Everton FC has reported financial losses of £89.1m in its latest financial report covering the 2022/23 season, which is being investigated by an independent commission.
The Merseyside club reported a loss of £89.1m, more than double the £44.7m deficit in 2021/22. This has been attributed to several problems and leaves supporters worried about the future.
One major factor behind this reported loss is the construction costs of the club’s new stadium (£210.9m), which is set to open ahead of next season.
Everton has also been affected by the ongoing conflict between Russia and Ukraine, with the club missing out on sponsorship revenue of around £20m, resulting in an £8.9m fall in turnover to £172.2m.
Leadership changes have also played a part, as expenses totaling £7.1m were incurred due to the departure of manager Frank Lampard and his staff in January 2023. Additionally, there were costs of £3m related to changes in board members.
Despite a profit on player trading of £47.5m via Anthony Gordon’s sale to Newcastle United in January 2023, this overall loss means Everton has now reported a loss for six straight seasons, with £255m lost over the past three seasons.
This is a worrying statistic for supporters of the club, who await the verdict of a second Profit and Sustainability (PSR) charge following one earlier this season in regards to its 2021/22 campaign as mentioned earlier.
As part of the Premier League’s PSR regulations, clubs are allowed to report a maximum loss of £105 million over a three-season period, or £35m per season, before potential sanctions are imposed.
Breaking this rule last season resulted in an initial 10 point deduction this year, which was later reduced to six due to Everton successfully appealing the decision.
As of now, Everton sit in 16th position in the table, maintaining a three-point lead over the bottom three teams, with nine games left in the season. A second charge, which is shaping up to be heavier, that is expected by 8 April could see the club relegated from the division for the first time in its history.
A fate that Everton narrowly avoided last season, beating Bournemouth on the final day to finish in 17th.
However the club’s woes don’t stop there.
A club statement read: “Collectively, the above conditions indicate the existence of a material uncertainty that may cast significant doubt about the group’s ability to continue as a going concern.
“The board is confident that funding will be secured or refinanced and that they will be able to achieve the levels of revenue and savings to allow the group to continue in operational existence for a period of 12 months after the date of signing these financial statements.”
American investment fund 777 Partners offer a glimpse of hope for supporters, with the firm awaiting Premier League approval for a takeover of Everton.
Concerns over the true extent of the company’s wealth have arisen over the past few months, but 777 Partners remain confident that the deal will be approved, releasing a statement.
The 777 statement read: “As it relates to the proposed acquisition of Everton FC, 777 Partners is confident in its ability to fund both the transaction and the club’s three-year business plan, the details of which it has provided to the Premier League as part of its ongoing process of regulatory approval.”
With the agreement still hanging in the air and the club awaiting to see the damage of a potential second breach of PSR, it is very worrying times for Everton.
