Josep Maria Bartomeu wanted in 2015 to make the club the first billionaire in football, ignoring the last number on the income statement: profit. Years later, record of income, but also of debt, expenses and minimum profitability.
"We want to be the first club to reach 1,000 million euros in turnover." "We are one step closer." "We are not here to give benefits, but to win titles." "We cannot compete with the club-states." These phrases have been repeated as a mantra in press conferences, groups and assemblies of FC Barcelona since 2015. It was the figure that should summarize the mandate of Josep Maria Bartomeu, but, after looking at the number above, they forgot the last row of the income statement. This is the story of an obsession with being a billionaire, which helps to understand why the board could be forced to resign. The decision is now only in the hands of the partners if it is confirmed that the promoters of the motion of censure have gathered the necessary guarantees.
Nobody will be able to argue to the current board that his stage will be settled with benefits if the calculation goes back to 2010-2011, when Sandro Rosell was its leader. The positive balance since then has been 192.4 million euros and only a first year in losses , 9.3 million. With this cushion, the red numbers of almost 100 million euros that the Covid-19 crisis will cause in the accounts for 2019-2020 can be absorbed without problems. The problem is whether that drawer can endure another year of crisis like 2020-2021, the additional debt that this will entail and how that definitely disrupts the great legacy that this board intended: Espai Bar?a.
Covering Mario Vargas-Llosa, many wonder: "At what point did Bar?a get screwed?" The timeline places us in 2014-2015 if we refer to the sports and institutional situation, and 2017-2018 in the economic plane. The protagonist of that turn is the same and is none other than Neymar. The formula to sign him led to Rosell's resignation in 2014 after a complaint in the National Court and the club's admission of guilt for tax crimes in 2016. The footballer's departure in 2017 was the biggest transfer in the history of football ( 222 million euros), but it was also the entry into a spiral of spending and debt that shakes the foundations of the Camp Nou.
While Real Madrid won LaLiga Santander and 320,000 euros in the Covid-19 season, Bar?a left empty in terms of titles, suffered the biggest defeat on the pitch in its history (2-8 against FC Bayern) and still not knows how to square artificially swollen accounts with transfers in the short and medium term. Only salary reductions and layoffs can give air to culers finances in the next twelve months .
The departure of the Brazilian installed in the offices of Aristides Maillol the impression that playing actively in the transfer market was going to be the accelerator to reach the goal of 1,000 million euros first. They bet heavily on the incorporation of great stars, but also potentially revaluable young people with whom to generate only capital gains (Marlon, Yerry Mina, Todibo ...). Financial investments rather than sports, a model of success in clubs such as Sevilla FC, Borussia Dortmund or Olympique de Lyon.
With a difference: these clubs define their salary mass based on the capital gains they generate in summer and not the other way around, while Bar?a was leaving the homework to do for the last day. This is how in 2018-2019 the net profit was saved with a sale signed five days before the accounting close, that of Jasper Cillessen to Valencia CF through a barter valued at 35 million euros for which in exchange he assumed the goalkeeper Net for 26 million and another 9 million in variables. It is a play that has been repeated this year, with the sale of Arthur to Juventus for 72 million in exchange for staying with Miralem Pjanic for 60 million. Short-term operations that have not released the wage bill, because to save the numbers for one year they have perpetuated a volume of spending on payroll and amortization that was aspired to be lowered.
This is how a situation has been reached that for many is unsustainable, especially when more than 200 million ordinary income has evaporated in the first Covid-19 course and an adjustment of 320 million more is needed for now. It is something that had been demanding from the decaffeinated economic commission that was designed in 2015 and from a part of the partners who asked for prudence in order to face the remodeling works of the stadium and the new Palau Blaugrana.
After the first five years of containment, in which the sports payrolls were around 220 million euros, the achievement of the triplet shot that game to 310 million, according to the LaLiga calculation system. Logic invited us to think that, being an exceptional situation, the situation would be resolved downwards, but no. That level of spending increased to more than 330 million in the following two years, and the imbalance reached its maximum with the renewal of the heavyweights (Leo Messi, Gerard Piqu?, Luis Su?rez, Sergio Busquets, Jordi Alba) and the arrival of stars that supplied Neymar, placing the annual bill at more than 490 million euros.
In the football industry, although they understand that Messi is the highest paid in the world, it is not shared that the ceiling was located at 50 million net per year. "Javier Faus was right when he said that you cannot review upward contracts every six months, because placing the salary ladder at those magnitudes explains this economic stress," says a club financial advisor, who inexorably takes the comparison to Real Madrid: " Florentino P?rez dispatched Cristiano Ronaldo when he asked for a raise from 21 million to 40 million euros net; that distorted a scale in which nobody charges more than 15 million and in which, position by position, Bar?a even pays double ”, he adds.
The loss of financial orthodoxy began with the dismissal of the CEO, Antoni Rossich, in 2014 , Faus's decision not to continue in the 2015 continuation meeting, and the resignation of the president of the economic commission, Ram?n Adell, after those elections and after receiving pressure from Bartomeu to sign the purchase of Arda Turan for 45 million despite the fact that it was not financially recommended.
The amortization is the other Achilles heel of the management of recent years. While Real Madrid allocated Ronaldo's 100 million to reduce debt and give itself a year of transition, Bar?a burned the box that Neymar quickly left with more than three signings in which they have reached nine digits: Dembel?, Coutinho and Griezmann. These movements have caused the depreciation of fixed assets for the acquisition of players to have gone from an average of 60 million per year between 2011-2012 and 2016-2017, to more than 130 million per campaign since then and at least until 2022-2023.
At the forefront of this policy have been Bartomeu and ?scar Grau, director general and who was given important powers in football matters with an organization chart in which the corporate management fell to Jordi Joly, in charge of Pancho Schr?der, director of finance and strategic relations , to prevent the seams from breaking due to the needs of the sports area. It has not been easy, and in the end it has ended up pulling in debt to meet all the payments, even at the cost of leaving the entity in a situation of large leverage.
If the net debt calculation system is maintained with which the orthodoxy was to be protected in the statutes, this figure went from 247 million to 490 million euros between 2016-2017 and 2017-2018, reaching a record of more than 600 million euros in 2018-2019. The closing of this year is not yet public, but the 100 million hole will have to be covered with new credits and it is already public that a similar amount was achieved with the State's guarantee during the pandemic. “They still owe us several invoices, they have asked us for postponements and they are haggling over the purchase orders,” admits a major supplier to the club.
Enrique Tombas, a strong man of the board in economic matters until his resignation by Bar?ate along with five other colleagues in March 2020, always defended that "we are in a comfortable situation and financing with this type of entity is the test of cotton." Reason was not lacking, because in two years they achieved 220 million in bond issues that moved their payment to 2023-2024, that is, to a new board of directors. The problem? To all this backpack must be added the 700 million from Espai Bar?a, to which will have to be added an additional 115 million euros interest .
Bar?a still has to approve financing with Goldman Sachs for Espai Bar?a, which is around 700 million euros
The operation is coordinated by Goldman Sachs, but has yet to be ratified by the assembly of delegates. And that is not the only obstacle, since Bartomeu asked for eight years of grace (margin to pay previous debts and ensure that the works are ready) and there are those who doubt that the banks will be willing to maintain a structure in which the repayment is It relies exclusively on the additional income from the stadium once the works are finished. "Going out to the market now ask that the debt is supported on this income is unthinkable that the current situation calls into question the operation of stadiums as we came to know her ", explained days ago on 2Playbook the director of the investment firm Rights & Media in Spain, Pedro Caro .
This is the income route that has suffered the most from the Covid-19 crisis, with all stadiums closed and no forecast of when they may reopen in Spain. The most optimistic scenario proposes the reopening for the beginning of 2020-2021, which raises a 50% decrease on a business that, in the case of Bar?a, already exceeded 160 million euros per year . It is, along with Real Madrid, the club that probably most needs a rapid reactivation of international tourism, since the bulk of this business corresponds to occasional visitors who, when they come, pay a visit to the museum, entry to the game and, as no, they buy some merchandise as a souvenir.
Precisely the retail division is another of the businesses that are suffering the most from the pandemic and where analysts mark another strategic error by Bartomeu. The board always complained bitterly that Deloitte, its previous auditor, would not let them record the gross income generated by the joint venture with Nike to exploit this activity, and that only the fee it received could be noted . In 2018, taking advantage of the renewal of the contract, Bar?a decided to take control to go from 25 million to at least 60 million in turnover in accounting terms, but also charged to its structure a staff of more than 250 people. Almost all of them were included in the temporary employment regulation file (Erte).
The club always hid from the fact that it had more freedom to open new fields in product licensing, as Nike always focused on its Blaugrana garments and not so much on the search for licensees. “I still don't understand that they took the risk of consolidating so many employees; Real Madrid has regained the same control, but by allying with Legends, and other greats in Europe have ended up allying with Fanatics, which knows the market much better, ”says a senior sports retail executive.
The club does not have two of its three main sponsors insured beyond 2020-2021
Today that contract with Nike is the most important, since it involves collecting 105 million a year and allows generating sales of more than 60 million per year in product before the pandemic . Then they are followed by Rakuten and Beko, with 55 million and 19 million euros a year, whose contracts expire this year and will hardly exceed, and who knows whether to maintain, figures agreed when Messi and Neymar were there. "They are more creative than at Real Madrid, but their arrogance has made them lose great relationships such as Audi or Suning," they point out. "They have systematically breached many clauses that were included in the agreements, as if they were doing a favor by complying with what they are paid for," criticizes an intermediary.
At least the club finally managed to recover the rights to ecommerce, something that in principle they agreed to leave in the hands of Nike against all logic if what was wanted is to accelerate the generation of income. This was achieved within the digital plan of Bar?a, one of the few things in which there is consensus within the industry. The strategy contemplates that this activity will generate 300 million euros per year in revenue from 2025, when it is expected that three key products will have been consolidated : the OTT Bar?aTV +, which has been given gas with audiovisual productions that diversify the offer further of sport; the online sale of merchandisingand tickets through the Culers loyalty program, and a clear offensive in eSports, through which an important alliance with Tencent in China has been achieved. An expansion that contrasts with the hibernation of the women's soccer and futsal franchises in the United States .
But not even that move with media impact went well, because one day after its presentation the so-called Bar?agate broke out , which for now has resulted in a police investigation, the dismissal of the compliance officer and the suspension of employment, not salary, by Jaume Masferrer, a close associate of Bartomeu, a shadow dircom for years and who is pointed out in the order to chop up invoices for the commission to I3 Ventures for monitoring on social networks to circumvent internal controls. "There are executives who have suffered for refusing to charge those invoices to their budget," add internal sources, on a case that is not closed and perfectly summarizes the disconnection that has existed for months between the board and the locker room.
"There has been no project for a long time and there is nothing, they are juggling and covering holes," said Leo Messi in August, when with an interview he said that he was staying and that Bartomeu had failed to speak. He was referring to the football area, but let us remember in the offices: since 2015, the president has dismissed two CEOs, has undertaken four remodeling of the management committee and has continuously removed and handed over powers. “Now many are already thinking of looking for another job; it is the problem of Bar?a, that nobody sees it as the peak of a professional career, but rather the springboard to go elsewhere ”.
