Everton spend big as they aim for Europe

The authoritative Swiss Ramble reviews the 2019/20 accounts of Everton.

The £140m loss is the highest reported to date in the 2019/20 Premier League, though all clubs are likely to report worse numbers last season, e.g. Spurs swung from £87m profit tax to £68m loss, while Manchester United went from £27m profit to £21m loss.

That said, the £140m loss is actually the third worst ever posted in the Premier League, while the previous year’s £112m is the fifth largest. The Everton board would argue that these results reflect the club’s position in the early stages of a long-term investment cycle.

The loss would have been even higher without £40m profit from player sales, £20m higher than prior year. Included Idrissa Gueye to PSG, Ademola Lookman to RB Leipzig, Nikola Vlasic to CSKA Moscow and Henry Onyekuru to Monaco. One of the highest profits from this activity in the Premier League.

The club have increasingly relied on profit from player sales, which has averaged an impressive £50m a season over the last four years, compared to just £13m in the preceding six years. Only Chelsea and Liverpool have made more money from player sales than Everton in the four years to 2019.

Everton have reported losses five times in the last six seasons with the sole exception being £31m profit in 2017. That includes (growing) losses in each of the last three seasons with a total deficit over this period of £265m.

The £186m revenue has grown £64m (53%) from £122m in 2016. Vast majority of the growth has come from commercial £55m, though TV revenue also up £15m, despite 2019/20 deferrals and rebates.

Despite the revenue growth there remains a huge disparity with the “Big Six”, where the lowest revenue (Spurs £392m) is more than twice as much. In fact, all of the leading clubs’ revenue growth in the last four years is higher than Everton, except Arsenal and Manchester United.

Everton's small £2m revenue decrease in 2019/20 is one of the better results of clubs that have so far published accounts with many announcing significant reductions: Manchester United £118m, Barcelona £102m, Juventus £77m, Roma £77m and Spurs £69m.

Everton's strategy is to spend big in the hope of securing regular European football, worth £60-90m in 2020 for Champions League entrants and £17-25m for the Europa League. Everton have earned €14m from Europe in last five years, compared to Manchester City €390m.

The club hope to start work on new 52,000 capacity stadium at Bramley-Moore Dock in 2021, if planning permission granted. Estimated cost is £500m, but could be a game-changer, as seen by Spurs match day income rising to £95m (even in COVID-impacted season) with their new stadium.

Wolves get raw deal from FFP

I used to see a lifelong Wolves fan for lunch once a month. He was approaching ninety, but still went to games. Sadly he passed away the other week. As football finance guru Kieran Maguire has noted, Wolves continue to be constrained by financial fair play rules. Radio 4 this morning described them as this year's 'crisis club' and the pessimists have certainly been piling in. Martin Samuel wrote sympathetically in the Sunday Times yesterday, saying that the Premier League drives talent away with regulatory red tape: 'Why could Al-Hilal sign Neves? Because Wolves needed the money. And why did Wolves need the money? Because the club had to comply with an artificial construct known as financial fair play. So Wolves are going skint, yes? No. There is no suggestion that Wolves are in financial trouble, only that they are failing to meet the rigours of FFP. Wolves’ owners appear to have the money to run the club, and invest in the club, and in fact came up with a pow

Gold standard ground boosts Tottenham's income

The gold standard in European football grounds is the Tottenham Hotspur stadium in north London, a £1bn construction project completed in 2019. Its impact on the club’s finances has become increasingly clear as the effects of the pandemic have faded. Previously, the average fan would spend less than £2 inside the ground on a typical match day, but now that figure is about £16, thanks to new facilities including the longest bar in Europe and an on-site microbrewery. Capacity has gone up from 36,000 at the club’s previous home of White Hart Lane to 62,000. The new stadium — built on land adjacent to White Hart Lane — has opened the door to a broad range of other events that have helped to push commercial income up from €117mn in 2018 to €215mn in 2022. Last year, Tottenham hosted US singer Beyoncé for five nights on her global Renaissance tour, two NFL matches, as well as rugby games and heavyweight boxing bouts. Money brought in from football has gone up too. Match day income is

Charlton takeover approved

The long awaited takeover of Charlton Athletic by SE7 Partners from Thomas Sandgaard has been approved: https://londonnewsonline.co.uk/se7-partners-obtain-efl-approval-for-charlton-athletic-takeover/ Charlton have had unhappy experiences with owners for over a decade, so how this works out will remain to be seen. There is certainly potential there, but will it be realised? This interview with Charlie Methven gives detail not available elsewhere: https://thecharltondossier.com/charlie-methven-on-the-record/

The Political Economy of Football V2

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