Juventus 2021-22 loss is staggering, but things could actually be worse

JUVENTUS have not had the best start to 2022-23 and already some people are calling for the head of coach Max Allegri. After a decade of dominating Italian football, Juve now have stiff competition in Serie A and in the past two seasons, Inter Milan and AC Milan have won the scudetto. Moreover, Juve haven’t been quite the same club since the Cristiano Ronaldo years.

The pandemic exposed some of the shortcomings of Italian football’s business model and Juve have suffered more than most. In 2020-21, they made a loss of over € 200 million and in 2021-22, the deficit widened to a net loss of € 254.3 million, the highest ever in Italian football history. They have now made a loss for five successive years.

It’s a very worrying situation, but Juve’s finances would have been even more challenging if they hadn’t completed a capital raising exercise in December 2021 that generated close to € 400 million. While this strengthened Juve’s equity, it was the second such exercise in a three-year period, following € 300 million raised in 2019.

In 2021-22, Juve’s revenues fell by 7.8% to € 443.4 million, largely due to under-performance in Serie A and the UEFA Champions League. After the complete collapse of income from ticket sales in 2020-21, Juve’s matchday revenues recovered to € 32.3 million, but around half the peak year of 2018-19. Broadcasting earnings dropped by 28% to € 170.5 million, a reflection of the club’s decline on the pitch since the highs of 2017 when TV income was over £ 234 million.

Juventus last five seasons

 Revenues €mPre-tax loss €mWages €mWage- income ratio
2021-22443.4252.535179%
2020-21480.720832367%
2019-205738228450%
2018-196212732853%
2017-185051025951%

Commercially, Juve’s income was also down, from € 206 million to € 199 million. And yet, Juve’s wage bill went up by 9% to £ 351 million, representing a wage-to-income of 79%, seven percentage points higher than 2020-21. More positively, Juve have cut their net debt to € 153 million and have cash liquidity of around € 70 million. Of their gross debt (€ 223 million), € 176 million is owed to bondholders and € 6 million to banks.

The club has proposed a three-year plan for the years 2022-23 to 2024-25, which includes strategic and operating initiatives to maintain sporting competitiveness, economic and financial balance as well as improved operations and brand development. Interestingly, it also highlights the intention to take an active role in the reform and evolution process of the sporting industry. Juve’s ambition is to go shoulder-to-shoulder with Europe’s top clubs such as Real Madrid, Bayern Munich and Manchester City. The club was among those advocating the creation of a European Super League in 2021, a proposal that appears to have been aborted for now. However, the club’s chairman, Andrea Agnelli, was among the most enthusiastic supporters of this controversial project, so if global economic conditions worsen, it is likely another attempt will be made.

Juventus were beaten in two Champions League finals in 2015 and 2017, but since then, they have reached one quarter-final and three times could not get beyond the round of 16. It is arguable that the Cristiano Ronaldo experiment was not a big success, from both a playing perspective and financially.

Juve have been one of the most active clubs in the transfer market over the past five seasons (2018-19 to 2022-23). Only Chelsea (€ 900 million) have spent more than Juve’s € 877.9 million and their net spend of € 288 million is among the 10 highest worldwide. Clearly, this level of spending is unsustainable. In 2022-23, their transfer balance sheet is currently a positive after they sold Matthijs de Ligt to Bayern Munich for € 67 million. They picked up two notable big names on free transfers in Ángel Di Maria and Paul Pogba, both of whom are older than the likes of de Ligt.

Juventus cannot afford many more slip-ups in the Champions League in 2022-23, they’ve lost their first two games in the group stage, against Paris Saint-Germain and Benfica, so more setbacks may consign them to the Europa League in the knockout phase. That would surely impact their revenue generation into 2023.

Doubles all round?

IF BAYERN Munich win the Bundesliga this weekend, it will complete a clean-sweep for the five champions of the major European leagues, in oither words, every winner from 2017-18 will have retained their title. Across the big five (England, France, Germany, Italy and Spain), we have seen monopolies emerge over the past eight seasons – Juventus (8 titles), Bayern (7), Paris Saint-Germain (6) Barcelona (5) and Manchester City (4) have dominated their respective leagues. Since 2011-12, there have been 40 championship victories, yet only six times (Leicester, Dortmund, Atletico, Real, Monaco and Montpelier) has the trophy been lifted beyond the elite band of clubs (which also includes, Chelsea and Manchester United). Manchester City have the chance to win the first “double” in England since 2010, but if they are successful, it will mean they have won an unprecedented treble. It’s hard enough to retain the Premier – the last team to do it was Manchester United in 2007-08 – so winning all three domestic trophies will set a new benchmark. At the time of writing, other clubs are in with a chance of securing a “double” – Bayern, Barcelona, Galatasaray, Celtic, Slavia Prague, Red Star Belgrade, Dinamo Zagreb and Maribor are among them, while others, Ajax, Red Bull Salzburg, Shakhtar Donetsk, PAOK and Sarajevo have already created a bit of history.

BRAND FINANCE issued its latest Football 50 this week and GOTP wrote much of the editorial of the report, along with a video script which was used on a short film produced by TIFO Football. Equally gratifying was that Real Madrid published the video on their official website. Real Madrid is not only the most valuable football brand, but is also the sector’s strongest brand, ahead of Barcelona and Bayern Munich. The club may have relinquished its UEFA Champions League crown for the first time since 2015 in the 2018-19 season, and has once more been outperformed domestically by fierce rivals Barcelona, but the financial, cultural, and political clout of Real Madrid places it ahead of its rivals, despite the loss of talismanic forward Cristiano Ronaldo, who left Madrid for Juventus in 2018. Click here to see the TIFO video

A PORTSMOUTH fan kicked and punched a Sunderland player who happened to fall over the perimeter fence at Fratton Park in the play-offs. The incident was an ugly one and the club could yet find it is disciplined as it was all too easy for the fan to attack the player. In the past, clubs have had their grounds (or part therof) closed because of hooliganism. The footage will enable Pompey to take action against the fan, it remains to be seen how the Football League/FA respond.

MAX ALLEGRI is leaving Juventus, which will trigger off a managerial merry-go-round over the next few weeks. Allegri could end up in the Premier, but where will he resurface? Chelsea, who have a penchant for Italian coaches (Ranieri, Ancelotti, Conte, Sarri) may yet dispense with the services of Sarri, even if he wins the Europa League to add to the club already qualifying for the UEFA Champions League.

MOST people will not be surprised that Brazil exports more players than any other nation. According to the excellent CIES Football Observatory, Brazil is clearly at the top of the rankings for countries exporting footballers. In total, 1,330 players having grown up in Brazil play in the 147 leagues covered in this report. Brazilians are present in 85 associations out of 98. This reflects the unique role played by Brazil in supplying professional footballers worldwide. With over 800 expatriates, France and Argentina also stand out from the crowd as exporters. Overall, almost a quarter of expatriates are from Brazil, France or Argentina (22.5%). The principle exporters from other continents are Nigeria for Africa (10th place, 361 expatriates), the United States for North America (25th, 145), Japan for Asia (30th, 128) and Australia for Oceania (35th, 101).

GOTP is off to the Non-League Finals day on May 19 AT Wembley. We’re rooting for Fylde and Cray Valley Paper Mills!

Photo: PA