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Liverpool Announce Financial Results

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YNWA

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[article=http://liverpoolfc.com/news/latest-news/156514-lfc-announces-financial-results]Liverpool Football Club today announced that solid progress continues to be made as it filed its financial results for the year to May 31, 2013.


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Revenue increased by nine per cent to £206.1million and external debt decreased by 29 per cent to £45.1million.

Since Fenway Sports Group (FSG) completed its takeover of Liverpool FC in October 2010, revenue has steadily increased year on year and external debt has decreased overall by nearly £200million. During this reporting period, FSG injected £46.8million to fully repay a historic stadium loan facility.

Managing director Ian Ayre said: "These results demonstrate that the financial health of the club continues to make good progress as we continue our journey to transform the club on and off the pitch.

"Over the past four or five years, revenue has been consistently increasing from around £170million in 2009 to over £200million today, and external debt has decreased significantly to less than £50million.

"With a hugely supportive ownership group, we have taken a measured approach to bring back financial stability to this great club by ensuring it is properly structured on and off the pitch.

"During the period, we signed six new players including Daniel Sturridge, Philippe Coutinho and Joe Allen, and we extended seven players' contracts which included Daniel Agger, Martin Skrtel, Martin Kelly, Lucas Leiva and Raheem Sterling - adding depth and strength to the squad while continuing to develop young talent. In addition, nine players were transferred out and eight players were loaned out."

Despite the club dropping three places to 12th in Deloitte's Football Money League, Liverpool remains the highest ranked club that is not in the Champions League. Its commercial revenue now accounts for 47 per cent of the total revenue, which is bettered by only the Money League's top six.

Ayre added: "These financial results are now up to 18 months old and we have continued to make further progress since this reporting period. Our strong links remain with our existing partners, signing new deals with Standard Chartered, Garuda and Carlsberg, and we have recently announced five new partnerships which endorses the global appeal of the LFC brand.

"We continue to invest in our digital and TV platforms and recently announced nine new television partnerships, allowing millions of fans across the world to watch Liverpool games and receive exclusive content.

"We have also seen good progress being made regarding a proposed stadium expansion at Anfield. Any final decision continues to be based on certainty; however, since the partnership was established between Liverpool City Council, Your Housing Group and LFC only 16 months ago, we regard the progress as extremely positive.

"Given where Liverpool Football Club was only a few years ago, the progress that has been made since FSG acquired the club has brought back much-needed stability with an ambitious vision which everyone is focused on.

"I'd like to thank everyone involved in running the club - our owners, fans, partners, players and staff - for all the hard work and dedication."
[/article]
 
[article=http://www.liverpoolecho.co.uk/sport/football/football-news/liverpool-fc-accounts-show-club-6768260]Exclusive: Latest Liverpool account figures demonstrate how Reds continue to make 'good progress', says Ian Ayre
3 Mar 2014 22:30
FSG have now reduced Anfield’s debts by £200m since taking over in October 2010

Liverpool FC are embarked on a journey of footballing and financial transformation, club managing director Ian Ayre proclaimed today as Anfield’s latest set of accounts were revealed.

While the Reds turned in an annual loss of almost £50m last year, turnover to the end of May last year broke through the £200m mark to £206m - a rise of nine per cent.

Meantime club bank debts decreased by 29 per cent – due in the main to a £46.8m interest free, inter company loan to the Reds via owners Fenway Sports Group. That was used to pay off debts relating to previous failed stadium projects under the ousted Hicks and Gillett regime.

FSG have now reduced Anfield’s debts by £200m since taking over in October 2010.

Ayre praised the unswerving commitment and day to day focus of the Boston-based Americans in restoring the Reds to glory and said: “We could not have a better set of people owning and running the club.

“They want what every fan wants.”

Liverpool’s net bank debts now stand at £45.1m after being reduced by £19.9m in the period to the end of May, 2013.

Today’s figures reflect the first season under manager Brendan Rodgers, when Liverpool were again without Champions League revenues, usually worth around £30m to a club.

This season, a resurgent Liverpool side lie second in the Premier League and on course to return to Europe’s elite stage for next season.

Commercial revenues in the accounts period rose from just under £64m to just under £98m, reflecting another strong year of increased sponsorship deals.

Media revenues at just short of £64m are not, however, significantly different to those returned in the previous accounts.

Ayre said: "These results demonstrate that the financial health of the club continues to make good progress as we continue our journey to transform the club on and off the pitch.

“Over the past four or five years, revenue has been consistently increasing from around £170 million in 2009 to over £200 million today - and external debt has decreased significantly to less than £50 million.

“With a hugely supportive ownership group, we have taken a measured approach to bring back financial stability to this great club by ensuring it is properly structured on and off the pitch.”

Liverpool have dropped out of the Deloitte top ten this year, but Ayre insists they can soon return to the European big league and thrive there in future.

He stressed the continuing global appeal of the club, which saw sponsorship deals struck or renewed with companies including Standard Chartered Bank, Indonesian flagship airline Garuda, and Carlsberg.

Liverpool point out they remain the highest ranked club that is not in the Champions League. Commercial revenues account for 47 percent of the Reds’ total revenue, which is bettered by only the Money League’s top six.

Ayre added: “These financial results are now up to 18 months old and we have continued to make further progress since this reporting period.

“Our strong links remain with our existing partners signing new deals with Standard Chartered, Garuda and Carlsberg, and we have recently announced five new partnerships which endorses the global appeal of the LFC brand.

“We continue to invest in our digital and TV platforms and recently announced nine new television partnerships allowing millions of fans across the world to watch Liverpool games and receive exclusive content.

“We have also seen good progress being made regarding a proposed stadium expansion at Anfield. Any final decision continues to be based on certainty. However since the partnership was established between Liverpool City Council, Your Housing Group and LFC only 16 months ago, we regard the progress as extremely positive.

“Given where Liverpool Football Club was only a few years ago, the progress that has been made since FSG acquired the club has brought back much needed stability with an ambitious vision which everyone is focused on.

“I’d like to thank everyone involved in running the club – our owners, fans, partners, players and staff – for all the hard work and dedication.”

Ayre on Liverpool’s owners FSG
Ian Ayre believes Liverpool have made massive leaps forward since’ the dark days’ and in principal owner John Henry and club chairman Tom Werner now have owners who are striving every day to fulfil the dreams of the supporters.

Ayre, speaking to the ECHO from a football industry conference in Barcelona, said: “What we have with this ownership group is a very true group of investors.

“They recognise the huge investment they made to buy Liverpool and as smart investors they know that they have to continue to invest to realise the true value of their investment long term.

“They’ve been very supportive to the business, to Brendan. This year we’ve not played any European football - but we continue to get support from the ownership.

“They are very involved in the business and I think that helps.

“People often think that they are distant and in the US and therefore don’t get too involved.

“But they are involved, day to day. There are lots of conversations go on.

“They are very understanding of the business. They expect very detailed information and to be in and around it however much they can be.

“They know what is going on and they know what they are investing in and how it’s being managed.

“I can’t say enough about all the support and commitment we have from them and despite what you read they don’t take a penny out of Liverpool Football Club.

“On that basis they are great investors and great owners to have.”

He continued:“The support and the commitment of these owners is absolutely unquestionable.

“I can tell you as the person running the football club that we could not have a better set of people who are committed and dedicated and want what every fan wants for Liverpool FC.

“I always use this phrase that John used on the day we announced the sale.

“He said we want to build a team to win; but not just to win once but to keep winning. And you can’t achieve that without commitment and investment and a long term view.

“They are each there one hundred per cent from this ownership group.

“It is transformational.

“It is fairly well documented that we were days away from perhaps the bank calling in the debt on Liverpool FC or something worse and here we are today.

“These results are some 18 months old but knowing what we know in terms of how the business is performing again this year and despite the backdrop of no European football in this current year, what we see is a business very much on an upward trajectory. “

“Everyone is there for everyone. Everyone can see the on pitch performance.

“We continue to invest in the team and we continue to grow our business and that can only be good for the future of Liverpool Football Club.

“It’s a long, long way from the dark days of just a few years ago.

Ayre firmly believes Liverpool’s next set of accounts will reflect the current season and with it a marked improvement if Champions League football returns to Anfield alongside continued investment and continued on pitch performance.

“Then we’d expect to be in very good health,” he said.

“John and Tom would love to bring the success they have had at the Red Sox, again for the third time this year, to Liverpool.

“They have had good years and bad years but they have always been there and always invested. And the proof is there.

“To win three World Series in the period since they bought it is a phenomenal achievement.

Ayre on Liverpool’s rise under Brendan Rodgers
Ayre praised the performances of Liverpool’s players under Rodgers this season as ‘astounding’ and insisted the Northern Irishman has done ‘a great job.’

Said Liverpool born Ayre: “We all had great faith in Brendan when he was appointed and I think he had a huge challenge in front of him.

“I mean we all did - but no one more than Brendan, because he comes to one of the biggest football clubs in the world where expectation is high and there was a lot of work to do.

“And in his first season he would admit - and I would admit it publicly - that there was a lot of finding his feet and starting to impart his philosophy and his style into the team.

“I think what we have seen this year is that starting to grow and prosper. And we’ll continue to add to the team and support him in putting additional players into the group.

“Both the efforts of Brendan and the players have been astounding.

“One of the things I really like is that Brendan works with the team and sets the season out into little chunks so they have four or five game runs.

“So they focus on a short number of games - they don’t focus on the entire season. And it’s worked well for them.

“They work as a group, they are focused as a group. The results are being delivered as a group and the performances of the players has blown everyone away.”

He added: “On Saturday at Southampton I was listening to the crowd and finally Liverpool fans are getting brave enough to believe what might be, you know.

“To get back into the top four has been the priority absolutely.

“But what I would say is that if you want to win anything, then you have to believe you can win it.

“So I’m sure the players and everyone else will be focused on winning every game and if that brings the top prize then that will be unbelievable.

“And if it brings Champions League football, then it will still be a fantastic season for us.”

Ayre on the part being played by Liverpool’s fans today
Liverpool’s fans who have seen their team not just beat, but demolish some of their biggest rivals this season, remain the driving force behind today’s concerted efforts to restore the Reds to glory, insists Ayre.

The Reds supremo, himself a fan who travelled to home and away matches as a youngster growing up in Kirkdale and then Litherland, said: The Liverpool fans who have been through these last few years with us are not just part of it – they are a big part of it and the reason to do it to be honest.

“I think people often focus on the business, we of course on revenues and sponsorship, but all of that comes from fans.

“The reason sponsors invest in the football club is because we have one of the biggest fan bases in the world.

“And sponsors all want to market products to people.

“And the reason media companies pay huge amounts for media rights is because Liverpool fans – and there are hundreds of millions around the world - want to watch their team.

“So our fans are a huge, huge part of our achievements and if you ask any player or any manager at any club, they’ll tell you the reason they do it is for the fans.

“I really believe that.

“We are blessed in that we have the best fans - and so many of them.

“Their support, as always, has been unquestionable.”

At a glance account highlights:

Annual loss of £49.8m (£40.5m in previous accounts which covered a shorter, ten month period)

Turnover up to £206.1m (£169m in previous accounts)

Net bank debt down by £19.9m to £45.1 m (£65m in previous accounts)

Commercial revenues up to £97.7m (£63.9m in previous accounts)

Media revenues of £63.8 million (£62.8m in previous accounts)

Administrative expenses at £213.1million (£176.5m in previous accounts)

Interest payments £4.5 million (£3.7m in previous accounts)

Players net book value £121.8m (£110.5m previous accounts)

Interest free intercompany loan (via FSG) of £46.8 million to LFC[/article]
 
Here you are mate.

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I don't have a clue but I'm not sure how a 50 million loss is good news. Please explain someone.
 
doctor_mac said:
I don't have a clue but I'm not sure how a 50 million loss is good news. Please explain someone.
Click to expand...


Its not great news at all. I suppose what they are trying to potray is the improvement in the topline and the expected improvement in the current year Financial results due to improved TV deal and wage bill drop (downing, carroll, reina etc)
 
YNWA said:
Its not great news at all. I suppose what they are trying to potray is the improvement in the topline and the expected improvement in the current year Financial results due to improved TV deal and wage bill drop (downing, carroll, reina etc)
Click to expand...

It doesn't make sense though. How can our net debt come down by over 40 million even as we record a 50 million loss?
 
This is gonna be interesting:

Annual loss of £49.8m (£40.5m in previous accounts which covered a shorter, ten month period)
Click to expand...

My understanding after a visit to this site: http://www.financialfairplay.co.uk/ (sorry I'm too lazy and not qualified to dig through the whole UEFA FFP document):

For the first season that the UEFA FFP (2014/2015) takes effect, clubs are permitted a maximum loss limit of €45m for the 2011/2012 and 2012/2013 seasons combined. So at today's exchange rate (1 : 1.21), we have to make €64m disappear from the figures.

So here's the thing - wage costs for the 2011/2012 season are excluded if a player was signed before Jun 2010 (and a new contract was not signed in the 2011/2012 season). Our wage bill for 2011/2012 is around £109m after adjustments or something, from what I've read (may or may not be correct - again, didn't go dig the official port).

Not all of this can be excluded though, because some players would've joined between Jun 2010 and May 2012, and some contracts would've been extended in that period (very few though I think). Rule of thumb is - the wages of players signed by Benitez, with contracts not extended in the Hodgson / Kenny era, would be excluded for the calculation of the 2011/2012 season. Anyone signed by Hodgson / Kenny, the wages count. Again, wage exclusions apply only to the 2011/2012 season; the wages will count for every player for the 2012/2013 season regardless of time of signing, extension, etc.

So the key is figuring out how much of the wage bill we can exclude from calculations for that particular 2011/2012 season. If that's 50% then that's almost (£109m x 0.5) = £55m we can slash. Add that back to our losses (okay simplified way, not factoring taxes and all that) and that basically turns our total loss for the 2 seasons in the FFP calculation to:

(- 49.8 - 40.5 + 55) = - £35.3m = (x 1.21) - €42.7m = safe!

I suspect there should be more than 50% that can be excluded for that season though. Yes, we added Cole, Meireles, Konchesky, Poulsen, Carroll, Suarez, Downing, Henderson, Adam, Enrique, Coates, Bellamy, etc. (typing this list is depressing...), etc. but I don't think the combined wages of these guys would've surpassed that of Reina, Johnson, Carra, Skrtel, Agger, Gerrard, Lucas, Kuyt, Babel (half season), maybe Aquilani (if whoever loanded him didn't pay his wages), etc.

FWIW, this wage exclusion area appears to be where City is able to get some relief for the first season of implementation of the FFP.

The other exclusion is stadium development costs, I think. I don't know if it applies for the payments we've had to make for the "ground planning" and what not for the "spade in the ground" shit, but if it does, then yay, we get a little more kick.

FYI, the exclusion will still be valid (again just for the 2011/2012 season) for the second season of the FFP, when the €45m loss limit will cover 3 seasons - 2011/2012, 2012/2013, 2013/2014 - instead of the current two. In the third season of the FFP, the 3-year loss limit gets dropped to €30m, and the wage exclusion thing disappears because 2011/2012 is no longer in the sliding window of seasons covered.

So I think we should be safe for the first year of implementation, but things need to improve quickly or else we may have some trouble in the second year.

Ross can shed more light on this stuff, as I'm just thinking out loud, regurgitating and (mis-)interpreting some of the stuff I've read to flaunt my ignorance.
 
doctor_mac said:
It doesn't make sense though. How can our net debt come down by over 40 million even as we record a 50 million loss?
Click to expand...

FSG put in some money (interest-free I think) to help pay off some of the bank debt. The losses are from cost of operations + debt servicing charges not covered by FSG's cash injection. So basically, our wages, expenses (agent fees, administration, transfer costs, interest payments, etc.) outstripped our revenues.
 
doctor_mac said:
I don't have a clue but I'm not sure how a 50 million loss is good news. Please explain someone.
Click to expand...

Losing money is definitely never good news of course. It'll affect us definitely if we still don't start fixing things, starting by shipping out high-wage earners in the team who aren't worth that wage anymore.

This should be a dose of the reality medicine to guys who think we can and should go out to buy to fill gaps in 5 to 6 "priority" positions. Even with us selling guys and bringing wages down in the process, it's prudent to control how much additional cost we load on. The UEFA FFP limit is going to be 30m euros (over 3 seasons) in 2 years' time, and we have easily surpassed that in one season alone.
 
studsup said:
Losing money is definitely never good news of course. It'll affect us definitely if we still don't start fixing things, starting by shipping out high-wage earners in the team who aren't worth that wage anymore.

This should be a dose of the reality medicine to guys who think we can and should go out to buy to fill gaps in 5 to 6 "priority" positions. Even with us selling guys and bringing wages down in the process, it's prudent to control how much additional cost we load on. The UEFA FFP limit is going to be 30m euros (over 3 seasons) in 2 years' time, and we have easily surpassed that in one season alone.
Click to expand...

The good thing is that we've built a relatively young squad, so we're looking at lengthy stays for many of our players, as opposed to having to replace them in a couple of seasons.
 
Our revenues have been expanding though. Qualifying for the Cl is huge as the English teams revenues nearly double, even if we are 4th we would stand to get £60mil. The new tv deal kicked in this year that's another £30mil which will show up in the next accounts. Unless we go on a Man City type spending spree in the summer I can't see FFP being a problem for us
 
Until someone who understands accounts looks at this and tells us the truth, I don't think we'll know if this is bad news or good news. I would guess it's bad news, but just not too severe. I looks they're trying to say 'we made a massive loss, but we paid some of the debt off so it's not all bad!'.
Sure 3yrs of 40+mill losses is not good at all.
 
I suppose the first thing to be aware of is that because of the change in accounting period the previous year for FFP purposes some of the increases aren't actually increases - match day and media revenue dropped. Commercial increased but the increase is overstated.
 
I suppose the first thing to be aware of is that because of the change in accounting period the previous year for FFP purposes some of the increases aren't actually increases - match day and media revenue dropped. Commercial increased but the increase is overstated.
 
doctor_mac said:
It doesn't make sense though. How can our net debt come down by over 40 million even as we record a 50 million loss?
Click to expand...

I thought the loss derives from the same period FSG decided to cut our losses on the Stanley Park stadium which was a once off £50m kick in the teeth that Hicks cronies spirited away in 'design fees & consultations' .
With a bit of luck it can be included in Stadium Development which we may be able to exclude from FFP.
 
I used to like football. That game where you watch your team kick a ball about. Discussing this stuff is fucking painful. Unless one of you either goes out to make millions like John Henry then buys the club, or becomes a top financial wizard, it's pointless.
 
Well unfortunately finances usually dictate success.

So they're more important than the trivial bullshit that people prefer to discuss.
 
Rosco said:
Well unfortunately finances usually dictate success.

So they're more important than the trivial bullshit that people prefer to discuss.
Click to expand...

Yeah, doesn't make it any less soul destroying when you're practically forced into looking into your clubs financial records as if it were a business you were thinking of investing in.

Most of us like to t EU to pretend this football club is the same one we supported when we were kids, not a multi national soulless business.
 
Once Moores sold up things were never going to be the same. And the reasons people wanted him to sell are the very things that have made it a soulless multinational business.
 
What's going on with this increase in CL money then? Heard a couple of people mention BT's involvement pretty much doubling the revenues, is that true? And from the season after next, right?

No wonder there's talk of Man Utd spending £200m this summer. They simply have to get back in it next year if the above is true.
 
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