"Despite the allure of Ronaldo, there are reservations..."
Feisty Chat with BVB: A Financial Rollercoaster
Football club Borussia Dortmund (BVB) is gunning for profitability by the 2023/24 season, taking a hit due to COVID-19 restrictions. CEO Hans-Joachim Watzke, recently speaking about the 2021/2022 annual report, stated, "We're aiming to pay a dividend again." Despite an improved operating result (EBITDA) of 80.8 million euros from 39 million, the club still recorded a loss of 35.1 million, contrasting with a loss of 72.8 million euros the previous year. The club's revenue climbed to 351.6 million euros from 334.2 million euros.
Pandemic restrictions dragged down the stadium occupancy rate to just 40%, with 60% of tickets left unsold. Revenue from TV marketing took a dive as well. Watzke, hesitant to forecast for the new business year after three consecutive years of losses, expressed hope that COVID-19 restrictions wouldn't be an ongoing issue.
Rumors swirled about world footballer Cristiano Ronaldo potentially joining Dortmund, but Watzke brushed them aside. Although he appreciates the Portuguese star, there's no contact or pending transfer.
The BVB share ticked up 2% at midday on Friday, defying a gloomy market climate and boasting a 21% increase over the past four weeks.
The Scoop:
The financial trials endured by BVB were orchestrated by COVID-19, especially during the 2020/2021 season. With mass gatherings banned, fan attendance slumped, causing significant revenue losses. Empty stadiums kept gnawing at club finances in subsequent seasons. The Signal Iduna Park, seating 81,000 fans, accounted for an estimated £65 million loss in matchday revenue during one COVID-affected season. The pandemic had a cascading impact on the football industry, starving clubs of recurring revenue, as illustrated by similar clubs like Barcelona[3]. Dortmund's sustainability measures, such as solar partnerships, are aimed at adapting to these pressures[4].
For the 2023/24 season, while specific financial results for Dortmund are yet to be disclosed, trailblazing signs of partial recovery can be discerned through:- UEFA competition prowess: Historically, Champions League appearances helped soften blows[1].- Commercial collaboration: Endeavors like solar energy partnerships may bolster long-term financial stability[4].- Normalization of matchday revenue: Likely, full stadium reopenings helped minimize the £65m losses[2].
Although Paris Saint-Germain still recorded substantial losses (€56m in 2023/24)[5], Dortmund's absence from similar loss reports hints at cost containment, although outright profitability remains elusive without solid figures.
- Borussia Dortmund, aiming for profitability by the 2023/24 season, is inherently linked to the COVID-19 pandemic, as the financial difficulties faced by the club were predominantly orchestrated during the 2020/2021 season.
- BVB's loss of £65 million in matchday revenue during one COVID-affected season can be attributed to the mass gatherings ban that led to a significant drop in fan attendance and subsequent revenue losses.
- The 2023/24 season presents trailblazing signs of partial recovery for Dortmund, with UEFA competition prowess, commercial collaborations, and the normalization of matchday revenue potentially bolstering long-term financial stability.
- Despite Paris Saint-Germain recording substantial losses in 2023/24, Dortmund's absence from similar loss reports suggests cost containment, albeit outright profitability remains elusive without solid figures.
- In European football leagues, the cascading impact of the pandemic is evident, as it starved clubs like Dortmund of recurring revenue, a situation similar to that experienced by clubs such as Barcelona.
