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Barcelona confirm €481m loss in 2020/21 financial records

Barcelona has announced a loss of €481m after-tax for the 2020/21 season as a result of “falling income and the inability to limit spending.” During the season fell far short of expectations the club’s financial problems and revenue have been widely documented for some time.

In 2020/21, the Spanish football club expects to make €828 million, which will just about cover projected expenses and leave them with a €1 million profit. Instead, revenue came in at €631 million, about €200 million less than expected. Meanwhile, spending was just over €1.1 billion. When you factor in taxes, you’re looking at a staggering €481 million loss.

With the COVID-19 pandemic, the club had a substantial financial impact. However, the pandemic is not the primary cause of Barça’s financial difficulties. The impact is estimated to be €92 million, implying that even without COVID-19, the club would have suffered a €390 million loss.

Barça’s Camp Nou and other facilities were forced to close due to the epidemic, resulting in an 84 per cent drop in earnings from the previous season. Commercial sales were down 10% from the previous season, but the majority of the decline is assumed to be due to closing stores.

Surprisingly, the pandemic resulted in Barça being slightly better off in terms of television/broadcasting revenue than they would have been otherwise. Because some revenue from the previous season was delayed due to the pandemic’s initial impact, it was instead included in the 2020/21 accounts. Early elimination from the Champions League resulted in a loss of television revenue.

In addition to declining revenues, expenditures in 2020/21 spiralled out of control. It climbed by 19 percent, from €955 million in 2019/20 to a new high of €1.136 billion despite the evident need for stricter supervision. Thanks to a combination of player wage cuts/deferments agreed with the previous board and a lack of administrative costs due to the stadium and stores being closed, the pandemic actually reduced that figure because €125 million was saved 

‘Other expenses increased by 281 percent due to ‘tax, legal, labour, and arrears provisions, as a result of the recognition of some liabilities that had not been acknowledged.’ At the end of June, the official end of the season, the club’s net debt was €680 million with an extra €533 million in bank debt. Barcelona’s net value is negative €451 million, which the club describes as “technical bankruptcy” in a separate financial report.

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