Liverpool have officially announced a record profit (after tax) of an impressive £39m in the latest financial results.
The club declared an overall revenue increase by £62m (to £364m) for the year, the highest in the club’s history. In overall terms, the Reds – after all those taxes – reported a profit of £39m despite spending a whopping £91m on six new players during the year. Also, the aforementioned figure now stands as the largest figure under new owners Fenway Sports Group.
Just in case if you don’t know, the Reds announced a £21m loss for the year ending May 2016. The notable profit came from a £30m increase in media revenue from the first year of the new three-season Premier League broadcast deal, while a certain £20m came from a growth in commercial revenue, courtesy of 12 new sponsorship partnerships including Malaysia Airlines, Konami and Joie.
To add to it, it was this season when the Reds spent more than £50m on a new training ground and the project is set to get concluded by 2021. Also, the club opened its expanded Main Stand this year, which saw an increase in Anfield’s capacity to 54,074.
The expansion of the main stand now sees our match day revenue increase by £12m, to £74m. The downside, however, stays that the net bank debt has increased by £22m (to £67m) due to the investment in infrastructure and players’ recruitments. But the debt, according to the club is sustainable given the overall growth of the club’s financial performance.
“Performance on the pitch and the reinvestment in our squad is always a priority and following the club’s record signing last month we will look to invest again in the summer,” said chief operating officer Andy Hughes, referencing January’s £75m purchase of Virgil van Dijk.
“Progress on and off the pitch is critical to the growth of this football club – we all want success and everything we’re doing is geared toward fulfilling our football ambitions.”
However, the results do not include the arrival of Mohamed Salah, Alex Oxlade-Chamberlain, Andrew Robertson and Virgil van Dijk. It also does not include the January sale of Philippe Coutinho to Barcelona. What the results show is the £91m expenditure on Sadio Mane, Loris Karius, Ragnar Klavan, Georginio Wijnaldum and Joel Matip. A further £95m went on infrastructure.
“These results are approaching a year old. Further progress and reinvestments have continued to be made both on and off the pitch,” added Hughes.
“Our recent capital projects which include the Main Stand, the new retail store, the combined training ground and the new pitch at Anfield will be close to £200m which further demonstrates the commitment from this ownership.
“We continue to work up design, capacity and economic viability options for Anfield Road working with an architect to help with that process.
“This follows the same comprehensive process we followed with the Main Stand expansion.
“We must also continue to manage our finances and cash flow effectively that we have worked so very hard to secure since FSG took charge of the club.
“With the full support of this ownership group, we have significantly improved the club’s financial position over the past seven years and these results further demonstrate our solid financial progress – despite the ever-rising costs in football.
“During the seven years, we have seen operating profits one year and losses in others, a situation which can be attributed, in the main, to player trading costs and the timing of payments.
“What is important is the underlying trend that has continued with the aim of strengthening our financial position with profits being reinvested back into the club and players, allowing this long-term stability to become a reality.”
So with that being done, the Reds will now be expected to strengthen their squad further in the summer. The club are in a dire need of a defensive midfielder given that Emre Can is expected to move away from Anfield over the summer, while the goalkeeping department still needs an upgrade.
Exciting times lie ahead? We hope so.
