Milan’s loss of €126m under Yonghong Li would have been far worse, were it not for higher than expected attendances.
The Chinese businessman bought the Rossoneri from Silvio Berlusconi in April of 2017, but he was forced out by Elliott Management, who bankrolled the takeover, just over 12 months later.
Last week the scale of the mismanagement was made clear by a €126m loss, but analysis from Calcio e Finanza reveals things could have been far worse.
Former CEO Marco Fassone saw his business plan rejected by UEFA, who denied both a voluntary agreement and a settlement agreement on Financial Fair Play.
Milan were projected to have a turnover of €273m for the 2017-18 financial year, and it did reach €255m but that included player trading.
The business plan provided for €99m from broadcast rights - excluding UEFA - €23m from match day revenue, €61m from sponsorship and marketing and €90m from the Chinese market, later expanded to include the whole Asian market in the second plan presented to UEFA.
The plan was to reach €524m in the 2021-22 season, with 45 per cent of that coming from China.
That meant a compound annual growth rate of 21.7 per cent. By comparison, Juventus - seen as the gold standard off the pitch for Serie A clubs - have grown by an average of 12 per cent between 2011 and 2016.
UEFA’s skepticism over Fassone’s business plan proved to be well founded though, with only €606,000 in revenue from China for 2017-18, rather than the projected €90m.
Indeed, the Rossoneri’s financial situation would have been far worse had match day revenue not reached €35.3m, well ahead of the €23m projection.
Without player trading the increase in revenue was just €7.87m, and would actually have fallen without the increased support of the fans.
The first business plan presented to UEFA for a voluntary agreement was dismissed as unrealistic, but the governing body allowed Fassone and the board to submit a new one.
Calcio e Finanza states that the first plan projected €19m net income from China, and the second - which was also rejected - €8.8m.
In the final submission for a settlement agreement the figure had fallen to zero.
Milan had projected €225m in revenue from China by June 30 2022, which an income of €600,000 would suggest was entirely unrealistic.
That didn't come out of the blue either, as it was made clear even before the takeover that generating revenue in China is difficult for football clubs.
It’s believed Fassone is planing to sue Milan for his dismissal, though the new owners may well argue just cause.
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