NEWS
Friday March 4 2016
Serie A chokes on €365m loss

Serie A cannot cope with the increase in costs and reported a €365m loss, with most clubs indebted and Parma already bankrupt.

After a €220m loss in the 2013-14 season, Serie A is in even worse shape than before. The deficit figure is not inclusive of the Gialloblu's accounts from last year, which would make the loss even greater.

According to a report published by La Gazzetta dello Sport, Serie A's gross revenue in and of itself remains largely stable at €1.84 billion, even showing a slight increase in value. However the costs have risen and the profits from the transfer market have fallen this year, leading to an unbalanced financial system. This is in contrast to the international situation, as the English Premier League, the Bundesliga, the Liga and the French Ligue 1 are all stable or making a profit.

Serie A's total debt increased from €1.6 to €1.7 billion last year. Of this debt, €1.1 billion is due to banks while €400m is due to suppliers, an increase of respectively 11 and 6 per cent. The capital from these loans has been used largely for transfers and expenses rather than long-term structural investments, such as stadium projects, which guarantee a return in revenue.

Teams such as Roma and Inter have most of their assets already pawned with the credit institutes. The Nerazzurri's debt is of €140m while that of the Giallorossi is €41m. The President of the team from the capital, James Pallotta, will likely sell some of his major players to finance his debt should his team not make it into the Champions League.

Milan are also in trouble, as last year President Silvio Berlusconi's company Fininvest had to inject €150m into the club to keep it from defaulting. In Serie A, 12 out of 19 clubs are reportedly in debt, with Genoa and Sampdoria looking shaky too. Only a few, like Juventus or Torino, appear to be in a healthy financial condition.

After Parma's bankrupty a number of norms were introduced by the FIGC to limit the effects of the crisis, but there seems to be still a lot of work to do to save the championship.