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Damning Facts

Comments (71)

I would like to set out how much our club is badly financially run.

1. Everton's net spend since the Premier League began is £55M (1992-2011); in the same period, we have sold £48.2M of youth players, meaning the club have spent just £6.8M of the money outside of youth players sales.

2. On the Official site we have 30 1st team players listed, 15 of which cost nothing, 7 cost £3M or less, 3 cost £5M or less and 5 cost more than £5M, given that Yakubu is one of the last 5, is out on loan, this now means over half of our squad cost nothing.

3. In 1998, before Sky and Premier League windfalls plus shirt sponsorships, Everton broke the transfer record for £2.2M (Cottee) yet, 23 years later, 20 out of our 30 squad of players cost less to buy than Cottee, and the club tells us we can't afford a loan player!!

4. Our net spend is the 11th highest in Prem, yet we are only one of 7 clubs to play in every Prem season.

5. Villa and Spurs are similar clubs & gates to us yet Villa have spent £60M net and Spurs £140M net more than us.

6. Wages? you ask... No, we are only 10th in the wages league.

7. Moyes has spent £106M but sold £81M, net £25M over 9 seasons, less than £3M per year. 10 managers have spent more than Moyes despite only Ferguson and Wenger being in their posts longer than Moyes.

8. Other possible explanations for the missing money: the ground? One stand rebuilt since the Prem started, and even that was cut in half, supposed to be two-tier.

9. In the last 3 years, here are some of the net spends of clubs over that period: Stoke £44M (£0M debt apparently despite that outlay); WBA £19.25M; Wolves £21.65M; Hull £13.9M; Fulham £12.3M; Birmingham £29.5M... also outspent by Sunderland until the Bent transfer ? what is Everton's spend over the same period? £5M!!

10. Other revenues acquired recently which have vanished: Chang £12M; Bellefield £8M; Kitbag £5M.

Summing up, despite being 1 of only 7 clubs to play in all Prem seasons, despite only spending £6.8M in 19 years outside of youth player sales, despite turnover that was £47M in 2006 but has hovered around £80M since, despite most of our time in Prem having the smallest squad, despite being only 10th in the wages league, despite being only 11th in net spend on transfers, despite having fairly steady around 35k gates in Prem, Bill Kenwright tells the fans we cannot afford a loan player or spend an amount we broke the transfer record with (£2.2M) on a player, 23 years later...

You, sir, are having a laugh, at our bloody expense, mate. Money is going astray in the bucket loads and you, BK, are responsible either directly or indirectly. In my opinion, BK is a stooge (see Alan Ball's book for that) and is DESTROYING OUR CLUB.

People's Club? Again you're having a laugh at our expense... you (BK) wouldn't even answer a Shareholders genuine question, you won't even allow an AGM or EGM... do us all a favour mate: your game is up ? RESIGN NOW.
Thomas Williams, Kissimmee     Posted 30/01/2011 at 01:59:03

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Derek Thomas
1   Posted 30/01/2011 at 07:15:34

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Hear Hear and so say all of... me.

Denial, by both (some) fans and board, It's been said before and it's always true, crisis what crisis 1979 etc. It will have to and very well might, get much worse before something is done. Then we are in catch up mode.

The supporters fund is in it's infancy and may not make it. My hope is that in 5yrs we 'could' be 100m to the good. How much would a Club in League one cost.

It can't happen to us?? just refresh your memories, what year was it that Villa were in the old 3rd Div.
Matthew Lovekin
2   Posted 30/01/2011 at 08:09:46

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Thomas, I understand what you are saying, however would you rather BK borrowed £200m from the bank to give to Moyes? Therefore getting Everton massively more in debt with huge interest rates that we can't afford to pay back?

What if Moyes spent £100m this transfer window, would you be happy? Money doesn't guarantee success.

Eight of Barcelona's starting XI are from their youth side, with many more on their bench. Does that mean the President doesn't back and provide money for the manager?

I understand what you mean about money going astray, the last published accounts show £21m spent on operating expenses!!! What are these expenses? We should have a breakdown as £21m is a hell of a lot of money!

However, there is a recorded debt on the balance sheet (can't remember the latest figure) which obviously we are paying back (successfully) with interest charges, but do you really want BK to increase the debt even more and we outspend our needs?
Joey Brown
3   Posted 30/01/2011 at 08:35:45

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Well when you put it that way!!
I agree this is ridiculous. The fact that we bring in no one and send out 3 pretty much sums up the end of Moyes. I'll be amazed if he doesn't walk this summer or sooner. I would.
Gavin Ramejkis
4   Posted 30/01/2011 at 09:09:00

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Thomas, its slightly worse in that point 8, the Park End was funded by a grant the club didn't pay for it and it's still screaming out for at least a second tier.

Matthew, Barca's youth setup is probably second to none, Messi came through it, their scouting system, economic power and brand name is a pretty much guarantees anything they want in terms of youth scouting.

No one will provide detail on these operating expenses which simply don't equate to wages, some fucker somewhere is making a pretty packet out of the club or is it Green's loans finally being called in? Don't forget the "silent man" still hasn't been named from the whole DK fiasco despite a Freedom of Information Act request to KMBC and a court ruling saying it had to provide the information requested. There are dark forces behind BK and he brought them inside our club.
Steve Sweeney
5   Posted 30/01/2011 at 09:45:31

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Matthew #2

Kenwright can't borrow anything against EFC, he has mortgaged everything and he has never, and it looks like he will never, put any of his own money in.

His smug face when we went 1-0 up yesterday sums up the man. He has gor to be forced out.

Jon Beck
6   Posted 30/01/2011 at 10:30:11

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A stark analysis indeed and clearly Everton as a business needs to do something drastic to either increase revenue or reduce costs, whilst Everton as a football club needs to continue as a top flight presence imo. It does feel like new investment and ideas are badly needed, but I can see why the figures, however opaque, put off new investors, however sincere the search for new investment is. Worrying times.
Richard Dodd
7   Posted 30/01/2011 at 10:44:43

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Bill Kenwright is an excellent Chairman managing the Club within its means to ensure THERE WILL ALWAYS BE AN EVERTON!
Brian Waring
8   Posted 30/01/2011 at 10:47:56

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Richard, if BK is such an excellent chairman, could you explain why we haven't even got the money to pay the wages of any loan players?

By the way, that comes from your other hero, Moyes.
Jimmy Hacking
9   Posted 30/01/2011 at 11:00:21

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BK #7

There will always be an Everton I'm sure... it's just that soon they will be playing in the Northern League Division One, and personally my ambitions stretch a little higher than that.
Phil Rodgers
10   Posted 30/01/2011 at 10:57:56

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I just want to know why we can't sign anyone, from the horse's mouth. What is making us so skint? How can we offer Pienaar a new contract yet we are unable to use that money on someone else?
Ray Roche
11   Posted 30/01/2011 at 10:52:56

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Matthew Lovekin #3: I think the point is, Matthew, that we shouldn't NEED to be begging off the banks, with those stats we should be debt-free.

If there is a worse run BUSINESS in the UK, never mind football club, I'd like to know how they're still IN business. The whole club needs a major overhaul, everything from the ridiculous queues to buy an overpriced meat(?) pie at tea bars that were deigned far too small, with too few staff, to the rubbish organisation whenever we are required to queue up for tickets ? all of it needs looking at by someone who knows a thing or two about running a football club or, indeed, any sort of organisation.

And it's a historical problem, too. The club has been mis-managed for decades. The Main Stand, built on the cheap. At the time, the cost of a cantilever design wasn't that much more expensive than the finished article but the club cut costs and ended up with hundreds of obscured view seats.

The Park End is another good illustration. A relatively recent construction it is nowhere near good enough for today's game. Poor concourse facilities, inadequate exits, it says it all that whenever a thread is running on this website regarding reconstruction of Goodison it is nearly always the first stand to be demolished and rebuilt properly.

This is tradition that Kenwright is continuing to this day. Is he waiting for another Russian or Arab billionaire to come and bail him out? Bill, it 'aint gonna happen. Just do one.

Steve Cotton
12   Posted 30/01/2011 at 10:57:28

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I have it on good authority that we were hoping that Arsenal would come back in for Jagielka this month. The money would have gone primarily on the debts but it would have helped bring in one new face.

Bear in mind that this season we have let Yobo, Wallace, Agard, Vaughan and Yakubu go on loan, saving a combined £110,000 a week, coupled with the sale of Pienaar for £ 2.5M, also saving £45,000 a week. So we are £ 150,000 a week better off and cant afford one player.

I assure you that even ONE player coming in would lift the Everton faithful. Players are flying around the Prem on loan and we cant get one in!!! FFS What about O'hara, Ireland, Pavlyuchenko, Keane is going to West Ham who now have 5 strikers!! Vela to West Brom! Steve Sidwell would have done a job in the middle, Wright Phillips is trying to get a loan!

Wayne Routeledge, Sully Muntari, Kyle Naughton, Paul Scharner etc.... someone would give the fans a boost and take a bit of pressure off Moysey and the team..

Perhaps the club is holed below the water!!!

James Stewart
13   Posted 30/01/2011 at 11:27:39

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Great Piece and facts are incredible. Our great club is run by absolute incompetents.

Moyes is paid highly enough to keep him toeing the Kenwright doublespeak. While everyone else gets shafted.

It does beg the question though: Where the fuck does all the money go at this Club?! If you took Rooney and Lescott out of it, would we still have a club!?
Roger Trenwith
14   Posted 30/01/2011 at 11:46:43

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A cursory look at Companies House website shows Everton Football Club Limited currently have listed forty seven (!) Particulars Of A Mortgage Or Charge (basically notifications of assets being secured against loans). How many of these are still outstanding is not known, but it gives some indication as to where the club's income is going, namely loan repayments and financing loan interest. Virtually everything the club own, including future revenue streams from season ticket sales and television money, is in hock.

The company is unusually late filing its 31 May 2010 accounts at Companies House, and has until 28 February 2011 to do so without incurring a penalty. It could be that the delay is down to the auditors asking for a plan to show how the company intends to remain trading for more than the following twelve months, which is a duty of the appointed number crunchers, and until they are satisfied with the club's answers, they will not sign the accounts off.

Looking at the 31 May 2009 accounts may give some clue as to the company's plight. On a turnover of almost £80M, 61% (!) of which comes from TV money, £49M was paid out in wages and the accounts show a loss for the year of £7M. The total amount of monies owed was nearly £79M (fig A), coincidentally almost the same as the turnover. The total of fixed assets (mainly the wonderful but seriously dilapidated stadium) plus intangible assets (mainly player's registrations) plus monies owed to the club was nearly £54M (fig B). If you subtract A from B you can see that the club has a balance sheet value of minus £25M. Says it all really.
Roger Trenwith
15   Posted 30/01/2011 at 11:52:20

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James - in answer to your question, probably not, or we'd be in the Championship with a points deduction for going into administration.
Christopher McCullough
16   Posted 30/01/2011 at 12:13:04

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Mortgage means death pledge in Latin.
Brian Denton
17   Posted 30/01/2011 at 12:32:47

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Strictly speaking, 'mortgage' is Old French (Christopher McCullough post #16)

I'll get me coat..............
Christopher McCullough
18   Posted 30/01/2011 at 12:35:45

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French is Latin language, though, surely.

Mortgage: from L. mortuus, pp. of mori "to die"+ gage ?pledge;?

Anyway, it's no way to run a business.
David Thomas
19   Posted 30/01/2011 at 12:31:53

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Steve,

I know it's all abour opinions but I for one would not be lifted / boosted if we brought in any of the players you mentioned in your post. I would rather stick with what we have at the moment than bring in any one of the names you listed.
Tony Hughes
20   Posted 30/01/2011 at 12:38:49

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Richard Dodd, if any further evidence about your sanity was needed, your post finally confirmed it!! You are off your trolley, mate!
Steve Cotton
21   Posted 30/01/2011 at 13:17:05

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Dave I appreciate that neither of us think any of that list will be much benefit... But surely we need a bit of depth and someone like Scharner who can play in defence, midfield or attack would have been a great addition particularly on a free... and the bastard always scores against us so there is another plus.

if we do as you say and wait till the summer, you know as well as I do that the big boys come and there will be the same shit left to bid on for over the top prices.

We are not that far from a steady side and two players would really help. We can't afford to buy so loaning is all we got, mate.

Next summer, you will be pulling your hair out at our failure to strengthen once again, I just know it...
Mark Wayman
22   Posted 30/01/2011 at 13:33:13

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Blind faith is naive or very dangerous.

I can't agree that Kenwright is an excellent chairman. Let us just say that he is searching 24/7 for investment. That isn't is only job. He is in charge of just about everything at the club via employing others in the interests of the club. For instance marketing/merchandise sales. Outside of the official club shop we have very little visiblity on the high street in our own city. That is very neglectful.
Alan Ross
23   Posted 30/01/2011 at 15:17:39

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What concerns me is there will always be a Doddy (Kopite in disguise) winding people up.
Brian Waring
24   Posted 30/01/2011 at 15:53:08

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Not having a dig at you Alan, but you shouldn't call a fellow blue a Kopite, no matter how sycophantic they are.
Craig Taylor
25   Posted 30/01/2011 at 16:05:28

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Totally agree but Cottee was neither bought or sold in 1998 was he?
Jay Harris
26   Posted 30/01/2011 at 16:06:49

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I agree with you Brian but Doddy's got to be the closest thing to an Evertonian Anti-Christ going.

I do believe it's all a bit of a wind-up on his part but in these depressing and worrying times he can be a pain in the proverbial.
Michael Kenrick
Editorial Team
27   Posted 30/01/2011 at 16:19:31

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Alan Ross (#24): we don't tolerate anyone calling Evertonians "kopites". And Doddy is not winding people up ? he's posting his opinion. Respect please.
Brian Denton
28   Posted 30/01/2011 at 16:36:26

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Craig (#26) I think it's a typo for '1988'............
Brian Waring
29   Posted 30/01/2011 at 16:44:24

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"Evertonian anti-christ" ? I like that one, Jay.

I sometimes wonder if he is able to keep a straight face when he's typing away.

He did tell us the other day though, to expect a decent loan signing before the transfer deadline. I hope he wasn't on about that Greek lad.
Gavin Ramejkis
30   Posted 30/01/2011 at 17:04:25

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Brian, I think he uses the same hallucinogens that Black Bill uses.

Go to bed early tonight ? there will be fuck all coming into Everton before midnight.

Glen Anderson
31   Posted 30/01/2011 at 18:06:14

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Christopher McCullough (#18) ? Absolutely correct, French is simply an evolution of Latin Vulgaris (which was the Latin widely spoken in the Roman Empire) so in a way it is Latin, just evolved by 2000 years.

Anyway, definitely agree that it is no way to run a club. In Germany and France it is not permitted to run a club in arrears like this and makes for a much more level playing field. If the Premier League had a similar rule, I wonder how much this would help clubs like Everton?
Gaute Lie
32   Posted 30/01/2011 at 19:04:31

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I don't think we are in for any treats this season. Players going out, no-one in to replace them. It is obvious to anyone Everton is in BIG trouble both on the field, and when it comes to the finances. We truly are in a bad state, and I can't see any short-term solutions. As long as there is no cash in sight we'll have to fight just to stay in the Premier League.

So. What happens if we get relegated?

Would we be down there for many years, or would we be able to show our fighting spirit and climb up again, fast? Would we loose our best players? Would we loose too much money (tv money, commercial+++)?

Would Moyesy leave, or is the second tier more suitable for him as a coach?

I have no solutions whatsoever. I just want to be prepared if the worst scenario is to come true.

Karl Masters
33   Posted 30/01/2011 at 18:49:36

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I think we really deserve to know more about these £21m of operating expenses.

A quarter of our turnover???? Highly suspect in every sense, suggesting covering up either incompetence or something even worse.

These are facts from the published accounts and I think we should stick to facts and not rumours of administration etc.

I have thought for a long, long time now that our off-the-field performance is dire and our on-the-field performance the complete opposite when you consider how little our Manager has to spend.
Steve Pugh
34   Posted 30/01/2011 at 19:08:36

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How much goes to pay Bill's special friends that allowed him to buy the club? Has anyone ever disclosed what interest is on those sort of loans?
Craig Taylor
35   Posted 30/01/2011 at 19:24:09

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Yes Brian, realised that but my battery died when I was typing!!!!
Michael Kenrick
36   Posted 30/01/2011 at 19:15:23

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Steve, I don't think anyone is privy to that information. The perception was that Bill had to remortgage his house back in the day to afford his wedge of TBH/Everton shares... total cost around £7M. House value: I think it was around £2M...

In all likelihood, Bill borrowed a significant amount of the remaining £5M ? possibly from Sir Phillip Green in the form of a private loan... but this is all speculation.

Jay Harris has speculated that the loans required to buy the Everton shares were made against the company itself ? a leveraged buy-out that to me defies all financial and business logic ? unless, of course, you happen to be the primary beneficiaries.

Perhaps some business finance expert could let us know more about this ? if such a manoeuvre is legal, and how such things are tolerated in business. Clearly they are acceptable, as I believe this was essentially what happened when the yanks first came in at Liverpool and Man Utd. Poses the question: why Kenwright can't be ousted by someone doing the same trick. But perhaps per the recent Liverpool model, you need to be on the Board in order to pull off such a trick?

Al Reddish
37   Posted 30/01/2011 at 19:49:29

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If it turns out like the redshite, maybe this is one trick that's worth missing though. I don't know about you lot but with these rumours of fall outs, administration and another inept transfer window, I will be glad of a summer with no footie to recharge my batteries!!!!!!!!!!!!
Richard Dodd
38   Posted 30/01/2011 at 19:41:35

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Thank you, Michael. Anyone who knows me is all too aware that I am neither a kopite nor a wind-up merchant. Like many, many other Evertonians, I just happen to believe that both Kenwright and Moyes have done a great job in keeping Everton in the top echelon of English football on very limited resources. Their sin seems to boil down to the fact that they support each other and aren`t prepared to risk bankrupting the Club by borrowing money difficult to service in terms of interest. Whilst our club`s indebtedness is modest in comparison to many Premier League outfits, every care must be taken to ensure that remains the case.

The trouble with so many football followers is that they are obsessed with the illusion that the only good directors are those who can and do hand their manager a blank cheque for signings in every window. Spurs come to mind... as do several clubs no longer in the Prem!

John Gee
39   Posted 30/01/2011 at 20:06:39

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I've defended Bill from the vitrol routinely peddled on this site... But I have to concede those figures are damning. Where has the money gone? I'd love Bill to start pulling rabbits out of the hat but it's not going to happen.

Bill... Back the manager with cash or do what the Wolves chairman did and give your shares away to someone who garentees to give the money straight to Moyes. And by the way, am I right that we're part owned by the Grantchester family? One of the richest families in the country? Hey! If you're not interested in football then give shares away too!
Colin Fitzpatrick
40   Posted 30/01/2011 at 19:51:59

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I don't think any money is missing from the accounts, in fact, scrap that ? there's definitely no money missing from the accounts, money from Chang, Bellefield an Kitbag, it doesn't get paid in single payments, will eventually appear in the applicable annual accounts; there are issues but I don't think thay are some of them.

Certainly, despite all the rhetoric to the contrary, there's a total lack of transparency on matters off the field but, for me, the real issue is that the directors, led by Bill Kenwright, are no nearer solving the conundrum of how to significantly increase the club's revenue streams so that we can allow the manager to compete. The board's last proposal, Kirkby, was a disaster on every conceivable level; it would have contributed absolutely nothing to the long-term well-being of the club. We can cut costs till we're leaner than a lean thing but market forces dictate how much footballers cost, how much they're paid... and if we can't compete with our peers in the marketplace, we all know what will eventually happen.

On the 31 December 2010, less than a month ago, we borrowed millions, once again, against our future Premier League money; since then, our latest credit rating score has now been reclassified as red, cash dealings only, due to a score of just 12 out of 100 (down from 30).

We've sold and loaned out players which means that money has come in to the club and our wage bill is eased but it would appear the manager has no funds to operate in the transfer market, the third in a row. Yet some still think Bill Kenwright is doing a good job; the reality is, on balance, he has rarely done a good job and over the past 18 months he has been a truly appalling chairman.

Who could replace him? In my honest opinion Betty the tea lady could be installed as chair and you wouldn't notice the difference.
Peter Dry
41   Posted 30/01/2011 at 20:03:02

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Richard or can i call you Ken? The person who is most obsessed about blank cheques or lack of them is David Moyes. Alls he has banged on about for nine years is having no money. Fans' obsession with blank cheques has been embedded and precipitated by David Moyes' relentless whinging.
Pete Sullivan
42   Posted 30/01/2011 at 20:00:10

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I wonder if BK has put a single penny into the coffers of Everton since he took ownership. I mean does he pay for his seat? Does he pay for his program, or the food and drink in the boardroom or any merchandise?

All he has done is (probably) borrow to finance his own purchase of Everton shares. Any spend on players has come from mortgaging and remortgaging and remortgaging (or selling) the club' s assets (Bellefield). Anyone could have done that. The only thing that has saved his bacon so far has been the miracles worked on a shoestring by Moyes. In my view, DM actually holds all the Aces... he should start pressuring BK to put up or sell out or tell him he will do one. Problems getting a job for DM? I don't think so.

Time to get out, BK ? you are a good guy, but you will ultimately be the architect of the club's downfall unless you go... the sad thing is ? you can't see it.

On a related point, wtf does Jon Woods contribute?

Jay Harris
43   Posted 30/01/2011 at 21:10:03

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Pete, with the information available, not one of the directors or shareholders have put a penny of their own money into the club.

They have of course bought shares and therefore ownership of the club which gives them certain rights including holding the fans and small shareholders in total contempt...
Gavin Ramejkis
44   Posted 30/01/2011 at 21:08:54

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Pete, I posed the very same statement about the likelihood that paying customers and season ticket holders will have put more into the club than any of the directors as they only bought shares and DK hearings showed they haven't and won't spend a penny of their own on the club.

Jon Woods closed rank with BK at the last AGM and the one share, one vote to bury the DK questions; I've always thought of him as the silent man, maybe someone closer to the club can shed a light on him?

Colin F ? what do you know about him?

Thomas Williams
45   Posted 30/01/2011 at 21:39:28

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The gist of my article was not to borrow more money for blank cheques, it is the fact we have had loads of money in since the Prem started, but as the above states we havent spent it on players, wages or the ground, we have spent £6.8M of our revenue in 19 years outside of the money recieved from youth players, so how are we borrowing from future revenue both in the past and the future? Something or someone is seriously amiss with our finances. Cottee year was a typo, sorry.

BK borrowed money from Greggs wife to buy his shares? Has that debt gone onto the club? We had allegedly £25M debt when BK took over; why, despite buying little and selling off everything, is our debt now £60-85M? ? despite turnover doubling in last 3 years.

Maybe the local lads can bombard LFC Echo to get them to investigate or we boycott that paper/rag?

Dan Patterson
46   Posted 30/01/2011 at 22:07:16

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I'd like to add something to this debate relating to where our money went.

I once worked closely with a person who was employed by the club as a business development manager, and this person was paid very handsomely for the job.

However, they also worked for the company that I worked at, and I was privy to a lot of information without ever revealing I was anything more than a fairweather blue, despite having a season ticket for 10 years.

This person, alongside big fat Keith, Bill et al used to organise a number of "promotional trips" to places such as New York, Asia and Europe which were supposedly in order to garner new sponsorship for the club... they were at one point close to signing a deal with Air Asia after the early success of the Chang deal. They also came close to agreeing to let Jamie Oliver's charitable restaurant chain take over catering at the club but got a better financial deal from Sodexho.

All in all, these trips came up with very little revenue, but what struck me at the time was how frivolous they were with money. I heard a number of phone calls between this person and others at the club moaning about early flight times to New York, so they instead used to charter a plane from a company called SilverJet and pay an absolute fortune to be flown privately, including limos, amazing hotels etc.

I'm sure that this type of spending is small fry compared to overall turnover, but the impression I got was that the people who ran the club ran a footballing lifestyle as good as the players, which the fans obviously paid for.

I've never bothered telling anyone this before, but for me it puts into perspective why the club is in such dire-straits as clearly no-one has ever watched the pennies, and so we have no pounds to spend!
Paul Henshaw
47   Posted 30/01/2011 at 22:15:01

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Here's a link for those who are interested in where are money goes... Read it and weep!

http://www.football-finances.org.uk/everton/2008/

Gavin Ramejkis
48   Posted 30/01/2011 at 22:14:19

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I'd really love a wikileaks type expose on the EPL and to blow it's whole crooked backside wide open for all to see the corruption and dodgy dealings. More and more people are falling out of love with the game and when your club fucks you over, it doesn't take much more to break the camel's back and drive you away from even turning out and spending your hard-earned on it.
Chris Jones
49   Posted 30/01/2011 at 22:23:16

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We're in deep shit until we get rid of BK.
Jay Harris
50   Posted 30/01/2011 at 22:41:25

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Thomas #45 and #46.

BK inherited an overdraft of £5 million which the banks at the time were unhappy with because BK could not give them a personal guarantee, as Johnson had.

However, there was money to come in from player sales so effectively he inherited a debt-free club.

Yet, at his first set of accounts, the debt had risen to over £20 million, raising the question in my mind ? was there a loan taken out on the club to secure Kenwright's share purchase???

I know it's all speculation but if you add the fact that Kenwright's house was only worth £1 million at the time and he allegedly remortgaged that, it begs the question: where did he get the rest from?
Darren Dempsey
51   Posted 30/01/2011 at 22:31:20

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We are in the shit and it's getting deeper! Kenwright's silence is deafening; you couldn't get the luvvie off the tele when we got to the Cup Final... now that it's all going tits up ? where is he?

I'm not saying it's all his fault ? it's the board as a whole!

SELL UP AND SHIP OUT THE LOT OF YOU!

You're KILLING our club! The administration rumour was started by a gobshite by the way!

Brian Murphy
52   Posted 30/01/2011 at 23:15:36

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Thomas ? great article and well done on getting these figures together.

What really worries me is the story I'm hearing that we have to raise £9 mill between January and the summer just to meet loan demands and generally just bloody keep things ticking over at club. So £3 mill for Pienaar and his wages = £4 mill. Another mill for Yaks wages = £5 mill.

Vaughan's on what, maybe £10k per week so that's another £250k off. So who is gona be next? I know we haven't a pot to piss in but how the he'll has it come to this?

John Shaw
53   Posted 30/01/2011 at 23:27:38

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Brian (52) ? is there any basis in the 'story' you have heard? I mean some of the ones doing the rounds at present range from hilarious to absolutely terrifying!!

As well as yours, there are also: Moyes has resigned; Neville, Rodwell and Bily are about to be sold; we will be put into administration tomorrow ? amongst others!
John Shaw
54   Posted 30/01/2011 at 23:38:39

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Brian (52) - another point is that things can't be that dire or we would not have got the loan from Barclays at the end of last month, I hope........
Brian Murphy
55   Posted 30/01/2011 at 23:45:32

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John (#53 & 54) ? I wish it wasn't from someone close but it is from someone with the inside track. I have no desire to post bullshit as it is really pissing me off to see us in this position. When I heard this on Friday last, I could not believe It had gotten this bad. All I can say is don't be expecting the squad numbers to be going in a positive direction tomorrow.
Steve Smith
56   Posted 31/01/2011 at 00:57:00

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These articles are getting a bit silly to be honest, and always lead to "it's Bills fault".

First of all, as Colin Fitz says above, there is no money missing from EFC's accounts, and to make the accusation is probably verging on the wrong side of the libel laws.

So let's imagine that tomorrow Bill and the board resign or sell their shares; on Tuesday, we will still be a club that turns over £80M a year, we will still be a club that gives 70% of that money to our players, we will still be a club that needs a wholesale redevelopment of GP or a new stadium build, we will still be a club that cannot afford even the wages of really top stars let alone their transfer fees, we will still be a club that even if we were 10 points clear at the top of the Premier League, could only sell 40,000 tickets per game.

So carry on blaming everything that moves at GP, carry on looking for scapegoats for all our ills... but, somewhere along the line, you also have to acknowledge that our worth, in the great scheme of things, ain't gonna change just because these people we have now decide to sell up.

I would love someone to come up with a believable arguement that, as we stand at present, we would be an attractive business to buy in to; I can more or less guarantee that no one on this site can.

Derek Thomas
57   Posted 31/01/2011 at 03:08:41

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What was this new loan for? To pay the interest on the others or some othe 'rob Peter to pay Paul' scheme.

I'm sure there is no money missing from the accounts. I'm sure there is a perfectly good 'letter of the law' explination for the total mismanagement of the club.

Something along the avoidance versus evasion, carrying over, adjusted for inflation, debts as assets, borrow on the strength of. In fact all the usual Enron type excuses.

I don't care about libel or defamation, because I ALSO don't have a pot to piss in; but hey, that's ok... coz I'm a fan too.
Danny Broderick
58   Posted 31/01/2011 at 03:31:46

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Our net spend is the 11th highest ? that sounds about right to me. We are 10th in the wages league ? again, that sounds plausible to me.

But where are we in the revenue league? Because, if we spend £49 million on salaries, then that only leaves us £31 million a year to operate with, and it doesn't leave much (if anything) for investing in the squad, when you consider that we must be paying back maybe £10 million pa in interest on our debt, plus overheads etc.

We need to raise our revenue streams. If we don't manage this, we will have no option but to be so reliant on producing homegrown players to make up the squad, and selling off the better ones to boost our income.

Gavin Ramejkis
59   Posted 31/01/2011 at 07:21:15

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Steve #56 so leaving BK and his board in place with their failing business model and a decade of failure and growing spiral of debt which has left us with no collateral and a ridiculous credit rating is the way to go? Should we just wait for the administrator and be asset stripped into the void then?
Alan Ross
60   Posted 31/01/2011 at 07:31:31

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Doddy,
I sincerely apologise for calling you a kopite. I took it that you actually believed in what you were saying. Overlooking the fact that you meant it sarcastically. I bow to your superior wit.
Eric Myles
61   Posted 31/01/2011 at 08:00:56

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Richard Dodd,

I used to have respect for your rather 'unorthodox' views, however much I disagreed with the.

However, now you're just taking the piss mate.
Michael Brien
62   Posted 31/01/2011 at 07:26:23

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Every Transfer window there is always an expectation of new players arriving. And disappointment if expected signings don't materialise. However, as has been pointed out, spending money doesn't always guarantee success on the pitch. A couple of years ago, one of my mates pointed out that at that stage of the summer close season both Stoke City and Hull City had spent more than Everton. I was equally frustrated at the lack of transfer activity and could only reply with "Maybe they are spending money that they haven't got."

In their time in the Premier League, Hull City assembled a fairly expensive squad. But the wheels started to come of with relegation and issues of massive debt. I noted that last week one of their main signings of their PL time, Jimmy Bullard has been loaned out to Ipswich.

There was also the case of Portsmouth ? if you look at the squad that won the FA Cup in 2008, how many are still at the club? On some of the smallest attendances in the Premier League, they were paying some of the highest salaries.

We can't compete in the top end of the transfer market, and we really need to get used to that. If it's any consolation, I remember when we were able to pay some of the highest fees of the day back in the 1970s, in signing Bob Latchford and Martin Dobson. But I think it is also worth noting that at that time one of our best signings was a certain Andy King from Luton for around £35,000.

The only way that we can compete is to try and emulate the likes of Arsenal, Barcelona and Ajax. Develop our own talent and look for promising young players in this country and in Europe. Fabregas was not a big name when he joined Arsenal, neither was Patrick Viera. It takes time but it can be done!!

Alan Williams
63   Posted 31/01/2011 at 08:08:55

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Thomas, you fail to mention expediture for the club which includes wages, agents fees (£3 million last year) interest on loans and the general cost of running EFC. If you add them all up then your may just answer your own questions. Too many breakfast at the Ponderosa, I think. COYB
David Watkins
64   Posted 31/01/2011 at 08:27:24

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G'Day guys,

As a recent convert to football and Everton fan (living in Australia), I stay up to ridiculous hours to watch as much EPL as I can. Yes, the A-League is terrible.

I have fallen in love with this club over the last 2 seasons mainly due to the way they play football, their rich history and David Moyes, I was also born the year EFC won the top league 85-86.

IMO he is a great manager who has produced very consistent results with little money comparatively. On paper, EFC have a great starting side all over the pitch. People who complain about not having enough money to sign big name players should simply support a team that does?

It is sad to hear all this news that EFC look to be heading towards big financial issues. I guess only time will tell if EFC are in trouble due to mismanagement.

Richard Dodd
65   Posted 31/01/2011 at 09:20:55

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So to be regarded as a `good` Evertonian, you now have to HATE Kenwright and be prepared to denigrate Moyes every time we drop a point. Thank gawd a lot of us don`t follow this line of thinking ? it`s pathetic!
Alan Ross
66   Posted 31/01/2011 at 09:50:51

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Richard,
May I call you Richard ?
There you go again with that cynical, perverse tilt on reality.
Oh, you are a card.
Phil Bellis
67   Posted 31/01/2011 at 11:32:21

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Richard, "keeping Everton in the top echelon of English football on very limited resources" ? Isn't that what we're attempting to discuss? Why are we so limited in resources? Who's fault is it?

You are a strange person not to even ask these questions; your blind faith makes flat-earthers look sensible.

I've no idea of the practical/legal issues involved but this rumour of needing £9 million... if true, why can't the club simply offer some sort of share/rights issue at £500 a pop ? see what the uptake would be?

Adam McCulloch
68   Posted 31/01/2011 at 12:49:32

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Judging by the expression on Davie's face in a Sky interview (slightly more dour than usual), he'll be walking this summer. It's not looking good when we can bump some big earners off the wage bill, and get back what we paid for Pienaar, and end up talking about a young Greek lad.

Unless he's Zeus, I'm not that interested.
Alan Williams
69   Posted 31/01/2011 at 13:22:06

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Steve 56, great post. I have been trying to put that point across for months but all you get is Gavin 59, type of reply. They always answer a question with a question as they don?t have the answer.

Yes, BK has failed to breach that gap but I honestly believe one of the reasons is down to the product he is trying to sell ? EFC!! Everybody?s expectations of our great club is far too high, as a fan but that?s normal. I too want the best but, when I put my business hat on, it?s so obvious why investment hasn?t arrived.

Unless you have a love for our team, then is it worth losing £3/500 million pounds in purchase, re-build of the stadium and team??? The answer is clearly No. BK is a self-made millionaire and has done so amid massive competition in his sector yet fans with no such credentials say he doesn?t have any business acumen at all ? how is that possible?

BK is a successful businessmen but his passion for EFC clearly gets in the way and leaves him totally exposed... but again he only has himself to blame. I have said this before: even if I was lucky enough to have a spare billion, I would never buy EFC ? it?s just not worth the hassle. COYB

Steve Smith
70   Posted 31/01/2011 at 17:16:38

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Just to correct Colin Fitz on our credit rating, it's actually 34 at this moment in time with a risk rating of slightly above average and they are paying their bills quicker in the last three months than they have in the previous 12.
Gavin 59.
Running within our means will always be a failing business model whoever owns the club, you are obviously advocating taking on massive loans {even though you think borrowings are a root cause of our problems} or you just want someone to gift us a load of cash?
Even if we were completely debt free, our turnover would still restrict us in the transfer market, even agent Johnston recognised this during his tenure, and nothing has changed, the figure may look bigger, but the majority of the money is still going in the same pockets.....the players.
David Cornmell
71   Posted 01/02/2011 at 00:13:07

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@ Michael Kenrick

A Leveraged Buy Out is when an investor or investors buy a controlling interest in a company's equity by largely using debt.

The classic model involves using the company's own assets to service the debt, although in some cases occasionally only the company's cashflow is required. With a controlling interest, any company asset may be sold, leased, sub leased or otherwise by the board at any time to service the debt.

The catch is finding someone to put up the money. "The market" has a share price, and that price reflects the value of the company. To perform an LBO ? borrow someone elses money to buy a company, and then use the company to pay back the money ? you have to convince the moneymen that the business you are going to buy is fundamentally undervalued, or generates such large surplus cash flow you'll be able to service the debt.

"Poses the question: why Kenwright can't be ousted by someone doing the same trick?" Well, the classic LBO in a public company would involve buying it, disposing of various assets to service the debt, and then disposing of the controlling interest on the market. There's your profit.

The classic way of defending yourself against a buy-out is to load the company up with debt. Your equity then becomes unattractive, as there is no excess cashflow {by definition} and any assets would be subject to creditors.

LBOs sound evil, and in a sense they are. But in another, they are not. If a company is fundamentally undervalued, then an LBO does release value for all stakeholders. "The market" has found the correct value for the companies ? and if some lucky bastard was smart enough to pocket the difference then all the better for him.

For better or for worse, this is the free market in action; the invisible hand at work.

Kenwright would not appear prima facie to have done anything illegal at all. Immoral and distasteful to others, yes; but these things matter very little in business.

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