€255.9 million reasons why Berlusconi is not stingy

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GUEST ARTICLE on Milan’s finances from Mikael.

We are about to go into the so called “Silly Season” where the media circus regarding player transfers are about to start. On a daily basis from now to the 1st of September we are going to hear transfer rumors. Most of them are not even true and pure fiction. Nonetheless we are going to read them, hear them and even discuss the usefulness to each individual player. This is great, this is what football is all about. Nothing can spark a debate as football news.

However, one of the recurring outbursts I read every summer (and even winter) is the phrase: “Berlusconi must sell because he is not willing to spend”. This seems to have been a legitimate statement when talking about Milan’s transfer campaign. This is, though, a complete false statement which the financial statements clearly show.

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Montolivo undergoes Milan medical

As stated in my recent article (Milan’s Financial State) the club has had a combined loss of 186.1 million euro from 2006 to 2010. Last month the club announced a 67.3 million euro loss for 2011. If you then look at the last 5 years the combined loss from 2007 to 2011 is a stunning 255.9 million euro which the following table illustrates:

The 255.9 million euro is an average 51.2 a year which Berlusconi has covered every single time. As Galliani stated when the latest financial report was released:

The losses have been completely covered by Fininvest, even though we’re number one in terms of commercial rights. I thank the president for his passion… Without Fininvest, we couldn’t be an example of sporting excellence the world over.”

The truth is that Berlusconi has invested heavily in the club the last five years. The truth is also that because the club has had so great wage expenses that the money was not used in the transfer market but instead used to cover the losses instead of investing. This is one the points I stated in the article I referred to above. The wages the club has paid was too much for the business to healthy.

It is not because Milan does not spend any money. But even with the huge financial support from the Berlusconi family it is impossible for Milan to compete with clubs like United, Barca, Real and Bayern as these clubs generate so much more revenue than our beloved club that the extra money from Berlusconi is not enough to close the gap.

I really look forward to the transfer window and it seems that Milan have already signed both Montolivo and Traoré. I love the rumors, gossip and the general circus. My only wish is for people to stop blaming Berlusconi for not spending any money as the accounts clearly show that there are 255.9 million reasons it is a groundless accusation. Have a great transfer window.

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milanfreak

yeahyeah.thats more reason he should atleast sell 20 – 40 % of his shares

Jo Milano

…and whose 2 blame? There’s a saying that goes: “being stingy is expensive” if he had spent that amount on good players we wudve had a jam packed stadium all year round & wudv had more franchise…. shirt sales ect. Like Madrid does. HE IS STINGY!!!!

Ryan

Blame Italy….all clubs here are like this

There aint enough revenue anymore

wat can we do? unless we win year after year we cant spend always :/

D-Bo

We can own our stadiums. I think that is the key. That is a huge amount of revenue that does not go to the clubs.

If that happens, things can change.

Kwabena Adu

The problem is there are too many fringe players in Milan than any other big club in Europe,If the player is not fitting in the team it’s better he leaves the club,Look at the LB problems,Galliani keeps on experimenting with players he knows can not cover the position Taiwo,Didac,Masbah,Emmanuelson,and Antonini are not suitable yet he brought them into the team,Buy on quality player and get a back up and the problem is solved. The number of players in the team is too much,30% have to be offloaded Emmanuelson,Masbah,Antonini,Bonera,Pato,Robinho have to leave *Pato is too fragile,Robinho can’t score,Masbah and Antonini are… Read more »

Zso

A question then… Whom to blame for the losses?!? Whom to blame for the empty stadium?
If ManU have more to invest then management should work on the solution for instance building own stadium so Berlusconi can have his dream and a sradium could be called Berlusconi…..
San Siro has 80.000 capacity but barely half full… work on that!!!!

ladon

You should also note that since the past three years, Milan has not really been able to generate income from player sales. How many of our current squad player can we boast of selling at 10m. We got taiwo for notting and how much is he worth. Many top european teams also generate funds from player sale. How much can we generate from the sale of Mesbah, Yepes, Traore. peanut or notting. Some club sides like porto make lots of money on player sales but you can do that when you go after out of contract players.

danrondo

the fault is the clubs error.why do we bring in mediocres like mesbah?we were the oldest team until now, we refused to have integrated our most talented youth players instead we kept playing with our senators.i think is the boards fault squarely.there are other clubs to learn from and am so afraid whether this will change soonest…good article as always.

TWF

so, stop dreaming to sign world class players please. managing milan is not as simple as playing Championship Manager game. trust me, like it or not, milan will only sign big names only if milan sell either ibra, pato or thiago silva.

Umar yunusa pato

Sorry milan

marc

our wages are the problem…really when gattuso ambrossini nesta flamini seedorf and van bommel are earning more than 100 000 euros a week thats a waste of money…all of them are at best average players…milan shpuld learn to seel players when they reach their 30s…we should have sold gattuso last year when anji wanted him…pirlo shouldve been sold to chelsea who are not our rivals…now ibra has to be sold and replaced with tevez…it is all about continity

sherbini

Berlusconi must leave! Sometimes change ir necessary ! Berlusconi stay= no more success !

sammy

We are broke as a doornail. We need to feed Milan with scraps to survive. What an embarrassment. This club is going down hill if this keeps repeating it self. And what are Ambro and Seedorf still doing in Milan. They don’t even play. This management is seriously damaged.

greg

Surely he and Galliani are to blame as WHY generate much less income than Bayern, Real, Barca and Man Utd when they were making more than them 10 years ago (barring Man Utd)

dozie

Let him sell the club

Ayybz

They may well be $255.9 million reasons why Berlusconi isnt stingy, but there is ONE outstanding reason why he is…they say he pays off millions to ensure that milans losses are covered come ffp…but the main reasons these losses have occured are largely due to the club not being able to generate enough match day revenue(in comparison to barca manu etc…) and also stupid amounts paid on player salaries. So my question is? why cant he build a stadium that will cost alot but will ensure financial stability!

Abys

Abyzz bro ur right ! thats the only solution

milanfan

because of the county laws. the county generates a lot of money from San Siro (at Milan’s expense), so they’re doing everything they can to make sure that the money doesn’t stop flowing to them. If the county wasn’t so greedy, Milan would’ve had it’s own stadium years ago.

Ayybz

well then theres my point!! Wasnt he the president of italy???! cudnt he have changed it? surely the revenue made from san siro isnt the only way of keeping the ‘Fashion’ city stable…isnt he a billionaire? cudnt he aid the city by finding other sources of revenue while allowing milan to own their own stadium…is that too hard to ask as a milan fan!

Reza

Our problem isnt just one .stadium is just one of them.our sponsors pay less to us than others .adidas pay half of what they pay to madrid to us.and fly emirat too

Ayybz

you dont seem to get it do you? it all comes back to the initial point which is owning a stadium…this will allow us to compete with the top 5 and increase our total revenue by a huge margin, perhaps 3rd or 4th in terms of ranking, and we would be able to sgin players of the highest level…than comes the sponsors and commercial revenue(which somehow milan seem to be good at considering they havent won much in the past 3-4yrs)…obv the sponsors and commercial revene are dependant on the success that the club achieve…how are we supposed to achieve… Read more »

Need A #10

i think by now everyone knows the problem with milan is the stadium even though milan are in the top 7 in the world without owning a stadium imagine where we would be with our own stadium.. and a little of bit of the financial problem is down to our sponsors aswell to be represented by a major club the sponsors have to dig deep in their pockets and that’s what berlu and galliani need to acknowledge so they can demand more money of fly emirates and adidas. if we just get that sorted then we are financially competitive with… Read more »

Nyemasem

Our mgt is visionless and aimless. How can u generate money when players seedorf,yepes,bonera,antonini,ambrosini,mesbah,traore in ur team. Nobody will buy their jerseys and nobody will buy ticket to watch them play. Ibra is leaving simply b’cos he has realised that mgt is not serious. If bellu can’t spend the he shd sell the team people who are ready to spend to bring back the glory of milan b’cos with these mediocre we will win nothing.

jb

Guess the players they are linking us with? Rigoni, Forlan, and one old dutch defender that plays in german league. Ibra is 100% right to leave milan because he was deceived by galiani that a winning project was ongoing to bring top players to milan, the boy feels deceived and disappointed afetr seeing d mediocre players coming into the club despite giving his best and beating his goal record. how could you resist a club offering you £300,000.00 per week with world class project at hand for a club that pays 190k full of mediocre? would u wait if u… Read more »

Vie

However, I LOVE MILAN

Kurfi

Fans u were all saying what is suppose to be put in place before the commencement of the 2012/2013 season. But, do u really believe those guys are ready to take ur advices, or even feel what u were really feeling? I guess it, NO! WHY? Simply becouse mgt of milan had already got wat they want with milan, milan elavated their status in the eyez of the world footballers fans. The final decision abt the status of milan in the world of football is in our hand, and we would be sharing it still via this blog.

Gallianineedstospend

I heard a report that Malaga are after both Flamini and Robinho. I thin we can get a good 25 million of this deal.