The precarious nature of Barcelona’s finances were laid bare on Wednesday as the club’s accounts revealed losses of €481 million (£409m) and chief executive Ferran Reverter claimed the Catalan giants were “technically bankrupt” when the current board took charge.

Reverter added that due to the actions of the previous board the club would have been “dissolved” had it been a public limited company (PLC).
Barcelona’s former president Josep Maria Bartomeu resigned last October amid growing unrest and was replaced by Joan Laporta in March, following a pandemic-delayed election process.

The current board has since attempted to carry out a restructuring of the club’s finances, moving on players, including Lionel Messi and Antoine Griezmann, in order to reduce the wage bill and bring it into line with La Liga regulations.

On Wednesday, the club’s accounts revealed that operating expenditure for the 2020-21 financial year had increased by 19 per cent to €1.14 billion (£970m) while revenue had fallen by around a quarter to €631m.

With total losses for that period of €481m, only €92m of which can be attributed to the pandemic, Reverter took aim at the previous board, accusing them of signing players the club couldn’t afford and offering inflated wages.
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“When we came in this March, we found a club that was technically bankrupt; if it was a PLC, [the club] would have been dissolved," Reverter told a news conference at Camp Nou.
There was no cash flow and we had difficulties paying salaries. Debt and future liabilities amounted to €1.35 billion and there was an urgent need for refinancing.
Reverter said it had been difficult to complete a full audit of Bartomeu’s dealings as the previous board had deleted emails every 90 days and used personal computers at times.

Although, the chief executive claimed immediate work needed to be carried out on Camp Nou and the club’s training facilities following Laporta’s re-election, he said the primary reason for the club’s financial woes was overspending on transfers and wages.
“Between 2016 and 2020, there was a 61 per cent increase in the payroll, which is the same as Juventus’ entire payroll, caused by new signings and player renewals," Reverter said.

"The signings were made at high prices and by signing contracts that included new remuneration concepts such as loyalty bonuses and end-of-contract premiums that increase future spending.

"If the same squad had been kept in this season, the payroll would have amounted to €835 million, 108 per cent over recurring revenue. Moreover, these operations have resulted in significant and unusual intermediation costs in previous years.”

Reverter added: “They didn't consider if they could pay for the players.

“Griezmann was signed in a rush. They realised they could not pay for him and ended up needing €85m in credit to do the deal."

The departures of both Messi and Griezmann, as well pay cuts the club has agreed with senior players, helped to wipe €155m off the wage bill for the upcoming season.

And, having agreed a line of credit, repayable over 10 years with 1.98 per cent interest, with Goldman Sachs worth over €500m, Reverter finished on a much more positive note as he discussed contract renewals and the potential for January signings.

“We're not over the hill yet and we still need to reduce outgoings, but we can sign and renew [players]," Reverter said.
"The contract renewals of Pedri and Ansu [Fati] are on the right track and player exits [at the end of August] generated more than €20m per La Liga's Fair Play rules, so we can sign if we consider it necessary?"
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04/12/2021 AT 15:26