By David Owen
March 4 – Liverpool’s exciting brand of attacking football, which has carried them to second place in the Premier League, is inspiring dreams of a return to the club’s glory days between the 1960s and 1980s. But the on-field revival has yet to be reflected in the bottom-line – at least judging by the latest published accounts.
The Reds this week unveiled financial statements for the year to 31 May 2013 showing that the club, owned by US-based Fenway Sports Group (FSG), remains firmly, well, in the red.
However, the £49.9 million loss was explained entirely by player amortisation and trading, in what was a busy period for transfer activity at the club with six players, including Daniel Sturridge, Philippe Coutinho and Fabio Borini arriving and a further nine, including Dirk Kuyt and Charlie Adam, transferred out.
Excluding player amortisation and trading, the club would have made a profit before interest and taxation of £14.8 million on turnover well up at £206.1 million from £169 million in the preceding 10-month period.
Managing director Ian Ayre said the results showed that the “financial health of the club continues to make good progress”, with external debt now down to below £50 million.
He went on: “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.”
With the team’s on-field achievements in 2012-13 still below the club’s historical standards, commercial income was the main driver of top-line performance, accounting for £97.7 million of the overall £206.1 million turnover figure.
Staff costs climbed to £130.8 million from £109.2 million in the prior 10-month period, although termination payments fell sharply from £9.6 million to £1.4 million.
The remuneration of the highest-paid director topped the £1 million mark, having been just £657,000 over the 10 months to 31 May 2012.
The club noted that during the period FSG had injected £46.8million to “fully repay a historic stadium loan facility”. It said that since FSG completed its takeover of Liverpool in October 2010, external debt had decreased overall by nearly £200 million.
The financial statements showed that the loss for the year had wiped out what remained of shareholders’ funds, which stood at minus £44.6 million at the close of the year.
Nonetheless, the improved Premier League TV deal, which will benefit all top-tier English clubs, combined with the Merseyside team’s dramatically improved on-field record in recent months, with Champions League qualification now probable, should mean that a period of much smoother financial sailing is now in prospect.
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