Under the Spotlight: The financial journey of Barca during Bartomeu’s presidency

28 September 2020

Bartomeu
Photo: PA Images One way or another, Josep Maria Bartomeu's tenure as president of FC Barcelona is coming to an end. We have looked at his financial mark which reveal an impressive growth in revenue by 52 per cent, largely due to commercial growth. Here Bartomeu during the presentation of Pedri as the new player of FC Barcelona.

One way or another, Josep Maria Bartomeu's tenure as president of FC Barcelona is coming to an end. We have looked at the financial mark he has made on the club during his five years in charge.

Under Bartomeu, the club have increased their revenue by 52 per cent, largely due to commercial growth.

However, the money has been spent rapidly. Barcelona's wage bill and transfer spending has left the club with the largest debt total in the world of football at €1.2 billion, an increase of 125 per cent under Bartomeu's term from 2015 to 2019.

Covid-19 could demolish his overall success in growing Barcelona financially.

Joseph Mailil, analyst jm@offthepitch.com

Last week FC Barcelona confirmed that a group of members had managed to gather enough signatures to declare no confidence in the current board of the club. This was the culmination of a 2020 in which the Barcelona president endured a growing distrust of his leadership, and the club went trophyless for the first time in 12 years.  

Since Josep Maria Bartomeu replaced Sandro Rosell as president in January 2014, Barcelona's sporting performance has been predominantly successful - with a treble in 2014/15 and four of five championships, although the club's Champions League exits seem to overshadow this.

As Bartomeu's tenure is coming to an end, whether after the election in 2021 or before, we have taken a deeper look at the financial mark he made during his tenure up to the impact of coronavirus.

 

Making the club less susceptible to sporting failures

Throughout Bartomeu's presidential tenure at Barcelona, income has been the benchmark for measuring financial success. In his full five years as president, the club managed to increase their total revenue by 52 per cent, going from €561 million in 2015 to €852 million in 2019.

Bartomeu has been keen on reducing the club's reliance on sporting performance for financial wellbeing and he has endeavoured to achieve this by growing the club's commercial power.

Barcelona grew their commercial income by 64 per cent under Bartomeu, with the vast majority of the growth occurring during his first two years in charge. By comparison, Spanish arch-rivals Real Madrid only grew 19 per cent and, of the six European giants, Juventus were the only club with proportionally better growth in commercial income.

 

Is the wage situation at Barcelona as bad as it seems?

Although FC Barcelona recorded the highest turnover of the latest fiscal year, the club's operating expenses don't paint a picture of perfect financial health. The Spanish club had, by far, the largest wage bill in Europe. Noticeably, there was a massive increase in 2018, despite the departure of Neymar, and the club saw their wage bill soar from €378 million to €529 million. 

 

However, this imbalance was corrected in 2019, when the club's significant increase in turnover offset the staggering wage bill. What's more, Barcelona have begun their long-overdue generational change. The departure of big profiles like Suarez and Rakitic, combined with the acquisition of younger players to replace them, should help reduce the club's wage bill.

Nonetheless, when looking at the proportional growth in wages over the five-year period, Barcelona saw their wages increase by 60 per cent, which is less than Juventus (66 per cent) and Manchester United (64 per cent, when disregarding exchange rate discrepancies). 

 

Player recruitment strategy in question

Lionel Messi, after announcing he would be staying with the club for another season, openly criticised Bartomeu's administration for its reliance on salesmanship. Looking back at the club's net spending during the past five years, it contrasts with the typical Barcelona policy, known for youth development. 

From 2015 to 2019 the club had net spending of €326 million according to Transfermarkt.com, with 2019 being the only year in which the club had player sales exceeding spending. 

This has also been reflected in the book values of the squad, which grew by 137 per cent from 2015 to 2019, closing the latest fiscal year at €528 million, only beaten by Chelsea. Considering that homegrown players like Messi are not included, and that last summer's addition of Griezmann and De Jong are yet to appear on financial statements, it is evident that this account doesn't reflect the actual value of the squad. 

The Bartomeu administration has demonstrated a tendency towards increasing player sales in order to finance the club's operations, especially over the last two years. During this time, the club had operating losses of almost €260 million, all of which were covered by the profits from player sales - more than €300 million. 

 

Most indebted club in the world of football

During the tenure of Bartomeu, Barcelona's total liabilities rose from €547 million in 2015 to €1.2 billion, an increase of 125 per cent. Apart from a significant drop in 2016, the club's debt during the period has been on a steep and continuous upward spiral. 

 

When comparing the staggering growth of their debt to the "Big Six" of Europe, the Catalans went from having the second-lowest total debt in 2016 to the highest in 2019. Although total liabilities only just exceeded those of Manchester United, net debt reveals a completely different situation - Barcelona had raw debt of €860 million, compared to United's €625 million in 2019.  

A staggering amount, especially considering the enormous uncertainty created by Covid-19.

The reason behind the snowballing of Barcelona's liabilities is debt to other clubs resulting from transfers and bond issuance. 
The club had transfer creditors expecting no less than €261 million in 2019, not including potential down payments for summer arrivals - a rise of 156 per cent since 2015. 

In addition to that, the club had €200 million in bonds added to their debt in 2019, which pushed their total over the threshold for the unwanted title of most indebted club in the football world. 

 

Covid-19 impact

As the financial report of 2019/20 has not yet been published, it remains to be seen just how great the impact of Covid-19 has been on Barcelona. With their enormous debt compounding the impact, some have predicted financial troubles ahead for the club.

In July, Bartomeu said in an interview that Barcelona are "the club worst affected by the coronavirus crisis" and he predicted "two to three years" of financial problems.

"Since March 14 we have not received a euro. We have missed out on €200 million. We have recovered a lot by reducing wages and using ERTEs [temporary employment regulation files - Spanish labour law allows the government to pay 70 per cent of wages]," he said to Mundo Deportivo, and added:

"Nobody should think that things will be fixed by next season. The great financial gurus talk about four years, but I think football will go faster."

He also revealed that the club will not reach the planned €1.1 billion in turnover:

"Now we will bring in 30 per cent less because of Covid," Bartomeu said.

However, despite Covid-19 and their immense debt, which continues to grow, he denied that Barca are in a poor financial state.

"Despite the losses, we will continue to be the leader in revenue. The club's debt level is not very high. When the audit ends in mid-August, the economic vice president, Jordi Moix, will explain it and we will see that we are at normal debt levels."