América-MG’s finances in 2021: to find investors in the SAF and consolidate in the elite, the accounts are balanced | sports business

One of the first clubs to set up SAF (Sociedad Anônima do Futebol) and accept the intention to sell part of its capital to investors, América-MG has not yet reached an agreement. Director Marcos Salum has said he will be selective in choosing a partner.

In its financial accounts, the association formalized that negotiations were underway with a U.S. fund, but there was no agreement. The talks ended last December. In February, they started with another international group.

Why look for such investments? Now, in the second season of the Brazilian Championship, the miners are looking for the most difficult thing for entities of this economic size: to settle in the elite.

And how much is needed? In this text, which is part of the annual series on the finances of Brazilian football, ge explains to the fans what is described in the latest economic accounts. They show a financial picture for 2021 and the challenges for 2022 and beyond.

+ Brazilian football finances in 2021: revenues rise again, but clubs still have debts and crises

+ Rodrigo Capelo’s column: How not to get into finances? The solution to decontextualized numbers is to ask questions

América-MG finances – Photo: Infoesporte

In general, América-MG has balanced accounts and has seen significant growth in recent years. It seems obvious that each club expands its income when it reaches the first level, but it was in the elite with the differences from other times.

In 2021, revenues reached BRL 102 million, the highest amount in the association’s history, and while the debt was at the same level as the previous year, it was BRL 108 million. The one-on-one relationship is healthy compared to the opponents.

It should be noted that the collection suffers from pandemic distortion. As Brasileirão ended in 2022 only in 2022, part of its revenue was deferred and recorded in the balance sheet for the following year. In other words, under normal circumstances, turnover would have been slightly higher in the previous year and slightly lower in the past.

The relationship between America-MG’s revenue and debt

Source: Financial Statements

América-MG is still a club that is dependent on broadcasting rights and awards, it is the rule of the football business in the world, with a few exceptions among the most popular.

This is the line that requires attention in the interpretation, as it counts in the 2021 revenue that corresponds to the 2020 Brasileirão. However, there was a significant increase compared to the one in Serie B, which is why stability at the first level is essential. .

The Brazilian Cup prizes are also counted in this area, as the money comes from the sale of tournament rights. In 2020, the club reached the finals and pocketed almost R $ 18 million. In 2021, the elimination in the third phase frustrated expectations.

América-MG’s turnover profile in 2021

Source: Financial Statements

Sponsorships and advertisements have multiplied several times and by 2021 reached R $ 14 million. In 2017, too, at the first level, the club raised R $ 9 million (adjusted to its current value through the IPCA). In other words, it was a real growth.

Among the income directly related to the fans – the box office, social activities and followers – the value recorded last year is also noteworthy. The club is in line with what it has gathered at the first level in other seasons, although the public at the stadium is still limited for most of the year.

The difficulty lies in the transfer of athletes. Despite being recognized for the quality of América-MG juvenile teams, as well as reputable players in the past, the revenue from this line is still very low and is only 2% of the total.

The assessment of the Americas-MG season in 2021 compares the budget between the budget (with the forecasts made by the board before the start of the year) and the balance sheet (with the results obtained during that period).

In the case of the club, the comparison is not perfect, as the published documents have slightly different criteria. For example, in the budget, the awards seem to be in line with the box office, and the balance sheet is aligned with the issue.

In the budget, the cost of the payroll goes to other expenses of the football department. On the balance sheet, there is only football pay, with no other games included. So another line to be careful is that it is imperfect as well.

BRL in millions Budget Done The difference
broadcasting rights 40 72 32
marketing and commercial 10 14 4
Ticket offices and stadium 18 4 -14
assistant member 10 9 -1
Player transfers 8 bi -6
In total 85 102 17
football payroll -63 -49 14
Financial result 0 -8 -8
net income 13 -5 -18

Among the revenue, it can be stated that the performance of the commercial area was even better than expected by the executive committee. It is also clear that player sales needed to generate more, as there was a difference of R $ 6 million between the budget and the amount collected effectively.

In terms of salary, América-MG has one of the lowest national elites. And this is a challenge for the future. As this is the indicator that has the highest correlation with performance, the better players receive higher salaries, the point at which the Mining Club needs to expand.

The economic result shows debt interest, among other aspects other than sports. Again, the comparison is broken because there was no forecast in the published budget.

The last line, from the net result, shows that the management intended to end with a surplus of R $ 13 million (profit) and end with a deficit of R $ 5 million (loss). There is no reason to despair.

Although América-MG’s debt remained at the same level as the previous year, the profile improved significantly. Especially when considering the payment period.

In 2021, the council managed to reduce its short-term obligations (payable in less than a year) to BRL 25 million, which is 28% of the total outstanding debt.

The lack of cash pressure for urgent payments is an ease that few clubs in Brazilian football have, even more so given the difficult state of the pandemic. América-MG did not reduce its debt, but made it easier to pay it in 2022.

América-MG’s debt profile by maturity

Source: Financial Statements

Part of that improvement was made through bank loans. The club acquired new loans, mostly from Banco Sicoob, and negotiated payment terms from 2023 onwards.

In the fiscal area, América-MG has the largest debt. And last year it was also renegotiated to cut costs over time and put less pressure on the ATM.

The balance sheet shows a reduction in the withholding tax (IRRF) obligations, all in the short term (payable in 2022), through extraordinary contributions to the government, almost entirely in the long term. (From 2023 onwards).

Being a club that invests little in the purchase of players ’federal and economic rights,“ in the others, ”in the table below, it’s almost zero. There are also suppliers and other companies that provide services to the association.

2021 by type of debt profile of América-MG

Source: Financial Statements

In view of the plan to sell part of the club business to investors, América-MG’s financial framework supports at least two conclusions.

First of all, there should be no reason to give up. The club is not broken, however, and its stability gives its managers time to negotiate as best they can – unlike opponents who sell part of their capital to avoid bankruptcy.

On the other hand, the inflow of money could accelerate the growth of the entity in recent years. For a club with controlled minutes, stadiums and debt, it is essentially possible to reverse the investment in the sale of part of the SAF to qualify for football.

Without joining, the trend is to stay close to América-MG Atlético-GO and Goiás, below Ceará and Fortaleza, which are clubs that have managed to compete at the top level, but still have the economic capacity to leave. in a constant struggle to stay there.

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