The Real Madrid announced this Wednesday, through an official statement, that it closed the 2020/21 financial year with a positive balance of 874,000 euros with a loss of income caused by the coronavirus of 300 million euros.
The entity chaired by Florentino Pérez will go from having a net debt of 240 million euros In the season 2019/20 to 46 million euros in the 2020/21 season.
In addition, it reported that it has a net worth of 534 million euros and a treasury of 122 million euros as of June 30, 2021.
“The effects of the health crisis caused by the Covid-19, which began in March of last year, have been extended throughout the 2020/21 financial year, in which all the matches had to be held behind closed doors. This has caused a loss of income in all business lines, mainly in the stadium, as there is no income from attending matches, “explained the white club.
He also added that the effects of the coronavirus extended to television rights, “both from the League and the UEFA“and commercial activities, both in the operation of facilities and in store sales and sponsorship.
Operating income went from having an average annual growth of 10.3 percent per year until the 2018/19 campaign to 8.5 percent, while Real Madrid’s loss of income in its business lines since March 2020 until June 2021 is close to 300 million euros plus new income “that could have been achieved if the pandemic had not existed.”
Likewise, Real Madrid reported that the loss of income has been compensated through the implementation of savings measures in the following areas: salary reduction, savings in operating expenses and dropouts of players with a total between the 2019/20 and 2020/21 courses of 295 million euros.
In this regard, it stands out that in the 2019/20 season Real Madrid did not save on player casualties, while in the next he got reduce expenses by 175 million euros. As for the salary reduction, he managed to save 36 million euros in 2019/20 compared to 22 million in 2020/21.
“In the 2020/21 season there have been no acquisitions and there have been removals of players, with the consequent impact on both transfer capital gains and cost savings. Both in 2019/20 and 2020/21, members of the first soccer and basketball squads and top executives have voluntarily agreed to lower their annual pay by ten percent. ”
He also highlighted that both in the 2019/20 season (177 million euros) and in the 2020/21 (180 million euros), it obtained an EBITDA (gross operating profit calculated before the deductibility of financial expenses) higher than the achieved in 2018/19 (176 million euros) before the pandemic, “despite the loss of income close to 300 million euros in both years due to the Covid-19 effect.”
With the saving measures adopted to compensate for the loss of income caused by the health crisis, Real Madrid closes the 2020/21 financial year with a profit of 874,000 euros after taxes, so the white club “is going to be one of the few greats in Europe that does not incur losses in these two years.”
Finally, he announced what the prospects are for the 2021/22 academic year and pointed out that the public is expected to return to the stadiums without knowing “yet” in what percentage and that the economic recovery prior to the pandemic “It will not be immediate.”
“In this context, the club will continue in the cost containment effort made thus far“the statement ended.