AC Milan are heading for a profit in the 2022-23 financial year, but the plan is very much to continue with cost containment and sustainability.
La Gazzetta dello Sport (seen below) recall how RedBird Capital bought Rossoneri ten months ago with a cash payment of €600m and the remaining €600m guaranteed by the old owners Elliott Management through a vendor loan.
They put trust in Giorgio Furlani – who was recently promoted to CEO – and Stefano Cocirio who is the Chief Financial Officer. They had a tough job given Milan made a €195m loss in 2019-20 which went to €96m in 2020-21 and then to €66m in 2021-22.
An improvement took place through the organic growth of revenues, with the return to the Champions League and the recovery of the commercial sector (from €52m in 2019-20 to €83m in 2021-22).
Meanwhile Elliott injected substantial resources into the coffers thus avoiding the need to take out loans to increase the debt, so when the transfer of shares did take place Cardinale found himself in possession of a club with a financial debt of just €28m.
The journey in the Champions League to the semi-finals this season brought total revenues of €125m, including UEFA prizes, box office and sponsor bonuses.
The renewal of the deal with kit maker PUMA saw the income go from €14m per year to €30m, and revenues will exceed €350m this year, net of capital gains which have been almost negligible in the current year.
As for costs, €56m was invested on the market in the summer session (€35.5m for De Ketelaere) with a tolerable increase in depreciation and the wage bill.
There continues to be a ‘ceiling’ for the transfer fees paid out and the salaries paid to individuals to keep costs under control. It is clear that with management based on self-sufficiency and the precise desire of the shareholder not to contribute equity, in line with the settlement agreement signed with UEFA, the lever to be used is that of revenues.
The great challenge of Cardinale’s management is closely connected to the ability to bring Milan to a turnover of €500m. Renewals like the one with Emirates (€15m to €30m per year) will begin in 2023-24, but it will not be easy to replicate the Champions League path.
It will be a new stadium – if and when that is built – which will bring the most significant extra revenue, estimated at at least €80m per year.
In the meantime, it will be necessary to keep the squad at a high level to keep participating in the Champions League, have constant access to international markets and continue to grow sponsorships and advertising.
However, it will be necessary to raise money from the growth of talents in recent years too. Not to depend on capital gains, but to implement a dynamic and profitable management of player trading.
Journalist: Mr Cardinale, what is your strategy for the mercato?
Jerry: I think we will build a nice beautiful stadium in Milan.
Journalist: Uh yeah but… Ok, what is the ambition for the team next year in Serie A and UCL?
Jerry: There will be wifi and nice VIP lounges. And a McDonalds at the entrance.
Journalist: Excuse me but…
Jerry: Stadium.
Journalist: But…
Jerry: Stadium. Stadium stadium stadium.
We will sign Stadium as our CM, AM, RW, and ST this mercato.
Increase revenue, cut spending, shareholders happy.
When they find where the new stadium will be built, then the timeframe may even be 5 years.
So what is Milan going to do for the next 5 years(minimum)?
Just targeting on competing in the Champions League?
Great ambition…..
What’s wrong with that? If Milan are consistently finishing top 4 and making the knockout rounds of UCL, I’d say that’s pretty good. Only Man City has paid their way to a UCL final every year. People forget there are other teams with other owners and they too would like to win trophies. Do you expect each year for it to be a forgone conclusion that Milan will win a trophy? If so you should support City or Bayern instead.
You are clearly not on the same page than most of Milan fans. It’s fine if you think this way and if you’re pleased with small ambitions for the team but stop trying to convince other people that it’s the good way of thinking. Go on Milan’s official page on social media, they are flooded with comments including #CardinaleOut that gather a lot of people. Even la Curva, who clearly didn’t give a f about Maldini’s firing, asked for the quality leap.
Everybody could see that Milan was on the verge to win on a regular basis. The scudetto last year, UCL semi finals this year, the team was on the road to success. Maldini asked for some investments, once again he was not asking for Haaland or Mbappé but players in our range financially.
Now it’s a huge step back, as we will only compete for one UCL spot every year, until the stadium is complete and until Jerry can resell the team to some serious owner with football ambitions. We can just wait and see.
Well said brother
Well said @Bartholomeo. Unfortunately @Flossonero is a Redbird lover lol. He’s always praising the ownership no matter what they do. Poor kid.
And for the record only FOUR clubs in all of Europe as of May 31, 2022 were DEBT FREE; PSG, Man City, (but who wants that “dirty” Arab money eh @flyingturtle) Leicester City and Chelsea. That is it. (Chelsea likely won’t be after fiscal year end 2023)
Basically Cardinale is saying until we are “debt free” we won’t be spending. Fantastic. Well I wouldn’t hold your breath. Milan is $666M euro in debt – loan from Elliot. And until we pay that back (@7% interest per year) we aren’t doing anything but sell our stars in a year or so (“but to implement a dynamic and profitable management of player trading”) .
That is it. Which is why we have a wage cap, budget limit of 30M per player; and transfer budget of 35M and why we are going after only FREE AGENTS and loans lol. This is the Redbird way. You can make PROFIT (as we did this season) to appease the shareholders BUT STILL BE IN DEBT – which we are. SO there you have it.
And the BS claim that until we are “debt free” we cannot spend is a joke and those who believe it are foolish. LIVERPOOL the club Cardinale wishes to emulate, is $326M in DEBT – but that does not stop them from wining titles, spending money on players and transfers. WHY? Cause practically every club and every business in the world operates with debt. If you own a home and have a mortgage – guess what. You have DEBT. But that doesn’t stop you from purchasing things for your home, going on vacation, buying groceries lol. Wake up gents. This is purely PR SPIN by Redbird to brainwash the fans into thinking that until we are debt free we cannot spend LOL.
The truth is Redbird have no ambition to win titles only turn PROFIT. Just like Atalanta. And when revenue is down – BOOM we will sell a star to raise $$ and become profitable again – just like Atalanta does. If we happen to win or qualify for CL along the way – cool. If we don’t no worries provided we are profitable. And they have a great 4-5year runway to do it.
M&M ensured our biggest talent is locked up until 2027 or 2028 and a stadium (if it ever gets done) will take 5 years if not more to get off the ground. So for the next 5 years Redbird will keep this frugal approach and when needed sell a star asset to keep us in the black (profit) and by the time the stadium comes around (if ever) they can sell the club again for profit. Endless cycle. Cardinale said himself they are not long term owners. They will prop up the asset then Redbird and Elliot will sell – this time hopefully to someone who has $$ and has the ambition to win. That is NOT Redbird/Elliot. It will be a long 5 years….
Well Bartolommeo coveted me.
But @Flossonero thank you for answering like that. You are the living proof on how Americans think of Milan. Milan doesn’t exist only the past 10 years, Milan is a club over 100 years old with numerous major trophies.
I get you guys don’t know exactly what Milan was and what it represents (i remind everyone that Cardinale didn’t know that Milan has won the CL seven times) but give us a break.
We are not saying to go like Man City..we can’t, BUT we cannot have the same ambitions and goals as Lazio…Sorry my friend that is not Milan, so maybe YOU should support a different team.
You may have grown up watching a Milan with Biglia, Zapata, Lapadula, Poli or whatever, but I grew with Milan watching Van Basten, Gulit, Papen, Donadoni, Maldini, Savisevic, Weah, Sevchenko, Kaka, Pirlo, Seedorf and other GIANTS… I saw live twice Milan lift the CL in my hometown, Athens with Barcelona and Liverpool…Don’t tell me to be a Bayern or a Man City supporter…Especially Man City is an ant compared to AC Milan….
Flossonero, you’re a perfect Atalanta fan. No ambition, but we sell players for a lot of money and we are self-sufficient. 😀
Lol Flosso you are like the incarnation of Poli. You’ve been really on the side of the new management. Who says we’re guaranteed top 4 each year? Our team which is about the 5th or 6th best overall squad in the league has been punching above their weight. But we’ve lost a key cog in the machine.
The reason why I didn’t mind going all out in the UCL semis by resting players in the league is because as a true Milan fan you always always take the trophy route. It’s the in-built ambition esp in Europe
Go support Inter if you want mediocrity.
Di Marzio: Ndicka to roma completed!
We can’t compete with Roma 😂
if the players see this, then they will demand a higher salary, because they deserve it
To give club to Cardinale was biggest mistake Milan ever made.Red Bird make sold in right moment,right after winning scudetto,price was on top.Then sharedholders came to pick up the fruits of scudetto and CL.With them on top,club is going nowhere,will not be competitive,no big name will ever come to club…they can only thank to god that Milan fans are loyal till the grave!Shame,huge shame….never was investment so minor after winning scudetto,like it was last year under Cardinale.That’s a joke…..I just hope they will go back to America,and let someone else lead the club…better sooner then later
About loyality.. I’ve been loyal 16 years but recent events like Ibra, Maldini, Berlusconi and Cardinale destroying Milan..
It makes me literally stop watching football – or in general just AC Milan. I love the club, the players but watching them right now would be kinda supporting Cardinale and literally just pain for me as other teams like Roma are growing while we are playing money-ball. And sorry but I refuse to support money-ball.
I started warching in 2006/2007 when football meant something..
Mam started watching in 06/07 and thinks that Cardinale is destroying Milan.
The man who was destroying Milan since you started watching was Berlusconi, not Cardinale.
All the mess Milan has been trying to get out of over the last 5 years under Elliott and RedBird was created by non other than Berlusconi.
Yeah, and he saved the club from bankruptcy 30 years ago, do you have a point or just random babbling? If he could have put his money into the club he would have done that but since the rules changed he was looking for someone to buy the club but no offers were in. Redbird or Elliot were not there to “save the club” or whatever you people keep claiming. Why didn’t they invest? Because they didn’t care, Elliot got in because they got the club cheap because of the defaulted loan and they invested to sell for more. Couldn’t care less. Redbird will make money for their investors, couldn’t care less about Milan or the fans. Elliot sold to Redbird to make more money from the loan they gave them. Literally making money, they have 0 actual care for the club or fans. Berlusconi did, whatever you reply to this, that is true.
The point was obvious but you were too busy random babbling to get it
Let’s see if gerry can fill up his trophy rack with…trophies….. or dust/player and stadium pictures.
Gerry will fill his pockets with money not trophies lol. All about PROFIT. Not once did he mention wining TITLES. We are the red/black version of Atalanta now. Can’t wait till he starts selling all our star players
Football needs excitement and dreams. Not being stable and reaching UCL every year. There was always dreams when we were shit also. Because we bought some fun players and had dreams of what could be. Last season was pretty boring because we only did the same. At least my passion waned a bit. Maybe it was because the season was lost after a couple of weeks after Napoli cruised away week after week. Or maybe it was that we played a pretty boring foorball that mainly relied on Leao and long balls for Giroud.
I’m sorry. But it just feels a bit sad that he seems to have such low ambitions and don’t want to invest for the future to get success. Instead save his way into stabilty. Snore…
I would like to point out that ticket prices have been steadily rising this past season to absurd amounts, especially for the champions league matches. Where is all this money going to because it isn’t being reinvested in signings?
This is what the “experts” did to increase revenue. You are paying more for a ticket. Listen to this “…attributed to higher income from commercial activities, royalties, and sponsorship agreements, which rose by €17.6 million.” So, that is what the experts did. 17.6M€ increase in income, this will bring big signings in the future, mark my words. Next year they will increase for another 9.72M. And the rest of the increase came from? Prize money and matchday income as people wanted to watch Milan in CL, not against Salernitana. That was a 100M. This is the magic of Gazidis, Furlani and similar guys, they are selling a story they increased revenues by a lot, did this did that and in reality, most of it came because of the players and how they performed. Nothing to do with the people that will of course put themselves as the ones responsible for that. Oh, and getting Kessie, Donnarumma and Calhanoglu to leave on a free because the wages were limited and they did not want to sign without an increase. That is direct financial damage that is actually much more than what they brough in with their big knowledge. Glorified accountants that cut costs and lost about 100-150M worth of players in the process of cutting costs. This is 75% of what they did. And you keep saying this is great. If we don’t get into CL next season like we didn’t this season (we only got lucky) bye bye, players sale time…Keep supporting it, Atalanta mentality…
So, the talk about big financial experts, sponsorships, US analysts, God and Thanos in the end show how fake all of it is. Basically the biggest increase in revenues came from what? Playing well and going far in the champions league. Right? Yes, money came from sold out stadiums and prize money. And most of Milan’s income was that. MOST OF IT. This year we got lucky because of Juventus point deduction next year we might lose about 30% of all the income of the club by not qualifying. Shove that self-sustainable story up yours…Without good players that can do good in Serie A and CL the same season there is nothing. The increase in income that came from all these experts is less than the income from CL and match revenue from CL matches, and by a few times. Just repeat that, income from Champions League is more than the increase done by Gazidis and all the other big experts in years. This whole story is a joke for empty heads and wannabee Atalanta fans. Just go and watch Atalanta, you can have sustainable players that will 100% be sold next season so you can buy new sustainable players. And yeah, it works for a few years and then you start playing Europa league or Conference league, you lose 50-100M a year from CL and things start falling apart slowly because you can’t sign players of the same quality like before. Standard, already seen 100 times. Anyone with a brain knows how it ends.
Cardinale didn’t even appoint a new SD. He knows NO SD will ever sign up for this bull$hit. He simply doesn’t even care about sporting aspect. He is here simply to buy cheap and sell high prospect that the Milan’s brand value will enable him.
We can lose EVERYTHING, be 10th every year.. but Milan’s brandvalue will keep fetching 20/30 mil for every player we will sign for 500k and shines even slightly. That’s all he is after. Toulouse did that every season since Gerry took over. The only barrier there for making more money for Gerry was, Toulouse had a brand value of a ripped shoe lace. And hence.. He bought Milan.
WOULD YOU LOOK AT THAT?
If ONLY there was someone in this blog who warned about the intentions of Cardinale the MOMENT he fired Maldini. LOL Yet I was labeled as Maldini fanboy. Now that we are officially becoming a feeder club, I am sure some of these Cardinale bootlicker ‘fans’ are finally living their happiest days.
Even the best sporting successes won’t make you that much money. You know what will? TRADING PLAYERS LIKE SLAVES. Moneyball algorithm can be used for winning trophies.. But it can also be used for making money ONLY.
All the baseball teams use Moneyball.. but they use it to be competitive and win. ONLY one team uses it for making money.. and it’s the Yankees. Guess what they won since they started it? NOTHING! Our lil Gerry aims for the same.
There is no aiming for competing for UCL, no aiming for Scudetto, no aiming for becoming a champion.. the only dream we have in this club.. is making 500mil for Cardinale.
WHO WOULD HAVE THOUGHT This fvcker is here for the money and MONEY only.
Fvck this sorryass yankee brickhead.
#Cardinaleout.