Atalanta post profit for sixth year in a row – every club in Europe should benchmark themselves against La Dea

Italian football has gone downhill both on and off the pitch in the last decade. No Italian team have won the Champions League or Europa League since 2010, and Serie A is by some distance the biggest loss-making league in Europe, accumulating a deficit of €1.06 billion between the 17 clubs to have published 2021 accounts.

But while the other Italian teams have struggled, the small Bergamo club of Atalanta have taken the world of football by storm. Getting promoted at the start of the last decade after the return of Antonio Percassi as president of Atalanta, the club finished in the bottom half in their first five seasons in Serie A. 

The turnaround began in earnest when current manager Gian Piero Gasperini took the helm of the Bergamo club in 2016 and led it to fourth place in his first season, qualifying the team for a spot in European competition for the first time in 26 years.

Since then, The Goddess have continually impressed, and in doing that have accumulated net profits of €175 million over the past five years, having recently published another surplus of €35 million.

For the first time in six years, Atalanta seem to be on shaky middle ground, currently sitting 8th in the league, at risk of missing out on European football for the first time under Gasperini. 

Aside from that, the rapid rise of Atalanta led a couple of months ago to Percassi selling 55 per cent of La Dea Srl. - a sub-holding company owning 86 per cent of Atalanta - to an investor group led by Stephen Pagliuca, the co-owner of Boston Celtics. Pagliuca, who currently owns 47 per cent of Atalanta, was recently revealed to be a part of the final three bidders to buy Chelsea. 

Off The Pitch has analysed how the small team from Northern Italy have developed the financial foundation to consistently compete with traditional top clubs in Serie A.

Growth in all revenue pillars

Over the past six years Atalanta have repeatedly been playing European football, allowing the club to turn the massive rises in income - mainly from broadcasting - into serious investments to remain competitive year after year.

The club’s revenue tripled since 2016 with broadcast income being the main revenue pillar, particularly from UEFA prize money. TV income rose from €36.4 million in 2016 to €126.6 in the recently-concluded financial year of 2021. The total turnover of €186.3 million was only €4 million less than AS Roma, although only 42 per cent of Juventus’ €437 million.

The club have managed to take advantage of the success on the pitch as commercial income has also nearly tripled making up 15.6 per cent of the total income in 2021.

Specifically, Atalanta increased sponsorships and advertising by €10 million, from €18.2 million to €28.2 million in 2021.

While broadcast and commercial revenue offset the declines in matchday during the pandemic by far, the club’s stadium has undergone three phases of construction to revamp capacity and modernise hospitality possibilities, which should increase their matchday and commercial income further in 2022 and into the future as full capacity is restored.

The acquisition of and investments in the stadium caused the club’s tangible assets to increase from €20 million to €50 million. 

Clear transfer market strategy 

UEFA recently launched their revamp plans for Financial Fair Play, placing greater emphasis on costs as a proportional measure of income, rather than previous solely absolute measures.

Despite the massive streams of income flooding into the club’s pockets over the past five years, Atalanta have decreased their wages-to-revenue ratio which is fixed around 40-50 per cent of the turnover.

That makes the club one of the best in Europe in terms of wage structures, with a ratio of 47 per cent in 2021 and 43 in 2020 - seasons which generally saw the ratio rocket as a consequence of diminishing revenue pillars.

Atalanta are a standout club in Italy, especially when looking at rivals Lazio and Napoli, who had lower income yet had personnel costs of €135 million and €155 million respectively - far more than Atalanta’s €88 million.

While competing clubs have found it hard to constrain wages, Atalanta have managed to keep wage growth sustainable in proportion to the impressive revenue boom over the past five years. 

Generally, Atalanta and Udinese are the only clubs in Italy’s top flight to consistently operate below the UEFA Risk Indicator of 70 per cent of revenue. Among the clubs in the big five to have published their 2021 accounts, Atalanta had the lowest ratio of all, significantly lower than esteemed clubs like Tottenham and Bayern at approximately 57 per cent each.

This also speaks to Atalanta’s very successful transfer strategy of acquiring unpolished players on the market at a reasonable price and salary with a later profit in mind. Over the past six years, the club generated profits from player sales of €250 million, making this an integral contributor to Atalanta’s yearly net profits. 

In 2021, Atalanta recorded profit from player sales of €50 million, mainly due to the sales of Amed Diallo to Manchester United, Papu Gomez to Sevilla, Musa Barrow to Bologna, and Roger Ibanez to AS Roma. 

Another testament to Atalanta’s salesmanship was seen this summer, as Atalanta activated their option to buy Cristian Romero from Juventus, only to loan him to Spurs with the obligation to buy this summer. This will allegedly generate income above €40 million, although around a third is to be written off in amortisations from the Juventus move. 

The club accumulated net profits of €175 million over the past six years, which is far more than their Italian rivals. Juventus, AS Roma, Inter Milan, and AC Milan accumulated losses of almost €2 billion in total during the same period, while Lazio and Napoli both had net profits close to breakeven.

Only Atalanta (€35.1m) and Verona (€2.9m) have presented profit after tax in 2021 among the 17 Serie A clubs having published accounts so far, with the remaining 15 teams ratcheting up €1.1 billion of losses in total.

The impressive bottom line naturally also affected La Dea’s equity positively, as it rose from €35 million to €165 million in the same period, equivalent to a rise of 373 per cent. 

2022 filled with uncertainty

Atalanta may well be one of the financially best run clubs in Europe and have proven that sustainability and on-field success can go hand in hand. However, the current outlook for the 2022 financial year could see revenue decrease for the first time in more than six years, as Atalanta are currently at risk of missing out on European play next season. 

If no European football becomes a reality, it will be a real testament to the club’s business model if they do manage to remain profitable and stay competitive next season.

At the same time, newly-arrived owner Pagliuca has made a move to acquire Chelsea Football Club, which could possibly leave the club in a bit of a pickle - although the Italian club are certainly the more sustainable of the two, so funds are not as essential to Atalanta. 

There is uncertainty about whether Pagliuca can hold the majority of shares in Atalanta and take over the London club, as both clubs are regulars in UEFA’s club competitions. Whether this means a complete exit for Pagliuca is unclear, as UEFA rules state that two or more participating clubs cannot directly or indirectly be controlled by the same person or entity. 

The CEO and son of the president at Atalanta, Luca Percassi, hopes Pagliuca can see the deal through as he perceives the Chelsea takeover as having huge potential for synergies, claiming in an interview with Tuttosport that it would have “enormous advantages”. Regardless, the move by Pagliuca presumably came as a chock to everyone around the club, just months after investing.

The successful bidder to take over Chelsea is expected to be announced in the coming weeks - news that will mean big potential changes for Atalanta either way.