FC Barcelona president Joan Laporta confirms a debt of 1,350 million euros and losses of 481 million euros for last season
The president of FC Barcelona, Joan Laporta, offered a press conference on Monday to put into context the current financial situation at the Club that faces his Board of Directors. The president concluded that the economic situation is “dramatic” whilst at the same time reminding everyone “we have good news.”
“There is a strategic plan based on the credibility and experience of our team that will make this situation temporary. The Club will be in a healthy state in two years.”
The president revealed that in terms of costs, on arriving at the Club the Board of Directors had to request “a bridge loan from Goldman Sachs to pay wages” and that recently urgent work had to be carried out at Camp Nou in 119 different areas at a value of 1.8 million euros “because not to carry them out would have brought risks to people’s safety.”
The president assured that according to the due diligence that will be presented in September, “the end of the financial year of the 20/21 season will bring losses of 481 million euros. This has been audited by Ernst&Young and presented to the league. The impact of the pandemic is 91 million euros.” Laporta also highlighted that the financial costs of the CLub “are around 6%, which is unsustainable, so we can congratulate ourselves that the new credit claimed of 595 million euros is with an interest rate of 1.9%.”
With regards to Club’s wage bill, Laporta remarked that “it represents 103% of income (617 million euros), 25-30% above our competitors. The Club’s worth is minus 451 million euros,” the difference between what the Club owes and what it is owed. “This is very delicate. It has been necessary to come up with a strategic plan to make sure we have a functioning business and enjoy the confidence of our creditors. The Club’s debt is 1,350 million euros.”
Division of invoices
Laporta also explained that they have discovered the modus operandi of the management of the Board of Directors of ex-president Josep Maria Bartomeu “that evaded all internal checks.”
“Invoices were split up in the case of I3 Ventures, the Espai Barça” and in other departments “the debt invoked was split up to be less than 10% of income so not to have pass through the Assembly.”
During his appearance Laporta also referred to the letter sent by Josep Maria Bartomeu last week in which he gave his version of the Club’s financial situation, especially over the last few months.
Laporta reiterated that the accounts for the 20/21 season were approved by the Assembly “for technical reasons and in no way validate the period 2010/20.” Laporta continued that Bartomeu Board “indeed is responsible for the financial year 20/21,” and that “if due diligence uncovers irregularities that no one will escape responsibility.”
The president refuted the argument if the Bartomeu Board had resigned “they could not make financial decisions and lost income.” “They did not lose 375 million euros because of the pandemic, it was 217 and if you have to apply the costs associated, it comes up at 91 million euros.”
“They presented a budget based on suppositions that if all turned out well, the 20/21 budget would have been 1 million euros in positive. That causes a financial and economic picture that is dramatic and very worrying.”
Laporta also pointed out that “sporting wages bills to the sum of 191 million euros were not reduced, it was 68. Disproportionate payments were made to middle men. For example, 8 million in commission for a player who cost 40. Or 8 million for someone to find players in South America.”
With respect to Barça Corporate, Laporta pointed out that "our board has not found any of the proposals to be acceptable … It is a lie that there was revenue of 220 million euros. They made a low offer for Barça Studios and made no contribution to Barça Escola, or to the Barça Innovation Hub, or to BLM".
"It is not true either that La Liga signing a deal with CVC Capital Partners was the solution. The assessment of CVC is poor and shows how short-sighted Bartomeu’s board was."
Appalling’ sports project
As for the legal proceedings involving Neymar, Laporta insisted that "we have not pardoned the PSG player 16.5 million euros. The best thing for both parties was to reduce the risk and reach a global settlement. We wanted to avoid the risk of paying 57 million in exchange for relinquishing 6.7 million."
As for player salaries, the president described his predecessor’s sports policies as ‘appalling’. "They should have changed the method and invested in and believed in La Masia and made more proportionate investments in keeping with sporting logic … Compliance with La Liga’s salary caps was erratic and as a result the league is viewing us as a club that violates the rules.”
As for capital assets, Laporta commented that Espai Barça "is based on a series of falsehoods and lack of transparency. As suggested, more than 12,000 members would be moved from the first to third tier. The project underestimated the costs and was disrespectful of the other sports sections. We shall be presenting a new financing programme to the Assembly and work can begin in the summer of 2022."
Laporta also wished to thank Bartomeu for his words at the end of his letter, in which the former president offered to help find solutions. “We shall bear that in mind” said Laporta.
Complete press conference:
https://www.fcbarcelona.com/en/club/new ... y-worrying
Dude probably watches law shows on tv and thinks he understand how things work.
