Liverpool's Woe's Set To Exacerbate Or Water Off A Duck's Back?

Discussion started by Marc Sibbons , on Friday, 04 May 2012 09:28

The news this week that Liverpool F.C are £50m down in losses from the last financial year is certainly not news the club welcomed. With the club languishing in 8th place in the league table, and in serious danger of missing out on qualification for next seasons Europa League, the Reds have been heavily criticised for their efforts this season.

Although they remain on course to lift the F.A Cup, (having secured a Wembley final meeting with rivals Chelsea), the club have underachieved by their usual high standards and a third consecutive season without Champions League football looks to have severely hit their finances.

The loss is believed to be attributed towards pay-offs to staff and costs associated with the club's failed new stadium plans.

Although new owners the Fenway Sports Group wiped out £200 million in debts when they took over in October 2010, the club was forced to write off £35 million over their moribund HKS-Stanley Park stadium project.

The sacking of manager Roy Hodgson after just six months, also contributed to a further £8.4 million in costs relating to contract terminations, figures lodged with Companies House showed.

But Liverpool's managing director Ian Ayre insisted the club's finances were in good shape, explaining that the results had been distorted by "extraordinary" expenditure.

So, are Liverpool F.C really in danger of drifting further ashore from financial safety or are the results not as bad as they look? Do you agree that the club's plans for a new stadium done more bad than good? Were Liverpool right to propose new stadium plans in the first place? Are the club now ruing their decision to axe Roy Hodgson so early into his contract and paying the avoidable + excessive costs? Are Fenway Sports Group the right people to get Liverpool out of their financial mess?

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Iain Taker,

The failure to qualify for the Champions League will continue to hurt Liverpool's revenues but this will in part be offset by the new shirt manufacture deal with Warrior and the considerably lower interest payments that they will need to pay out next season. The one off costs of sacking Hodgson and the stadium are the reason why the figures were higher than expected by some but I agree with Colin the sheer amount wasted on the stadium seems baffling to me.

379 days ago

Colin Robinson,

It seems strange that a club would have to invest so much in a stadium that will not be built.

It will be interesting to see the next set of figures given that Liverpool invested so much money in its playing squad in the summer of 2011 in terms of transfer fees and wages. Another failure to qualify for the Champions League is also damaging.

On the upside, Liverpool has a very lucrative deal with Standard Chartered and agreed another with Warrior Sports.

379 days ago

Steven Falk,

The only surprise to me is that it's not more.
Last year's (2010/11) distribution of European competition money was as follows:-

Man United - £53.2m
Chelsea - £44.5m
Tottenham - £31.1m
Arsenal - £30.0m
Liverpool - £ 6.1m

That's a big gap to make up in a season given that the wage bills of these clubs are not widely different and that the other main income generators (Match-day, Commercial and TV) also tend to be linked to performance (albeit with a time-lag)

380 days ago

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