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Does Gareth Bale Have A Bad Back?

BernabeuAccording to Carlos Mendoza, the President of the Association for Madrid’s Values, Real Madrid’s debt is a massive €541m, not the €90m that the clubs president Florentino Perez claims.

Mendoza was stopped from talking by Perez at the recent Madrid members meeting, but Perez could not stop him from talking to AS Sport. If you are a Real Madrid fan, some of Mendoza’s comments must scare the daylights out of you, especially the part about the club borrowing against future ticket sales and sponsorship income.

AS: You looked worried at the meeting…

My association (for Madrid’s Values, the Asociación por los Valores del Madridismo) have studied the accounts and the budget. We’ve got good people. Our treasurer is an auditor in one of Spain’s biggest companies and we’ve detected things where the President’s explanation isn’t in line with reality. There are things that worry us for the future.

Why did Florentino stop you speaking?

I was saying that the club’s debt is 541 million euros, which is the total of long-term and short-term debts. Florentino only recognises the net financial debt, that is what is owed just to the banks, which is around 90 million. But of course Madrid has debts with other parties other than the banks: with players, with clubs, with sporting institutions, with the government and public bodies, with suppliers… The total is 541 million euros, more than double the amount Florentino inherited from Lorenzo Sanz. And on top of this debt, he wants to rebuild the Bernabéu, which he says will cost of 400 million euros. Then he said he can’t finance it and he’ll have to come up with clever strategies.

How much debt can the club cope with?

The club’s turnover is very high. We’re the club with the highest income levels in the world, but we’re also number one in costs. The thing is, incomes have been increasing by an average of 12% a year for the past decade but in the last year they only went up 1%. And the costs are rising fast.

The income isn’t growing?

I would suppose it is because of the economic backdrop. And if things are uncertain, getting involved in the new Bernabéu project costing 400 million doesn’t seem very sensible. There’s something else too. The club have two new credit lines, but they’ve had to use the advertising income and the season ticket sales for the next three or four years as guarantees to the banks, because they don’t trust the club… That’s not me saying that, it’s from the club’s annual accounts.

Used as a guarantee?

They’ve been pawned basically. Just like when you go to the pawn shop, they give you money and you leave a guarantee, something real. If you don’t pay them back, they keep whatever it is you left. Here, if Madrid don’t pay back the money, the bank has the right to the income from the advertising income and the season ticket sales.

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