OL predicts €50m Covid-19 impact on financial year

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By Paul Nicholson

May 15 – French Ligue 1 side Olympique Lyonnais has reported that it expects a €50 million impact on its revenue in the final April 1 to June 30 quarter as a result of no play due to the coronavirus pandemic.

The club said that this figure excluded any player transfer basis and assumed a 7th placed finish in the league, its position when Ligue 1 was declared over for the season by the LFP. OL has appealed to a Paris court for a suspension of the LFP’s decision and to look at options of reopening the season in August or declare it null and void. Without this happening OL will likely miss out on lucrative European club competition for the first time in 25 seasons.

OL said there was potentially the opportunity to recover €20.4 million in compensation via a government loan, but that it had taken measures to reduce operating expenses, including payroll by between €35-40 million.

The French government has stipulated there can be gatherings of no more than 5,000 people before September and OL said that it might be possible to schedule matches with that number of spectators from August 30.

That opportunity is crucial for OL’s future finances as it should enable the Coupe de la Ligue final against PSG to played (which if OL won would give access to the Europa league), OL’s second Champions League round of 16 match against Juventus (OL lead the tie 1-0), an end August start to the 2020/21 season, and for the women’s team a Champions League semi-final against Bayern and the semi-final of the Coupe de France.

The LFP has finalised a new 1.2 billion media rights deal for the 2020-24 period (a 60% increase on the previous agreement) with Mediapro, beIN and Free. OL said that cash released from that deal will boost finances, though the LFP still has to finalise the breakdown by club.

The Covid-19 impact on OL’s finances was announced as the club reported a record revenue high of €265.7 million for the first nine months of the financial year. That is a €41.9 million (19%) increase on the previous year and included an estimated -€9 million impact in April from the Covid-19 crisis.

Much of the increase was due to transfer business with Tanguy Ndombele being sold to Spurs for €47.6 million and Nabil Fekir to Real Betis for €19.8 million in the summer transfer window and Lucas Tousart going to Hertha Berlin for €21.1 million in the winter window.

Elsewhere OL reported a 24% increase in revenue to its Events business to €6.5 million, boosted by revenue from the 2019 Women’s World Cup semi-final and final matches.

Ticket revenue was up 1% €33.5 million but media revenue was down 9% to €99.5 million due to fewer home league matches and the current failure to complete the Champions League campaign.

It is that Champions League campaign and finding an opportunity to qualify for European competition next season that will dictate OL’s financial performance over the next 12 months.

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