Economist analyzes Corinthians’ debt under Duilio’s management and points out what could have been better

Economist Cesar Grafietti analyzed Duilio Monteiro Alves’ management at Corinthians, between 2021 and 2023. One of the former Corinthian president’s main objectives was to control the debt, which was close to R$1 billion when he took over, a fact highlighted by management consultant in sport as a challenge despite the increase in revenue in the same period.

“It’s very difficult to manage a club with 1 billion in debt, straight away you have a cost that starts at 100 million in interest every year. No matter how much you see an increase in revenue from 500 million to 600 million, this difference already goes towards paying interest. A sheet that is half the sheet of your main competitors, you bet more, you start to delay something else, so you enter the vicious cycle because if you win, you push one debt there, another one here. Maintaining the debt was what could be done”, said Cesar Grafietti in an exclusive interview with My Timano, in the frame Chat with Vessoniat the YouTube – Check out the full video below.

As shown in the 2023 financial statement carried out by RSM Global, a company that analyzed Corinthians’ finances, the debt at the end of Duilio’s management fell to R$885.9 million. Despite the reduction, Cesar Grafietti believes that the old board could spend less and maintain sporting performance.

“Maybe we could do better? It did! If we analyze financial performance with sporting performance, the club only reached one final of the Copa do Brasil, couldn’t it have spent a little less to have the same performance? Maybe if I had spent 15% or 20% less more efficiently and used the difference to avoid falling behind on liabilities, labor charges, income tax and everything else. Perhaps it would perform better with 200 million or 300 million less debt in 2023”, pointed out the economist, who also stated that the significant reduction in debt would make the deadline for other financial issues at Corinthians more flexible.

“This makes a difference in the market’s recognition of what is being done, this transparency that is lacking between the club, fans and the market is what is needed for everyone to support the moment in which you are taking some performance risk and are able to reduce the debt. If you manage to reduce 100 million per year, the creditor also starts to be more flexible with the deadline because they see that you are paying debt”, he concluded.

It is worth noting that Corinthians’ debt under the Duilio Monteiro Alves administration was accounted for separately from the club’s outstanding debts with Caixa Econômica Federal for Neo Química Arena, which is around R$700 million. Now under the new management, everything is going into the same account, so the debt is close to reaching the R$2 billion mark.

The 2023 financial statement will still be voted on by the Corinthians Deliberative Council next Monday.