ToffeeWeb - Season 2008-09

The Mail Bag

Kirkby: A lame argument?

With the club announcing a record turnover, with a 49% increase in revenue, resulting in a pre-tax profit of £6.8 million, is the financial argument for moving to a new stadium starting to sound a bit lame??

Now I am not just talking about Kirkby here, I am talking about any new stadium. £6.8 million profit while still a 'ramshackle, broken down' Goodison Park?... never! Have the Everton Board of Directors just shot themselves in the foot, when it comes to their argument for moving to Kirkby?

Success on the pitch is really the only thing that will make a club financially successful. After all it's the team that wins games ? not the stadium, isn't it? On that basis, is the only thing we really need a few more seats and a lick of paint for the time being?
Brian Baker, Aldershot Posted 18/12/2008 at 05:51:43

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Simon Stanley
1 Posted 18/12/2008 at 14:25:54

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Profit after admin and finance expenses is £27,000.

Simon Stanley
2 Posted 18/12/2008 at 14:31:05

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Sorry. After player trading and finance charges, profit is £26,000. My mistake.

Jay Harris
3 Posted 18/12/2008 at 14:43:47

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Totally agree with you, Brian, but from a different perspective.

Kirkby with a loan interest charge of between £7 and 10 million a year will increase costs significantly and I cannot see an increase in gate receipts nor corporate income to cover it let alone make a profit.

It?s a time to improve what we?ve got and look for more cost effective stadium development in the meantime.

Matt Byrne
4 Posted 18/12/2008 at 15:14:03

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Now I am dead against the Kirkby plan, but I just would like to know how a loan of the reported £78 million it would cost Everton for the stadium would result in an annual interest payment of £7-10 million?

I also think the reported £1 million per year just to keep Goodison ticking over is a bargain. I personally would like to see the stadium redeveloped bit by bit as has already been documented by many. I also fail to see how building a supermarket with a shed on the side would be attractive to would-be investors. Surely a mad arab sheikh with bags of money would want to build a stadium to his own design? They are not going to come along and say, "Wow, you built a stadium for £78million, yes i?d love to pay the £150million or whatever you now value it at, Bill."

Also, they should then rename the club, calling it Everton but moving it to Kirkby is surely against the trade description act! and yes my tongue is firmly in my cheek before you all start arguing.

Jay Campbell
5 Posted 18/12/2008 at 18:12:42

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Correct - sucess on the pitch is the first priority everythin else will follow.

Kirkby is for several people connected to Everton and Tesco to get their pockets lined and thier retirement funds bolstered NOTHIN ELSE!!

Paul Niklas
6 Posted 18/12/2008 at 19:21:36

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Matt, the loan at interest only would cost about 10%, however it all depends who is lending the money, the banks are not in a position to at the moment, Tesco may involve their own bank to loan the amount as part of the overall deal which may bring the interest down to about 6% as interest only with the capital repayment at the end of the agreed term.

It will be in the region of £6 to 10 million a year, by the way mezzanine finance is sometimes used which is a collective of wealthy individuals funding the whole amount but this can as high as 18% at times.

Money is costly today despite interest rates being low, it's all about risk and the more the risk the more the cost.

Robbie Muldoon
7 Posted 18/12/2008 at 21:40:17

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Kenwright gave the right solution today... finish in the top 4!!

If we could finsh in the top 4 within the next 3-4 seasons and quailfy it would change the dynamics of our financial situation dramatically. We should be fighting for 4th with all we have because of what is at stake. Kirkby is just a device to enable Kenwright to be able to sell.

Andy Callan
8 Posted 19/12/2008 at 10:59:29

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Why can?t you get it in your head that we need to leave Goodison ?coz it?s old, rundown and can?t be rebuilt in it?s current footprint?

We are NEVER going to complete on a financial level with Man Utd etc, but by moving and trying to generate more cash at least we will have had a go at it.

Damian Wilde
9 Posted 19/12/2008 at 12:10:36

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Jay Campbell, where?s the evidence that Kirkby is solely for ?lining people?s pockets?. Could there be a possibility that it?s for other purposes??? I know your answer to that will be ?no? as you seem unable to take anyone else's viewpoint into account other than your own. You?re a bit paranoid aren?t you, Fella?

Graham Atherton
10 Posted 19/12/2008 at 11:57:47

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Success on the pitch is important, but just as important is to be in a position to take full advantage of any success.

It matters that, even if we qualified for CL, the current facilities for fans and commercial over and above 34 000 are poor. We need increased numbers of everyone attending those matches and that means having facilities to compare with the best in Europe.

No one part of the ?building for success? is more important than any other in the cause of delivering sustained improvement in our competitiveness. The sustained success of the team depends on income ? income depends on making the absolute most out of our fanbase. You can?t do that in a stadium with poor sightlines for 20% of the seats, little room and a tent in the car park, no matter how many times you paint it!

Tom Green
11 Posted 19/12/2008 at 12:28:58

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I disagree with most on here, the only way we will get success on the pitch is if we spend millions on world-class players. To have multi millions, you need bigger crowds, ie 50,000+, and will also attract better players. Now some people?s term of success is finishing in 4th place; mine is a little different ? we need to finish in a Champions League place, yes ? but we also need to win cups.

Tom Green
12 Posted 19/12/2008 at 12:47:23

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Its a vicious circle, guys, it used to be success equaled money; now, in today's game, it is money equals success... sad but true.

Jay Harris
13 Posted 19/12/2008 at 13:34:47

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Paul Niklas,
thanks, you answered the interest question very well but we should also bear in mind the £78 million is not a fixed figure, it relies on £52 million of retail cross subsidies which even if the current climate wasn't so bad would be difficult to achieve.

IMO the end cost if it happens will be likely around £100 million. With GP only valued at around £13 million and mortgaged to the hilt, it makes you wonder why this Kirkby madness goes on.