Juventus, why will the capital increase be made? And what is it for?

The board of directors, approving the 2022-23 accounts (-124 million), also defined the guidelines for a new recapitalization. An obligatory step, which is part of a plan with a view to 2027

Another 200 million. In total they will make 900 over 4 years. After the maneuvers at the end of 2019 (300 million) and at the end of 2021 (400), the Juventus board of directors has defined the guidelines for a new capital increase, which the shareholders’ meeting of 23 November is called to approve, together with the 2022-23 budget at a loss of 123.7 million (-239 in 2021-22). After the previous injections, designed to fuel European grandeur and to deal with the Covid emergency, this recapitalization became necessary due to the damage caused by the legal proceedings (Consob opened a new proceeding following the previous maneuvers) and by the investments wrong.

reasons

The penalty in Serie A and the exclusion from the cups had direct negative effects of 115 million (plus the 10 million fine from UEFA), 80% of which this season. Without the Champions League, the 2023-24 financial year risks closing with an even higher loss, despite massive cost-saving actions. And given that the net equity, as of 30 June 2023, had already fallen to 42 million and that the first quarter as of 30 September 2023 will close with a loss of more than a third of the share capital, the equity contribution was, in practice, forced . Not surprisingly, the CEO Maurizio Scanavino says: “The capital increase comes at a very important time because non-participation in the cups could put the club in difficulty, which could not have adequate resources for the future. In this way, however, we can plan with serenity and at the same time decisively the near future of Juventus.” No other club in Italy can boast a majority shareholder with the availability and will of Exor (profit of 2.2 billion in the half-yearly report). The safe led by the CEO John Elkann has already indicated his willingness to subscribe to his share (63.8%) and to advance the 128 million with payments towards a future capital increase. In the two previous capital increases, Exor had paid out 446 million but the remaining 254 had come from minority shareholders, a sign of the trust of fans, small investors and funds. And if this umpteenth recapitalization, as Scanavino explains, “is the confirmation of the commitment and the now centenary bond that the Agnelli family has with Juventus”, the main path remains budgetary discipline. The updated plan, expiring in 2027, has as its objectives the return to the sporting top, the visibility of the brand, the economic-financial balance and the “significant and structural” reduction of net financial debt, which as of 30 June 2023 was 340 million.

binomial

The project reiterated by the CEO of “combining sustainability and competitiveness” is not a simple matter. The return to the Champions League is fundamental for the accounts, however the “important resources” that Scanavino speaks of must be handled with care. On the market we will move in the wake of the last sessions: sustainable investments, opportunities to be seized and valorization of the talents of the first team, the Next Gen and on loan. The management of player trading by sporting director Giuntoli will be fundamental. With the Pogba variant. “I am very sorry on a human level – says Scanavino – we are waiting to know how the player and his management will decide to continue this path”. At least 10 million dance per season.

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