English Premier League club Everton announced record losses of 140 million pounds ($185 million) on Friday after feeling a heavy financial impact from the pandemic.
The club’s deficit is considerably worse than a year ago when it posted a then-record loss of 111.8 million pounds, albeit over a 13-month accounting period.
Everton said the cost of the disruption by the pandemic amounted to 67.3 million pounds, with last season suspended for three months until June and then resuming in empty stadiums.
To help offset the losses, majority shareholder Farhad Moshiri injected another 50 million pounds of his own funds during the financial year up to June 30 and has put in a further 50 million pounds since then.
That took Moshiri’s investment in the northwest English club since assuming control in February 2016 to 400 million pounds, with plans for a further 100 million pounds to be injected.
The club is creating proposing a new share issue to Moshiri’s Blue Heaven Holdings up to a value of 250 million pounds, with the conversion of previous shareholder loans into equity equating to 150 million pounds of that total. That would potentially take his share in the club from 77.2% to 93.3%.
“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,” Everton chief executive Denise Barrett-Baxendale said. “Prior to the pandemic, we were forecasting record revenues in excess of 200 million pounds. 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.”
Due to Moshiri’s continued investment, net debt was reduced to 2.3 million pounds from 9.2 million pounds in 2018-19, while the club’s sponsorship, advertising and merchandising revenue of 64 million pounds was more than double the previous year’s total of 29 million pounds.
There was a 113 million pounds investment in the squad during the 2019-20 financial year, with a further 70 million pounds since then. The payoff to former manager Marco Silva and his backroom team last December amounted to 6.6 million pounds.