Guangzhou Evergrande FC shows CNY630m deficit for the first half of 2018

Guangzhou Evergrande FC have published their interim report for the first half of 2018. The report shows that the club recorded a CNY630m deficit for the first half of 2018, with CNY260m in revenue. 

The revenue increased by 15.38% compared to the first half of 2017 and the deficit was actually smaller than the first half of 2017. 

CNY236m of the revenue came from advertising while ticketing revenue was only CNY19m. The report also shows that most of the revenue came from businesses with affiliated companies. For instance, advertising revenue from affiliated companies was CNY189m, revenue gained from the sales of products and services to affiliated companies was CNY21.37m, while revenue from selling tickets and fan merchandise to affiliated companies was CNY5.856m. 

The total operational costs of the CSL club was CNY903m. The main reason for this deficit can be attributed to the high salaries and transfer costs of players and coaches. 

To make up for their cash flow, the football club borrowed CNY780m from Evergrande Group according to the report. Last year, they also borrowed CNY190m and CNY163m from Evergrande Tourism and Evergrande Group respectively. 

Current total assets of the club is CNY1.095bn, a decrease of 2.21%. The total deficit of the club is CNY2.104bn (an increase of 40.33%). The net assets of the club is minus CNY1.009bn. 

Source: Tencent 

Proofread by Raymond Fitzpatrick