “that will be recovered in the next financial year.”

“With the 2019/20 season heavily affected by the global pandemic, there was a negative impact on the Club’s financial performance, one which was already suffering due to the situation inherited from the previous ownership. As a result, the Club registered a full-year net loss of approximately €195m.

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“The impact of the health emergency on the Club’s financial statements is as a result of the lack of matchday revenue and the subsequent reduction in commercial activities and lower revenues from the retail sector (Museum, Store, Casa Milan, etc.)

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“Furthermore, the limited number of matches played (10 Serie A matches) in July and August 2020 also weighed on the accounting records and led to the postponement of part of the accrual of the TV rights for the 2020/21 season.

“Finally, it is worth noting that the Club was banned from taking part in last season’s UEFA Europa League, which had a further negative impact that will be recovered in the next financial year.”

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The club also commended its owner, Elliott Management Corporation, an American investment management firm, for their constant support through the herculean time.

The constant support of Elliott, which guarantees the financial stability of AC Milan, has however allowed important investments and the effects are expected in the short term.

READ: Partey Deal: Arsenal records a whopping £67 million deficit in summer of 2020 transfer window

“At the same time, the Club launched an effective cost efficiency policy that entailed a significant reduction in player wages and top management salaries,” the statement continued.

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The European Club Association has estimated that the European football industry will lose more than €3billion due to the global pandemic over the next two seasons, with 90 percent of this impact weighing on clubs.

READ: FG, Labour agree cut in electricity tariff for 3 months, to distribute 6 million free meters

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UEFA to cut prize money for next 5 seasons due to financial impact of COVID-19

UEFA has decided to cut prize money for the Champions League and Europa League competitions due to the financial impact of the COVID-19 pandemic.

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UEFA to cut prize money for next 5 seasons due to financial impact of COVID-19

The Union of European Football Association (UEFA), lost £514million from the Champions League and Europa League last season due to the COVID-19 pandemic.

This led to reduced TV and sponsorship income, and as a result, it plans to cut prize money for club competitions – Champions League and Europa League, over the next five years (seasons) to offset the incurred losses.

READ: Football: AC Milan announces loss of €195million

According to The Times, UEFA wrote to its 55 member associations revealing the amount lost (£514million) due to the financial impact of the pandemic and its plans to cut the prize money for its two competitions.

By spreading the costs out to offset losses, competing clubs in the two UEFA club competitions (Champions League and Europa League) can expect a roughly 4-per-cent drop in Uefa prize money in each of the next five seasons.

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READ: Manchester United: A football club or a business

The 2019-20 Champions League and Europa League were on hold for five months (mid-March to August) when the pandemic wreaked havoc on the global sporting calendar, with the UEFA opting to schedule matches from the quarter-finals which were played as single-match knockout ties at neutral venues in Lisbon, Portugal (Estádio da Luz and Estádio José Alvalade).

DAZN, an English streaming platform terminated its rights deal for the UEFA club competitions (Champions League and Europa League) in particular places like South East Asia and Japan, the streaming platform cited the delay and the reduced number of matches (one-legged tie) as a reason for the termination.

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READ: Ajax FC’s shares fall by 21% after Champions League defeat

Telco Altice, a French multinational telecommunications corporation, which holds exclusive rights for the Champions League and Europa League in France, has publicly demanded its money back, due to the delay and reduction in matches played. Telco Atlice pays €350million per season for its rights to the two UEFA club competitions for the 2018-21 cycle.

READ: Messi emerges highest paid Sportsman on earth; here is how

Also, UEFA recently announced that financial services company – Mastercard, has renewed its Champions League sponsorship contract to continue through the 2021-24 cycle extending its 26-year partnership, dating back to 1994. The agreement also includes sponsorship rights for the UEFA Super Cup competition in 2021, 2022, and 2023.

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Sports

Football: Manchester United net debt rises by 133% to £474.1million

Manchester United recently announced its revenue for the fiscal year of 2019/20 ending in June 2020.

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Football: Manchester United net debt rises by 133% to £474.1million

English top-flight club, Manchester United, recently announced its revenue for the fiscal year of 2019/20 ending in June 2020. The club’s net debt increased by 133% to £474.1million from £270.5million. However, due to the economic uncertainty caused by the pandemic amidst fears of a second wave of COVID-19, the club has refused to issue revenue guidance for the 2020/21 financial year.

READ: Football: Lyon lost €36.5 million in the 2019/20 financial year

READ: Barcelona overtakes Real Madrid on biggest earners’ list 

READ: EPL clubs to be fined £37 million each over suspension of matches

This is according to KPMG Football Benchmark Club Finance and Operations Tool and club’s press release.

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READ: Football: AC Milan announces loss of €195million

What you should know

  • Manchester United’s net debt has increased in the fiscal year of 2019/20 to £474.1million, an increase of 133% compared to £270.5million in the previous year.
  • The club posted a cumulative revenue of £509million for the 2019/20 fiscal year which ended in June 2020 and also represents a nosedive of 18.8% compared to revenue of £627.1million in the 2018/19 fiscal year. This is also the lowest figure the club has recorded since the 2014/15 fiscal year.
  • Broadcasting revenue decreased from £241.2million to £140.2million, a drop of 42%. This was primarily attributed to an estimated £15.0m Premier League rebate due to broadcasters, broadcast schedule changes to the 2019/20 football season, non-participation in the UEFA Champions League, and the impact of playing two fewer Premier League away games.
  • Due to the impact of postponement of the Round of 16 Europa League home match and closure of non-match day operations in mid-March which saw Old Trafford shut down, matchday revenue decreased to £89.8million, a drop of 19%.
  • However, despite the losses, United’s commercial revenues remained resilient, posting an increase of 1.4% to £279m in the previous year.

READ: Roma on the verge of signing new deal with New Balance after premature termination with Nike

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READ: Chelsea FC posts N46.42 billion loss in 2019

READ: U.S. budget suffers a deficit of $3.1 trillion in 2020, as pandemic slams the economy

Manchester United’s Executive Vice-Chairman Ed Woodward said, “Our focus remains on protecting the health of our colleagues, fans, and community while adapting to the significant economic ramifications of the pandemic.

“Within that context, our top priority is to get fans back into the stadium safely and as soon as possible.”

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Cristiano Ronaldo tests positive for COVID-19

Portuguese football star, Critiano Ronaldo has contracted the novel coronavirus.

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Cristiano Ronaldo tests positive for COVID-19

Portuguese and Juventus Star, Cristiano Ronaldo has tested positive for Covid-19 and he has left the Portugal squad for isolation.

After arriving in Portugal for the Internationals break, he featured in two matches against Spain and France. His last match was on Sunday against France and was in contention to play against Sweden tomorrow.
The announcement  was made by the Portuguese Federation, and he has left the squad to self-isolate.
More details shortly…
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