Sevilla ship slowly sinking

The €15m euro loss Sevilla announced at their AGM last Wednesday may have been the first time the club have ended up in the red in the past 10 years, but it should have come as no surprise.

Although it was the first loss during President Jose Maria Del Nido’s presidency, the club’s finances have been in a mess for a while. Before the figures were announced, the club had debts of around €85m, including €31m in outstanding payments to players and an unpaid tax bill of €14m.

Before the season started, the club announced they had trimmed their annual budget by a third from 2011-12 to 2012-13, from €90m to €60m, with Del Nido announcing “we have to face reality.”

On Wednesday Del Nido cited the club’s failure to qualify for European competition – missing out on the Champions League in 2010-11 and the Europa League in 2011-12 and 2012-13 – as the principal reason for the hole in the club’s finances.

There is no doubt this was a blow to the club’s pockets – just reaching the group stages of the Champions League would have netted them at least €7m, plus win bonuses of €800,000 per victory, while competing in the Europa League group stages would have meant at least €1m. But a bigger issue is the club’s failure in recent years to replicate their excellent record of acquiring talented players on the cheap – or for free, in the case of youth products Sergio Ramos and Jose Antonio Reyes – and making a huge profit on their sales.

Between 2004 and 2010, the club made total earnings of €143m on the sales of Reyes, Ramos, Julio Baptista, Dani Alves, Seydou Keita, Christian Poulsen, Sebastien Squillaci and Adriano. This steady income, coupled with the financial benefits of regular European football, allowed them to keep buying players and paying steady wages, and their regular participation in the Champions League made them an attractive destination for players.

Since 2010 the only notable sales have been Luis Fabiano, Didier Zokora, and Martin Caceres, bringing in less than €20m in total. The fall in income from transfers and a lack of European football has meant Sevilla have joined many clubs in La Liga in relying on TV income for the bulk of their revenue. The club may be in the top five earners in this area but the €31m they receive is not enough to cover their €62m wage bill on its own.

Del Nido explained the club would have to sell players to compensate for the €15m losses, but their current crop of players is far from as valuable as a few years ago, with Ivan Rakitic, Jesus Navas and Alvaro Negredo their only valuable assets remaining.

There is a lot of disgruntlement with Del Nido among Sevilla fans, amplified by his recent measures against the main ultra group ‘Los Biris’, and his shady past, which saw him receive a seven year prison sentence – which he is currently appealing – last year for embezzlement of public funds in Marbella as the lawyer of former mayors Jesus Gil and Julian Munoz.

But unlike Barcelona, Real Madrid, Athletic Bilbao and Osasuna, Sevilla’s members have no say in electing their president, and Del Nido’s popularity is safe with the people who count, the club’s shareholders, 97.7% of whom re-elected him on Wednesday.

Del Nido’s ties to Sevilla are strong. His father was vice-president during the 1970s and Del Nido joined the board in 1987 as vice secretary and his ten years as president has been one of the most successful periods in the club’s history, bringing with it two Copa del Reys and two UEFA Cups.

Although the good times now seem a distant memory, there seems to be a general resignation to the fact that Sevilla cannot compete with Barcelona and Madrid, and a sense that things could be a lot worse, as the club’s economic adviser Juan Luis Villanueva Ruiz-Mateos declared: “The losses are big, but we are in a much healthier financial state than a lot of clubs in Spain.”

Although just one point from their last three games is a worrying trend for Sevilla, the situation is by no means desperate. They are just three points off the Europa League spots, and have a realistic chance of achieving Del Nido’s aim of qualifying for European football. Unless things deteriorate rapidly, the President seems here to stay.