Real Madrid pass the crisis due to the pandemic with note

He Real Madrid will present a surplus of 320,000 euros in the accounts already closed from the 2019-20 season that the delegated members must approve in the next Assembly, whose date will be announced this week. A absolute management success in the most difficult season that professional football has had to experience for the economic crisis derived from the coronavirus. These are the data that have transcended so far. A drop in income than round 15% on what had been budgeted and that they have not prevented the entity from being in the green numbers.

Experts consulted by this newspaper indicate that, before the income drop so strong (especially from the stadium's operating income) there is no other recipe than containment of spending. In this sense it has been decisive the fast performance by Florentino Pérez and its board of directors, First, in the cost reduction of operations (transfers) and, en greater extent, due to the agreement reached with the captains for the reduction in the salary bill of 10% of the first football and basketball teams, and Castilla. This reduction meant savings of more than 50 million euros. But it is also necessary to add the salary reduction for senior executives, to whom that 10% reduction was also applied.

Real Madrid Shield / Flag

All in a season in which, at least, a third of the competition could be played normally. In the 2020-21 campaign the situation may become worse, with everything an exercise without an audience in the stadiums, which leads to the directive to remain firm on its roadmap: new negotiation of salary reduction with players and senior executives and exploitation of a extensive staff (sales and transfers). The idea is that they are not compromised for the summer 2021 important operations (Mbappé, Camavinga, Upamecano, Halaand …) that have been parked.

The exact data will be known with the official publication of the accounts audited that the delegates have to vote. Madrid usually adjust budgets a lot and there are few variations in them. Thus, in that of the 2018-19 season, the last one approved (voted by the delegates in the Assembly), a revenue of 752 million had been budgeted and 757 million were settled. For this season (the 2019-20), whose accounts will be voted on in the next few days, had been projected revenue of 822 million. But the coronavirus has ruined that historic figure.

The four legs of the bench operating income (the ordinary or recurring ones that leave aside, for example, the sale of players) and that measure the strength of an entity are these items: Partners and stadium (For 2019-20, 161 million income had been budgeted); friendly and competitions international (109); TV broadcast (179); and Marketing (371). Of these four items, Marketing had increased substantially compared to the previous year (18-19), where it was 295, an increase motivated by the renewal signing with Adidas, which went from paying 40 million annually to more than 100.

With the publication of the accounts it will be known exact way the settlement of this budget of the 2019-20 season already finished and the variation that each of these four games has had. Too the main of expenses, which is personnel, in which Madrid had planned pay 456 million euros to its more than 800 workers (between sports and non-sports personnel). This meant an Efficiency Ratio (total wage bill with respect to operating income) of 55%. The ECA (Association of European Clubs) recommends that it not exceed 70%. Madrid also has the highest score in the Football Club Transparency Index (INFUT), which measures the transparency in the accounts of the First and Second clubs.

The crisis derived from coronavirus has not prevented Madrid from having green numbers again. Is it so far, Either way, from profit of 34 million of euros that had yielded the previous approved fiscal year (that of the 18-19), which represented an increase of 23% compared to the previous one. But the club has achieved successfully overcome the slowdown caused by the pandemic. For the next budget (the one of the season that begins, 20-21) Madrid has already made sure income for player sales of nearly one hundred million (45 for Achraf, 15 for Oscar and 25 for James)Although they are not ordinary or operating income, they do ensure the balance of finances. That budget will be around € 650M (It is expected that with 172 million less income), a significant setback compared to the 822 expected for 19-20 (although they were not met due to the coronavirus) and that places Madrid in the levels of the 2015-16.