#ASRoma 2018/19 accounts cover a season that the owner James Pallotta harshly described as “a complete disaster”. They fell from 3rd to 6th in Serie A and exited the Champions League at the last 16 (compared to the semi-finals in 2017/18). Some thoughts in the following thread.
#ASRoma loss before tax improved from €18m to €15m, despite revenue falling €17m (7%) from €253m to €236m & €63m cost growth. Offset by profit on player sales rising €75m to €129m & other player management income up €11m to €15m. Loss after tax down from €25m to €24m. 
#ASRoma revenue fell €17m (7%) to €236m, mainly due to less progress in Champions League: TV down €22m (13%) to €145m, match day down €5m (14%) to €34m. However, commercial was up €10m (21%) to €55m. Including player trading, revenue up €61m (19%) from €320m to €381m.
Following investment in the squad, #ASRoma wage bill climbed €25m (16%) from €159m to €184m and player amortisation increased by €27m (47%) from €56m to €83m. Other expenses were also up by €9m (11%) to €95m, while net interest payable rose €3m (14%) to a hefty €28m.
#ASRoma €15m loss before tax is not great, but is by no means the worst in Italy, as seen by Milan’s huge €143m loss, followed by Inter €40m & Juve €27m. Just over half the clubs in Serie A lose money. The most profitable are Atalanta €35m, Sampdoria €19m & Sassuolo €13m.
The situation is much the same after tax with the largest losses reported by Italy’s traditional “big four”: Milan £146m, Inter €48m, Juventus €40m & #ASRoma €24m. Highest profits were made by Atalanta €24m, Sampdoria €12m & Sassuolo €8m. Napoli had a €6m loss in 2017/18.
The last time that #ASRoma reported a profit before tax was back in 2009 – and that was just €3m. Since then, they have suffered losses 10 years in a row, adding up to a hefty €286m. In fairness, the losses have fallen for the last two seasons.
Profit on player sales is increasingly important for #ASRoma, averaging €93m a year over last three years. Excluding this activity, 2018/19 loss would have been €144m. This season the only notable sales to date are El Shaaraway and Gerson, though January window still to come.
#ASRoma EBITDA (Earnings Before Interest, Tax, Depreciation & Amortisation), considered a proxy for cash operating profit, as it excludes once-off items like player sales and exceptional items, fell from €12m in 2018 to minus €29m, though not as bad as £(51)m two years ago.
#ASRoma EBITDA of €(29)m is the second worst in Serie A, only behind Milan’s frightening £(62)m. In stark contrast, Inter and Juventus lead the way, generating a healthy €78m and €36m respectively.
#ASRoma revenue growth highlights the importance of qualifying for Europe, particularly the Champions League. The 2018/19 revenue of €236m was greatly influenced by €66m from Europe’s leading tournament (TV €58m + match day €8m), though not as much as prior year’s €98m.
Despite the decrease in 2018/19, #ASRoma €236m revenue remains the third highest in Italy, but it is now less than half of Juventus’ €495m and a substantial €140m behind Inter €373m. Roma’s revenue mix: broadcasting 61%, commercial 23%, match day 14% and player loans 1%.
In the last 3 years, #ASRoma have only grown revenue by €15m (7%), while Inter (up €194m) and Juventus (up €123m) have powered ahead. In the same period, the giallorossi have also been outpaced by Atalanta, Napoli and Lazio. Only Milan have a lower rate of growth.
Based on 2017/18 revenue, #ASRoma were 15th in the Deloitte Money League, just ahead of Schalke 04. They should remain in the Top 20 this season, thanks to the Champions League revenue, but it is worth noting that they had been as high as 9th in 2007/08.
#ASRoma broadcasting income fell €22m (13%) from €167m to €145m, mainly due to €26m decrease in UEFA prize money from €84m to €58m, partly offset by €4m increase in domestic TV from €83m to €87m. 2nd highest in Italy, only below Juventus €207m, but ahead of Inter €139m
In 2018/19 #ASRoma received around €78m TV money from Serie A: 50% equal share; 30% performance (15% last season, 10% last 5 years, 5% historical) and 20% supporters. Also included Roma library €4m and Tim Cup €1m. New deal increased equal share from 40% to 50%.
Based on my estimate, #ASRoma earned €55m from the Champions League after going out in the last 16, much lower than prior season’s €84m when they reached the semi-final (2nd highest UEFA distribution that year). Other Italian clubs: Juventus €91m, Napoli €47m and Inter €46m.
Champions League revenue increased by 54% in 18/19. However, there is a new UEFA coefficient payment (based on performances over 10 years), where #ASRoma are only ranked 22nd of clubs competing this season (worth €12m). Benefits clubs like 6th ranked Juventus, guaranteed €30m.
#ASRoma have earned an impressive €282m from Europe in the last 5 seasons, only surpassed in Italy by Juventus’ €447m, but comfortably ahead of Napoli €185m, Inter €67m and Lazio €59m. Will receive lower money in 2019/20, due to only qualifying for Europa League.
#ASRoma match day income fell €5m (14%) from €39m to €34m, split domestic €26m (up €1m) & Europe €8m (down €6m). This was 4th highest in Italy, around half Juventus €71m. Note that club accounts include UEFA prize money here, but I have reclassified to broadcasting.
#ASRoma average attendance rose from 37,450 to 38,622, the 4th highest in Italy behind Inter, Milan & Juventus. After many delays the mayor of Rome has approved the new stadium. Pallotta: “If we want to consistently compete with the largest teams in Europe, we need the stadium.”
#ASRoma commercial income increased €10m (21%) to €55m, which means it has grown by €21m (60%) in just 2 years. However, still less than a third of Juventus €187m and Inter €183m, and also below Milan €76m. Growth due to sponsorship, which doubled from €12m to €24m.
#ASRoma shirt sponsor Qatar Airways will pay €11m a year until 2021, while Hyundai back-of-shirt deal is worth €3m a year. Betway €4.5m training kit deal has to stop due to anti-gambling rule. Nike kit deal €6m. Long way behind Juventus €93m: Jeep €42m + Adidas €51m.
#ASRoma player loans income up €1m to €3m. Leading the way in Italy are Juventus €31m (mainly Higuain €18m & Favalli €5m) and Atalanta €13m. Roma boosted by other player management, which rose €11m from €4m to €15m, mainly performance bonuses from previous player sales.
#ASRoma wage bill increased by €26m (16%) to €184m, due to additions to the squad. As a result of this growth, the wages to turnover ratio shot up from 63% to 78%. Last year benefited from the additional money from the Champions League run.
#ASRoma wages have grown by €29m (19%) in the last 3 years. This is around the same level of growth as most leading Italian clubs, but they have all been significantly outpaced by Juventus (up €106m) and Inter (up €68m).
#ASRoma now have the 4th highest wage bill in Italy with €184m, though they are within striking distance of Milan €185m and Inter €193m. However, they are all trailing far behind Juventus €328m. On the other hand, well above Napoli €118m (2017/18 figure) and Lazio €86m.
Following the increase to 78%, #ASRoma wages to turnover ratio is among the highest (worst) in Italy, though not quite as bad as Milan 81%. Much higher than Juventus 66%, Napoli 64% and Inter 51%. Also above UEFA’s recommended upper limit of 70%.
#ASRoma player amortisation, the annual cost of writing-off transfer fees, surged €27m (47%) from €56m to €83m, which means that this expense has tripled in five years (from €28m in 2014).
As a result, #ASRoma player amortisation of €83m is the 3rd highest in Italy, around the same level as Inter €85m and Milan €80m, but a long way below big-spending Juventus €149m.
#ASRoma have significantly increased gross transfer spend, averaging €109m in the last three years, but their average sales have increased even more to €134m, which means that they have had average annual net sales of €25m over this period,
In fact, over the last 4 seasons, #ASRoma have the lowest net spend (or, more accurately, highest net sales of €74m) in Serie A. In stark comparison, the four biggest spenders over this period are: Milan €327m, Inter €173m, Juventus €153m and Napoli €94m.
It’s a different story in terms of gross spend with #ASRoma €328m being the 4th highest in Italy, though around half of Juventus €609m. Also behind Milan €482m and Inter €382m. 2019/20 purchases include Spinazzola €30m, Lopez €24m, Cristante €21m and Diawara €21m.
#ASRoma net financial debt rose slightly from €219m to €221m, as gross debt fell from €266m to €255m, with cash also down from €48m to €35m. Debt largely €204m for loan agreement with Goldman Sachs and Unicredit, €29m from holding company and €22m overdraft.
#ASRoma gross debt of €255m is the third highest in Italy, behind Juventus €473m (partly driven by new stadium) and Inter €436m (another Goldman Sachs financing). Roma have announced the issue of a €275m bond in a move to help restructure debt repayments.
#ASRoma net interest payable was up €3.4m (14%) to €28m, the 2nd highest in Italy, only surpassed by Inter €29m. Interest rate is Euribor 3 months (minimum 0.75%) plus 6.25%. This annual payment is a big competitive burden. Bond aims to reduce interest rate to 4-5%.
In addition, #ASRoma owe €164m in transfer fees, €12m lower than prior season. This is the second highest in Italy, only behind Juventus €221m. Other clubs in turn owe Roma €77m, so the net balance is €87m, which is a sizeable rise from €18m just two years ago.
#ASRoma have been very reliant on increases in capital from their owners, including €70m in 2016/17. In addition, shareholders approved a further €150m increase in the October 2019 AGM, which would add up to €350m in nine years.
For the time being #ASRoma are no longer under a FFP review after being released from its settlement agreement by UEFA. They had been fined €6m by after failing to meet the maximum €30m deficit for 17/18 monitoring period (covering 2015-17) after allowable deductions.
Pallotta noted, “FFP is a reality for us and it has dictated many of our actions.” It is therefore problematic that #ASRoma failed to qualify for the 2019/20 Champions League, as the Europa League is far less lucrative. Long-term the new stadium is a must for a sustainable model.
