Learning Management for Active Players from the 18th Term Financial Statements of AC Nagano Parceiro

Starting this month, I have decided to launch a one-month limited closed community for active soccer players as a pilot project.

Focusing on things 'outside of soccer' while still active, and building a foundation to live life on one's own terms after retirement. With this theme, I am experimenting with dialogue and knowledge sharing among trusted peers.

The theme for the first call is 'How to Read Financial Statements'.

You might think, 'Financial statements for soccer players?', but this is actually one of the skills that is essentially useful in the world of business and investment.

The ability to read numbers leads to...

• the ability to see where money is being spent

• where there is room for growth

• what the 'place' you are currently in is like

and other such insights.

In this article, as a preparatory piece, I would like to roughly organize how to read financial statements using the management information of the professional soccer club AC Nagano Parceiro as a subject.

Latest Financial Information for AC Nagano Parceiro (18th Term / 2024)

Nagano Parceiro's operating company, 'Nagano Parceiro Athletic Club,' reported a net loss of 120.05 million yen in its 18th term financial results from January 1 to December 31, 2024, marking its third consecutive year of losses (and the largest deficit since incorporation). This resulted in.

In terms of the club's competitive performance, the background includes a difficult season with an 18th place finish in the 2024 J3 League and a 13-game winless streak, which clearly reflects the challenges on the revenue side.

However, insolvency has been avoided, and the club is not in danger of ceasing operations.

At the shareholders' meeting, the club president expressed regret, stating that their projections were 'too optimistic,' and revealed a policy to make management stabilization the top priority moving forward.

By looking at these actual club management figures, one cultivates the perspective to interpret 'what the numbers represent' and 'what factors lie behind them.'

How to 'read' financial statements begins with understanding the terminology.

The financial information above was found via a Google search. To properly interpret this information, it is necessary to 'confirm any logical leaps that you cannot understand' and 'carefully understand the meaning of each term one by one'. Reading financial statements is basically a repetition of this. The key is to understand it 'to the level where you can explain it to others in your own words'.

For example, as I will explain in the article later, I did not understand 'insolvency has been avoided, and the club is in danger of ceasing operations'.

What is written above is “If you fall into a state of insolvency, the club faces a crisis of survival.” What does that mean? You have to look into that yourself.

When you are a beginner, it feels like looking up terms like “financial results,” “net loss,” and “deficit” one by one.

What is insolvency?

Before that, as a premise, regarding insolvency. Insolvency is a state where a company or organization has more liabilities than assets. Simply put, it is a state where “you have more debt than what you own.”

If this state continues, it becomes difficult to obtain support from external sources such as banks or sponsors, and the operation itself may become unsustainable.

For example, a friend with an annual income of about 3 million yen who has 10 million yen in debt, and even if they sell their only asset, a car, it only amounts to 2 million yen, so they cannot pay off the debt immediately. That person is in a state of insolvency.

What happens to a club when it becomes insolvent?

If insolvency is prolonged,

• delays or cuts in player and staff salaries

• reduction of the reinforcement budget

• sponsor withdrawal

• club dissolution or withdrawal from the league

could lead to situations such as these. In other words,
it is “a problem that cannot be dismissed by the feeling” that “it will be fine even if the numbers are in the red.”

Here, regarding the aforementioned “reason why insolvency leads to a crisis of club survival.”

Regarding the J.League Club Licensing System and insolvency

Overview of the Club Licensing System

The J.League Club Licensing System is established to maintain the competitive level and facility standards of clubs, and to ensure management stability and financial soundness.

There are three types of licenses: “J1,” “J2,” and “J3,” and to play in each category, it is necessary to obtain the corresponding license. The license review consists of criteria spanning 5 fields and 57 items (Grade A, B, and C), and if even one Grade A item is not met, the license will not be issued.

For J1 and J2, an independent third-party organization conducts the review, and for J3, the J.League Board of Directors makes the judgment.

The relationship between insolvency and licensing

In principle, a license will not be granted if there is a capital deficit, which is a state where liabilities exceed assets. This is a requirement directly linked to the club's survival.

However, due to the impact of COVID-19, special measures have been applied since fiscal year 2020, providing a certain grace period. From fiscal year 2025, these special measures are expected to be abolished, and the original penalties for capital deficits or three consecutive years of losses will resume. For Nagano Parceiro, this means without the special measures, they would fall under the category of three consecutive years of losses, meaning a risk of license revocation and club survival.

Future Risks and Responses

From fiscal year 2025, it is highly likely that licenses will not be granted to clubs that have not resolved their capital deficits, and license suspension due to three consecutive years of losses will also become a realistic risk. Clubs must aim for a sound management structure through measures such as achieving profitability or increasing capital.

What is the situation with Nagano Parceiro?

As mentioned earlier, in its 18th term financial results from January 1 to December 31, 2024, Nagano Parceiro recorded a net loss of 120.05 million yen, marking three consecutive years of losses (and the largest deficit since incorporation), but a capital deficit has been avoided. Also, because special measures are currently in place, the club is not in immediate danger of collapse.

In other words, they have spent more than they earned for three years in a row, but they are somehow managing to stay in the black overall by dipping into past savings, and because of the special measures, they are in a precarious situation where they are just barely getting by.

Who holds the key to club management?

The fate of the club lies with the management team, especially the **CEO (President)**. No matter how passionate the staff on the ground may be, the direction and survival of the club are determined by the management's steering.

Ultimately, both companies and clubs change significantly depending on who is running them. When actually investing, I also check what kind of person the president of the company is and what their background is if there are interview articles or videos available. It is super important.

And since it seems the president of Nagano Parceiro has changed at this timing, I will touch upon that.

New President Appointed in April 2025

At AC Nagano Parceiro, Mr. Yasuhiro Shibuya was appointed as the new president effective April 1, 2025.

Mr. Shibuya has set a goal for the club to exceed an average attendance of 5,000 per match this season, and has made it clear that he intends to work with all staff to brainstorm and tackle customer acquisition.

Mr. Shibuya has built his career in corporate sales for 37 years, and has been active in Nagano for the past four years. He has also studied sports management at the Sports Human Capital (SHC) public interest incorporated foundation and shows enthusiasm for managing a soccer club.

At his inauguration press conference, regarding the club's difficult financial situation, he stated, “I will strive to stabilize management through sales activities and ingenuity from new angles,” and expressed his desire to build an organization that values dialogue with staff.

Furthermore, as a club that promotes “community roots,” he has made it clear that he will proactively address issues such as “how to increase exposure” and “how to raise interest” while engaging directly with fans and supporters.

The background to his decision to accept the presidency includes the voices of supporters behind the goal in the final match and the support of his family, and he says he is “seriously taking on the challenge for Nagano.”

How will it actually turn out? Keep an eye on the future.

What has been the average attendance per match in the past?

What caught my attention here is the point that “the club has set a goal of exceeding an average of 5,000 spectators per match this season.” “How realistic is this goal?” and “If it happens, how much will earnings increase?” are things that also become clear when looking at the financial information.

By the way, I referred to this site.

https://cieloazul310.github.io/jclub-financial-table/club/parceiro/

The following is the trend of AC Nagano Parceiro's past attendance data and ticket revenue.

Looking at this data, we can see that the higher the number of spectators, the higher the ticket revenue. If “an average of 5,000 people per match” is achieved, and if the unit price per customer remains at the current level (around 1,000 yen), there is a possibility that ticket revenue per match will be around 5 million yen, and annual revenue will be around 95 million yen.

This is a significant increase in revenue compared to the 2023 fiscal year results (69 million yen), and it is a key measure for management improvement.

However, it is not enough to eliminate this season's net loss of 120.05 million yen, and it is merely “one step toward improvement.” A total management reform, such as reviewing the fundamental expense structure and revenue sources, is required.

It's getting long, so I'll stop here.

Summary: The ability to read numbers is the ability to protect the future

In this article, I have organized the “entrance” to reading financial statements while using the actual management information of Nagano Parceiro as a subject.

• “What does a deficit mean?”

• “What is so bad about insolvency?”

• “What changes when the president changes?”

• “What can you tell by reading numbers?”

I would be happy if you could have even a slight image of these questions.

Certainly, “financial statements” may not be directly related to soccer players. But there is no doubt that it is a skill that becomes “the management of the club you are involved in” and “the foundation for handling money in the future.”

It is better to know than not to know. It is better to prepare now rather than later. I hope this can be a trigger for you to think so.

If you think this article is even a little “useful,” please give it a like or leave a comment! I would be happy if you could think of a comment as the first step in studying. Questions or even just saying “this part was easy to understand” are very welcome!

(This may also lead to future calls and community dialogues.)

Thank you for reading until the end!

Glossary (Terms used in this article)

• Financial Statements: Documents summarizing the 'inflow and outflow of money' for a company or club. Created annually.

• Balance of Payments: The balance between income and expenditure. A positive balance is a surplus, and a negative balance is a deficit.

• P/L (Profit and Loss Statement): A part of the financial statements showing the flow of sales, expenses, and profits over one year.

• Net Loss: A term used when there is a deficit rather than a profit.

• Deficit: A state where expenditures (money spent) exceed income.

• Insolvency: A state where liabilities (debts) exceed assets.

• Club Licensing System: Permission required to play in the J.League. Clubs must meet management and facility requirements.

• Average Revenue per Customer: The average amount paid by one spectator. Calculated as admission revenue divided by the number of spectators.

Reference URLs

https://parceiro.co.jp/info/detail/sftJkpqqXQBJcUK_jkr3K2pValBlRUtCbkNFeHh4dHFibHBadTduc19DMlRsclRfcHlFM2ZhX3FrUGc

https://cieloazul310.github.io/jclub-financial-table/club/parceiro/