Liverpool FC Forum

[Redrider]

From today's Daily Post:

£22m price of failure Nov 5 2004
EXCLUSIVE by Chris Bascombe, Liverpool Echo

LIVERPOOL FC have announced record losses of £21.9m.

Figures for the past financial year reflect the Reds' failure to qualify for last season's Champions League, worth an estimated £15m.

The annual shareholders' report reveals the huge cost of sacking Gerard Houllier and his back-room team, including Phil Thompson, Joe Corrigan and Christian Damiano, also contributed to the losses.

Termination payments for staff and players, Emile Heskey among them, who were considered surplus to requirements cost an astounding £10.7m.

What is going on here, if this club was run as a PLC, huge questions would be asked at the 'Board meeting'
Houllier was paid £5m to reverse out of the door and Heskey paid circa £2m.
Financially we are in a mess !!

[Big Niall]

It doesn't surprise me. I don't think the club is well managed. Kirkland and dudek are both good goalies but spending about £11m in one day on two guys in the one position (when goalies rarely get rested, or dropped unless injured) is madness.

Spending all that money on Cisse (who even though I wish him a speedy recovery) hasn't done anything.

We don't have the money to buy another striker and I hope we do NOT buy one. I fear a Leeds thing happening.

I remember a couple of years ago Chelsea had no money to spend and the following season they qualified for the champions league .

[greenred]

Its all very un Liverpool.Presumably those figures dont include the summer transfers either,14million for Cisse etc.Plus we have a new stadium to pay for.Christ,ive gone off me lunch.

[Chairman Mao]

Agree.We had spent so much money on players,but a lot of them didn't worth so much.

[dawson99]

i refuse to worry about money, i just wanna watch the football. i know its  abad attitude but all the bitchig and moaning wont change a thing so i just hope we do our talking on the pitch as it were

[Pig Catcher]

We also seem to have too many players on our books, that we don't use and are unlikely to use.

[Redtribe]

I think in the transfer window we will see a few players leave i.e. henchoz diou if we can get anything for them then great but even too get them off the books will be good!
As long as we qualify for the champions league we will be fine!
We are not anything like leeds and to be 15million in debt is actually not that bad for a Large football club!

[Woollyback]

We need to be run like a hard-nosed Plc as far as the finances go. Moores and his board have been had for mugs too many times. They need to sharpen up and sharpen up QUICK. Or get somebody in who can drag the board kicking and screaming into the 21st century

A "golden goodbye" (as reported in the Daily Post) for Heskey when he was sold, not sacked, is ridiculous. It says to me that Heskey's agent was too strong for the LFC board. We need directors who will eat agents for breakfast - dare I say it, a bit like the sharks at Manure

[Leonmc0708]

Its typical of some people on this forum to sensationalise any bit of news with stupid topic names and silly comments.

According to the website, Rick Parry today reassured Liverpool fans the club's accounts are under control despite reporting record losses.  The annual report, which was delivered to shareholders this week, announces a £21.9 million loss for the last financial year as the Reds counted the cost of failing to qualify for the Champions League.

Liverpoolfc.tv webpage report on finances
 
Apparently, the decision to change the management team last summer and the sharp drop in revenue generated from cup competitions, in a financial year where the Reds made almost £14 million less from cup games compared to the previous season, were the major factors behind the heavy loss.
 
Encouragingly, though, the Reds managed to reduce their overall debt by £3.5 million, from £18.9 to £15.4 million.
 
"The key business objective for the year was to secure an immediate return to the Champions League," said Parry. "The Board, therefore, took a conscious decision to continue to invest in the team in the summer of 2003 and to budget for a loss.
 
"Instead, the main financial target was to ensure there was no increase in net debt. Both these objectives were achieved.
 
"The loss is essentially attributable to two factors. The loss of Champions League revenue and the decision to change the management team. The loss in itself does not constrain player spending, after all we did invest significantly in the summer.
 
"It is the level of debt and future cash flows that govern our transfer activity."
 
The decision to terminate the contracts of Gerard Houllier, his managerial team and players considered surplus to requirements in the summer cost the club £10.7 million.
 
After a disappointing season which saw the Reds scramble into the final Champions League place, the board felt a change was needed even though they knew they would have to endure the pain of a £10 million plus pay-out.
 
The collapse in TV revenues in the UEFA Cup was also a contributing factor to the loss. When Liverpool reached the UEFA Cup final in 2001 they made £14 million compared to just £3 million last season with the major TV companies showing less of an interest in the competition.
 
It is important to note that £20.8 million of the reported loss for the year has no cash implications for the club.
 
£17.3 million is accounted for in the amortisation of players' contracts - where, for accounting purposes, payments for players are spread over the length of their contracts even if the transfer fee is paid off well before - and £3.5 million has been written off against the value of Anfield with a new stadium now looking more certain.
 
The accounts also show a modest increase in the wage bill from £54.4 million to £54.9 million while commercial activities saw a jump of £2.2 million on the previous year to £30.6 million.
 
Despite the overall loss, the Reds' board have still been able to sanction the signings of four new players since Rafael Benitez arrived at the club.
 
The sale of Emile Heskey to Birmingham enabled the club to fund their commitment to signing Djibril Cisse while the departures of Michael Owen and Danny Murphy generated the cash to secure the arrivals of Spanish quartet Xabi Alonso, Luis Garcia, Antonio Nunez and Josemi.
 
With the transfer window reopening in January the yearly accounts will not prevent Benitez from strengthening his squad if he deems it necessary.
 
Indeed, such is Liverpool's desire to achieve success on the field - even if it comes at the expense of the balance sheet - it is worth remembering that the club never once entertained the idea of agreeing the sale of Steven Gerrard to Chelsea in the summer in a £20 million plus deal which would have wiped out their loss and made the figures much happier reading for fans. 

In all honesty, it's one of the lowest debts in European football and has been reducing year on year.

Basically the headline figures in all this are:

Despite the fact being out of the Champions League cost us £14m and we also had to pay off the ex-management team we still managed to go out and buy a number of real quality players and make enough money to pay off some of our debt.

Extremely encouraging as far as I am concerned.

[Woollyback]

Leon, I'm not moaning about the loss or our balance sheet, I'm just astounded that Heskey's contract seems to have included a pay-off if we sold him! 

[Ciggy]

yer man city are 67 mill in debt  we think we have problems
And they are never likely to qualify for the CL either.

[Boocity]

Despite the fact being out of the Champions League cost us £14m and we also had to pay off the ex-management team we still managed to go out and buy a number of real quality players and make enough money to pay off some of our debt.

Extremely encouraging as far as I am concerned.

Well said

[banana]

I think all Houllier supporters will disappear after this. Houllier has been a disaster to our club and the next time he wishes to see a home game he should not be given VIP treamtment. He gets paid so much from Liverpool that I am convinced he can afford to buy a ticket. Now we have to qualify for CL to stay alive. We could become the next Leeds, Roma, Lazio, Dortmund etc...

[Leonmc0708]

I think all Houllier supporters will disappear after this. Houllier has been a disaster to our club and the next time he wishes to see a home game he should not be given VIP treamtment. He gets paid so much from Liverpool that I am convinced he can afford to buy a ticket.

Get over it will you lad.

A disaster? that is total tosh and you know it.

Where you calling him a disaster when we where in Dortmund ?

[115-1073096938]

No he wasn't. He wasn't there thats why Leon.

He wasn't in cardiff either.

Infact he wasn't even in Liverpool. No ****** wonder he doesn't know what it means to win cups like that.

Even the ****** league cups against the mancs (i watched in Manchester) That was ****** amazing.

But not being a true supporter or fan Banana, you don't have a clue.

You are simply the biggest T!T i've ever come across in my life. How dare you slag moments like those off? Some of us are proud to win things and feel pride when we do.

It all adds up to making us the most successfull team in England.

Some of us weren't old enough to remember the europian cups or multiple league championships and these are the best memories we have of something we UNCONDITIONALLY LOVE, for a know nothing, little aisian ****** to slate memories like these is beyond belief. Show some ****** respect you little stain.

If anyone said that about my club in person i'd ****** nut them.