FC Schalke 04 release revenue numbers for first two quarters of 2021
FC Gelsenkirchen-Schalke 04 e.V. reported a total revenue of €106.7 million in the first two quarters of the 2021 fiscal year (€102.2 million in the first two quarters of 2020). Business operations were affected by the ongoing Covid-19 pandemic and the ensuing restrictions, as well as relegation from the Bundesliga. Particular attention was paid to mitigating the effects on total revenue through cost-cutting measures, reduced working hours, and the halting of development and investment projects.
Christina Rühl-Hamers, director of finance, personnel and legal matters: “The first two quarters of 2021 were massively influenced by the Covid-19 pandemic and the need to restructure our squad following relegation from the Bundesliga, as expected. Through various cost-cutting measures, we were able to mitigate the impact on our total revenue.” A reported shortfall of €21.0 million during the first two quarters of 2021 (€9.7 million in the first two quarters of 2020) is also the result of the profits from the sale of a starting spot in the eSports League of Legends European Championship (LEC) only being included in the reporting for the second half of the 2021 fiscal year.
Focus on short and mid-term reorientation
At the same time, the focus was on repositioning the club in the short and mid-term, in order to be prepared for the economic and sporting requirements of the 2. Bundesliga. “Since the turn of the year, our actions were largely influenced by the increasingly possible scenario of competing in the second division, and all the financial and economic consequences associated with that,” said Christina Rühl-Hamers. “This quick reorientation and the close cooperation between our sporting and finance departments have, in hindsight, proven to be effective and necessary decisions, in particular with an eye on the challenges of the summer transfer window and meeting the licensing requirements for 2020/21.”
This quick reorientation and the close cooperation between our sporting and finance departments have, in hindsight, proven to be effective and necessary decisions.
However, this was just the first step, said Rühl-Hamers. “The goal is to now continue to stabilise FC Schalke 04 over the coming months and to manage the effects of the pandemic and our relegation. The comprehensive restructuring of our squad, the capacity of the VELTINS-Arena increasing to over 56,000 seats and the funds received from the sale of seasons tickets were, and continue to be, important for the club.”
Due to the Covid-19 pandemic, FC Schalke 04 were able to record virtually no income from matchday operations, events (2020: €9.2 million), or catering (2020: €2.5 million) during the first half of 2021. Additionally, sponsorship income also decreased significantly (2021: €22.0 million / 2020: €28.7 million), particularly because the pandemic resulted in no revenue in the areas of hospitality and box seat marketing, while some marketing contracts were unable to be fulfilled. Merchandising income also decreased due to the pandemic and the poor sporting situation (2021: €3.1 million / 2020: €5.7 million). In contrast, income from media rights (2021: €48.3 million / 2020: €48.0 million) as well as other capital income (2021: €3.0 million / 2020: €3.2 million) remained relatively stable.
The revenue generated by first-team player transfers – notably those of Weston McKennie to Juventus and Suat Serdar to Hertha BSC – helped boost transfer revenues (2021: €30.1 million / 2020: €4.8 million).
A reduction in financial debts
In comparison to last year, the Royal Blues are expecting to record lower revenues in nearly all business areas due to the continued effects of the Covid-19 pandemic, as well as relegation to the 2. Bundesliga. On the other hand, FC Schalke 04 are expecting to record an increase in revenue from transfer payments. Overall, the club are predicting a slight decrease in revenues when compared to last year (€174.7 million), as well as a shortfall in the low eight-figure range in the 2021 fiscal year.
The liabilities incurred have risen slightly following the sale of the LEC spot as of 30th June, but, in contrast to last year, will decrease significantly by the end of the fiscal year on 31st December 2021. Despite the effects of the Covid-19 pandemic and relegation, financial debts decreased from €149 million in the last half-year to €143.8 million.
“Our focus, on the one hand, is on the continued financial consolidation of the club, something that has to go hand in hand with strategic development in all areas. Right now, we are looking carefully at the short and mid-term financial plan, especially with respect to licensing for the 2022/23 season, for which we will have to deal with the DFL’s stipulations. The situation in which Schalke 04 finds itself is a challenging one. Personally, I am completely confident in our goal of getting the club to a point of economic stability.”
Our interim report for 2021 is now available on schalke04.de.