Good will hunting Financial demands keep rising at Everton but a new ground still hasn’t been located. Simon Hart looks at a unique set of problems
The subsequent evidence of the club’s accounts for the year ending May 2010, published on February 7, was not wholly encouraging, despite chief executive Robert Elstone describing them as “healthy”. Besides a pretax loss of £3.1 million, the cost of keeping together Moyes’s astutely assembled group
The Mirror journalist David Maddock is a sympathetic chronicler of the Merseyside football scene but his blog on Everton on January 18 was unfortunate in its timing. With David Moyes’s team underperforming and rumours circulating about the club entering administration, he sought to explain “why Everton’s achievements under Moyes and Kenwright are far more impressive than anything Man City have done” – urging fans to “rejoice in the fact that the club is run prudently with no danger of going bust”.
of players had taken the wage bill to £54.3m – 69 per cent of turnover – and the net debt had risen by £7m to £44.9m. Bank interest was £4.5m a year – roughly the annual cost of a Mikel Arteta.
Goodison Park generates a raucous atmosphere but is less good at generating income
For those Evertonians who had witnessed the media-supported hoopla surrounding Liverpool’s problems, this view was probably not what they wanted to read during a month that brought three departures from a struggling squad and not a single new face – the fifth transfer window running without a net spend on players – and left many supporters asking just how well run their club really is.
T hat t hese resu l t s w e r e r e l e a s e d t w o months later than last year had prompted concern among shareholders and supporters. Everton said the delay was a consequence of the drawnout sale of their former Bellefield training ground. However, the Directors’ Report accompanying the accounts noted that this sale (for a reported £8m) and the club’s January transfer window activities were factors cPHE R S ON
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in the agreement of a new overdraft facility with the bank to take Everton through to the season’s end. This begged the question of whether Everton were forced to off load players in January to appease the bank.
What is certain is that Everton have stretched their finances to near breaking point to support Moyes and, given the economic climate, can no longer go to the bank for loans. Although income from sponsorship and advertising has increased during the last decade, revenue – TV money apart – has remained relatively static over the last five years, and last year’s loss would have been £22m but for the sale of players, notably Joleon Lescott.
It could be argued that Everton’s finances would not be under such a harsh spotlight had Moyes’s “best-ever” squad (as the Scot described it) met pre-season expectations but, with outgoings exceeding revenue, the current business model does not appear sustainable indefinitely. The balance sheet shows £95m of liabilities and only £65m of assets, and the funds from Bellefield – money once earmarked for a new stadium – served to repay debts. The Directors’ Report notes that they acquired “ further funding” through the securitisation of future guaranteed revenues “post year end”. Rumours about the possible sale of Marouane Fellaini or Jack Rodwell, and Moyes’s own position, increase the sense of uncertainty about the future.
Top right Trying to balance the books (from left) Sir Philip Carter, Jon Woods and Bill Kenwright Right David Moyes feels the squeeze