Board Approves Flamengo's Budget Readjustment for 2026

Flamengo's Board of Directors approved the budget readjustment for 2026 on Wednesday (28/10). The revised budget projects significant advances across the club's key operational indicators: recurring revenue increases 20% compared to 2025, recurring EBITDA nearly doubles year-over-year, and the projected recurring operating margin of 25% for this year continues to grow compared to 19% in 2024.

The budget readjustment is a procedure outlined in Flamengo's Bylaws and is part of the governance and transparency practices adopted by the club. It is a regular review: throughout the year, the originally approved budget is compared against actual results, and projections are adjusted to reflect the reality of the fiscal year.

HIGHER-QUALITY REVENUE

The most important takeaway from the readjustment is the composition of the club's revenue. While some absolute numbers budgeted for 2026 were not reached, revenue quality improved compared to the previous year: a larger portion of what the club collects comes from recurring sources, which tend to repeat in coming years, and a smaller portion depends on one-time events.

Flamengo as a business is operating, growing, and showing consistent evolution, with a more solid and predictable revenue base.

DEBT REMAINS AT COMFORTABLE LEVELS

Even without reaching the targets set in the original budget, Flamengo's debt indices remain at comfortable levels. The ratio between debt and cash-generating capacity, known as leverage, stands at 1.2x compared to recurring EBITDA, below the figure recorded in December 2024, when the index was 1.8x.

EBITDA is a measure of operational result: it indicates how much cash a business generates from its activities, before interest, taxes, depreciation, and amortization. Recurring EBITDA, meanwhile, considers only revenues that repeat every year and excludes extraordinary income such as player sales, prize money for titles, and participation in FIFA's Club World Cup.

In practical terms, this means Flamengo would be able to pay off its entire debt in roughly one year and a few months using only the cash generated by operations, without relying on additional revenue.

WHAT DROVE THE READJUSTMENT

Player investment: The club made significant investments in its squad this year, including the acquisition of Lucas Paquetá's playing rights. As the deal was completed early in the year, the operation had a full-year impact on 2026's fiscal results.

Player sales below budget: Revenue from player transfers fell short of projections, but this does not mean the club was inactive in this area. The best example is the failed sale of Gonzalo Plata, which fell through when the buying club withdrew after final terms had been agreed.

Maracanã Stadium: Revenue generated by the stadium grew 20% compared to 2025, but still fell short of the initial 2026 budget. The gap between budgeted and readjusted figures stems from a projected stadium naming rights deal that did not materialize in 2026.

The readjustment was approved by majority vote at a meeting attended by 56 board members.