FC Bayern Forum

Florentino, Sept 2: "We earned 600 million revenues!!!!"
Real Madrid guy from accounting: "Sir, ehem, that's 600 million debt... Sorry"

Where is FFP now? Red Star Belgrado is cut out from European competition.. PSG, Man City and Real can continue without any problem pff.

Celta Vigo - Atletico Madrid highlights:

1. Atletico Madrid knows how to attack set pieces
2. Both Celta Vigo goals were special. The first one especially.

Ottomeister13 wrote:Where is FFP now? Red Star Belgrado is cut out from European competition.. PSG, Man City and Real can continue without any problem pff.

I guess it's the usual; "heavyweights must remain within the competition"-thing they have going.

Stop the hating, the reason why Real Madrid is not affected by FFP is, because they earn tons of money, they have a magnificent cashflow and are able to service their debt at all times. While their total debt increased, they still made a profit. How does that work? It's not all about Spanish 'miracle bookkeeping'. They probably pay off the transfer fees of this year's player transfers over several installments.

As long as they continue to earn more money every year, their debt really doesn't matter. It's only when the club's growth stalls or decreases, when debt becomes an issue. What people have to understand is that debt by itself is not a bad thing for a company. Bayern München chose not to utilize the potential of bank loans to increase the performance on the pitch. Yet we sold club shares and have to pay an annual dividend.

It's sustainability and the perception of 'safety' on the one hand versus investing everything for the ultimate success on the other. We also have to keep in mind that Real Madrid's aggressive strategy has been rewarded with record-breaking results every year, the club is growing and prosper. It's not like investing less money doesn't have its risks on the long-term.

Leading a club like Real Madrid or Bayern München with different club identities and long-term strategies is all about finding the right balance. Bayern decided to sell 24,9% of the club to investors, Real Madrid decided to take bank loans they can afford.

I don't see anything wrong with that.

I love how you talk so much about finances but when I told you less than a year ago that Dortmund will spend good money this summer you insisted that we don't have it.

If you dont see anything wrong with the fact they have 500 million+ debt and see nothing wrong with it, because in fact they are spending money they don't have, especially those sums and their debt is getting bigger and bigger. Then what's the freaking point of FFP? It's implemented to make the soccer bussiness a bit healthier transfer wise and stuff and to clear those debt's a lot.. not to improve them, there will be a time they have to pay it back and then Karma is the bitch.

I couldnt be proud on a club who has to loan money, just to be relevant at all to buy those expensive players to try and have succes. To sell certain shares is one thing, but to sell all so the club doesnt own itself anymore is a complete different thing.

Yeah it very fun to have idiots around who spent 1 billion plus on their teams.. Yippie kah yee...

Ottomeister13 wrote:If you dont see anything wrong with the fact they have 500 million+ debt and see nothing wrong with it, because in fact they are spending money they don't have, especially those sums and their debt is getting bigger and bigger. Then what's the freaking point of FFP? It's implemented to make the soccer bussiness a bit healthier transfer wise and stuff and to clear those debt's a lot.. not to improve them, there will be a time they have to pay it back and then Karma is the bitch.

I couldnt be proud on a club who has to loan money, just to be relevant at all to buy those expensive players to try and have succes. To sell certain shares is one thing, but to sell all so the club doesnt own itself anymore is a complete different thing.

Yeah it very fun to have idiots around who spent 1 billion plus on their teams.. Yippie kah yee...

Let me play devil's advocate for a second. You couldn't be proud of a club who's in debt, but you can be proud of a club, which sells its shares to stay competitive? One might argue, that what we're doing is harder to reverse than what Real Madrid is doing. Especially since the Spanish behemoth is such a hugely impressive business.

The point of FFP is to stop clubs from receiving money, which they did not earn themselves via Related Party Transactions from rich Oligarchs or Sheikhs. It's not in place to stop businesses from pursuing the path they deem most likely to be successful. It's a fact that Real Madrid is easily able to repay their debt, they have huge assets which by far exceed their debts and they worked very hard to get into the position in which they're currently in.

Borusse wrote:I love how you talk so much about finances but when I told you less than a year ago that Dortmund will spend good money this summer you insisted that we don't have it.

Yeah, because we knew at the time that Borussia Dortmund was going to be able to plan with an additional € 100M from external investors. That obviously doesn't make any difference.

I initially expected up to € 40M net investment which does not translate into 'insisting that Dortmund doesn't have the ability to spend'. It's correct that Borussia Dortmund's spending exceeded my expectations as well as those of observers and BVB's own fans, but we always knew that your club was healthy and I never disputed the fact. Furthermore it is important to assess spending not only over one transfer period, but many to properly assess a club's spending power.

Bazi wrote:

Ottomeister13 wrote:If you dont see anything wrong with the fact they have 500 million+ debt and see nothing wrong with it, because in fact they are spending money they don't have, especially those sums and their debt is getting bigger and bigger. Then what's the freaking point of FFP? It's implemented to make the soccer bussiness a bit healthier transfer wise and stuff and to clear those debt's a lot.. not to improve them, there will be a time they have to pay it back and then Karma is the bitch.

I couldnt be proud on a club who has to loan money, just to be relevant at all to buy those expensive players to try and have succes. To sell certain shares is one thing, but to sell all so the club doesnt own itself anymore is a complete different thing.

Yeah it very fun to have idiots around who spent 1 billion plus on their teams.. Yippie kah yee...

Let me play devil's advocate for a second. You couldn't be proud of a club who's in debt, but you can be proud of a club, which sells its shares to stay competitive? One might argue, that what we're doing is harder to reverse than what Real Madrid is doing. Especially since the Spanish behemoth is such a hugely impressive business.

The point of FFP is to stop clubs from receiving money, which they did not earn themselves via Related Party Transactions from rich Oligarchs or Sheikhs. It's not in place to stop businesses from pursuing the path they deem most likely to be successful. It's a fact that Real Madrid is easily able to repay their debt, they have huge assets which by far exceed their debts and they worked very hard to get into the position in which they're currently in..

Yeah with the former Spanish King Juan Carlos as RM fan it's not weird the IRS is not after them. Here in the Netherlands they shut down clubs completely by having debts less then 1 million euro... If a soccer club does it it's al okay, but if sole people do it they go to jail because they can't pay back. Especially in a country that is like bankrupt, it's just said that something like this is possible.

It's pure speculation and the timing of the events that Rodriguez' transfer is more than about football but also helped Perez' company land a big project in Colombia.

It's always been liked that though. RM getting a helping hand from the government and it won't change. Until those Spanish banks have money, and until EU keeps those banks aflota, it's not going to change. FFP won't change anything because it just bite the small fishes while changes it's rules for the big fishes (example, Man City and HGP requirement).

Only consolation the general football fan has is, despite everything, RM still hinging on it's successful history and Barcelona remains the more impressive club overall in Spain.

I'm not defending unfair advantages granted by the city of Madrid or the Spanish gouvernment. That shit should be resolved and the EU already distrubed another one of those deals between Real Madrid and the city of Madrid if I'm informed correctly. The only thing I'm arguing, is that making debt is not evil as long as a club like Real Madrid CF is easily able to service the repayment.

Yeah but still... Having all the succes in the world, while spending money that in fact you don't even have is just... Especially in a country that has like no money left.. Like Ramsej says, its unfair to other clubs who just can't get deals or money like that and in fact are no competition at all..

Bazi wrote:. . . they earn tons of money, they have a magnificent cashflow and are able to service their debt at all times.

False:

AS wrote:Por otro lado, en las cuentas que ahora presenta el Madrid (2013-14) el fondo de maniobra (la diferencia entre los derechos de cobro a menos de un año con respecto a las obligaciones de pago a un año vista) es negativo (-94 millones). La temporada anterior también lo era (-100). Hay clubes como Bayern o United en el que este fondo de maniobra es positivo.

That's Spanish for what you are entitled to receive (in a year) is 94 million less than what you indebted to pay in the same year.

While their total debt increased, they still made a profit. How does that work? It's not all about Spanish 'miracle bookkeeping'. They probably pay off the transfer fees of this year's player transfers over several installments.


Bookeeping follows the principles of general accounting rules and they dictate, from Alaska to the White Coral Reef, that investments (purchase of players) are amortized for the period of his contract. Rules for the timing of this application may vary depending on the asset (or haircut) you invested in. Problem is not the profit per se, but rather the need to sell crucial players to balance the books. One word of caution; CRUCIAL stands for financially optimal players, not sporting ones necessarily.

Madrid is in a position in which they need to sell players that were purchased at rock bottom prices and excel sporting wise in order to balance their books. This is totally different from the necessity to sell players which no longer made sense on the pitch; a.k.a. k.a.k.a.

Problem is when you sell the Kakas and the Coentraos and who knows what else, you go and incur in an actual loss right there: the difference of what you pay vs what you receive is actually recorded the moment he boards that plane in Barajas.

Every team needs to sell players to help out the cash flow but the problem is, Madrid needs to sell ONLY the successful ones (financially and sportingly) and that sounds rotten, not to mention the fact that you only have a handful of success stories to choose from.

As long as they continue to earn more money every year, their debt really doesn't matter. It's only when the club's growth stalls or decreases, when debt becomes an issue. What people have to understand is that debt by itself is not a bad thing for a company. Bayern München chose not to utilize the potential of bank loans to increase the performance on the pitch. Yet we sold club shares and have to pay an annual dividend.


False. "Have to" and "Choose to" are two different issues. A company/team may opt to share dividends depending on your incorporation (type of company). Bayern paying dividends on a $2MM euro profit IS A WHOLE DIFFERENT matter than paying a monthly accrued interest on $200+ million owed to the banks. Dude, Uli wasn't born yesterday.

It's sustainability and the perception of 'safety' on the one hand versus investing everything for the ultimate success on the other. We also have to keep in mind that Real Madrid's aggressive strategy has been rewarded with record-breaking results every year, the club is growing and prosper. It's not like investing less money doesn't have its risks on the long-term.


That is what in Spanish we call Bull. Real Madrid is, again, in a position in which they need to NOT win trophies such as the CL in order NOT to be in a position to finance their books without selling your soul or your teammates. Such is the case that Madrid actually has a lower EBIDTA (dammit I always get that wrong) on a CL year because bonuses offered to players at a time of signing (aggregate contacts that is) are higher that the actual prize itself. In 2011-2012, 12-13, 13-14 Madrid recorded EBIDTAs (earnings before taxes) of 134, 132 and 125 respectively, a sequentially lower number based on bonuses overbalancing earnings. Had they not win the CL, Madrid would have recorded an actual EBIDTA of 145 million. Now that is f*cking wrong in any sense.

Now we may get into other aspects such as people (30 in total) earning a thousand bucks per day, short term debt now beign higher than long term ones, or gross profit rise of a mere 5% vs 11% rise in debt on a CL winning year but I would let you decide for yourself if making 550 million profit (and ignoring the actual stuff behind) does make sense indeed.

Then again, they DID sell Altintop for a profit. That in itself earned them my forgiveness.