Get all your news in one place.
100's of premium titles.
One app.
Start reading
Birmingham Post
Birmingham Post
Business
Tom Houghton

Liverpool, Everton and Man Utd's financial woes revealed as Covid pandemic tears through budgets

It's likely that all four of the North West's biggest football clubs will be happy with their start to the Premier League season.

Liverpool and Manchester United sit joint top of the table, while Manchester City and Everton are just a few points behind - both level on points with fourth-placed Tottenham.

However a look beyond the positive performances on the pitch - and up into the boardroom - paints a different picture altogether, with executives making desperate efforts to protect their clubs from the impact of the coronavirus.

Since the outbreak began back in March, the pandemic's detrimental effect on elite football has been no secret, with gate receipts vanishing, and financial uncertainty hitting fans and clubs alike.

Although payments from broadcasters have provided some financial cushion, revenues have still plummeted across the board.

With a vaccine rollout likely to take some months to implement fully, and infection rates continuing to rise, full stadiums of fans seems a long way off.

Here, BusinessLive takes a look at the three North West giants - Liverpool, Everton and United - to have reported financial results since the pandemic.

Liverpool

Premier League champions Liverpool FC could be set for an eight per cent drop in their operating revenue, as the Liverpool Echo reports.

The Reds are set to publish their latest accounts in the coming months - figures set to give more clarity over the impact of Covid-19.

Released this week, accounting firm KPMG has compiled a detailed analysis of the impact of coronavirus on six of European football's domestic champions from the 2019/20 campaign.

The report looked at Liverpool, Real Madrid, Paris Saint Germain, Bayern Munich, Juventus and Porto, with some of those clubs having already submitted their financial statements for the current year.

In terms of operating profit, the income that the football club has less the day-to-day running costs of the business, Liverpool's drop was more modest than some.

According to the report, the Reds saw a drop of eight percent, a sum of €47.6m (£42.1m) from a total of €557m (£502m). That figure was made up through €82.5m matchday revenue, €231.9 broadcasting revenue and €242.6m commercial and other revenue streams.

Andrea Sartori, KPMG’s Global Head of Sports said: "While recent pre-COVID-19 seasons demonstrated constant and stable growth for almost all the champions of Europe’s top leagues, the past season has been distressing for all, albeit to various extents.

"The coronavirus crisis has questioned the financial sustainability of the football ecosystem as a whole and further exposed its fragility."

Everton

The Liverpool figures came a month to the day since city rivals Everton announced club record losses of £139.9m.

The Blues revealed that £67.3m of that figure came from the current pandemic to make overall losses across 2019/20 rise from a figure of £111.8m in 2018/19.

The club had been on course to post record revenue over the course of the financial year before the impact of the coronavirus, projected to be in the region of £220m.

Everton's commercial income, sponsorship, advertising and merchandise revenue has risen to £64m, which has more than doubled from the previous year.

The net debt position was reduced to £2.3m (down from £9.2m in 2018/19) because of the continued support from majority shareholder, Farhad Moshiri, who contributed an additional £50m within the reporting period.

The club's CEO Denise Barret-Baxendale said: “Clearly this has been a very challenging year, not least from a financial perspective with the impact of Covid-19 having a profound, wide-reaching and material impact on our figures. Prior to the pandemic, we were forecasting record revenues in excess of £200m.

"Our final accounts show that a significant proportion of our losses have been directly attributable to the pandemic.

“However, in this period, it is encouraging that our commercial performance has improved markedly, and this will continue to be a priority moving forward."

Manchester United

Man Utd were among the first to publish their 2019-20 books, showing the full financial implications of Covid-19.

Released in October, the Red Devils reported a £70m drop in expected revenue in the period to June 30 as a result of the pandemic.

The club's overall revenue dropped 18.8% from the previous year's record of £627.1m to £509m.

The net debt more than doubled from the previous year to £474.1m.

In a club statement released after the results, executive vice chairman Ed Woodward said: "We are looking back today on what has been one of the most extraordinary and challenging seasons in recent history and I am proud of the way the club continues to respond.

Ed Woodward executive is seen the leaving the ground after the Premier League match between Chelsea and Manchester United at Stamford Bridge on February 17, 2020 (Craig Mercer/MB Media/Getty Images)

"There are still big challenges and uncertainties ahead as the coronavirus pandemic continues to disrupt our way of life across the globe.

"This disruption is clear to see in the financial results that we are announcing today and we expect the impact to remain visible for quite some time to come.

"However, the past year has also demonstrated the underlying strength and resilience of the club; the special role that sport plays in our societies; and the meaningful impact the club can make in our communities through this period of adversity."

United's rivals Manchester City are yet to release their 2019-20 financial results.

Sign up to read this article
Read news from 100's of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.