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Financial fair play: where does PSG stand?

2020-02-01T15:31:36.171Z


The club's accounts for the 2018-2019 season show a drop in its profits. The end of the contract with QTA last summer has notably


The 2018-2019 accounts of the PSG that we dissected confirm the shift made by the PSG to get out of its dependence on Qatar, with an increase of 91.1 million euros (M €) in its revenues by other channels (VIP boxes and lounges, TV rights, non-Qatari sponsors). PSG football posted a profit of € 26.4 million last season, down € 13.2 million from the previous season.

The Paris financial balance is currently being studied by the UEFA Club Financial Control Authority (ICFC). The latter goes through a magnifying glass between the months of October and February the accounts of clubs whose accounts stop in June (which is the case of PSG). The fall in profit could a priori worry about the decision of the authority, which subtracts from the Parisian accounts part of the amounts related to contracts with Qatari sponsors.

The “nation branding” with QTA which inflated the club's accounts by 145 M € is thus taken into account for an amount estimated at only 58 M €. Last year, PSG emerged victorious from the legal proceedings which opposed it to UEFA. The latter was considering a new discount on contracts which could have put PSG in irregularity with the rule which requires not to exceed an exceptional deficit of 30 M €.

Parisian leaders confident about UEFA

It is understood that the Supervisory Authority will include contracts in the same way this year, for the last time, while the contract with QTA ended last summer as it required. It should also be noted that it is not enough to subtract the UEFA discount from the net result to obtain the balance sheet presented by PSG to the controllers. Indeed, certain expenses related to infrastructure, the training center or the female team are not taken into account for the FPF.

For example, UEFA recently indicated that PSG had a total payroll of € 337m last season, which is € 37.6M less than the figure stated in the club's accounting document for the whole group. No signal from the body suggests for the moment a fear of a problem with UEFA for the current evaluation, while the Parisian leaders have always been very confident.

The possible contract extensions of Neymar and Mbappé will play a major role in the context of the FPF. LP / Arnaud Journois

If it is impossible to draw definitive conclusions on the room for maneuver of the PSG, we can on the other hand assess its developments. For the 2019-2020 fiscal year, which started on July 1 in Paris, must for the first time do without the windfall of the QTA contract at 145 M €, even if the local tourist office has become a classic sponsor for an annual amount 10 15 times lower. The full entry into force of the giant contracts with Nike and Accor which offer PSG a jersey estimated at € 140 million per year (compared to around € 50 million previously) are a first step. Just like the regular signing of new partnerships.

New player sales to lighten the club?

We think in particular of that with Rwanda, around 10 M € per year or that formalized this Saturday with Qatar Airways. The airline takes the place of Fly Emirates (Dubai), which has displayed on Paris jerseys for 14 years, and enters the category of premium partners (such as Renault, Deliveroo, Qatar National Bank, Orange, Nivea men…) estimated between 5 and 10 M € per year. Qatar Airways also joins the long list of sponsors with a direct link to the small Gulf State which owns the PSG. A club where it is estimated that these new signatures and those in progress will be enough to erase the "departure" of QTA.

To solve the financial fair play equation, the club sold players for € 109.5 million in 2018-2019, compared to € 161.7 million the previous year. Amounts which are reduced in book value according to the remaining contract duration at the time of the sale. Since July 1, PSG has already collected € 35.9 million (N'Soki, Trapp, Descamps, Nkunku, Zagre). At the same time, it increased its salary and transfer charges (smoothed over the duration of the contract) with the arrivals of Sarabia, Gueye, Diallo and Navas. As usual, PSG continues to show confidence in its economic development and financial fair play, highlighting the various studies that prove its attractiveness and the increase in its income.

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If we look beyond July 1, 2020, the end of contracts for Thiago Silva and Cavani will free up room for maneuver, which could quickly be swallowed up in the event of an extension by Neymar and / or Mbappé. The increase in French TV rights should also give tens of millions of euros of room for maneuver in Paris. Until then, the exercise of the option to buy Icardi (at Inter Milan) should cost PSG € 65 million. In this context, close sources expect new sales of players at the end of the season, a subject on which the club does not position itself.

Source: leparis

All sports articles on 2020-02-01

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