MN: Optimism surrounding Milan’s 2019-20 accounts – the sign of a financial recovery

By Oliver Fisher -

AC Milan are on an encouraging path regarding their financial health, a report claims, something indicated by certain measures.

As MilanNews report, Milan’s official accounts had to be published at the end of June (meaning they are due in the public domain any time) and rumours are circulating about a significant improvement in the accounts despite the impact of COVID-19.

The expectation is a net loss of €100m, but that is significantly reduced compared to the €-146m recorded last year, again despite all the difficulties of the financial year.

These are liabilities that take into account the negative impact of around €20m due to the Pandemic, which has taken away ticket sales, matchday revenue from the stadium plus revenue from the museum and Casa Milan.

In addition to this positive direction, it should also be emphasised that unlike other clubs Milan have no debt either on the bond financial markets, nor on traditional bank debt.

The report adds that like many clubs, Milan also makes use of ‘factoring’ with things such as television rights and transfer fees as revenue, but these are relatively small at €75m and €35m respectively.

Factoring is essentially the process where money owed to a business for goods or services sold but not paid for is known in accounting as accounts receivable or trade receivable and can be listed as an asset on the club’s balance sheet. Factoring is the process of taking this asset and selling it to a third party – at a discount.

These are signs that Elliott Management are serious in their pursuit of remedying the failures of the past and keeping faith in its promise to gradually return Milan to where it must be, all while respecting FFP and the patience necessary to rebuild the foundations of a fallen giant.

Tags AC Milan