Everton Post Record Net Profits
Fri 31st Oct 2014 | Money & Finance
Everton’s first season under manager Roberto Martinez proved to be as successful off the field as it was on it.
The 2013/14 Annual Report highlights record net profits and turnover breaking through the £100m mark for the first time in the Club’s history.
In the same season that the Blues recorded their highest ever Premier League points total en route to European qualification, a 39% increase in turnover from £86.4m to £120.5m ensured the Goodison Park club achieved a record profit of £28.2m.
In the first season of the significantly enhanced new broadcast rights deal, the Club benefited from a fifth place finish and an increase in the number of live televised matches. As a result, the Club reported an uplift in operating profit before player trading of £23m on the profit of £0.7m recorded in 2012/13. The new three-year TV deal provided Everton with a broadcast revenue of £88.5m for the year, exceeding the Club’s total turnover of £86.4m, for the previous year.
Whilst the increase in broadcast revenue awarded by the Premier League accounted for much of the increase in turnover and profits, commercial successes were noted across the Club. An increase in average league attendances from 36,356 in 2012/13 to 37,732 in 2013/14 contributed to gate receipts increasing by £1.9m, to £19.3m.
Underpinning this increase in gate receipts was a successful season ticket campaign, with the Club securing almost 25,000 season ticket holders, an increase of almost 1,000 against the previous year.
The Club’s sponsorship, advertising and merchandising revenue also increased from £7.6m in 2013 to £8.4m in 2014, boosted by the long-term support of key partners such as Chang and Kitbag.
Everton Chairman Bill Kenwright said: “It was a special season that blended the optimism of youth, a much talked-about, bold new style, individual brilliance and an enduring team spirit that runs through every Everton squad.
“A season that brought a Club record Premier League points haul - a total that in almost any other year, would have sealed Champions’ League football. It was a season that, quite simply, we didn’t want to end.”
As a result of strengthening the playing squad, staff costs rose by 10% to £69.3m. However, due to the significant rise in turnover, the Club’s wages, as a percentage of turnover, fell to 58% from 73% (it is important to note that, when comparing to other clubs; outsourced revenues should be added back, reducing significantly the wages to turnover ratio).
The reclassification of the Premier League’s investment in community initiatives accounted for a significant proportion of the increase in other operating costs, rising by £4.9m to £27.5m. In addition, the Club committed additional support to youth development and first team staff, introduced goal line technology and ‘next generation’ turf and incurred an increase in pre-season tour costs arising from the International Champions Cup tournament in the United States.
Everton recorded a profit on disposal of players of £28.2m, compared to £15.6m in 2012/13. The majority of this profit on the sale of players related to Marouane Fellaini, Victor Anichebe and Nikica Jelavic whilst proceeds helped to support the further strengthening of the squad in the summer of 2014, with the record signing of Romelu Lukaku,
The Club also agreed new and extended terms for Roberto Martinez, contracting him to the Club until June 2019.
The financial results have led to the Club’s net debt position as at 31 May reducing from £45.3m in 2013 to £28.1m in 2014.
Chief Executive Robert Elstone said: “The strong results for 2013/14 are a reflection of the drive, commitment and hard work of all staff at the Club. Teamwork and clear priorities will always be fundamental to our success.
“And, at the most senior level in our Club, the passion and talent of our outstanding Manager fits seamlessly with the vision and dedication of our Chairman. These combined efforts, shaped by a clear strategy, will continue to be targeted exclusively on ensuring the success of the Everton first team.
“Our financial results highlight growing revenues, costs remaining under control and debt reducing, and when we combine that solid financial base with a playing squad that continues to improve and increase in value, we have every right to be confident and positive on future prospects.”
Image: Action Images / Ed Sykes
Posted by: Aaron Gourley
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