The Blue Union respond

[StevO]

My worry is that we could be on that list by the end of 2012.

[LexKing]

My worry is that we could be on that list by the end of 2012.

 

Me too, but at least now we got rid of some debts and lowed our payroll, may be thats enought to avoid that list.

[smeghead1]

The Arteta money is going to avoid administration for us for the immediate future, but i have to admit things need to be done to force the current boards hands. I read somewhere that 4 intrested parties have been knocked back City's and Villas owners are 2 of them and if you read between the lines that was due to destination Kirkby which was going to save the club, it didnt it left us with a big hole in our finances!

I agree with some im not a big fan of protests etc but if it raises the profile of the club in that i mean gets us some air time etc maybe the next intrested party may have more of a chance (lets hope).

I still believe the biggest fcuk up made by this board was missing out on the Kings Dock that puts a lump in my throat everytime i drive past or even worse goto the place to a concert etc i hope we dont regret that forever!

[StevO]

Kirkby would never have saved the club, was a nightmare if an idea.

 

Hopefully with £14m taken off the debt might just be the difference getting someone on board. But the likes of the kit bag deal might be a hindrance if someone wants to come in and grow us commercially abroad, which no doubt a foreign investor would want to do.

[Lowensda]

According to the BlueUnions meeting write up, im not a real fan. Pricks

[Romey 1878]

According to the BlueUnions meeting write up, im not a real fan. Pricks

 

 

This real fan bollocks is pissing me off and is a phrase thrown about by both sides.

 

For Gods sake, we're all real fans whichever side of the fence you happen to sit.

[Hafnia]

According to the BlueUnions meeting write up, im not a real fan. Pricks

 

According to our skipper anyone who is against the current ownership isn't a real fan. The difference is, he is paid a fortune by the fans he's insulting, the blue union aren't.

[Lowensda]

 

 

This real fan bollocks is pissing me off and is a phrase thrown about by both sides.

 

For Gods sake, we're all real fans whichever side of the fence you happen to sit.

 

completely agree mate, its used to encourage people to 'side' but from my perspective it takes away credibility by playing mindless mind games.

 

I understand why the BlueUnion are there, and in a way its nice to see someone actually act on something but the way they do it and the way they present themselves is a joke. More and more they just sound like annoying nosey kids who just want to know more than you.

[Lowensda]

 

According to our skipper anyone who is against the current ownership isn't a real fan. The difference is, he is paid a fortune by the fans he's insulting, the blue union aren't.

 

haf, bollocks. Don't talk shit, they're both as bad as each other. Don't try to paint it that the BlueUnion are godly and nothin they do is wrong. They're both childish for sayin it. You can't justify being silly.

[smeghead1]

 

 

haf, bollocks. Don't talk shit, they're both as bad as each other. Don't try to paint it that the BlueUnion are godly and nothin they do is wrong. They're both childish for sayin it. You can't justify being silly.

 

The problem you have J is that both BK and the BU think they know whats best for the club, im more of the inkling that under our current leaderhip we will never be any better than we are now. We will continue to see the talent we unearthed playing against us, not for us.

The BU have gone about things the wrong way in my eyes, but then BK has missed a few opportunities to better the club. He has also put all his eggs into one basket in Kirkby and been oblivious to the fact if it went wrong he had no back up plan.

Bk has got us into this predicament but im not 100% sure the BU are going the right way about getting us out of it only time will tell and alls i can do is support the team and get behind DM because without that fella in charge we'd be right in the shit (well deeper in it anyway).

[Lowensda]

 

The problem you have J is that both BK and the BU think they know whats best for the club, im more of the inkling that under our current leaderhip we will never be any better than we are now. We will continue to see the talent we unearthed playing against us, not for us.

The BU have gone about things the wrong way in my eyes, but then BK has missed a few opportunities to better the club. He has also put all his eggs into one basket in Kirkby and been oblivious to the fact if it went wrong he had no back up plan.

Bk has got us into this predicament but im not 100% sure the BU are going the right way about getting us out of it only time will tell and alls i can do is support the team and get behind DM because without that fella in charge we'd be right in the shit (well deeper in it anyway).

 

smeg, I completely agree mate. Your views mirror mine, i feel we'll continue to tread water unless somethings done but like you, the BlueUnion are doin it all wrong in my opinion.

[Hafnia]

 

 

haf, bollocks. Don't talk shit, they're both as bad as each other. Don't try to paint it that the BlueUnion are godly and nothin they do is wrong. They're both childish for sayin it. You can't justify being silly.

 

I'm not justifying anything, nor am I talking rubbish. But, don't dismiss the blue union using the "real fan" divisive comment when our club captain has done so. I don't like the comment.

[Noble Savage]

I not a big fan of B.U's tactics (especially a protest BEFORE the game ) but unfortunately they are the only one's with any sort of plan . I just wish they hadn't riled a lot of people before yesterdays meeting.

 

For the first time since the start of all these protest groups , I have now jumped on the fence.

[Bailey]

completely agree mate, its used to encourage people to 'side' but from my perspective it takes away credibility by playing mindless mind games.

 

I understand why the BlueUnion are there, and in a way its nice to see someone actually act on something but the way they do it and the way they present themselves is a joke. More and more they just sound like annoying nosey kids who just want to know more than you.

 

I agree its very annoying and unessesary and both sides should stop trying to play that card. According to both parties a lot of people on here arent 'real fans' which is a complete insult, even if I dont agree with the viewpoint of some on here.

 

BU do have to start getting some proper facts and investigate there claims further. Keoic were successful because they went to reputable sources, got several views and analysed all the data available to them. At the moment BU seem more interested in slagging off the board without trying to get to the nuts and bolts of what is going on. Having said that, I am glad that they are there because it means something might happen that will benefit the club in the long run.

 

I not a big fan of B.U's tactics (especially a protest BEFORE the game ) but unfortunately they are the only one's with any sort of plan . I just wish they hadn't riled a lot of people before yesterdays meeting.

 

I agree.

[smeghead1]

 

 

smeg, I completely agree mate. Your views mirror mine, i feel we'll continue to tread water unless somethings done but like you, the BlueUnion are doin it all wrong in my opinion.

 

But what do you do J? Ive goto be honest and say im kinda stumped and live in hope of a takeover, the Mcmanus rumour has got me excited again but im just waiting for the tears. There has to be a way to get it out in the open without destroying everything we love about the club in the process!!

[Adam Partington]

im kinda stumped and live in hope of a takeover, the Mcmanus rumour has got me excited again

 

The what rumour?

[smeghead1]

 

 

The what rumour?

Its been on talksport that JP Mcmanus is looking at Everton. Mickey Quinn was kinda saying that the board may not be spending money due to a takeover. Its on the twitter thread i think.

[Avinalaff]

[Hafnia]

http://www.liverpoolecho.co.uk/everton-fc/everton-fc-news/2011/09/05/blue-union-group-hits-back-over-criticism-from-everton-fc-chairman-bill-kenwright-100252-29363567/ Edited September 5, 2011 by Hafnia

[Lowensda]

“In order to allow the CEO to concentrate on reducing costs, developing our own revenue streams and repairing relations with the fan-base, the board must now appoint a fully autonomous group of professionals who can effectively develop and implement a strategy to identify and sell the club to a buyer who can demonstrate an ability and desire to take the club forward on both a commercial and football level.”

Well I hope the club don't use the BlueUnion to develop fan relations. They'd be useless.

[Hafnia]

Well I hope the club don't use the BlueUnion to develop fan relations. They'd be useless.

 

J the same could be said for Mr Ross. The relationship with the fanbase is as low as a snakes belly, that isn't my primary concern though.

 

I think that the statement you quoted was succint and for me is right on the money "professionals who can effectively develop and implement a strategy to identify and sell the club to a buyer who can demonstrate an ability and desire to take the club forward on both a commercial and football level"

 

Clearly this is the crux of the problem with many fans, if we are for sale then Bill just isn't the man to do it.

[Lowensda]

 

J the same could be said for Mr Ross. The relationship with the fanbase is as low as a snakes belly, that isn't my primary concern though.

 

I think that the statement you quoted was succint and for me is right on the money "professionals who can effectively develop and implement a strategy to identify and sell the club to a buyer who can demonstrate an ability and desire to take the club forward on both a commercial and football level"

 

Clearly this is the crux of the problem with many fans, if we are for sale then Bill just isn't the man to do it.

 

Haf I agree to a point and i do think someone needs to come in; someone who is highly sought after, highly respected and proffesional and try to find some sort of interest. I just don't like the idea of a fan group (BU) trying to highlight some of their own credentials for that role (that's the impression i'm getting).

 

To allow the BU to build fan relations, would be like Gaddaffi trying to restore peace to Libyans. They have their own motives and views, and their way with people is shocking (unless you follow them you might as well be dead).

 

I wish not to be represented by them.

 

I understand that Ross isn't the right guy either, but I don't like the idea of the BU being the people to do it. I also understand that they're very passionate and want change but I don't know any members of the BU from Jack. So what's to say the person (or people) involved in sourcing an incredibly complicated and important deal, has about as much business accolades as my little toe?

 

They may think they're up to the task, but do they know what that sort of deal involves?

 

So what happens if BU get involved, somehow source a deal, new owners/buyers come in and the club still falls on its arse? Who can we blame then? Who's responsible for that? I think if the BU are that 'tight' a group, they'll single someone else out or divert blame...which from BU's point of view, isn't that what they're doing now?

[Matt]

I not a big fan of B.U's tactics (especially a protest BEFORE the game ) but unfortunately they are the only one's with any sort of plan . I just wish they hadn't riled a lot of people before yesterdays meeting.

 

For the first time since the start of all these protest groups , I have now jumped on the fence.

what sort of plan is this?

[Avinalaff]

 

Edited September 5, 2011 by Avinalaff

[Matt]

 

[MikeO]

"Union spokesman Dave Kelly said the club have no proof that the meeting at Kenwright’s London office was taped..."

 

 

“Everyone present agreed – enough is enough." Well I bet that was unexpected.

 

 

 

 

 

[Lowensda]

Courtesy of MTK at NSNO -

 

Apologies for the length but if you haven't read Swiss Ramble's article on Everton's finances then you really should. The article was written in April 2010 & was based on the 2009 accounts but many of the problems are still the same. I have added the figures from the 2010 accounts in bold - unfortunately most of them are now worse. If you don't believe that the board needs to take action, then please take the time to read this & reconsider

 

Why has Nobody bought Everton?

 

While the focus on Merseyside has been on Liverpool, both in terms of their likely failure to qualify for the Champions League and the financial doom and gloom arising from the Hicks and Gillett regime, people seem to have overlooked what is happening at Goodison Park. Not only have Everton recovered very well after a dreadful start to the season, including a memorable dismantling of Manchester United, but they also have issues of their own off the pitch. Their financial problems may not be quite so spectacular, but the fact is that Everton’s business model is bust. Their strategy, for want of a better word, appears to be to run the business at a loss every year in a gamble to achieve success on the pitch and to fund it by steadily increasing their debt. Every now and then, they might accidentally make a profit, but only at the price of selling one of their prize assets, the best/worst example being Wayne Rooney five years ago. From a commercial perspective, it is difficult to see how the club will prosper in the future – unless they find a wealthy benefactor.

 

That is why leading theatrical producer, “True Blue” Bill Kenwright, who has been Everton chairman since 2004, formally put the club up for sale in 2008, when he appointed Keith Harris of the investment bank Seymour Pierce as broker, but Everton has effectively been on the market for many years. The reasons are obvious, but Kenwright explained why his “kind of chairmanship” no longer has a future in the rich men’s playground known as the Premier League: “I am a pauper when it comes to other chairman. I want this club to have a billionaire owner, but it’s not me and I apologise it’s not me. Everyone knows this football club needs investment. If I can sell it, it will be sold tomorrow”. If this had not been evident before, it became abundantly clear with the arrival of Sheikh Mansour’s billions at Manchester City, which has starkly highlighted the limited budget available to David Moyes.

 

So why has nobody bought Everton? After all, this is a club with a fine tradition, having been winners of the old First Division nine times, the FA Cup (when it meant something) five times and the European Cup-Winners Cup once in 1985. As the song goes, “if you know your history”, but it’s not all old news, as Everton were the last team to break the Big Four stranglehold on Champions League places in 2005, came fifth in the Premiership for the last two seasons and were finalists in the FA Cup only last year. In David Moyes, they also have a very good manager, who Kenwright described as “the most important figure at the club”. It is certainly true that Moyes is responsible for taking the club to the upper echelons of the league, but paradoxically his ability could be considered a strength and weakness, as there is always a risk that he could leave for pastures new. Recently, he appeared to break ranks for the first time, “It’s getting harder to keep up with the Joneses. I want to be involved in a football club which makes progress”.

 

Even the man tasked with selling the club, Keith Harris, admitted that Everton were not football’s most attractive prospect, “The demographics of Liverpool as a city are not hugely compelling. It is not a very wealthy city. Everton share the city with another club, which arguably has been in the vanguard for the last decade, and they both have a stadium to build. So the economics need a lot of looking at”. They have a loyal, but parochial support, with no identifiable image or brand, which was not helped by the UEFA ban on English clubs in the 80s, which prevented Everton from taking their rightful place in the European Cup.

 

In fact, Harris confessed that he was making “no progress at all”, exacerbated by the credit crunch, “It has never been more difficult to find buyers. It's no longer a question of price negotiation - it's should we? People are wondering if now is the time to spend”. Kenwright agreed, “We aren't living in a normal world. I am talking to people every week, but in the last few months it's been 'We want a deal done in the next week' and then you literally don't hear from them again. There's just no money”. That may be true, but it does not take long for hard-nosed financial investors to appreciate that this club simply does not make money. Move along, nothing to see here. They walk away even more quickly once they have noticed the club’s growing debt and realise that they would have to fund the building of a larger stadium.

 

Ah, the new stadium. Everton had proposed building a new 50,000 capacity ground as part of a retail park in Kirkby, on the outskirts of Liverpool, but in November the government rejected their planning application. This was a real blow to the club, as they had been putting all their energies into this scheme for the last three years. Former chief executive Keith Wyness had gone so far as to describe it as “the deal of the century”, because Tesco were going to pay £52m of the construction costs, leaving Everton to find “only” £78m. Wyness argued that much of this money would have been raised by selling Goodison Park and Bellefield, the club’s former training ground, and charging for naming rights at the new stadium. Any debt would be “easily” serviced from the increased earnings at the larger ground. On the face of it, this rejection seems disastrous, as the supporters have been told, “There is no Plan B”, but now “the book is closed” on Kirkby. Current chief executive Robert Elstone had made this very plain, “If this club is going to compete at the top end of the Premier League, we need a favourable decision”.

 

This is the third time in 13 years that a proposal for a new ground has come to nothing, but this rebuff might just be a blessing in disguise. Many fans never warmed to the idea of moving to Kirkby, which prompted the formation of the “Keep Everton In Our City” (KEIOC) campaign. Their opposition was explained thus, “This was a location issue. This stadium would have been nine miles outside the city centre, further from a city centre than any other Premier League ground”. Their concerns were shared by Liverpool Council, who would also prefer a central site. A better alternative for the supporters was the proposal to build a new stadium on Liverpool’s prestigious King’s Dock, but that scheme was scrapped when the club failed to raise sufficient money.

 

Which brings us to the question of how exactly Everton would have funded Kirkby. We’re none the wiser after the planning inquiry, as the club refused to explain how they would meet the construction costs on the grounds (sic) of “commercial sensitivity”. The sale of Goodison is unlikely to make “loadsamoney”, as it is situated in a far from salubrious area with boarded-up terraced houses, while their hopes of redeveloping their former training ground for housing were dashed when the application for planning permission was refused (there’s a trend here). The idea of securing big bucks for naming rights also appears a little far-fetched when you consider the low money paid for shirt sponsorship. If by some miracle the club did manage to cobble together the funds, all it would do is further inhibit their capability to spend money on new players.

 

On the other hand, a brand new, state of the art stadium (or even planning permission) should “improve the club’s financial position, attract investment and provide more money for the manager”. According to a club spokesman, “Any club which can boast a stadium which is modern, fit for purpose and capable of expansion does represent a more attractive proposition to potential investors”. Indeed, the club’s second largest shareholder, Robert Earl, the Planet Hollywood entrepreneur, said that he would not put further money in until the club had moved to a new stadium. Kenwright explained the economic facts (as Rafa might say), “I don’t want to be the guy that takes the club away from Goodison Park. I would sooner stay here personally, but it is not an option financially”. In the same way that Arsenal had to leave Highbury for the Emirates, Everton need to relocate to a stadium with more commercial opportunities and higher match day revenue.

 

Something has to be done to boost the club’s revenue, as the profit and loss account looks simply awful. Last year, even when the club reported record turnover of £79.7m (an increase of £4.0m on the previous year) (2010 decreased to 79.1m) on the back of a pretty successful season, they still suffered a loss of £6.9m (2010 loss of £3.1m). This is nothing new under the sun, as Everton have only managed to record a profit once in the last seven years – and that was only due to Wayne Rooney’s big money transfer to Manchester United in 2005. Since “Wazza” was sacrificed, there have been £27.1m of cumulative losses (2006 - £10.8m, 2007 - £9.4m, 2008 break-even, 2009 - £6.9m) (2010 cumulative loss since 2005 is £30.2m). Although revenue has significantly increased over the years, thanks to the arrival of Sky television money, this has been matched by spiralling costs. In 1999 Everton reported a loss of £10.7m on turnover of just £25.6m, so in the last ten years revenue has risen by a remarkable £54.1m, but less impressively this has only produced a slightly smaller loss.

 

The main reason for the cost growth is player wages, which rose by 10.3% last year alone from £44.5m to £49.1m (2010 £54.3m). This “significant investment in the playing squad” gave rise to a higher wages to turnover ratio of 62% (2010 69%), which is nowhere near the worst in the Premier League, but is far from comfortable, even if the club considers it “appropriate”. On top of the salary levels, headcount is also increasing from 210 to 226 (2010 increased to 234) with “players, training and management” rising from 80 to 86 (2010 decreased to 85). As a small compensation, at least the director’s remuneration, presumably Kenwright’s, has reduced from the £450k average of the last three years to “only” 244k in 2009 (now at £0, no directors being paid). However, costs have not been helped by wasting nearly £3m on fees incurred for the design and planning of the failed stadium bid (£1.5m in 2008 plus £1.3m in 2009).

 

The losses over the years would have been even higher if the club had not been selling players. Over the last five years. £40m (2010 now increased to £59m) has been contributed by what accountants call “profit on disposal of players’ registrations”. The impact was most obvious in 2005 when Rooney’s sale resulted in a net profit of £23.5m, but you can also see its importance in the last two years. The club just broke-even in 2008, thanks to £9.2m profit from player sales, but reported an overall loss of £6.9m in 2009, when the profit from player sales was much lower at £3.8m (principally from the sale of Andrew Johnson to Fulham). This bodes well for next year’s results, which will include the £22m sale of Joleon Lescott to Manchester City (2010 profits on player sales were increased to £19.0m but club still made £3.1m loss so Swiss Ramble’s positive prediction was wrong).

 

This has not stopped the club buying players and Everton have somehow found £84m in the last five years to improve the squad. This does not include £11.8m of contingent liabilities, which will be payable based on future appearances and loyalty bonuses, which would bring the total to nearly £100m. In the accounts, costs associated with buying a player are capitalised as intangible fixed assets and written-off over the length of the contract, as the assumption is that the player would have no value after his contract expires, since he could then leave on a “free”. As an example, John Heitinga was bought for £6m, so if we assume that was on a 4-year contract, £1.5m costs would be booked to the accounts in each of the next four years. Although costs of buying a player are not fully reflected in the accounts in the year of purchase, over time the amortisation costs can have a real impact, which is what has happened at Everton with these costs rising from £12.3m to £13.0m in 2009. That’s a lot in the context of a £6.9m loss. (2010 Player amortisation now at £17.2m)

 

Kenwright is quite open about this policy in the annual report, “Once again, every available penny was channelled towards the manager to facilitate the upgrading of the senior squad”. This could be seen in the period covered by the last accounts with the record £15m purchase of Marouane Fellaini. Since then, the bulk of the Lescott money has been spent on Sylvain Distin £5m, John Heitinga £6m andDiniyar Bilyaletdinov £9m, but the tap might be closed for a while, given Moyes’ remarks during the January transfer window, “We will be trying to get some players in January but they will probably all be loans. We won't be buying anyone, we don't have those finances”. That’s one of the problems: the only way that Everton have managed to buy these players is by taking on more debt, but Kenwright himself has admitted, “I can’t go on every year as I have been doing, borrowing for transfer funds for David Moyes”.

 

Net debt did actually increase slightly in 2009 from £36.8m to £37.9m (2010 increased to £44.9m), which is nothing compared to the £237m debt at Liverpool or £716m at Manchester United, but it is meaningful, as the club appears to have no way of paying it off. In July Kenwright admitted, “Our debt is a big debt and a worrying debt. It is manageable because of our performance on the field, but it is too much debt that every year is going to be added to”. The debt largely arises from a £30m 25-year loan arranged by Bear Sterns in 2002, which has the advantage of being long-term with a fixed interest rate of 7.79%, but has contributed towards a net interest charge of £4.1m last year (up from £3.9m) (2010 net interest was £4.5m). In fact, in return for the £30m loan, Everton will end up repaying £68m. The accounts also reveal one other obvious reason for the club’s need to borrow – they have no cash at bank. Nothing, nada, zilch. Not a surprise, given that the cash flow has been negative for the last four years: 2009 - £1.8m, 2008 - £10.9m, 2007 – 4.7m and 2006 - £5.3m. The last time that the cash flow was positive was 2005, due to, guess what, the Rooney sale. (2010 negative cash flow of £1.2m despite the Lescott sale)

To be fair, Everton control costs quite well, but their revenue lags way behind other major clubs. The 2009 turnover of £79.7m may have been a record for the Toffees, but it’s significantly lower than the Big Four (Manchester United £279m, Arsenal £224m, Chelsea £206m and Liverpool £185m). Fair enough, they benefit from the riches of the Champions League, but Everton are also a fair bit under their peers (Spurs £113m, Manchester City £87m and Aston Villa £84m). They’re even outperformed by Newcastle £86m – who play in the Championship. How can Everton hope to compete on their level of revenue?

 

Even where revenue has grown considerably, as with broadcasting increasing from £27m in 2007 to £49m in 2009 (2010 increased to £50.2m), this has little to do with the club, being down to the collective Sky Premier League agreement. Everton has a huge dependency on television, more so than other clubs, with 61% of their total revenue coming from this stream (2010 63%), but it just about covers the wage bill (2010 TV revenue no longer covers the wage bill). This will further rise in the next three years by at least £7.5m per annum, thanks to the recent agreement on overseas rights, but Everton would have to qualify for the Champions League to earn the really big money (another £25m). This is why we have a number of clubs building up debts in order to reach the heady heights of the top four – but they aren’t all going to get there …

 

Although the club promised to improve its commercial operations a few years ago, it remains feeble at £9.2m, up just £0.5m from the prior year (2010 increased to £9.7m). As a comparison, Spurs earn £29m commercial revenue. To be fair, the club outsourced its merchandising and catering operations in 2006 and its retail business to Kitbag in 2009, which mean that they receive a lower net income from subcontractors, but even so. Everton boast that their shirt sponsorship deal with Chang is the third longest running in the Premier League, but strangely do not mention where they stand in terms of revenue. It’s definitely a lot less than the deal Liverpool recently signed with Standard Chartered Bank – one promise that Christian Purslow actually has delivered on.

 

But where Everton really fall down is match day revenue, which was only £21.9m last year, even though it rose 7% (2010 fell to £19.2m). It may be even lower next year, following the team’s early exit (4th round) from the FA Cup, though this may be offset by their progress in the Europa League. To place this into context, Manchester United and Arsenal both earn more than £100m from match day revenue, while even Liverpool, whose ground is not much larger than Everton’s, managed to gather £43m.

 

This is the reason why Everton must still look at other options for their ground. Plan B was always to remain at Goodison Park and refurbish their traditional home, but this really would be a case of making the best of a bad job. Limited by a capacity of only 40,000, which is effectively even lower, due the large number of seats with a restricted view, it also does not possess any quality corporate areas for money-spinning hospitality. The ground itself is hemmed in by Victorian housing (and a church) and supported by an inadequate road network. In short, there is no feasible way of transforming Goodison into a modern stadium.

 

Even if Kirkby had gone ahead, it would not have generated much additional revenue. A study performed by Deloittes on behalf of Everton estimated a paltry £6m extra a year and that was based on the club almost filling the 50,000 stadium every match. That would represent an appreciable increase from last season’s average attendance of 35,667 (down from 36,904 in 2008), so Everton cannot take for granted an increase in crowds, unlike, say, Tottenham, whose proposed new ground is partly justified by their waiting list of 23,000 for season tickets.

Others, including Liverpool Council and KEIOC, believe that an alternative location in the city centre can still be found. Although this would be expensive, the suggestion is that it could be financed by some sort of mortgaging scheme, e.g. selling seats for the next 25 years. The council has also indicated that it would favour a ground-sharing scheme, given the financial troubles of both Liverpool clubs. This has worked well on the continent for many years in Milan and Rome and more recently in the Allianz Arena in Munich, where the stadium glows red when Bayern play, and blue when it’s the turn of 1860. How appropriate. However, some worry that this would be detrimental to Everton’s brand, if they were perceived as the junior partners.

 

What other assets do Everton have? In short, not many. The balance sheet has been deteriorating for a long time with net assets of £18.5m in 1999 declining to net liabilities of £26.7m ten years later (2010 net liabilities of £29.8m). The club takes great pains to emphasise the long-term nature of their loans, but the net current liabilities are also at a record high of £37.4m (2010 new record of £40.7m). Most of the club’s assets have been sold off (the training ground, the academy at Finch Farm and the Megastore), which also increases costs for higher rents, while Goodison’s value is declining. The only assets left are the players themselves with intangible assets now up to £39.4m (2010 increased to £45.3m). Nothing has been included in the accounts for home grown players, but the horrible truth is that any (financial) value would only be realised if the player were sold. What price a debt reducing, balance sheet strengthening sale of Jack Rodwell to Arsenal or Manchester United for £15m this summer?

 

There appears to be no way out for Everton short of a wealthy patron buying the club, described by the Bundesliga chief executive as “the greater fool theory - some day a greater fool will come and buy the club”. At least, Everton have not sold out to leveraged buy-out vultures like the Glazers or a buffoon like Mike Ashley, but the club deserves somebody more financially astute than Kenwright, who unbelievably stated, “I do not understand why football clubs have such big debts, it is a mystery”. Indeed, some fans are growing suspicious of Kenwright’s numerous claims that he is looking for an investor (“Every name you see that has been out there looking for football clubs, we’ve spoken to them. We’ve had people in the Far East, America, Switzerland, Japan …”). When challenged on this at the 2009 AGM, Kenwright’s incredible response was, “I’m not answering your question. I’m bored with your question”.

 

Whoever buys the club would need very deep pockets. First, they would have to buy out the directors’ shares (Kenwright 25%, Earl 23%,John Woods 19%), but they would also have to repay the loans, fund a new stadium, pay for new players and inject working capital. Not a very appealing prospect from a financial point of view. Just look atRandy Lerner at Aston Villa: he paid £63m to takeover the club, but has since pumped in another £200m to improve the squad – without spending anything substantial on the stadium.

 

This is a major issue for Everton, as the other clubs striving to break through the glass ceiling all have rich sponsors (Villa – Lerner, Spurs –Joe Lewis, City – Sheikh Mansour). As Kenwright put it in the annual accounts, “maintaining our progress, continuing to punch above our weight will be very difficult”. He added, “At the end of the day, the club’s finances will be key to everything”. If that is indeed the case, Everton’s fans might have to settle for mid-table mediocrity, unless Moyes can continue to “work miracles”.

 

 

 

Realise this could set the whole...'we're gonna die' episode off but I thought it was worth read

[StevO]

The only comment i will make is i dont think the BU are making out they are the people to run the club and to fix these problems. i think they are are asking the people in charge to recognise these issues and bring in professionals to rectify them.

I dont for one second think any of the BU would be daft enough to think they themselves could do the job, they just want the right people brought in.

 

thats how i read it anyway.

 

Broughton would be the man for me. i dont care that he worked for the shite, hes nto a red anyway. but he will have spoken to a lot of people to get the reds sold, he may have met people who would be interested in a cheaper club, im sure he has contacts out there. but im sure he would also want to be paid a premium, which we should be able to afford after our player sales. he may also be a better option to deal with the bank with his track record in multi million pound business.

[Hafnia]

Would like broughton also. Gets the job done, simple as that.

[SimonButtle]

i have just removed all the BU and Peoples Group stuff from my facebook, there is some guy on there going on about bombing Kenwrights house